Portola Valley City Council
July 22, 2026

TOWN OF PORTOLA VALLEY
Regular Meeting of the Town Council
Wednesday, July 22, 2026
7:00 PM
MAYOR: Craig Taylor
VICE MAYOR: Mary Hufty
COUNCILMEMBERS: Rebecca Flynn, Judith Hasko, Helen Wolter

A G E N D A
HISTORIC SCHOOLHOUSE - 765 Portola Road, Portola Valley, CA 94028 Remote Public Comments: Meeting participants are encouraged to submit public comments in writing in advance of the meeting. Please submit your public comments by using the online form, by 1:00 PM on the day of the meeting. Time permitting, your correspondence will be uploaded to the website. All received questions will be forwarded to the Portola Valley Town Council for consideration during the meeting and included in the public record. Members of the public may also provide comments in person at the meeting. The agenda and staff report will be posted on the Town’s website by approximately 5:00 PM the Friday prior to the meeting. Additionally, technology permitting, the public body will take questions using the Raise Hand button for those who attend the meeting online or by phone. The Mayor will call on people to speak by the phone number calling in. Remote participation is provided as a supplemental way to provide public comment, but this method does not always work. The public is encouraged to attend in person to ensure full participation.

In-Person Public Comments: Please fill out and submit a Public Comment card to the Town Clerk or Mayor prior to speaking. The Mayor will call your name at the appropriate time. Each speaker's time is limited to three (3) minutes. The Mayor reserves the right to limit speaker's time, depending upon the number of speakers or other circumstances.

Assistance for People with Disabilities: In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the Town Clerk at (650) 851-1700 or by email at [email protected]. Notification 48 hours prior to the meeting will enable the Town to make reasonable arrangements to ensure accessibility to this meeting.

VIRTUAL PARTICIPATION VIA ZOOM
To access the meeting by computer:
https://us06web.zoom.us/j/85661031107?pwd=XBbPrv9WKnql1xOByNvR6a5i74XjuR.1 Webinar ID: 856 6103 1107
Passcode: 048294
To access the meeting by phone:
1-669-900-6833 or 1-888-788-0099 (toll-free)
Mute/Unmute - Press *6 / Raise Hand - Press *9
1 1. CALL TO ORDER

2. ANNOUNCEMENT OF REMOTE ATTENDANCE / ROLL CALL

3. REPORT OUT FROM CLOSED SESSION

4. PRESENTATIONS / PROCLAMATIONS
a. Commemoration Honoring the Life, Leadership, and Enduring Legacy of Former Portola Valley Mayor Edward C. "Ted" Driscoll, Jr.

5. TOWN MANAGER REPORT

6. ORAL COMMUNICATIONS

7. CONSENT AGENDA
a. Approve Regular Meeting Minutes of July 8, 2026
b. Approve Warrant List for July 22, 2026
c. Adopt a Resolution Updating the Authorized Signers at Bank of America

8. REGULAR AGENDA
a. Consider Adoption of a Resolution Authorizing an Additional FY26-27 General Fund Budget Appropriation and Authorizing the Town Manager to Execute an Amendment to the Professional Services Agreement with Maze & Associates for Expedited Auditing Services for Fiscal Years 2023-24 and 2024-25.
b. Consider Adoption of a Resolution Submitting to the Voters of Portola Valley a Measure Both to Adopt a Town Charter and to Authorize a Real Property Transfer Tax at the General Election to be held on Tuesday, November 3, 2026 as Called by Resolution 3001-2026

9. COUNCIL SUBCOMMITTEE, LIAISON COMMITTEE, AND REGIONAL AGENCIES REPORTS a. 07/07/2026 Conservation Committee Liaison Memo
b. 07/13/2026 Geologic Safety Committee Liaison Memo

10. ADJOURNMENT
There are no written materials, and the Town Council does not take action under this agenda item.

Persons wishing to address the Town Council on any not on the agenda or related to Presentations/Proclamations or the Town Manager Report subject may do so now. Please submit a speaker’s slip located at the front of the room to the Town Clerk or Mayor, prior to speaking. Please note the Council is not able to undertake extended discussion or action on items not on the agenda. Each speaker’s time is limited to three (3) minutes.

Oral and written reports arising out of Council subcommittee and liaison appointments to both in-town and regional committees and initiatives. The Town Council does not take action under this agenda item.

The next Regular Town Council meeting will be held on August 12, 2026 at 7:00 p.m.

Land Acknowledgement:
2 The Town of Portola Valley acknowledges the colonial history of this land we dwell upon the unceded territory of the Ramaytush (rah-my-toosh) Ohlone, Tamien Nation, and Muwekma (mah-WEK- mah) Ohlone, who endured a human and cultural genocide that included removal from their lands and their sacred relationship to the land. Portola Valley recognizes that we profit from the commodification of land seized from indigenous peoples and now bear the ecological consequences. We seek to understand the impact of these legacies on all beings and to find ways to make repair. 3 TOWN OF PORTOLA VALLEY

COMMEMORATION HONORING THE LIFE, LEADERSHIP,

AND ENDURING LEGACY OF FORMER PORTOLA VALLEY
MAYOR EDWARD C. “TED” DRISCOLL, JR.

WHEREAS, Edward C. "Ted" Driscoll, Jr. and his wife, Sue Learned-Driscoll, made Portola Valley their home in 1985, choosing this remarkable community in which to raise their children, Adam and Laura, and dedicating themselves to preserving the Town's unique rural character, natural beauty, and sense of community; and
WHEREAS, Ted's lifelong commitment to thoughtful planning and public service was grounded in an exceptional academic career, earning a Bachelor of Arts degree from the University of Pennsylvania in 1974, a Master in Architecture in 1977 and a Master of Landscape Architecture in 1978 from Harvard University, and a Doctor of Philosophy in Applied Earth Sciences from Stanford University in 1985, bringing to municipal leadership a rare combination of scientific understanding, planning expertise, and practical judgment; and WHEREAS, Ted began his service to the Town on the Architectural and Site Control Commission from 1987 to 1990, continued on the Planning Commission from 1990 to 1993, and then served with distinction on the Portola Valley Town Council for twenty years, from 1993 through 2013, including five terms as Mayor; and
WHEREAS, throughout those decades of service, Ted exemplified the highest ideals of public leadership through careful preparation, respectful deliberation, intellectual integrity, and an unwavering commitment to finding thoughtful solutions that served both present and future generations of Portola Valley residents; and
WHEREAS, Ted served as Council liaison to numerous Town committees and commissions, generously sharing his expertise, encouraging civic participation, mentoring emerging community leaders, and strengthening collaboration throughout the Town; and WHEREAS, among his many lasting accomplishments, Ted was a member of the renowned "Tenacious Gang of Eight," whose vision, determination, and leadership inspired an extraordinary community-wide fundraising effort that exceeded its original goal by raising more than $20 million, ensuring the successful construction and completion of Portola Valley's Town Center campus—today recognized as one of the nation's exemplary sustainably designed civic facilities and a lasting symbol of the Town's shared values; and WHEREAS, Ted consistently championed thoughtful land use planning, environmental stewardship, fiscal responsibility, scientific understanding, and preservation of Portola Valley's distinctive rural character, helping shape policies and decisions whose benefits continue to serve the community today; and
4 WHEREAS, beyond his official positions, Ted earned the respect, admiration, and affection of colleagues, staff, volunteers, and residents alike through his humility, generosity, civility, intellectual curiosity, steady leadership, and deep love for the Town he served; and WHEREAS, Ted leaves a legacy measured not only by buildings constructed, policies adopted, or years of service, but by the enduring culture of thoughtful governance, community collaboration, and stewardship that continues to define Portola Valley; and WHEREAS, the Town Council joins Ted's family, friends, colleagues, and generations of residents in mourning his passing while celebrating a life devoted to public service and community leadership.

NOW, THEREFORE, BE IT RESOLVED, that the Town Council of the Town of Portola Valley hereby honors and commemorates the life and extraordinary public service of former Mayor Edward C. "Ted" Driscoll, Jr., expresses its deepest gratitude for his decades of leadership and dedication, and extends its heartfelt sympathy to Sue, Adam, Laura, and the entire Driscoll family.

BE IT FURTHER RESOLVED, that this Commemoration shall be entered into the permanent records of the Town of Portola Valley so that future generations may know of Ted Driscoll's remarkable contributions and the lasting legacy he leaves to the community he loved and faithfully served.

IN WITNESS WHEREOF, I have hereunto set my hand and caused the Seal of the Town of Portola Valley to be affixed hereto this 22nd day of July, 2026. ___________________________
Craig Taylor, Mayor
5 TOWN OF PORTOLA VALLEY

STAFF REPORT
TO: Mayor and Members of the Town Council
FROM: Veronica Dao, Town Clerk
DATE: July 22, 2026
RE: Approve Regular Meeting Minutes of July 8, 2026

RECOMMENDATION
Staff recommends Town Council review and approve the July 8, 2026 regular meeting minutes.

ATTACHMENTS

1. 07-08-2026 Council Regular Meeting Minutes
6 Volume 47
July 8, 2026

PORTOLA VALLEY TOWN COUNCIL REGULAR MEETING MINUTES – JULY 8, 2026

1. CALL TO ORDER
Mayor Taylor called the meeting to order at 7:03 p.m. Roll call was taken by the Clerk.

Present: Councilmembers Helen Wolter, Judith Hasko, Rebecca Flynn, Vice Mayor Mary Hufty (arrived 7:07 p.m.), Mayor Craig Taylor

Absent: None
Others: Town Manager Darcy Smith, Town Attorney Catherine Engberg, Assistant Town Manager Tony McFarlane, Planning and Building Director Sarah Cawrse, Town Clerk Veronica Dao

2. ANNOUNCEMENT OF REMOTE ATTENDANCE / ROLL CALL

3. PRESENTATIONS / PROCLAMATIONS – None.

4. TOWN MANAGER REPORT
Town Manager Smith updated the Council on the following:
 Summer concert series
 Recap of Emergency Preparedness and Safety Day
 Town Public Works and fire mitigation projects

5. ORAL COMMUNICATIONS
Mayor Taylor invited public comment. None were received.

6. CONSENT AGENDA
Mayor Taylor invited public comment. None were received.

Consent Agenda items 6a, 6b, and 6d were pulled for separate discussion and action.

Motion and second (Hasko, Hufty) to approve Consent Agenda item 6c. The motion carried unanimously by voice vote.

Item 6a was corrected to note that Councilmember Wolter was recused from the Closed Session item.

Item 6b was corrected with revised vote count order of “aye-nay-recuse/abstain.” 7 Volume 47
July 8, 2026

Motion and second (Flynn, Hasko) to approve Consent Agenda items 6a, 6b, and 6d.

The motion carried unanimously by voice vote.
a. Approve Special Meeting Minutes of June 24, 2026
b. Approve Regular Meeting Minutes of June 24, 2026
c. Approve Warrant List for July 8, 2026
d. Adopt a Resolution Approving and Authorizing the Town Manager to Execute an Amendment to the Cooperation Agreement with the County of San Mateo which Permits the Town’s Continuing Participation in the County’s Housing and Community Development Program

7. REGULAR AGENDA
a. Consider Acceptance of the FY 2022-23 Annual Comprehensive Financial Report Assistant Town Manager McFarlane presented the item.

Mayor Taylor invited public comment.

Public Comment
 Rita Comes
Council asked questions and discussed the item.

Motion and second (Flynn, Wolter) to accept the FY22-23 financial report. The motion carried unanimously by voice vote.
b. Receive Information and Provide Direction on the Draft Ordinance Amending Chapter 3.12 of Title 3 (Revenue and Finance) of the Portola Valley Municipal Code Regarding the Real Property Transfer Tax
Town Manager Smith and Assistant Town Manager McFarlane presented the item.

Mayor Taylor Invited public comment.

Public Comment
 Rita Comes
 David Cardinal
 Betsy M.

Council asked questions and discussed the item.

No formal action was taken.
8 Volume 47
July 8, 2026

8. COUNCIL SUBCOMMITTEE, LIAISON COMMITTEE, AND REGIONAL AGENCIES

REPORTS
Councilmembers reported on several local and regional meetings they attended recently.

Mayor Taylor invited public comment.

Public Comment
 Rita Comes

9. ADJOURNMENT
The meeting adjourned at 8:52 p.m.
_________________________ _________________________
Craig Taylor, Mayor Veronica Dao, Town Clerk
Submitted for approval to the Town Council at its July 22, 2026 regular meeting. 9 ______________________________________________________________________________________ TO: Mayor and Members of the Town Council
FROM: Anthony McFarlane, Assistant Town Manager
DATE: July 22, 2026
RE: Warrant List for July 22, 2026.

RECOMMENDATION:

Review and accept the Warrant List for July 22, 2026:

REPORT SUMMARY
The following table lists warrant activity by date, tracks starting and ending warrant numbers, and total amount of warrants issued.

The following table lists payments by fund.

Date
Ending
Warrant #
Warrant 7/22/2026 6162 6219 58 684,238.24 7/23/2026 7/8/2026 6161 Attached are Warrant Lists for:

Prior Warrant List
Type of Warrant Date
Starting
Warrant #
Ending
Warrant #
Total
Warrants Amount
Warrants
Released
Date Fund Amount
7/22/2026 101-General Fund 522,790.40
7/24/2026 205-Library Fund 13,480.36
7/24/2026 206-Gas Tax Fund 38,000.32
7/24/2026 212-Measure M MVF 1,195.00
7/24/2026 222-Inclusion In-lieu Fund 10,385.10
7/24/2026 401-Capital Projects 3,442.20
7/24/2026 505-Woodside Highlands RMD 29,900.00
7/24/2026 701-Customer Deposits 65,044.86
Total $ 684,238.24
Payments by Fund

TOWN OF PORTOLA VALLEY

STAFF REPORT

TOWN OF PORTOLA VALLEY
10

Warrant List July 22, 2026
The following table lists the warrants issued as EFT/ACH payments. EFT/ACH payments are recurring payments for contributions related to retirement and deferred compensation, workers’ compensation premiums, and utilities, etc.

The following table lists the warrants that were voided and the reason for the voided transaction.

The following table lists the warrants issued outside of the scheduled warrant list cycle for various reasons, such as processing error, reissuing a voided check, or employee separation.

DISCLOSURE
Included in the warrant list is the annual payment to PLAN-JPA for liability, property, and employee risk management insurance premiums. Payments are for the following. • Liability - $206,720
• Property- $53,976
• ERMA - $15,869
Insurance premiums are assessed annually and are paid at the beginning of the fiscal year. Any other payments to PLAN JPA will be for claims.

Date Warrant # Issued to Fund Dept Purpose Amount
7/22/2026 6164 Bank of America Various Various Jun CC Charges $ 7,619.61 7/22/2026 6165 California Water Service 101/205 510/610 Jun Water Utility 24,424.86 7/22/2026 6166 CalPERS 101 Various Jun Contributions/Jul UAL 44,672.65 7/22/2026 6169 SCA of CA, LLC Various 510 Jun Street Sweeping 2,095.00 7/22/2026 6174 Good City Company Various Various Jun Services 70,301.25 7/22/2026 6178 Missionsquare Retirement 101 Various Jul 15 Contributions 2,471.47 7/22/2026 6183 Navia Benefit Solutions 101 Various Jul 15 Contributions 562.50 7/22/2026 6184 PERS Health 101 Various July Medical Premiums 20,413.33 7/22/2026 6185 PG&E 101/205 510/610 Jun Electric Utility 181.99 7/22/2026 6187 Platinum Facilty Services 101/205 510/610 Jun Custodial Services 4,488.67 7/22/2026 6191 State Comp Insurance Fund 101 Various Jul W/C Premium 2,212.58 7/22/2026 6192 Verizon Wireless 101 610 Jun Telephone 870.51 7/22/2026 6197 Stepford 101 610 Jun/July IT Services 12,190.67 7/22/2026 6200 Shute Mihaly & Weinberger Various 125 May /Jun Legal Services 58,367.99 7/22/2026 6202 Amazon Capital Services 101 610 Office Supplies 63.42 7/22/2026 6203 AT&T 101 610 Jun Telephone 737.08
7/22/2026 6209 American Asphalt Repair 505 620 Woodside Highlands RMD 29,900.00 $ 281,573.58
Warrants issued as ACH/EFT
Total
Date Warrant No Issued To Fund Dept Purpose Amount
$ -
Warrants Voided and Reissued
Total
Date Warrant No Issued To Fund Dept Purpose Amount
$ -
Warrants Issued Outside of a Scheduled Warrant List
Total
Date Warrant # Issued to Fund Dept Purpose Amount
7/22/2026 6186 PLAN - JPA 101 610 Annual Insurance Premiums $ 276,565.77 Disclosure
11

Warrant List July 22, 2026

ENVIRONMENTAL IMPACT
The recommended Town Council action to review and approve the Warrant List for July 8, 2026, is not considered a "project" under the California Environmental Quality Act (CEQA) Guidelines and is therefore exempt from CEQA requirements. As provided by CEQA Guidelines Section 15378(b)(5), a "project" does not include "organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment." Review and acceptance of the Warrant List is therefore exempt from CEQA, and no further environmental analysis is required.

FISCAL IMPACT
Total fiscal impact is $684,238.24 with $285,425 accrued to FY 2025-26 and $398,813 assigned to the current year.

For additional information on any item disclosed in this report, please contact the Finance department directly at [email protected].

ATTACHMENTS

1. 07/22/2026 Warrant List Certification
12 TOWN OF PORTOLA VALLEY Warrant Disbursement Journal July 22, 2026 Claims totaling $684,238.24 having been duly examined by me and found to be correct are hereby approved and verified by me as due bills against the Town of Portola Valley. Date _____________________________ ________________________________ Anthony McFarlane, Assistant Town Manager Motion having been duly made and seconded, the above claims are hereby approved and allowed for payment. Signed and sealed this (Date) _____________________ _______________________________ _________________________________ Darcy Smith, Town Manager Craig Taylor, Mayor 13 14
15 16
17 18
19 20
21 22
23 24
25 26
27 28

TOWN OF PORTOLA VALLEY

STAFF REPORT
TO: Mayor and Members of the Town Council
FROM: Anthony McFarlane, Assistant Town Manager
DATE: July 22, 2026
RE: Adopt a Resolution Updating the Authorized Signers at Bank of America

RECOMMENDATION
Adopt a resolution updating the authorized signers on the Town account at Bank of America

BACKGROUND
The Town of Portola Valley maintains one checking account at Bank of America. When the list of persons authorized to sign checks on behalf of the Town changes, Bank of America requires a Resolution authorizing those changes.

DISCUSSION
The Resolution authorizes the following elected officials and officers to sign checks on behalf of the Town:

Mayor – Craig Taylor
Vice-Mayor – Mary Hufty
Town Manager – Darcy Smith
Assistant Town Manager – Anthony McFarlane

FISCAL IMPACT
The recommended Town Council action to adopt a resolution updating the authorized signers at Bank of America has no fiscal impact.

ATTACHMENTS

1. Resolution
29 1
RESOLUTION NO. ____-2026

RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF

PORTOLA VALLEY UPDATING AUTHORIZED SIGNERS AT BANK

OF AMERICA
WHEREAS, the Town of Portola Valley maintains one checking account at Bank of America; and
WHEREAS, when the list of persons authorized to sign checks on behalf of the Town changes, Bank of America requires an adopted Resolution authorizing the changes.

NOW, THEREFORE, the Town Council of the Town of Portola Valley does hereby RESOLVE as follows:

1. Authorize the following Town of Portola Valley elected officials and officer or successors in office to sign checks on the Town’s behalf:
• Mayor – Craig Taylor
• Vice Mayor – Mary Hufty
• Town Manager – Darcy Smith
• Assistant Town Manager – Anthony McFarlane
PASSED AND ADOPTED at the regular meeting of the Town of Portola Valley on July 22, 2026.

AYES:

NOES:

ABSENT:

ABSTAIN:

By:

Craig Taylor, Mayor
ATTEST:

Veronica Dao, Town Clerk
30 TOWN OF PORTOLA VALLEY

STAFF REPORT
TO: Mayor and Members of the Town Council
FROM: Anthony McFarlane, Assistant Town Manager
DATE: July 22, 2026
RE: Consider Adoption of a Resolution Authorizing an Additional FY26-27 General Fund Budget Appropriation and Authorizing the Town Manager to Execute an Amendment to the Professional Services Agreement with Maze & Associates for Expedited Auditing Services for Fiscal Years 2023-24 and 2024-25.

RECOMMENDATION
Staff recommends that the Town Council adopt a resolution authorizing an additional FY26-27 General Fund budget appropriation and authorizing the Town Manager to execute an amendment to the professional services agreement with Maze & Associates for expedited auditing services for Fiscal Years 2023-24 and 2024-25.

BACKGROUND
To accelerate completion of the Fiscal Years 2023-24 and 2024-25 annual financial audits consider adoption of a resolution authorizing an additional FY 26-27 General Fund budget appropriation and authorizing the Town Manager to execute an amendment to the professional services agreement with Maze & Associates.

Maze & Associates was established in 1979 and currently has 72 municipal clients. They have been the Town’s auditor since 2014. Included in the attached engagement letter, is their most recent peer review from 2023. Maze & Associates received a peer review rating of pass, the highest rating.

DISCUSSION
Financial responsibility and long-term viability is one of the highest council priorities. One of the strategies incorporated to address this priority is to reduce the backlog of financial audits. In May 2024, the Town was 3 fiscal years behind on its financial audits. Since then, audits for Fiscal Year 2020-21, 2021-22, and 2022-23 have been completed with clean opinions. However, even with this progress, the Town is still two years behind.

Staff, including Mayor Craig Taylor and Chair of the Finance and Audit Committee George Savage, met with Maze & Associates to discuss expediting the audits for the Fiscal Years 2023-24 and 2024-25 and having them completed and accepted by Council by October 28, 2026. As a result of this meeting, the audits will be expedited, and an aggressive schedule was presented to staff. The total cost for this service is approximately $144K. An additional appropriation of $45K will be needed as the review will be done by senior partner level staff at Maze.

FISCAL IMPACT
31 The FY 2026-27 Town Finance budget includes $45K for auditing services and an additional $50K in miscellaneous consulting services related to augmenting finance staff. Adopting the resolution increases the Town Finance budget by an additional $45K and increases the General Fund deficit to $723K.

ATTACHMENTS

1. Resolution

2. Engagement Letter
32 RESOLUTION NO. XXXX-2026

RESOLUTION OF THE TOWN COUNCIL OF THE TOWN

OF PORTOLA VALLEY AMENDING THE OPERATING
AND CAPITAL BUDGET FOR FISCAL YEAR 2026-27 AND AUTHORIZING THE

TOWN MANAGER TO EXECUTE AN AMENDMENT TO THE PROFESSIONAL

SERVICES AGREEMENT WITH MAZE & ASSOCIATES
WHEREAS, Financial responsibility and long-term viability is one of the Council’s highest priorities,
WHEREAS, Reducing the backlog of audits is the top strategy for financial responsibility,
WHEREAS, The Town is currently two years behind on financial audits, WHEREAS, Maze & Associates has agreed to expedite the financial audits for Fiscal Years 2023-24 and 2024-25,
WHEREAS, additional resources will need to be appropriated in the current fiscal year,
WHEREAS, the Town Council adopted the proposed operating and capital budget on June 24, 2026.

NOW, THEREFORE, the Town Council of the Town of Portola Valley does RESOLVE the following:

1. To amend the Town's Fiscal Year 2026-27 operating and capital budgets, overall reflecting the following:
a. Projected revenues: $13,503,521
b. Projected expenditures & transfers: $12,578,131

2. The Town Manager is authorized to execute an amendment to the Professional Services Agreement with Maze & Associates. 33 PASSED AND ADOPTED this 22nd day of July, 2026.

AYES:

NOES:

ABSENT:

ABSTAIN:

ATTEST:

By:

Craig Taylor, Mayor
Veronica Dao, Town Clerk
34 Ver PPC ALG-CL-1.3 2/25
July 6, 2026
Darcy Smith, Town Manager
Town of Portola Valley
765 Portola Road,
Portola Valley, CA 94028
Dear Darcy:

We are pleased to confirm our understanding of the services we are to provide for the Town of Portola Valley as of and for the years ended June 30, 2024 and 2025.

Audit Scope and Objectives
The services we have been engaged to provide are outlined below, but we are also available to provide additional services at your request:
1) Audit of the Basic Financial Statements, and assistance with the preparation of the Basic Financial Statements, and review of Management Discussion & Analysis. 2) Testing of compliance for Measure A and preparation of required reports. 3) Testing of compliance with the Agreement for Distribution of Measure W Funds. 4) Perform procedures and issue agreed upon procedures opinion to comply with Proposition 111 Appropriation Limit increment requirements.

Accounting standards generally accepted in the United States of America (GAAP) provide for certain required supplementary information (RSI), such as management’s discussion and analysis, to supplement the Town’s basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. As part of our engagement, we will apply certain limited procedures to the Town’s RSI in accordance with auditing standards generally accepted in the United States of America (GAAS). These limited procedures will consist of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We will not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

If the Town’s financial statements are accompanied by supplementary information other than RSI, we will subject the supplementary information to the auditing procedures applied in our audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with GAAS, and we will provide an opinion on it in relation to the financial statements as a whole, in a report combined with our auditor’s report on the financial statements.
35 Ver PPC ALG-CL-1.3 2/25
In connection with our audit of the basic financial statements, we will read the other information accompanying the financial statements and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report.

The objectives of our audit are to obtain reasonable assurance as to whether the financial statements as a whole are free from material misstatement, whether due to fraud or error; issue an auditor’s report that includes our opinion about whether your financial statements are fairly presented, in all material respects, in conformity with GAAP; and report on the fairness of the accompanying supplementary information when considered in relation to the financial statements as a whole. Reasonable assurance is a high level of assurance, but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. Misstatements, including omissions, can arise from fraud or error and are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment of a reasonable user made based on the financial statements.

The objectives also include reporting on internal control over financial reporting and compliance with provisions of laws, regulations, contracts, and award agreements, noncompliance with which could have a material effect on the financial statements in accordance with Government Auditing Standards.

Auditor’s Responsibilities for the Audit of the Financial Statements We will conduct our audit in accordance with GAAS and the standards for financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and will include tests of the accounting records and other procedures we consider necessary to enable us to express such opinions. As part of an audit in accordance with GAAS and Government Auditing Standards, we exercise professional judgment and maintain professional skepticism throughout the audit.

We will evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management. We will also evaluate the overall presentation of the financial statements, including the disclosures, and determine whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We will plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or governmental regulations that are attributable to the Town or to acts by management or employees acting on behalf of the Town. Because the determination of waste and abuse is subjective, Governmental Auditing Standards do not expect auditors to perform specific procedures to detect waste or abuse in financial audits nor do they expect auditors to provide reasonable assurance of detecting waste or abuse.

Because of the inherent limitations of an audit, combined with the inherent limitations of internal control, and because we will not perform a detailed examination of all transactions, an unavoidable risk exists that some material misstatements may exist and not be detected by us, even though the audit is properly planned and performed in accordance with GAAS and Government Auditing Standards. In addition, an audit is not designed to detect immaterial misstatements or violations of laws or governmental regulations that do not have a direct and material effect on the financial statements. However, we will inform the appropriate level of management of any material errors, fraudulent financial reporting, or misappropriation of assets that comes to our attention. We will also inform the appropriate level of management of any violations of laws or governmental regulations that come to our attention, unless clearly inconsequential. Our responsibility as auditors is limited to the period covered by our audit and does not extend to any later periods for which we are not engaged as auditors.

We will also conclude, based on the audit evidence obtained, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the government’s ability to continue as a going concern for a reasonable period of time.

36 Ver PPC ALG-CL-1.3 2/25
Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts, and may include tests of physical existence of inventories, and direct confirmation of cash, investments and certain other assets and liabilities by correspondence with selected customers, creditors and financial institutions. We will also request written representations from your attorneys as part of the engagement, and they may bill the Town for responding to this inquiry.

We may from time to time, and depending on the circumstances, use third-party service providers in serving your account. We may share confidential information about you with these service providers, but remain committed to maintaining the confidentiality and security of your information. Accordingly, we maintain internal policies, procedures, and safeguards to protect the confidentiality of your personal information. In addition, we will secure confidentiality agreements with all service providers to maintain the confidentiality of your information and we will take reasonable precautions to determine that they have appropriate procedures in place to prevent the unauthorized release of your confidential information to others. In the event that we are unable to secure an appropriate confidentiality agreement, you will be asked to provide your consent prior to the sharing of your confidential information with the third-party service provider. Furthermore, we will remain responsible for the work provided by any such third-party service providers.

Our audit of the financial statements does not relieve you of your responsibilities.

Audit Procedures - Internal Control
We will obtain an understanding of the Town and its environment, including the system of internal control, sufficient to identify and assess the risks of material misstatement of the financial statements, whether due to error or fraud, and to design and perform audit procedures responsive to those risks and obtain evidence that is sufficient and appropriate to provide a basis for our opinions. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the financial statements. Our tests, if performed, will be less in scope than would be necessary to render an opinion on internal control and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to Government Auditing Standards. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentation, or the override of internal control. An audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses.

Accordingly, we will express no such opinion. However, during the audit, we will communicate to management and the Council internal control related matters that are required to be communicated under AICPA professional standards and Government Auditing Standards.

Audit Procedures - Compliance
As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we will perform tests of the Town’s compliance with provisions of applicable laws, regulations, contracts, agreements and grants. However, the objective of our audit will not be to provide an opinion on overall compliance, and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards.

37 Ver PPC ALG-CL-1.3 2/25
Agreed-Upon Procedures
The Town agrees to the procedures related to the Appropriations Limit Worksheet (Worksheet) for the years ended June 30, 2024 and 2025, as suggested by the League of California Cities and presented in their Article XIIIB Appropriations Limitation Uniform Guidelines, and will acknowledge that the procedures to be performed are appropriate for the intended purpose of the engagement, which is to assist you in meeting the requirements of Section 1.5 of Article XIIIB of the California Constitution. Our engagement to apply agreedupon procedures to the Worksheet will be conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we obtain your written agreement to the procedures to be applied and your acknowledgement that those procedures are appropriate for the intended purpose of the engagement. The agreement and acknowledgement are contained within this letter.

A refusal to provide such agreement and acknowledgement will result in our withdrawal from the engagement.

We make no representation that the procedures we will perform are appropriate for the intended purpose of the engagement or for any other purpose.

Because the procedures requested do not constitute an examination or review, we will not express an opinion or conclusion on the Worksheet. In addition, we have no obligation to perform any procedures beyond those to which you agree.

We will issue a written report upon completion of our engagement that lists the procedures performed and our findings. Our report will be addressed to the Town. If we encounter restrictions in performing our procedures, we will discuss the matter with you. If we determine the restrictions are appropriate, we will disclose the restrictions in our report. Our report will contain a paragraph indicating that had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

There may exist circumstances that, in our professional judgement, will require we withdraw from the engagement. Such circumstances include the following:
 You refuse to provide written agreement to the procedures and acknowledge that they are appropriate for the intended purpose of the engagement.
 You fail to provide requested written representations, or we conclude that there is sufficient doubt about the competence, integrity, ethical values or diligence of those providing the written representations, or we conclude that the written representations provided are otherwise not reliable.  We determine that the description of the procedures performed or the corresponding findings are misleading in the circumstances of the engagement.
 We determine that restrictions on the performance of procedures are not appropriate.

An agreed-upon procedures engagement is not designed to detect instances of fraud or noncompliance with laws or regulations; however, should any such matters come to our attention, we will communicate them in accordance with professional standards and applicable law. In addition, if, in connection with this engagement, matters come to our attention that contradict that the Worksheet is in accordance with Article XIIIB of the California Constitution, we will communicate such matters to you.

You agree to the procedures to be performed and acknowledge that they are appropriate for the intended purpose of the engagement.

You are responsible for the Worksheet and that it is in accordance with Article XIIIB of the California Constitution. In addition, you are responsible for providing us with (1) access to all information of which you are aware that is relevant to the performance of the agreed-upon procedures on the subject matter, (2) additional information that we may request for the purpose of performing the agreed-upon procedures, and (3) unrestricted access to persons within the entity from whom we determine it necessary to obtain evidence relating to performing those procedures.

38 Ver PPC ALG-CL-1.3 2/25
At the conclusion of our engagement, we will require certain written representations in the form of a representation letter from management that, among other things, will confirm management’s responsibility for the presentation of the Worksheet in accordance with Article XIIIB of the California Constitution.

Responsibilities of Management for the Financial Statements Our audit will be conducted on the basis that you acknowledge and understand your responsibility for designing, implementing, and maintaining effective internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error, and for evaluating and monitoring ongoing activities to help ensure that appropriate goals and objectives are met; following laws and regulations and ensuring that management and financial information is reliable and properly reported.

Management is also responsible for implementing systems designed to achieve compliance with applicable laws, regulations, contracts, and grant agreements. Management is also responsible for the selection and application of accounting principles, for the preparation and fair presentation of the financial statements and all accompanying information in conformity with GAAP, and for compliance and applicable laws and regulations and the provisions of contracts and grant agreements.

Management is responsible for making drafts of financial statements, all financial records and related information available to us and for the accuracy and completeness of that information (including information from outside of the general and subsidiary ledgers) and for the evaluation of whether there are any conditions or events, considered in the aggregate, that raise substantial doubt about the Town’s ability to continue as a going concern for the 12 months after the financial statement date or shortly thereafter (for example, within an additional three months if currently known). We understand that the Town will provide us with the Closing Checklist information required for our audit and that the Town is responsible for the accuracy and completeness of that information. Management is also responsible for providing us with (1) access to all information of which you are aware that is relevant to the preparation and fair presentation of the financial statements, such as records, documentation, identification of all related parties and all related-party relationships and transactions, and other matters, (2) additional information that we may request for the purpose of the audit; and (3) unrestricted access to persons within the government from whom we determine it necessary to obtain audit evidence. We understand that the Town will provide us with the Closing Checklist information required for our audit and that the Town is responsible for the accuracy and completeness of that information. At the conclusion of our audit, we will require certain written representations from management about responsibilities for the financial statements; compliance with laws, regulations, contracts, and grant agreements; and other responsibilities required by GAAS and Government Auditing Standards.

Management’s responsibilities include adjusting the financial statements to correct material misstatements and confirming to us in the management representation letter that the effects of any uncorrected misstatements aggregated by us during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements of each opinion unit taken as a whole.

Management is responsible for the design and implementation of programs and controls to prevent and detect fraud, and for informing us about all known or suspected fraud affecting the Town involving (1) management, (2) employees who have significant roles in internal control, and (3) others where the fraud could have a material effect on the financial statements. Management’s responsibilities include informing us of its knowledge of any allegations of fraud or suspected fraud affecting the Town received in communications from employees, former employees, grantors, regulators, or others. In addition, management is responsible for identifying and ensuring that the Town complies with applicable laws, regulations, contracts, agreements and grants and for taking timely and appropriate steps to remedy fraud and noncompliance with provisions of laws, regulations, or contracts or grant agreements that we report.

39 Ver PPC ALG-CL-1.3 2/25
With regard to including the auditor’s report in an exempt offering document, you agree that the aforementioned auditor’s report, or reference to Maze & Associates, will not be included in any such offering document without our prior permission or consent. Any agreement to perform work in connection with an exempt offering document, including an agreement to provide permission or consent will be a separate engagement. With regard to an exempt offering document with which Maze & Associates is not involved, you agree to clearly indicate in the exempt offering document that Maze & Associates is not involved with the contents of such offering document.

Management is responsible for the preparation of the supplementary information, which we have been engaged to report on, in conformity with GAAP. Management agrees to include our report on the supplementary information in any document that contains and indicates that we have reported on the supplementary information.

Management also agrees to include the audited financial statements with any presentation of the supplementary information that includes our report thereon. Management’s responsibilities include acknowledging to us in the representation letter that: (1) management is responsible for presentation of supplementary information in accordance with GAAP; (2) that management believes the supplementary information, including its form and content, is fairly presented in accordance with GAAP; (3) that the methods of measurement or presentation have not changed from those used in the prior period (or, if they have changed, the reasons for such changes); and (4) management has disclosed to us any significant assumptions or interpretations underlying the measurement or presentation of the supplementary information.

With regard to the electronic dissemination of audited financial statements, including financial statements published electronically on your website, you understand that electronic sites are a means to distribute information and, therefore, we are not required to read the information contained in these sites or to consider the consistency of other information in the electronic site with the original document.

Management is responsible for establishing and maintaining of a process for tracking the status of audit findings and recommendations. Management is also responsible for identifying and providing report copies of previous financial audits, attestation engagements, performance audits, or other studies related to the objectives discussed in the Audit Scope and Objective section of this letter. This responsibility includes relaying to us corrective actions taken to address significant findings and recommendations resulting from those audits, attestation engagements, performance audits or other studies. Management is also responsible for providing management’s views on our current findings, conclusions, and recommendations, as well as your planned corrective actions, for the report, and for the timing and format for providing that information.

In connection with this engagement, we may communicate with you or others via email transmission. As emails can be intercepted and read, disclosed, or otherwise communicated by an unintended third party, or may not be delivered to each of the parties to whom they are directed and only to such parties, we cannot guarantee or warrant that emails from us will be properly delivered and read only by the addressee. Therefore, we specifically disclaim and waive any liability or responsibility whatsoever for interception or unintentional disclosure of emails transmitted by us in connection with the performance of this engagement. In that regard, you agree that we shall have no liability for any loss or damage to any person or entity resulting from the use of email transmissions, including any consequential, incidental, direct, indirect or special damages, such as loss of revenues or anticipated profits, or disclosure or communication of confidential or proprietary information.

Other Services
We will also assist in preparing the financial statements and related notes in conformity with GAAP based on information provided by you. These nonaudit services do not constitute an audit under Government Auditing Standards and such services will not be conducted in accordance with Government Auditing Standards. We will perform the services in accordance with applicable professional standards. The other services are limited to the financial statement services previously defined. We, in our sole professional judgment, reserve the right to refuse to perform any procedures or take any action that could be construed as assuming management responsibilities.

40 Ver PPC ALG-CL-1.3 2/25
Management agrees to assume all management responsibilities relating to the financial statements and related notes and any other nonaudit services we provide. Management will be required to acknowledge in the management representation letter our assistance with the preparation of the financial statements and related notes and any other nonaudit services we provide and that you have reviewed and approved the financial statements and related notes and any other nonaudit services we provide prior to their issuance and have accepted responsibility for them.] Further, management agrees to oversee the nonaudit services by designating an individual, preferably from senior management, with suitable skill, knowledge, or experience; evaluate the adequacy and results of those services; and accept responsibility for them.

Engagement Administration, Fees, and Other
We will provide copies of our reports to the Town; however, management is responsible for distribution of the reports and the financial statements. Unless restricted by law or regulation, or containing privileged and confidential information, copies of our reports are to be made available for public inspection.

The audit documentation for this engagement is our property and constitutes confidential information. However, subject to applicable laws and regulations, audit documentation and appropriate individuals will be made available upon request and in a timely manner to a federal agency providing direct or indirect funding, or the U.S.

Government Accountability Office for purposes of a quality review of the audit, to resolve audit findings, or to carry out oversight responsibilities. We will notify you of any such request. If requested, access to such audit documentation will be provided under the supervision of Maze & Associates personnel. Furthermore, upon request, we may provide copies of selected audit documentation to the aforementioned parties. These parties may intend, or decide, to distribute the copies or information contained therein to others, including other governmental agencies.

We will retain audit documentation for this engagement for seven years after the report release date pursuant to state regulations. If we are aware that a federal awarding agency, pass-through entity, or auditee is contesting an audit finding, we will contact the party(ies) contesting the audit finding for guidance prior to destroying the audit documentation.

As an attest client, we cannot retain your documents on your behalf because doing so will impair our independence. This is in accordance with the “Hosting Services” interpretation at ET 1.295.143 of the AICPA Code of Professional Conduct. The Town is responsible for maintaining its own data and records.

We do not host any of the Town’s information. SharePoint/OneDrive are used solely to transmit data or as a method of exchanging information and is not intended to store the Town’s information. The Town is responsible for downloading any deliverables and other records from the SharePoint/OneDrive that it wishes to retain for its own records at the completion of the engagement. For multi-year engagements, such downloading should occur annually.

Upon completion of the engagement, data and other content will either be removed from SharePoint/OneDrive or become unavailable to the Town within a reasonable timeframe (generally one week after issuance of our report). For multi-year engagements, completion of the engagement occurs when the deliverables are completed for that year.

We expect to begin our audit in July 2026 and to issue our reports by the October 15, 2026 deadline if all checklist items and Town agreed milestone are met from our meeting on July 6, 2026. David Alvey is the engagement partner and is responsible for supervising the engagement and signing the reports or authorizing another individual to sign them.

To ensure that Maze & Associates’ independence is not impaired under the AICPA Code of Professional Conduct, you agree to inform the engagement partner before entering into any substantive employment discussions with any of our personnel.

41 Ver PPC ALG-CL-1.3 2/25
Our fees for these services are billed based on our contract with the Town. Our standard hourly rates vary according to the degree of responsibility involved and the experience level of the personnel assigned to your audit.

Our invoices for these fees will be rendered each month as work progresses and are payable on presentation. In accordance with our firm policies, work may be suspended if the Town’s account becomes thirty days or more overdue and may not be resumed until the Town’s account is paid in full. If we elect to terminate our services for nonpayment, our engagement will be deemed to have been completed upon written notification of termination, even if we have not completed our report(s). You will be obligated to compensate us for all time expended and to reimburse us for all out-of-pocket costs through the date of termination.

These fees are based on anticipated cooperation from Town personnel, the completion of schedules and data requested on our Checklists by Town personnel, preparation of audit confirmations we request by Town personnel, location of any documents selected by us for testing, and the assumption that there will be no unexpected increases in work scope, such as new Single Audit Act major programs, new debt issues, etc., or delays which are beyond our control, as discussed on the Fees Attachment to this letter. If significant additional time is necessary, we will discuss it with Town management and arrive at a new fee before we incur any additional costs.

We understand you will provide us with basic workspace sufficient to accommodate the audit team assigned to your audit. We understand the basic workspace will be equipped with a telephone and direct Internet access, preferably a temporary network outside of your network, a public IP address and a wired connection. We understand you will also provide us with access to a fax machine and read only access to your general ledger system.

You may request that we perform additional services not addressed in this engagement letter. If this occurs, we will communicate with you regarding the scope of the additional services and the estimated fees. We also may issue a separate engagement letter covering the additional services. In the absence of any other written communication from us documenting such additional services, our services will continue to be governed by the terms of this engagement letter.

Our most recent peer review report accompanies this letter.

Reporting
We will issue a written report upon completion of our audit of the Town’s financial statements, which, if the financial statements include information other than RSI and supplemental information, will also address other information in accordance with AU-C 720, The Auditor’s Responsibilities Relating to Other Information Included in Annual Reports. Our reports will be addressed to the Town Council. Circumstances may arise in which our report may differ from its expected form and content based on the results of our audit. Depending on the nature of these circumstances, it may be necessary for us to modify our opinions, add a separate section, or add an emphasisof-matter or other-matter paragraph to our auditor’s report, or if necessary, withdraw from this engagement. If our opinions are other than unmodified, we will discuss the reasons with Town management in advance. If, for any reason, we are unable to complete the audit or are unable to form or have not formed opinions, we may decline to express opinions or may withdraw from this engagement.

We will also provide a report (that does not include an opinion) on internal control related to the financial statements and compliance with the provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a material effect on the financial statements as required by Government Auditing Standards. The report on internal control and on compliance and other matters will include a paragraph that states (1) that the purpose of the report is solely to describe the scope of testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of internal control on compliance, and (2) that the report is an integral part of an audit performed in accordance with Government Auditing Standards in considering internal control and compliance. The paragraph will also state that the report is not suitable for any other purpose. If during our audit we become aware that the Town is subject to an audit requirement that is not encompassed in the terms of this engagement, we will communicate to management and those charged with governance that an audit in accordance with U.S. generally accepted auditing standards and the standards for financial audits contained in Government Auditing Standards may not satisfy the relevant legal, regulatory, or contractual requirements.
42 Ver PPC ALG-CL-1.3 2/25
*****
We appreciate the opportunity to be of service to the Town and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return a full copy of this letter to us.

Maze & Associates
RESPONSE:

This letter correctly sets forth the understanding of the Town.

By: _______________________________________
Title: _______________________________________
Date: _______________________________________
43 Ver PPC ALG-CL-1.3 2/25
Town of Portola Valley
Engagement Letter
Fee Attachment
June 30, 2024 and 2025
Our fees for the work described in the attached engagement letter will be as follows, unless they are adjusted for one or more of the items below.
2024 2025
Basic Financial Statements $68,800 $68,800
Measure A 3,200 3,200
Measure W 3,200 3,200
Proposition 111 Appropriation Limit 1,700 1,700
Total: $71,900

$71,900
Our fee is from our meeting dated July 6, 2026.

Our price includes “print to PDF” versions of all reports issued. Due to the significant increase in the cost of paper products, our price also includes up to 10 bound copies of each report, except for the ACFR. If you require additional bound copies, we will provide a cost estimate before proceeding.

Web-Ready PDFs of Reports – print to PDF copies of the above reports are provided at no charge. These report copies are high quality, but do not include any bookmarks or hyperlinks and the file sizes may be large, depending on the length of the report. If you would like a higher quality PDF file with bookmarks and hyperlinks in the table of contents, we have listed the option below. Please contact us if you would like us to prepare the following option for your report, or if you’d like a quote for the preparation of a file for another type of report. In addition, should you decide on the Web PDF option, please let us know at least a week in advance.

Additional Services - The above fees are for audit and assurance services described in the accompanying engagement letter. They do not include fees for assisting with closing the books nor providing other accounting services. Should the Town require assistance beyond audit services we will provide a cost estimate before proceeding.

Report Finalization - Our fee is based on our understanding that all information and materials necessary to finalize all our reports will be provided to us before we complete our year-end fieldwork in your offices. In the case of Financial Statements, this includes all the materials and information required to print the Financial Statements. As in the past, we will provide final drafts of all our reports before we leave your offices. We will schedule a Final Changes Meeting with you for a date no more than two weeks after we complete our fieldwork.

At that meeting, we will finalize all reports for printing. After that date, report changes you make and changes required because information was not received timely will be billed at our normal hourly rates.

Post-Closing Client Adjusting Entries - The first step in our year-end audit is the preparation of financial statement drafts from your final closing trial balance. That means any entries you make after handing us your closing trial balance must be handled as audit adjustments, or in extreme cases, by re-inputting the entire trial balance, even if the amounts are immaterial. If you make such entries and the amounts are in fact immaterial, we will bill you for the costs of the adjustments or re-input at our normal hourly rates.

Recurring Audit Adjustments - Each year we include the prior year’s adjusting entries as new steps in our Closing Checklist, so that you can incorporate these entries in your closing. If we are required to continue to make these same adjustments as part of this year’s audit, we will bill for this service at our normal hourly rates. 44 Ver PPC ALG-CL-1.3 2/25
Grant Programs Requiring Separate Audit - Grant programs requiring separate audits represent a significant increase in work scope, and fees for these audits vary based on the grant requirements. If you wish us to determine and identify which programs are subject to audit, we will bill you for that time at our normal hourly rates.

Changes in Town Personnel - Our experience is that changes and /or reductions in Finance Department staff can have a pronounced impact on costs of performing the audit. If such changes occur, we will meet with you to assess their impact and arrive at a new fee before we begin the next phase of our work. However, we reserve the right to revisit this subject at the conclusion of the audit, based on your actual performance and our actual costs.

45 Ver PPC ALG-CL-1.3 2/25

46 Ver PPC ALG-CL-1.3 2/25 47

TOWN OF PORTOLA VALLEY

STAFF REPORT
TO Mayor and Members of the Town Council
FROM: Darcy Smith, Town Manager
Catherine Engberg, Town Attorney
DATE: July 22, 2026
RE: Consider Adoption of a Resolution Submitting to the Voters of Portola Valley a Measure Both to Adopt a Town Charter and to Authorize a Real Property Transfer Tax at the General Election to be held on Tuesday, November 3, 2026 as Called by Resolution 3001- 2026

RECOMMENDATION
Staff recommends that the Town Council adopt a Resolution Submitting to the Voters of Portola Valley a Measure Both to Adopt a Town Charter and to Authorize a Real Property Transfer Tax at the General Election to be held on Tuesday, November 3, 2026 as Called by Resolution 3001-2026.

BACKGROUND
Portola Valley was incorporated in 1964 in order to have local control over development.

The goals were to preserve the beauty of the land, to foster low-density housing, to keep government costs low by having a cadre of volunteers, and to limit services to those necessary for local residents. The Town’s General Plan and local regulations embody the Town values. One of the major community goals in the General Plan is to conserve the rural quality of Portola Valley and maintain the town as an attractive, tranquil, familyoriented residential community for all generations compatible with the many physical assets and natural features of the area. The town is a special and wonderful place to live, with a scientifically designed community survey in September 2025 finding that

90.8% of respondents report being satisfied with the overall quality of life in the town.

Local governance and our autonomy allow us to maintain our values and the local character.

One of the Town Council’s priorities is financial responsibility and long-term viability. The majority our revenue comes from property taxes, which represents $4.6M and 50% of our total General Fund revenues for Fiscal Year 2026-27 Historically, the Town had extremely low property taxes when established in 1964. Based on Proposition 13, which was established by voters in 1978, the Town receives 4.3% of property tax collected and an additional allocation of 2.7% from the County to bring us up to 7%. The Town 48 receives the lowest percentage of revenue in the County. We received additional revenue from the current utility user tax ($1.2M and 13% of the General Fund revenue) and sales tax ($350k and 4%).

General Fund fiscal forecast
The updated long-range General Fund fiscal forecast indicates an ongoing structural deficit of approximately $700,000 per year. Generally, expenses are increasing faster than revenues. For example, the Town’s law enforcement contract cost has increased from $1.37M in FY21-22 to $2.54M in FY26-27, a total increase over a five-year period of 85%. During the same time period, the General Fund’s share of the contract cost has increased from $1.2M in FY21-22 to $2.4M in FY26-27, a total increase of 94%. Without new revenue, the General Fund reserve will fall below the minimum reserve policy level of 20% of annual operating expenditures by the end of FY 2027-28 and will be depleted by the end of FY 2029-30. Additionally, the Town has identified funding needs for a range of other priorities, including capital projects, road resurfacing, fleet and equipment replacement, deferred maintenance, safety and resilience projects, etc.

The following graph shows the predicted shortfall in General Fund Reserves:

Ensuring the Town’s fiscal solvency will require locally controlled revenue enhancement.

As a strong fiscal steward of taxpayer dollars, the Town has already taken steps to close the revenue gap by completing a comprehensive user fee study. The Town Council adopted an updated Master Fee Schedule for FY2026-27 to ensure the Town achieves appropriate cost recovery in building and planning services, field and facility rentals, and other administrative charges.

Community Survey and Review of Potential Locally Controlled Revenue Options In a recent community survey and through The Portola Valley Conversation – a discussion involving hundreds of residents about protecting emergency services and our financial stability – residents said that ensuring the Town’s fiscal stability and protecting 49 the Town’s autonomy were top priorities. Strategies to demonstrate financial responsibility have included efforts by the Town to educate the community on Town finances, complete the backlog of financial audits, implement the recommendations from the Krisch & Co Report, conduct a user fee study, and develop and implement the necessary infrastructure to improve operational efficiency and effectiveness.

The recommendation to adopt a resolution submitting a measure adopting the Town Charter and a Real Property Transfer Tax Ordinance for voter adoption at the upcoming election would address resident priorities identified through the Portola Valley Conversation. Hundreds of residents have participated in that Conversation, and they identified priorities such as maintaining wildfire prevention services such as vegetation and brush management/clearance programs to reduce the chance of a wildfire; maintaining 911 emergency response times and police patrols; maintaining Town autonomy by preventing a County takeover of local zoning and planning services; and repairing deteriorating storm drains to prevent system failure, flooding and water pollution and sinkholes.

To address long-term viability, the Finance Committee was tasked in May 2024 with researching several topics that could address the Town’s structural deficit. Over the summer of 2024, the Finance Committee made several presentations of their findings and made recommendations for the Town Council to consider that would address the Town’s structural deficit and other funding needs. In May 2025, the Town Council initiated a work program that included a community survey. In August 2025, the Town Council received additional information regarding the Town’s current financial situation and provided direction to the Ad Hoc Town Council Subcommittee and staff regarding Locally Controlled Revenue Options.

As highlighted above, a community survey of Portola Valley registered voters was completed in September 2025, and the results were presented to the Town Council in November 2025. The community survey identified the need to be prepared for natural disasters such as wildfires, earthquakes, flooding, or landslides. Community priorities include prevention measures, evacuation planning, and reliable emergency response communication systems to help keep residents safe.

Finally, Portola Valley residents responded that they wish to protect Town autonomy and the Town’s ability to make its own zoning decisions as an incorporated community.

Survey responses indicated that residents do not want zoning and planning decisions to be made by the County, which would occur if the Town lost its independent status. The survey indicated that 60% of Town residents are supportive of the Town’s becoming a Charter Town. This input has led Town staff to continue engaging the community and Town Council on the Charter approach.

Town Charter and Real Property Transfer Tax
Based on this input, the Town Council began the formal Charter process and on April 22, 2026, the Town Council directed staff to proceed with the recommended limited and "simple" charter. They further directed staff to schedule two public hearings on the Draft Charter to fulfill the requirements of the California Government Code Section 33458(b).

On May 13, 2026, the Town Council conducted the first noticed public hearing and on June 24, 2026, the Council conducted the second noticed public hearing. Thus, the 50 Town has fulfilled the California Government Code hearing requirements.

The Town’s research and survey indicated that the most viable option for increasing Town revenue, which is supported by residents, is the potential to adopt a Real Property Transfer Tax (RPTT). RPTTs are solely applied to the sale of real property, and are ONLY paid by the purchasers or sellers of real properties; i.e., not by real property owners who do not sell their property. An agreement between the buyer and seller may determine who pays the cost. If enacted, the RPTT would develop a locally generated and controlled funding source that the Town could use to maintain and/or increase the current level of services and facilities provided by the Town.

However, only Charter Cities and Towns may adopt an RPTT beyond the minimal “documentary transfer tax” amount authorized under state law. Pursuant to California Revenue and Taxation Code sections 11901 et seq., a general law city or town is authorized to impose a documentary transfer tax of up to 27.5¢ per $500 of the sales price for real property transfers. The Town adopted such a documentary transfer tax in 1967. However, as a General Law Town, it is restricted from adopting a real property transfer tax beyond the minimum allowed in state law. As other towns/cities have done, our Town would need to obtain voter approval to adopt a Charter and become a Charter Town in order to have the authority to adopt the RPTT beyond the minimum authorized by state law.

Both the Town Charter and the RPTT would become effective only if adopted by a 50 percent plus one vote of the Portola Valley electorate. If voters approve the ballot measure, the Town would be converted from a General Law Town to a Charter Town, and the RPTT would be effective ten (10) days after the Town Council declares the results of the election.

DISCUSSION
This agenda item presents for Town Council consideration of adoption of a Resolution submitting to the voters a Measure both to adopt a Town Charter and to authorize a Real Property Transfer Tax; and requesting that the San Mateo County Board of Supervisors consent to the consolidation of this election with the Statewide General Election to be held on the same date and direct the Registrar of Voters to conduct the Election. A two-thirds vote of the Town Council membership (effectively 4/5 of the five-member Council) is required to place the measure on the ballot. The draft Resolution also directs the Registrar to print the ballot measure, including the Town Charter and the RPTT ordinance in the ballot pamphlet.

The Town Finance Committee met to discuss the potential additional locally controlled revenue on June 30, 2026 and July 13, 2026.At the July 22, 2026 Town Council meeting, the Council will discuss and finalize the rate for the Real Property Transfer tax to be included in the Resolution. The attached draft Resolution includes the staff recommended tax rate of $10 per $1,000 sales price. Council may direct a change to this tax rate before placement on the ballot. Additionally, the Ordinance allows for the Town Council to (A) repeal or reduce the tax and (B) Rreduce tax rate and later restore the tax rate to a rate that does not exceed the tax rate approved by the voters. Exemptions can also be added in the future by the Town Council.

The ballot measure text has been refined slightly to prioritize the respondent feedback regarding community priorities in the scientifically designed community poll conducted in 51 September 2025. The text has been carefully and scientifically selected by staff and the Town’s experienced consultant. Pursuant to its existing committee charter authority, the Town Finance Committee would provide independent oversight of annual audits, which would include the revenue generated by the measure. The proposed measure does not legally restrict the use of tax revenue to any specific purposes as it is classified as a “general tax,.” If approved by a majority of those voters casting a ballot at the November 3, 2026 election, the tax proceeds may be used for any unrestricted general revenue purposes.

In parallel with the Council meeting timeline, the Town is conducting community education and outreach to ensure transparency and equitable public access to the Charter development process. For example, public outreach activities have included articles in regular Town publications.

FISCAL IMPACT
Based on 15-year average market activity and a flat rate structure, the rate of $10 per $1,000 of sales price (1%) is projected to generate approximately $2,000,000 in additional locally controlled revenue per year. Actual revenues will vary based on real estate market conditions and property sales activity. If approved by voters, additional revenue would support the City’s General Fund and help to address wildfire prevention/vegetation management; 911 emergency response/ police patrols; local zoning/planning services; storm drain repair; and general government services.

It is estimated that the County of San Mateo Elections Division will charge the Town approximately $6,000 to $7,200 to place the ballot measure on the November 3, 2026 Statewide General Election Ballot. There may be additional costs for the full printing of the text of the Ordinance and Charter in the Voter Information Pamphlet, which can be accommodated in the current Town operating budget. Actual costs are dependent on several factors, including the number of registered voters and the number of jurisdictions participating in the election. In addition, there are legal, community education, and other direct costs associated with this effort. A total cost has not been calculated at the time, but the current Town operating budget includes budget appropriations to cover the current expenditures.

ENVIRONMENTAL IMPACT
The proposed action will not result in direct or indirect physical changes in the environment, and therefore is not a project within the meaning of the California Environmental Quality Act (“CEQA”) and the State CEQA Guidelines, Section 15378(b)(4)&(5) and is further exempt under Section 15061(b)(3) of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that creation of a government funding mechanism would have a significant effect on the environment.

ATTACHMENTS

1. Resolution with Exhibit A: Town Charter and Exhibit B: Ordinance 52 RESOLUTION NO. 3010-2026

A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF PORTOLA VALLEY

SUBMITTING TO THE VOTERS OF PORTOLA VALLEY A MEASURE BOTH TO

ADOPT A TOWN CHARTER AND TO AUTHORIZE A REAL PROPERTY TRANSFER

TAX AT THE GENERAL MUNICIPAL ELECTION TO BE HELD ON TUESDAY, NOVEMBER 3, 2026 AS CALLED BY RESOLUTION 3001-2026
WHEREAS, the Town of Portola Valley was incorporated as a general law town in 1964 by residents seeking to manage local affairs; and
WHEREAS, pursuant to California Revenue and Taxation Code sections 11901 et seq., a general law city or town is authorized to impose a documentary transfer tax of up to 27.5¢ per $500 of the sales price for any transfer of real property within the city or town with a sales price over $100, subject to certain conditions and exemptions; and WHEREAS, pursuant to Portola Valley Municipal Code, chapter 3.12, the Town has imposed a real property transfer tax (equivalent to a documentary transfer tax) since 1967 at the state-authorized rate of 27.5¢ per $500 of the real estate sales price; and
WHEREAS, charter cities and towns may enact real property transfer taxes beyond the 27.5¢ per $500 maximum set forth in California Revenue and Taxation Code sections 11901 et seq., provided the charter city or town secures appropriate voter approval of the increased real property transfer tax; and WHEREAS, as a general law town, Portola Valley does not currently have the legal authority to enact a real property transfer tax beyond that already imposed under Municipal Code chapter 3.12; and
WHEREAS, if Portola Valley becomes a charter town, it would be authorized to enact a real property transfer tax that exceeds 27.5¢ per $500; and WHEREAS, becoming a charter town would help ensure Portola Valley’s local autonomy and expand the economic and fiscal independence of our Town to promote the health, safety, and welfare of all residents; and
WHEREAS, the Town Council provided direction to Town staff and the Town Attorney’s Office to prepare a draft charter for the Town Council to consider submitting to the voters of Portola Valley to change Portola Valley to a charter town, which would also empower the voters to adopt a real property transfer tax; and 53 WHEREAS, pursuant to California Government Code Section 34458(b), the Town Council held two duly noticed public hearings on May 13 and June 24, 2026 to hear public comment and testimony and to consider the charter proposal; and WHEREAS, the Town Council has directed the preparation of a ballot measure to submit to the voters of Portola Valley the approval of both the Portola Valley Town Charter and an ordinance adopting a real property transfer tax (the “Measure”); and WHEREAS, pursuant to authority provided by California Constitution, Article XI, Section 3, California Government Code Sections 34450 et seq. and California Elections Code Sections 1415 and 9255, the Town Council of the Town of Portola Valley is submitting to the voters the proposed Town Charter that would change Portola Valley from a general law town to a charter town, and would authorize the Town to enact a real property transfer tax beyond the amount authorized by California Revenue and Taxation Code sections 11901 et seq., subject to applicable voter approval, as more specifically set forth therein (the “Town Charter”); and
WHEREAS, California Constitution, Article XI, Section 3, requires that any charter proposal be approved by a majority of Town voters voting at an election called for that purpose; and
WHEREAS, California Constitution, Article XIIIC, Section 2(b), requires that any general tax for unrestricted general revenue purposes, such as a real property transfer tax, must be submitted to and approved by a majority vote of Town voters voting on it; and
WHEREAS, both the Portola Valley Town Charter and the real property transfer tax would be approved if the Measure receives at least a simple majority vote of affirmative votes; and
WHEREAS, the real property transfer tax ordinance submitted to the voters, if approved, would impose a tax on the sale of real property; payment of the tax could be negotiated between buyer and seller; the tax rate would be ten dollars ($10.00) per each one thousand dollars ($1,000.00), or fraction thereof, of the consideration paid for real property; the tax would be owed at the time of sale of real property; and WHEREAS, in these current economic times, the Town seeks to maintain its autonomy, independent status, and ability to make its own zoning decisions as consistent with its status as its own incorporated community—should the Town lose its independent status, zoning decisions would be made by the County; and WHEREAS, the Town wishes to be prepared for natural disasters such as wildfires, earthquakes, flooding or landslides with prevention measures, evacuation planning and emergency response communication systems; and 54 WHEREAS, revenue from the real property transfer tax would provide a reliable source of local revenue that would go into the Town’s general fund and could be used for any legitimate government purpose, including wildfire prevention and vegetation management, maintaining police services, repairing deteriorating storm drains, local planning and zoning services, and general municipal services to the public; and WHEREAS, the Town seeks to maintain local control over local funding sources that cannot be taken by the County, State or Federal government; and WHEREAS, pursuant to California Government Code Section 34458(b), this resolution is being adopted at a Town Council meeting which is at least twenty-one (21) calendar days after the second public hearing referenced above; and WHEREAS, on June 24, 2026, the Town Council adopted a Resolution 3001- 2026 Calling for a General Municipal Election to be Held on November 3, 2026; and Requesting the County of San Mateo Board of Supervisors to Consolidate Said Election with the Statewide General Election; and
WHEREAS, the Town Council also desires to submit the Measure to the voters at the General Municipal Election; and
WHEREAS, pursuant to Article XI, Sections 3 and 5 of the California Constitution and California Elections Code sections 1415, 9222 and 9255, the Town Council is authorized to submit the Measure to the Portola Valley voters at the General Municipal Election to be held on November 3, 2026; and
WHEREAS, the Town Council further desires to set deadlines and rules for primary and rebuttal arguments for and against the Measure.

NOW THEREFORE, BE IT RESOLVED by the Town Council of the Town of Portola Valley as follows:

Section 1. Recitals. The foregoing recitals are true and correct and are hereby incorporated by reference.

Section 2. Election Called. Pursuant to the requirements of the laws of the State of California, the Town Council hereby calls an election to be held in the Town of Portola Valley, California, on Tuesday, November 3, 2026, at which it shall submit to the voters of Portola Valley a measure that, if approved by a majority vote, would make Portola Valley a Charter Town and adopt a real property transfer tax.

Section 3. Ballot Question. The Town Council, pursuant to its right and authority, does hereby submit for adoption by the voters of Portola Valley at the General Municipal Election of November 3, 2026, the following question:
55 Town of Portola Valley Autonomy Measure. Shall the
measure maintaining Portola Valley’s independent status be adopted, providing: wildfire prevention/vegetation
management; 911 emergency response/police patrols; local zoning/planning services; storm drain repair; and general government services; by adopting a charter for the Town of Portola Valley solely for, and establishing a real property transfer tax of $10 per $1,000, paid by buyers or sellers of property, until ended by voters, providing approximately $2,000,000 in locally controlled funding annually, with independent oversight?
YES
NO
Section 4. Minor, Non-Substantive Changes to the Ballot Question. The Town Council authorizes the Town Manager and Town Attorney to make minor nonsubstantive revisions to the ballot question, as deemed necessary by the County Elections Office, to facilitate administration of the election and compliance with applicable law, provided that such revisions do not materially change the purpose or substance of the ballot question.

Section 5. Measure To Be Submitted To Voters. The full text of the proposed measure to be submitted to the voters is attached to this Resolution as Exhibit A (proposed Town Charter) and Exhibit B (proposed Ordinance) (the “Measure”), including the proposed Charter of the Town of Portola Valley and an ordinance adopting a real property transfer tax, and shall be completely printed in the voter pamphlet. The Town Council hereby approves the Ordinance as to form and further approves the submission of the Measure to the voters of the Town at the November 3, 2026 general municipal election. The Measure shall not take effect unless and until it is approved by a vote of at least a simple majority (50% plus 1) of affirmative votes of the voters voting on the question at the election. If the measure is approved, both the Charter and the Real Property Transfer Tax shall be approved.

Section 6. Impartial Analysis. The Town Attorney is hereby directed to prepare an impartial analysis of the Measure pursuant to Elections Code Section 9280 which shall be filed no later than August 18, 2026.

Section 7. Primary Ballot Arguments. In accordance with Section 9282 of the Elections Code, primary arguments in favor of and against the Measure, not exceeding 300 words, shall be filed with the Town Clerk no later than August 11, 2026 at 5:00 p.m., signed, with the printed name(s) and signature(s) of the author(s) submitting it, or if submitted on behalf of an organization, the name of the organization, and the printed name and signature of at least one of its principal officers who is the author of the argument. Neither the Town Council nor any members of the Town Council will submit a ballot argument on behalf of the Town Council. The Town Clerk shall comply with all provisions of law establishing priority of arguments for printing and distribution to the voters, and shall take all necessary actions to cause the selected arguments to be printed and distributed to the voters.
56 Section 8. Provisions For Rebuttal Arguments. Pursuant to Section 9285 of the Elections Code, when the Clerk has selected the arguments for and against the Measure which will be printed and distributed to the voters, the Clerk shall send copies of the argument in favor of the Measure to the authors of the argument against, and copies of the argument against the Measure to the authors of the argument in favor. The authors or persons designated by them may prepare and submit rebuttal arguments not exceeding 250 words. The rebuttal arguments shall be filed with the Town Clerk not later than August 18, 2026 at 5:00 p.m., accompanied by the printed name(s) and signature(s) of the person(s) submitting it, or if submitted on behalf of an organization, the name of the organization, and the printed name and signature of at least one of its principal officers. Rebuttal arguments shall be printed in the same manner as the primary arguments. Each rebuttal argument shall immediately follow the primary argument which it seeks to rebut.

Section 9. Requesting the Consolidation of Elections. Pursuant to Elections Code Section 10400 et seq., and consistent with Resolution No. 3001-2026 Calling for a General Municipal Election to be Held on November 3, 2026; and Requesting the County of San Mateo Board of Supervisors to Consolidate Said Election with the Statewide General Election, adopted on June 24, 2026, the San Mateo County Board of Supervisors is hereby requested to consent and agree to the consolidation of the General Municipal Election described in this Resolution with the Statewide General Election on November 3, 2026, and provide all services necessary to conduct the election and print a measure on the ballot as described in Section 3 of this Resolution.

Section 10. Other Procedures. In all particulars not recited in this resolution, the election shall be held and conducted as provided by law for holding municipal elections.

The consolidated election shall be held and conducted in the manner prescribed in Elections Code section 10418.

Section 11. Notice. In accordance with Section 12111 of the Elections Code, the Town Clerk is hereby authorized and directed to cause notice of the election on the measure to be published. The Town Clerk is hereby directed to file a certified copy of this Resolution with the Board of Supervisors and the County Elections Official, and is hereby authorized and directed to take all steps necessary to place the measure on the ballot and to cause the Measure to be printed.

Section 12. California Environmental Quality Act (CEQA). The Town Council hereby finds and determines that the Measure relates to organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment, and therefore is not a project within the meaning of the California Environmental Quality Act (“CEQA”) and the State CEQA Guidelines, Section 15378(b)(4)&(5) and is further exempt under Section 15061(b)(3) of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that creation of a government funding mechanism would have a significant effect on the environment. 57 Section 13. Severability. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the Resolution which can be given effect without the invalid provision or application, and to this end the provisions of this Resolution are severable. The Town Council hereby declares that it would have adopted this Resolution irrespective of the invalidity of any particular portion thereof.

BE IT FURTHER RESOLVED that this resolution shall become effective immediately upon passage and adoption.

PASSED AND ADOPTED on July 22, 2026 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

By: __________________________
Mayor
ATTEST:
_________________________
Town Clerk
Attachments
Exhibit A: Town Charter
Exhibit B: Ordinance
58 EXHIBIT “A”

TOWN OF PORTOLA VALLEY CHARTER

STATEMENT OF PURPOSE
The Town of Portola Valley was incorporated as a general law town in 1964 by residents seeking the right to manage local affairs. With this Charter, the Town of Portola Valley will reclaim more local autonomy and expand the economic and fiscal independence of our Town government to promote the health, safety, and welfare of all its residents.

ARTICLE I

POWERS OF TOWN
100. Exercise of Constitutional Power of Local Taxation The Town of Portola Valley adopts this Charter to exercise all constitutional powers conferred on charter cities under Article XI sections 3 and 5 of the California Constitution with respect to municipal affairs in relation to local taxes, including a system for the imposition, levy and collection of such taxes. In particular, and without limiting the authority of the Town to generate revenue, the Town may impose a tax on the conveyance of real property, based upon the price paid for the real property (“real property transfer tax”). Any real property transfer tax imposed by the Town shall be in addition to any similar tax authorized by the general laws of the State of California. In the event of a conflict between this Charter and the general law, the provisions of this Charter shall govern.
101. Exercise of Powers Under General Laws
Except as provided in this Charter with respect to the power of the Town over local taxation, the powers of the Town shall otherwise be constrained by, subject to, and governed by the general laws of the State as now and hereafter existing relating to towns and cities organized under said general laws. The Town shall have the power and authority to exercise any and all rights and privileges lawfully granted to any general law city or town of the State of California.
102. Severability
If any provision of this Charter is found by a court of competent jurisdiction to be invalid, the remaining provisions of the Charter shall remain in full force and effect. 103. Effective Date of Charter/Amendment
59 This Charter, and any amendment or repeal of this Charter, shall be deemed ratified when approved by the voters of Portola Valley and shall take effect upon acceptance and filing by the Secretary of State of the State of California pursuant to Government Code Section 34460.

ARTICLE II

SUCCESSION
200. Name and Boundaries
The municipal corporation now existing and known as the Town of Portola Valley, also referred to herein as “the Town,” shall remain and continue to be a municipal body corporate and politic, as at present, in name, in fact, and in law. The boundaries of the Town shall be as established at the time this Charter takes effect, or as they may be changed thereafter in the manner authorized by law.
201. Rights and Liabilities
The Town shall remain vested with and continue to have, hold, and enjoy all property, rights of property, and rights of action of every nature and description now pertaining to this municipality, and is hereby declared to be the successor of same. It shall be subject to all the obligations, contracts, liabilities, debts, and duties that now exist against or with the Town.
202. Ordinances, Codes, and Other Regulations
All ordinances, codes, resolutions, regulations, rules, and portions thereof, in force at the time this Charter takes effect, and not in conflict or inconsistent herewith, shall continue in force until repealed, amended, changed, or superseded in the manner provided by this Charter and any other applicable laws. 203. Pending Actions And Proceedings
No action or proceeding, civil or criminal, pending at the time this Charter takes effect, brought by or against the Town or any officer, office, or department thereof, shall be affected or abated by the adoption of this Charter, or by anything herein contained. 60 EXHIBIT “B”
ORDINANCE NO. 2026-456

AN ORDINANCE OF THE PEOPLE OF THE TOWN OF PORTOLA
VALLEY, CALIFORNIA, AMENDING CHAPTER 3.12 OF TITLE 3
(REVENUE AND FINANCE) OF THE PORTOLA VALLEY MUNICIPAL
CODE REGARDING THE REAL PROPERTY TRANSFER TAX.

THE PEOPLE OF THE TOWN OF PORTOLA VALLEY DO ORDAIN AS
FOLLOWS:

SECTION 1. Subject to the approval of a majority of the voters of the Town of Portola Valley at the General Municipal Election so designated by the Town Council in a separate resolution placing the proposal on the ballot for such election, Chapter 3.12 of the Town of Portola Valley Municipal Code is hereby amended to add, delete or modify its provisions as follows (section titles are shown in bold font, additions are shown in underline font, and deletions are shown by strikethrough font; sections that do not contain underline or strikethrough font have not been modified or amended):

3.12.010 Title—Statutory authority.

The ordinance codified in this chapter shall be known as the "Real Property Transfer Tax Ordinance of the Town of Portola Valley." It is adopted pursuant to the authority contained in Part 6.7, commencing with Section 11901, of Division 2 of the Revenue and Taxation Code of the state, and pursuant to the authority contained in the Portola Valley Charter section 100.

3.12.020 Imposed—Rate.

There is imposed on each deed, instrument or writing by which any lands, tenements, or other realty sold within the town shall be granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by his, her, or their direction, when the consideration or value of the interest or property conveyed, exclusive of the value of any lien or encumbrances remaining thereon at the time of sale, exceeds one hundred dollars, a tax at the rate of $10.00 for each one thousand dollars ($1,000.00) of the value of consideration twenty-seven and one-half cents for each five hundred dollars or fractional part thereof paid for a transfer of real property.

3.12.030 Person responsible for payment.

Any tax imposed pursuant to Section 3.12.020 shall be paid by any person who makes, signs or issues any document or instrument subject to the tax, or for whose use or benefit the same is made, signed or issued. The transferor and transferee of real 61 property subject to the tax shall be jointly and severally liable for payment of this tax to the Town and may apportion the tax among themselves.

3.12.040 Exemption—Instrument to secure debt.

Any tax imposed pursuant to this chapter shall not apply to any instrument in writing given to secure a debt.

3.12.050 Exemption—Instrument by which public agency acquires title.

Any deed, instrument or writing to which the United States or any agency or instrumentality thereof, any state or territory or political subdivision thereof, is a party, shall be exempt from any tax imposed pursuant to this chapter when the exempt agency is acquiring title.

3.12.060 Exemption—Conveyances for reorganization or adjustment.

Any tax imposed pursuant to this chapter shall not apply to the making, delivering or filing of conveyances to make effective any plan of reorganization or adjustment:

A. Confirmed under the Federal Bankruptcy Act, as amended; B. Approved in an equity receivership proceeding in a court involving a railroad corporation, as defined in subdivision (m) of Section 205 of Title 11 of the United States Code, as amended;
C. Approved in an equity receivership proceeding in a court involving a corporation, as defined in subdivision (3) of Section 506 of Title 11 of the United States Code, as amended; or
D. Whereby a mere change in identity, form or place of organization is effected.

Subsections A to D, inclusive, of this section shall only apply if the making, delivery or filing of instruments of transfer or conveyances occurs within five years from the date of such confirmation, approval or change.

3.12.070 Exemption—Conveyance to make effective orders of the Securities and Exchange Commission.

Any tax imposed pursuant to this chapter shall not apply to the making or delivery of conveyances to make effective any order of the Securities and Exchange Commission, as defined in subdivision (a) of Section 1083 of the Internal Revenue Code of 1954, but only if:

A. The order of the Securities and Exchange Commission in obedience to which such conveyance is made recites that such conveyance is necessary or 62 appropriate to effectuate the provisions of Section 79k of Title 15 of the United States Code, relating to the Public Utility Holding Company Act of 1935; B. Such order specifies the property which is ordered to be conveyed; or C. Such conveyance is made in obedience to such order.

3.12.080 Levy not imposed on transfer of interest in continuing partnership.

A. In the case of any realty held by a partnership, no levy shall be imposed pursuant to this chapter by reason of any transfer of an interest in a partnership or otherwise if:

1. Such partnership, or another partnership, is considered a continuing partnership within the meaning of Section 708 of the Internal Revenue Code of 1954; and

2. Such continuing partnership continues to hold the realty concerned.

B. If there is a termination of any partnership within the meaning of Section 708 of the Internal Revenue Code of 1954, for purposes of this chapter, such partnership shall be treated as having executed an instrument whereby there was conveyed, for fair market value, exclusive of the value of any lien or encumbrance remaining thereon, all realty held by such partnership at the time of such termination.

C. Not more than one tax shall be imposed pursuant to this chapter by reason of a termination described in subsection B, and any transfer pursuant thereto, with respect to the realty held by such partnership at the time of such termination.

3.12.090 Exemption—Instrument resulting from or in lieu of foreclosure.

Any tax imposed pursuant to this chapter shall not apply with respect to any deed, instrument, or writing to a beneficiary or mortgagee, which is taken from the mortgagor or trustor as a result of or in lieu of foreclosure; provided, that such tax shall apply to the extent that the consideration exceeds the unpaid debt, including accrued interest and cost of foreclosure. Consideration, unpaid debt amount and identification of grantee as beneficiary or mortgagee shall be noted on the deed, instrument or writing or stated in an affidavit or declaration under penalty of perjury for tax purposes.

3.12.100 Exemption—Instrument to effect division of community property.

A. Any tax imposed pursuant to this chapter shall not apply with respect to any deed, instrument, or other writing which purports to transfer, divide, or allocate community, quasi-community, or quasi-marital property assets between spouses for the purpose of effecting a division of community, quasi-community, or quasi-marital property which is required by a judgment decreeing a dissolution of the marriage or legal separation, by a judgment of nullity, or by any other judgment or order 63 rendered pursuant to Part 5, commencing with Section 4000, of Division 4 of the Civil Code, or by a written agreement between the spouses, executed in contemplation of any such judgment or order, whether or not the written agreement is incorporated as part of any of those judgments or orders.

B. In order to qualify for the exemption provided in subsection A, the deed, instrument, or other writing shall include a written recital, signed by either spouse, stating that the deed, instrument, or other writing is entitled to the exemption.

3.12.110 Administration.

The county recorder shall administer this chapter in conformity with the provisions of Part 6.7 of Division 2 of the Revenue and Taxation Code and the provisions of any county ordinance adopted pursuant thereto. The Town Council may adopt additional rules for the collection of this tax, as well as provide for penalties and interest for nonpayment of this tax, provided said additional rules are consistent with this voterapproved ordinance.

3.12.120 Claims for refund.

Claims for refund of taxes imposed pursuant to this chapter shall be governed by the provisions of Chapter 5, commencing with Section 5096, of Part 9 of Division 1 of the Revenue and Taxation Code of the state.

3.12.130 Operative date.

This chapter shall become operative upon the operative date of any ordinance adopted by the county, pursuant to Part 6.7, commencing with Section 11901, of Division 2 of the Revenue and Taxation Code of the state, or December 13, 1967, whichever is the later.

3.12.130 – Council amendments.

The Town Council is hereby authorized to amend Chapter 3.12 of Title 3 (Revenue and Finance) of the Portola Valley Municipal Code in any manner that does not increase the tax rates, or otherwise constitute a tax increase that requires voter approval pursuant to the California Constitution. Council amendments may include, but are not limited to, amendments that:
(A) Repeal or reduce the tax.
(B) Reduce tax rate and later restore the tax rate to a rate that does not exceed the tax rate approved by the voters.
64 (C) Interpret or clarify implementation or enforcement of the tax so long as the interpretation or clarification does not increase the tax rate. (D) Create exemptions from the tax.

SECTION 2. Fiscal Accountability Provisions. The amount generated by this new general purpose revenue source and how it was used shall be included in the annual audit of the Town’s financial operations by an independent certified public accountant.

The Town of Portola Valley Finance and Audit Committee, pursuant to its committee charter authority to provide independent review and oversight, shall review the audit and may make such recommendations to the Town Council as it deems necessary and appropriate.

SECTION 3. California Environmental Quality Act (CEQA). Approval of this Ordinance is exempt from review under CEQA pursuant to Sections 15378(b) and 15061(b)(3) of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that creation of a government funding mechanism would have a significant effect on the environment.

SECTION 4. If any section, subsection, paragraph, or sentence of this Ordinance, or any part thereof, is for any reason found to be invalid, unconstitutional, or beyond the authority of the Town of Portola Valley by a court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Ordinance.

SECTION 5. This Ordinance shall take effect 10 days after the certification of its approval by the voters at the November 3, 2026 election pursuant to Elections Code Section 9217.
************************************************************************** This Ordinance was approved and adopted by a majority vote of the voters of the Town of Portola Valley at the municipal election consolidated with the November 3, 2026 statewide election.

By: __________________________
Mayor
ATTEST:
_________________________
Town Clerk
65 TOWN OF PORTOLA VALLEY

LIAISON MEMO
TO: Mayor and Members of the Town Council
FROM: Councilmember Rebecca Flynn
DATE: July 22, 2026
RE: 07/07/2026 Conservation Committee Liaison Memo

BACKGROUND
Action Items

1. New Opening on the Conservation Committee. Applications are available on the Town website.

Contact Chair Marianne Plunder for more information.

Notes

1. Joerg Zimmerman resigned from CC due to other obligations.

2. Kori Anne Bagrowski interested in joining the CC. President of Westridge Garden Club.

3. Tip of the Month (Megan) – planning for fall planting. 7/14, 8/4, 8/18 are deadlines to get into the next Town newsletters.

4. What’s Blooming Now (Nona)– coyote mint article.

5. Biocide Committee (Sarah, Nona, Chris, Eliza) – Met with Scott Weber, PW, to understand how PVConnect works for dead animals. Few people use it. More people contact the Humane Society directly. No report of sick animals from PVConnect. Investigating if we have a rodenticide problem or not. Animals are not being tested. Considering a webpage submission form. Doing Kudos for PW for IPM, posted in June. Response time for PVConnect is quick, checked daily - Scott calls the correct numbers and checks back. PVConnect app is not supported anymore, only the website version. Town is launching OpenGov software in a few months. TM recommends CC promote contacting Peninsula Humane Society directly instead of the Town for dead and sick animals. PV Website updated about Peninsula Humane Society (bats, sick animals, dead animals). Limit reports to Scott that are only relevant to the PW. PHS comes to events at PV such as Town Picnic.

How do we get animals tested? PHS doesn’t take pictures. CC should call PHS to attend the Town Picnic.

6. Wildlife friendly fencing, wildlife corridor, habitat preservation – distinguish between existing and new/major remodel; critical to CC mission. Westridge CCRs have different requirements (ADUs can’t be 4 feet from the street in Westridge.). Concern about divided rules for parts of the Town.

Can’t make retroactive ordinances to existing properties. Need a vigorous educational project to let existing properties know what fencing and habitat preservation are preferred. CC needs backing and support of TC, needs to partner with TC and staff. Process for new ordinances needs more detailing. More details in priority setting will be needed in January 2027. Concerns from public about ignoring wildlife. CC could start mapping corridors. CC could put out more PSAs, publications, education, and do events during Wildlife awareness month about habitat preservation and wildlife corridors.

7. Site reviews and landscaping plans – CC involvement not included in a recent remodel/landscaping – hillside removed, 3 flat levels with artificial grass, pool. No ordinance for artificial lawns. Another remodel change – driveway changed with nonnative hedge, not in the 66 plans that CC reviewed. CC needs a dialog with the town on responsibility of CC with respect to plans. Applicants for new houses with site development plans and ASCC plans currently only require landscape plan “if applicable”. Applicable requirements not well defined. CC sees all ASCC applications with landscaping. If a landscape plan is not being proposed, then the project is not reviewed by CC. Historically there were always landscaping plans. Should there be a requirement for new homes and major remodel to provide a landscaping plan? If a site is scraped, then there is a need for a landscaping plan. The ethos of the town is that properties should fit in. CC recommends more native plants and water-thrifty plants. Planners do check projects after they are finished to make sure that the project complies with the plans. Site development permits typically involve landscaping. Building permits don’t typically involve major staging areas or landscaping plans. Landscapes larger than 500 feet must be permitted due to WELO irrigation requirements.

Town enforcement does follow up with problem fencing that they have been notified about. CC laying the groundwork for future needs.

8. Town Picnic – Sept 19 – CC table planned, topics: biocide, wildlife corridors.

9. Collaboration with WASC – educational outreach with their board. CC available to help provide native vegetation expertise and accompany WASC on their site visits. Unpermitted tree removal project – compliance is to plant a tree 1 for 1 for those that were removed illegally. A property had not submitted an updated landscape plan to Town yet which means the CC has not had a chance to review the updates. Needs to happen before work proceeds on the site.

10. Large number of tree permits. Need to have a phone number and an email included with the plans.

11. Proposed Tree Removal document – Issue of the Town’s liability for CC’s role in defining risk for trees that are claimed to be dangerous. Applicants need to hire qualified Tree Risk Assessors if the reason for a tree removal is due to risk of danger. Climate change is having impacts on existing trees. Water conservation issues. CC makes recommendations. CC decided to withdraw plans for a new Tree Review document.

12. Next meeting August 4, 2026, at 5:30 PM.
67 TOWN OF PORTOLA VALLEY

LIAISON MEMO
TO: Mayor and Members of the Town Council
FROM: Vice Mayor Mary Hufty
DATE: July 22, 2026
RE: 07/13/2026 Geologic Safety Committee Liaison Memo

BACKGROUND
Attendance: Steve Ingebritsen, Simon Klemperer, Patricia MCCroy, Nan Shostak, Bob Wrucke Actions:

Subsidiary Body Teleconferencing Meeting Policy resolution No 2998-2026 was enthusiastically endorsed.

Hazards Subcommittee: In light of this week’s NOAA report, they discussed town notification of flood warnings, early preparation, sand bags, and messaging from Town Manager. Strain gages at Stanford Golf Course are being monitored by Steve. He responds pragmatically to those measurements, considering his creek side home. 2026 is a very high severity El Nino Year and we need to be proactive.

Discussed interaction with Emergency Preparedness. Local responses and citizen awareness are critical for timely corrections.

Safety Element Subcommittee: Has met with the Planner and have made brought forward to her their comments and suggestions on the Seismic and Geologic Hazard section. They are bringing those suggestion back to the full committee for review and approval. All were accepted and an additional suggested modification to Policy S-2.22 and 2.23. Those suggested changes were reviewed and approved, and the subcommittee was tasked with moving forward on them.

The accompanying maps on the Safety Element are out of date and inadequate to evaluate in this draft form. The committee is strong in its recommendation that the final maps be shown to this subcommittee as soon as possible as there are obvious errors that their collective expertise could easily asses and correct in an expeditious manner so, as to not incur increase expense, to not delay the process and to achieve the maximum clarity and risk reduction.

The committee is in complete support of the rest of the Safety Element.

New agenda items: A potential long-term goal of the committee was raised by Simon who is also on the Woodside Geologic Safety Committee, for a working group on the intersection of Zoning, Ordinances, and the General Plan Elements. Further clarity is desired on how the town of Portola Valley differentiates its seismic risk under the California Building Code or when significant remodels trigger new fault rupture investigations. This is thought of as an educating and clarifying effort that can be made and directed by the Committee with a scheduled full Committee meeting with input from Planning and Town Geologist.

There is a desire that the Geologic Safety Committee be consulted before approval at the Planning Commission level. Further discussion will be agendized. 68