Agenda packet — Economic Development Committee, July 26, 2023

Wednesday, July 26, 2023
City of Rialto
Council Chambers
150 S. Palm Ave.

Rialto, CA 92376
Rialto City Hall, Council Chambers, 150 S. Palm Ave. Rialto CA 92376 Economic Development Committee
Regular Meeting - Final
1 July 26, 2023Economic Development Committee Regular Meeting - Final

CALL TO ORDER

ROLL CALL

PUBLIC COMMENTS

REVIEW/APPROVAL OF MINUTES
Minutes for the June 28, 2023 EDC meeting will be presented at the next EDC meeting.

PRESENTATIONS
EDC-23-691 Archaea Energy - CNG Station Project
Archaea Energy CNG Station - EDC PresentationAttachments:

EDC-23-690 Newcastle Partners - Foothill Freeway Commerce Center Foothill Freeway Commerce Center - EDC PresentationAttachments:

REPORTS/DISCUSSION ITEMS
EDC-23-593 Draft Community Benefit Agreement Ordinance / Draft Professional Labor Agreement Ordinance
Community Benefits_DRAFT ORD.v4.docx
Rialto Project Labor Agreement Ordinance.docx
Attachments:

EDC-23-692 Alternatives for Financing Mitigation of Warehouse Impacts on the City Exhibt A - Draft Memorandum Re: Alternatives for Financing Mitigation of Warehouse Impacts on the CityAttachments:

UPCOMING MEETINGS/OTHER DISCUSSION ITEMS

ADJOURNMENT

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2 City of Rialto
Legislation Text
File #: EDC-23-691, Version: 1, Agenda #:

For the Economic Development Committee [July 26, 2023]
TO: Honorable Economic Development Committee Members
APPROVAL: Paul Gonzales, Community Development Manager
FROM: Daniel Casey, Senior Planner
Archaea Energy - CNG Station Project
DISCUSSION:

Archaea Energy, the applicant, is currently developing a Renewable Natural Gas (RNG) Plant on the Mid-Valley Landfill site. The concept includes capturing Methane (CH4) and Carbon Dioxide (CO2) emissions generated at the landfill and converting those emissions into RNG. Portions of the RNG will be transported directly to Archaea Energy’scustomers through local natural gas infrastructure, and the remaining RNG will be compressed at a planned Compressed Natural Gas (CNG) station and loaded onto trucks for transportation to nearby wholesale customers. Archaea Energy proposes to develop the CNG station on approximately 3.0 acres of land located on the south side of Casmalia Street directly across from the Mid-Valley Landfill site.

Features of the proposed development include:
· RNG pipeline from Mid-Valley Landfill to CNG station
· Four (4) CNG Dispensers
· Paving
· Landscaping
· Fencing
· Street Improvements
The proposed CNG station will require the approval of a Conditional Development Permit and a Precise Plan of Design by the Planning Commission. The applicant will also be required to submit the necessary environmental documentation, in accordance with the California Environmental Quality Act (CEQA).

Archaea Energy will conduct a presentation during the meeting, a copy of which is attached as Attachment No. 1.

RECOMMENDATION:

Staff recommends that the EDC review the proposal and provide general direction to the applicant City of Rialto Printed on 7/21/2023Page 1 of 2
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3 File #: EDC-23-691, Version: 1, Agenda #:

Staff recommends that the EDC review the proposal and provide general direction to the applicant and staff.

Attachments:

1. Archaea Energy CNG Station - EDC Presentation
City of Rialto Printed on 7/21/2023Page 2 of 2
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4 Renewable Energy Redefined
CNG Station Project
City of Rialto Planning Department
July 2023
5 Archaea at a Glance
2 One of the largest and fastest-growing renewable natural gas (“RNG”) producers in the U.S.  Focused on the end-to-end development of RNG facilities to transform waste emissions into low carbon fuel, with a primary focus on landfill gas (LFG) projects
 Industry-leading RNG portfolio, with 13 RNG facilities and 33 landfill gas to electric facilities (LFGTE)
 Technology-driven approach paired with gas processing expertise in order to achieve operational excellence, faster project timelines, and lower development costs
 Differentiated commercial strategy focused on long-term commercial partnerships that provide a multi-decade
decarbonization solution to displace fossil fuels
 More than 500 highly-skilled employees across the United States 46 RNG and landfill gas to electric (LFGTE)
facilities across the U.S.

RNG facility
Landfill gas to electric facility
Note: Facilities are owned through Archaea wholly-owned entities or joint ventures. Facilities include 13 facilities that produc e pipeline-quality RNG and 33 LFG to renewable electricity production facilities, including one non-operated facility and one facility that is currently not operational. 6 Landfill Gas to Energy Operations Support a More Sustainable, Circular Economy 3 RNG provides numerous environmental benefits by transforming naturally occurring waste into clean energy LFG-to-energy projects meaningfully
decarbonize the municipal solid waste
industry, the third largest source of
human-related methane emissions in
the U.S…
…resulting in significant decarbonization
benefits that will continue to grow as
more projects come online…
…while also meaningfully decarbonizing
the transportation sector…
…and existing natural gas infrastructure
by displacing fossil fuels…
…as RNG is used as a drop-in fuel
source to replace fossil natural gas and
decarbonize power intensive
infrastructure and processes.
1 3
5 Electricity
Heat Process
steam
2 4
Fossil
CH4
RNG
CH4
CH4
7 Environmental Benefits of an Archaea RNG Project
4 With an Archaea Energy facility, landfill emissions are turned into renewable energy instead of entering the atmosphere Landfill with no Gas Collection Landfill with Gas Collection, but no LFGTE or RNG Facility
Landfill with Gas Collection and
Archaea RNG Project
Methane (CH4) and CO2 are vented directly
to the atmosphere. CH4 and CO2 are captured and flared. CH4 is converted to CO2, which is less destructive to
the atmosphere. This approach captures up to
80% of the CH4, but it is not used beneficially.

CH4 and CO2 are captured and processed.

CH4 is upgraded into pipeline-quality RNG that
displaces fossil fuels. This approach captures
and beneficially uses over 90% of the CH4.

CO2 is burned, limiting the impact on this gas
on the atmosphere, and in line with state
regulations. Archaea is working on technology
to capture and sequester this CO2, further
reducing emissions.
8 Archaea Environmental and Social Impact
5 LFG-to-RNG production facilities
capture naturally occurring waste
emissions and repurpose them into
valuable, low carbon fuel that
displaces the use of non-renewable
resources to produce the same
amount of energy.

Capturing landfill emissions
prevents both malodorous and
hazardous air pollutants from
being emitted into nearby
communities, resulting in
improved overall wellbeing for
residents.

When LFG is converted into
RNG, various non-methane
organic compounds are
removed during gas treatment
and upgrading processes, which
reduces possible health risks
from these compounds.

RNG facilities support
neighboring industries
(construction, engineering,
equipment vendors, utilities)
while typically employing local
talent to run day-to-day
operations.

Repurpose waste
emissions into reliable fuel Improve local air quality Health & safety benefits Regional & nationwide economic benefits
LFG-to-RNG facilities produce considerable social and economic benefits while mitigating adverse environmental effects Source: EPA Landfill Methane Outreach Program (“LMOP”). 9 Mid-Valley Sanitary Landfill RNG Project and CNG Station 10 Project Overview – Operations, Benefits, and Impacts

71. Estimated using EPA’s LFGE Benefits Calculator.

This project is expected to deliver significant community benefits with little to no off-site impacts • Archaea Energy is currently developing a renewable natural gas (RNG) plant on-site at the Mid-Valley Sanitary Landfill, which is owned by San Bernadino County and operated by Athens Services. At the Archaea RNG plant, the gases that are collected from the decomposing waste in place at the landfill will be processed to remove any impurities and transformed into RNG, instead of being vented or flared into the atmosphere. • A portion of the RNG will then be transported through local natural gas infrastructure to our customers, including the University of California and other utilities and corporations looking to decarbonize their operations. The remaining RNG will be compressed on-site at the planned CNG station and loaded onto trucks for transportation to nearby wholesale customers. • Using EPA estimates, when operating at full capacity, the RNG facility is expected to have the same annual environmental benefits as the carbon sequestered by more than 650,000 acres of U.S. forests and provide enough renewable natural gas in one year to heat more than 16,000 homes1. • We’ll be hiring a handful of folks to operate the RNG facility and associated CNG station. These will be high-paying, blue-collar jobs with full benefits and a 401k and that don’t require a college degree. We aim to hire from the local community whenever we can. • Safety is at the core of everything we do. We have extensive plans in place to comply with all local, state, and federal laws to ensure the safety of the environment and the community during both the construction and operation of the plant. • We expect fewer than 5 truck entries and exits from the CNG station, which would be located adjacent to an existing truck stop and freeway, per day.

So, aside from a small increase in activity during the construction of the station, the community should notice very few, if any, off-site impacts from our operations.
11 RNG Project and CNG Station Project Location
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CNG Station Proposed Plan View Layout and Technical Specifications 9 • For this project, Archaea has partnered with
Fastech, a leading builder of CNG stations,
who has built hundreds of stations to date.
• The CNG station will consist of:
 Basic inlet filtration
 Two compressor system
- A single compressor is sufficient
for these flow rates, but a
second compressor is included
for redundancy.
 VFD rated motors and drives to control
the compressor flow rate
 Matrix panel to support up to four
trailer loading positions
 Traceable/certified transaction data
for trailer filling events
 A single site buffer storage tank (with
backpressure regulator flow, process
stability, etc.)
 A compressed air system for
Instrument Air connections
• The CNG station has been designed to
comply with all relevant conditions of the
nearby existing truck stop (landscaping,
color, noise, etc.).
13 Rialto CNG Station Rendering
10 14
Rialto CNG Station Rendering
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Rialto CNG Station Rendering
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Questions?
17 City of Rialto
Legislation Text
File #: EDC-23-690, Version: 1, Agenda #:

For the Economic Development Committee [July 26, 2023]
TO: Honorable Economic Development Committee Members
APPROVAL: Paul Gonzales, Community Development Manager FROM: Daniel Casey, Senior Planner
Newcastle Partners - Foothill Freeway Commerce Center
DISCUSSION:

Newcastle Partners, the applicant, proposes to develop three (3) commercial buildings with drive- through lanes on Planning Area 1 (2.63 acres) of the Pepper Avenue Specific Plan, and one (1) industrial warehouse building on Planning Area 10 (11.64 acres) of the Pepper Avenue Specific Plan.

The project site is located at the southeast corner of Pepper Avenue and the SR-210 Freeway.

Planning Area 1 is within the Community Commercial (CC) land use district of the Pepper Avenue Specific Plan and Planning Area 10 is within the Light Industrial (LI) land use district of the Pepper Avenue Specific Plan.

Features of the proposed development include:
· 226,731 square foot industrial warehouse building
· 3,915 square foot commercial building with drive-through lane · 3,000 square foot commercial building with drive-through lane · 2,190 square foot commercial building with drive-through lane · Parking
· Landscaping
· Concrete tilt-up screen walls
The applicant presented two (2) different proposals to the Economic Development Committee (EDC) on January 26, 2022. Both proposals included only industrial buildings. The first proposal consisted of three (3) industrial buildings and the second proposal consisted of one (1) larger industrial warehouse building. Discussions during the EDC meeting included consideration of splitting the larger industrial warehouse building into two (2) smaller industrial warehouse buildings and preserving commercial uses along the Pepper Avenue frontage.

Subsequently, the applicant filed various applications with the Planning Division in March 2022 to develop two (2) industrial warehouse buildings and to preserve approximately 2.63 acres of land along the Pepper Avenue frontage for future commercial uses. However, the applicant now seeks to discuss consideration of an alternate proposal to return to one (1) industrial warehouse building but City of Rialto Printed on 7/21/2023Page 1 of 2
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discuss consideration of an alternate proposal to return to one (1) industrial warehouse building but with the inclusion of three (3) commercial buildings along the Pepper Avenue frontage. The three (3) commercial buildings will likely accommodate restaurant and or coffee users.

The project will require the approval of a series of Conditional Development Permits and a Precise Plan of Design by the Planning Commission. The applicant will also be required to submit the necessary environmental documentation, in accordance with the California Environmental Quality Act (CEQA).

Newcastle Partners will conduct a presentation during the meeting, a copy of which is attached as Attachment No. 1.

RECOMMENDATION:

Staff recommends that the EDC review the proposal and provide comments to the applicant and staff.

Attachments:

1. Foothill Freeway Commerce Center - EDC Presentation
City of Rialto Printed on 7/21/2023Page 2 of 2
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19 July 2023 EDC MEETING

FOOTHILL FREEWAY COMMERCE CENTER
20 Agenda
02 NEWCASTLE | PARTNERS

INTRODUCTION

PROPOSED PROJECT

OVERVIEW/BACKGROUND

COMMUNITY BENEFITS
2 1 4
3 5

PROJECT TIMELINE

ECONOMIC IMPACT
21 Newcastle Partners, established in 1999, is a real estate firm specializing in the development and acquisition of institutional quality industrial and office properties. Newcastle Partners has developed 65 projects with a total square footage of over 9.5 million square feet and more than 350 acres throughout Southern California.

NEWCASTLE | PARTNERS

JACKSON SMITH
Partner

COURTNEY SMITH
Development Manager
03 22
The project site is 14.8 acres, east of N.

Pepper Ave. and south of State Route
210.

General Plan Land Use Designation:

Pepper Ave. Specific Plan
Pepper Ave Specific Plan Land Use
Designation: Community
Commercial/Light Industrial
04 FOOTHILL FREEWAY

COMMERCE CENTER

EXISTING SITE
23  Project attended EDC in January 2022 where project was being proposed as ONLY Industrial  Project incorporated feedback from EDC, revising site plan to include both commercial/retail and industrial land uses  Applicant formally submitted project with two industrial buildings and three retail buildings along frontage  Market changes and access restrictions have changed since original EDC which makes two building industrial scenario infeasible 05 PROJECT BACKGROUND
24 05

PROPOSED COMMERCIAL
Fast Food Drive-
Through
Fast Food Drive-
Through
Coffee
Freeway access & visibility
Increases sales tax capture by
increasing convenience for
northbound traffic
25 05

PROPOSED INDUSTRIAL
 Architectural enhancements –
glass and other materials to
enhance freeway/ street views.
 Site Walls - to screen views to
on-site uses
 Site Design – Locate truck
court facing south to screen
truck court
26 COMMUNITY BENEFITS
F O O T H I L L F R E E W A Y C O M M E R C E C E N T E R W I L L D I R E C T L Y I N V E S T :
$ 5 0 0
$ 1 5 0
$ 6 5 R E C U R R I N G

C I T Y R E V E N U E
10 T H O U S A N
D

D E V E L O P M E N T

I M P A C T

F U N D S

S A N B E R N A R D I N O

C I T Y U N I F I E D

S C H O O L D I S T R I C T

T H O U S A N
D

T H O U S A N
D
27 Permanent Jobs Construction Jobs Well Paying Jobs
The proposed project will
generate over 280
permanent, local well-paying
jobs.
>280
The proposed project will
generate over 151
construction jobs.>151
The proposed project will offer
employees competitive wages that
are higher than the average Rialto
household median income.
$25/hr

ECONOMIC IMPACT
11 28
12 PROJECT TIMELINE
Ground Breaking
Fall/Winter '25
Spring '24
Planning Commission
Hearing
 Industrial and Commercial will
be processed concurrently for
Planning Commission Approval
 Applicant proposes to rough
grade project with retail
building pads
29 13
QUESTIONS?
30 Let's
Connect
[email protected]
Email
951-582-9800
Phone
14 31
City of Rialto
Legislation Text
File #: EDC-23-593, Version: 1, Agenda #:

For Economic Development Committee July 26, 2023
TO: Honorable Economic Development Committee Members
APPROVED: Colby Cataldi, Director of Community Development FROM: Paul Gonzales, Community Development Manager
Draft Community Benefit Agreement Ordinance / Draft Professional Labor Agreement Ordinance

BACKGROUND
Community Benefit Agreement
Within the past six (6) months, the City has seen the inclusion of Community Benefit Agreements (CBAs) from developers in conjunction with their land development applications. A CBA is an agreement between a community organization or City with a developer or property owner for a new project. A CBA is an opportunity for a developer or landowner to work with the City to provide additional benefits to the community that match the City’spriorities, goals and objectives to improve its communities throughout the City.

The recently proposed CBA agreements have typically been submitted by industrial developers with proposals for large warehouse buildings near or beyond 300,000 square feet in size. The City does not currently have an application process for a CBA, but is currently evaluating the steps to develop a fair process to receive additional benefits for communities that may be impacted or affected by large scale projects.

Project Labor Agreement
Along with CBAs, the City has seen the increase for Project Labor Agreements (PLAs) with the local unions. A PLA is an agreement between a contractor or managing entity with a union or unions. The benefit of a PLA is the use of the agreement in hiring of local skilled union workers and will benefit the local work force and the community as a whole. The PLA sets wages, benefits, working conditions, and is for a set amount of time typically during the construction of a project. A typical project may be under construction for six (6) to nine (9) months, at which time the PLA agreement would be active.

ANALYSIS/DISCUSSION
The Rialto Municipal Code (RMC) does not currently have any regulations for Community Benefit Agreements or Project Labor Agreements. In order to address the more recently submitted CBAs and PLAs, draft ordinances were prepared with certain standards and criteria for each agreement. The draft ordinances are attached for the Economic Development Committee’s review and comments.

FINANCIAL IMPACT
None
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RECOMMENDATION
Staff recommends that the EDC receive the update and provide comments.

Attachments:

1. Draft Community Benefit Agreement Ordinance

2. Draft Professional Labor Agreement Ordinance
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ORDINANCE NO. ____

ORDINANCE NO. ____

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF RIALTO, CALIFORNIA ADDING CHAPTER 18.71 TO

THE RIALTO MUNICIPAL CODE TO PROVIDE FOR

COMMUNITY BENEFIT AGREEMENTS

WHEREAS, the City of Rialto (“City”) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, pursuant to its police powers derived under the California Constitution, Article XI, section 7, the City may make and enforce laws within its boundaries which promote the public health, morals, safety, or general welfare of the community, and are not in conflict with general laws; and
WHEREAS, the City recognizes the significant benefits to the community of development within the City and similarly recognizes the detriments t o the quality of life in the community arising from development impacts; and
WHEREAS, when a project is determined to have environmental impacts sufficient to require the preparation of an environmental impact report, the City desires to require the project applicant to enter into community benefits agreement; and WHEREAS, community benefits agreements provide local assistance and advantages that offset the development impacts created by land use projects.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF RIALTO ORDAINS AS FOLLOWS:

Section 1. The City Council hereby finds that all of the foregoing recitals and the staff report presented herewith are true and correct and are hereby incorporated and adopted as findings of the City Council as if fully set forth herein.

Section 2. This Ordinance is exempt from the requirements of the California Environmental Quality Act (“CEQA”) pursuant to State CEQA Guidelines because there is no possibility that this Ordinance or its implementation would have a significant negative effect on the environment. (14 Cal. Code Regs. § 15061(b)(3).) City staff shall cause a Notice of Exemption to be filed as authorized by CEQA and the State CEQA Guidelines.
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ORDINANCE NO. ____

Section 3. A new Chapter 18.71 entitled “Community Benefits Agreements,” is hereby added to the Rialto Municipal Code to read as follows:
“18.71 – COMMUNITY BENEFITS AGREEMENTS
Sections:

18.71.010 – Findings, intent and purpose.

The city council of the city finds and declares that:

A. This chapter implements the city’s commitment to
community engagement, promoting transparency and
accountability, and ensuring development projects in the city promote economic growth and prosperity for all residents.

B. Pursuant to its police power derived under the
California Constitution, Article XI, section 7, the city may enact and enforce laws within its boundaries which promote the public health, morals, safety, or general welfare of the community, and are not in conflict with general laws.

C. In Sheetz v. County of El Dorado , (2022) 84
Cal.App.5th 394, the California Court of Appeal upheld cities’ ability to adopt legislatively authorized fee programs that apply generally to new development.

D. The city has a vested interest in protecting the public health, safety, and general welfare.

E. Projects that require the preparation of an
environmental impact report (“EIR”) inherently create significant environmental impacts.

F. New development imposes social costs on t he
residents of the city through increased density and traffic, and the loss of open space and impairment of the viewscape.

G. Community benefit agreements can help ensure
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ORDINANCE NO. ____

more equitable development, enabling existing residents to benefit from new activit y and opportunities , and enable project applicants to contribute meaningful investments in the community that partially offset the social costs borne by the community as a result of development.

18.71.020 – Application of Community Benefit Agreements.

This chapter shall apply to any project that propose to change zoning, amend a Specific Plan, amend the General Plan, and projects with a minimum total building square footage of 100,000 square feet or for a project which an EIR will be prepared, pursuant to California Environmental Quality Act Guidelines §§15081 and 15081.5.

18.71.030 – Contents and form of community benefits agreement.

Persons subject to this Chapter must enter into a community benefits agreement that provides for investments in the community in a form approved by the city attorney, which may include provisions for:

A. Community enhancement contribution s, including
lump sum and/or annual contributions;
B. Project labor agreements governing hiring and labor
relations during project construction and business operations; C. Any other provision as may be considered necessary
or proper to further legitimate city interest or to enhance the public health, safety, and welfare.

D. The project labor agreement shall be in final form as approved by the city attorney.

18.71.040 – Amount of Required Benefit.
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ORDINANCE NO. ____

The amount of benefit pursuant to this chapter 18.71 to be provided by a project applicant shall be five (5) dollars a square foot for the total square footage of the building(s).
“Estimated Project Costs” shall mean all of the project applicant’s anticipated and reasonably estimated costs to be incurred up to receipt of a certificate of occupancy, a certificate of completion, or similar certification issued for the project by the city, including any costs and expenses estimated to be incurred to plan, design, engineer, finance, and construct the project.”
Section 4. If any section, subsection, subdivision, sentence, clause, phrase or portion of this ordinance is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, then such decision shall not affect the validity of the remaining portions of this ordinance. The City Council hereby declares it would have adopted this Ordinance and each section, subdivision, sentence, clause, phrase, or portion thereof, irrespective of the fact that one or more section, subsection, subdivision, sentence, clause, phrase, or portion thereof be declared invalid or unconstitutional.

Section 5. The City Clerk shall certify to the adoption of this ordinance and publish and post the ordinance in accordance with Government Code Section 36933. This ordinance shall take effect thirty (30) days after its date of adoption.

PASSED, APPROVED AND ADOPTED this ___ day of _____________ 2023.

_________________________________
DEBORAH ROBERTSON, Mayor
ATTEST:
_____________________________
BARBARA McGEE, City Clerk

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ORDINANCE NO. ____

APPROVED AS TO FORM:
_____________________________
ERIC S. VAIL, City Attorney
State of California )
County of San Bernardino )
City of Rialto )

I, Barbara McGee, City Clerk of the City of Rialto, do hereby certify that the foregoing Ordinance was introduced and first read on the ___ day of __________ 20 23, and had its second reading at the regular meeting of the Rialto City Council on the ___ day of _____________, 2023, and was passed by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

_________________________________
Barbara McGee, City Clerk
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28 ORDINANCE NO. XX

AN ORDINANCE OF THE CITY COUNCIL O F THE CITY
OF RIALTO CALIFORNIA ADDING CHAPTER 18.73 TO

THE RIALTO MUNICIPAL CODE TO PROVIDE FOR

PROJECT LABOR AGREEMENTS

WHEREAS, the City of Rialto (“City”) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, pursuant to its police powers derived under the California Constitution, Article XI, section 7, the City may enact and enforce laws within its boundaries which promote the public health, morals, safety, or general welfare of the community, and are not in conflict with general laws; and
WHEREAS, local, good-paying, union jobs can simultaneously address the dual crises of climate change and economic inequality; and
WHEREAS, pr oject labor agreements improve job quality and opportunity for local residents, ensure worker and community safety, and provide adequate workforce training for communities impacted by economic and environmental inequality; and WHEREAS, the City Council desires to require project applicants to enter into project labor agreements for any project for which an environmental impact report is required;

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF RIALTO ORDAINS AS FOLLOWS:

Section 2. This Ordinance is exempt from the requirements of the California Environmental Quality Act (“CEQA”) pursuant to State CEQA Guidelines because there is no possibility that this Ordinance or its implementation would have a significant negative effect on the environment. (14 Cal. Code Regs. § 15061(b)(3).) City staff shall cause a Notice of Exemption to be filed as authorized by CEQA and the State CEQA Guidelines. 39 1
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Section 3. A new Chapter 18.73 entitled “Project Labor Agreements,” is hereby added to the Rialto Municipal Code to read as follows:
“18.73 – PROJECT LABOR AGREEMENTS
Sections:

18.73.010 – Purpose.

A. Project labor agreements are the preferred tool to ensure that important proprietary goals of the City are achieved by having a guaranteed source of locally skilled union workers. Because union jobs on the whole pay better, have better benefits, and are safer than non-union jobs, project labor agreements reduce income inequality and promote worker safety.

B. Project labor agreements also advance the City’s interests of ensuring that unemployed and under-employed residents will receive employment opportunities within the City. Over the years, project labor agreements have proven to be an excellent mechanism to promote the hiring of unemployed and under-employed local residents. These agreements have proven their effectiveness in targeting construction employment and training opportunities to mitigate the harm caused by economic and environmental inequality.

C. Project labor agreements also advance the City’s interest of addressing environmental challenges in ways that create and maintain local quality jobs and build a stronger, fairer economy for residents impacted by adverse environmental impacts.

18.73.020 – Definitions.

For purposes of this Chapter 18.73, the following definitions shall apply:
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“Covered Project” means any project for which an environmental impact report will be prepared, pursuant to California Environmental Quality Act (“CEQA”) Guidelines §§15081, 15081.5. Notwithstanding the foregoing sentence, “Covered Project” does not include any public work or improvement projects undertaken by the City. “Covered Project” also does not include any project where the application of a project labor agreement would violate the conditions of a state, federal, or other public funding source.
“Project Labor Agreement” shall mean a pre -hire collective bargaining agreement with one (1) or more labor organizations that establishes terms and conditions of employment for a covered project. “Contractor” shall mean a person entering into or performing a covered project.
“Subcontractor” means any person, firm, partnership, owner-operator, limited liability company, corporation, joint venture , proprietorship, trust, association, or other entity providing services to a Contractor or other Subcontractor in fulfillment of the Contractor’s or other Subcontractor’s obligations arising from construction work on a Covered Project. “Union” means each collective labor organization representing each of the crafts or trades necessary for the construction of a Covered Project and their respective affiliated local unions.
“Local Resident” shall mean an individual whose primary place of residence is within the City.

18.73.030 – Application of Project Labor Agreements.

This chapter shall apply to any project for which an environmental impact report will be prepared, pursuant to CEQA Guidelines §§15081 and 15081.5. The requirement shall be set forth as a condition of approval of any entitlement granted in connection with a project application for a 41 1
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covered project stating that the contractors and subcontractors at all tiers, shall be required to sign an agreement to be bound and to enter into a project labor agreement. The project applicant and the general contractor shall execute a master project labor agreement which shall govern its work on the construction of the covered project according to its terms. Nothing in this provision shall impact or otherwise impair the terms of any existing Project Labor Agreement.

18.73.040 – Required Provisions and Form.

Unless the city council, by majority vote, determines otherwise, a project labor agreement for all covered projects shall contain the following provisions:

A. The project labor agreement shall be binding on all contractors and subcontractors at all tiers;
B. The contractor shall require all subcontractors, at all tiers, as a condition of working on the covered project, to become parties to the project labor agreement;
C. The project labor agreement shall guarantee against work stoppages, strikes, lockouts, and similar disruptions of the project; D. The Union and its members shall continue work on the covered project despite the expiration of the applicable collective bargaining agreements;
E. All contractors and subcontractors shall recognize the Union as the exclusive bargaining representative of the workers employed on the covered project;
F. All contractors and subcontractors shall use the Union hiring hall procedures for satisfying project needs on the covered project; G. The project labor agreement shall require use of the “Helmets to Hardhats” program to assist returning veterans in obtaining 42 1
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employment and training opportunities on the covered project; H. The wages and benefits of the craft employees performing work on the covered project shall be governed by the collective bargaining agreement of the Union traditionally recognized as the bargaining representative of the craft(s) in question;
I. Prohibition of discrimination based on race, national origin, religion, sexual orientation, political affiliation or membership in a labor organization in hiring or dispatching workers for the project; and J. The project labor agreement shall include local hire provisions, targeted hire of low-income or disadvantaged workers, and the creation of pre-apprenticeship pathways for careers on the covered project.

K. The project labor agreement shall be in final form as approved by the city attorney.

18.73.050 – No Conflict with Federal or State Law.

Nothing in this Chapter 18.73 shall be interpreted or applied so as to create any requirement, power, or duty in conflict with any federal or state law.”
Section 4. If any section, subsection, subdivision, sentence, clause, phrase or portion of this ordinance is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, then such decision shall not affect the validity of the remaining portions of this ordinance. The City Council hereby declares it would have adopted this Ordinance and each section, subdivision, sentence, clause, phrase, or portion thereof, irrespective of the fact that one or more section, subsection , subdivision, sentence, clause, phrase, or portion thereof be declared invalid or unconstitutional.

PASSED, APPROVED AND ADOPTED this ____ day of _______, 2023.

__________________________________
DEBORAH ROBERTSON, Mayor
ATTEST:
________________________________
BARBARA McGEE, City Clerk

APPROVED AS TO FORM:
________________________________
ERIC S. VAIL, City Attorney
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28 STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO ) ss

CITY OF RIALTO )
I, Barbara McGee, City Clerk of the City of Rialto, do hereby certify that the foregoing Ordinance No. __________ was duly passed and adopted at a regular meeting of the City Council of the City of Rialto held on the ________ day of _____________________, 2023.

Upon motion of Councilmember ___________________, seconded by Councilmember ____________________, the foregoing Ordinance No. _________ was duly passed and adopted.

Vote on the Motion:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and the Official Seal of the City of Rialto, this _____ day of _______________, 2023.
____________________________________
Barbara A. McGee, City Clerk
45 City of Rialto
Legislation Text
File #: EDC-23-692, Version: 1, Agenda #:

For Economic Development Committee [July 26, 2023]
TO: Honorable Economic Development Committee Members
APPROVAL: Arron Brown, Acting City Manager
FROM: Eric S. Vail, City Attorney
Robert F. Messinger, Deputy City Attorney
Alternatives for Financing Mitigation of Warehouse Impacts on the City

BACKGROUND
The City Council directed the City Attorney to prepare a memorandum discussing the alternatives for financing mitigation of warehouse impacts on the City. Attached to this report is a draft memorandum discussing such alternatives. The City Attorney is presenting the draft memorandum to the Economic Development Committee to request input prior to presenting the memorandum to the entire City Council.

FINANCIAL IMPACT
Any financial impact is indeterminate until such time as an alternative strategy is adopted.

RECOMMENDATION
City Attorney recommends that the EDC review the draft memorandum, discuss and provide input to legal staff.

Exhibit:

A. Draft Memorandum Re Alternatives for Financing Mitigation of Warehouse Impacts on the City.

City of Rialto Printed on 7/21/2023Page 1 of 1
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46 Los Angeles – Inland Empire – Marin County – Oakland – Orange County – Palm Desert – San Francisco – Silicon Valley – Ventura County DRAFT

M E M O R A N D U M
TO: Honorable Mayor and Members of the City Council
FROM: Eric S. Vail, City Attorney
Robert F. Messinger, Deputy City Attorney
FILE NO.: 08747-0009
DATE: July __, 2023
RE: Alternatives for Financing Mitigation of Warehouse Impacts on the City

RECOMMENDATION:

Receive report on alternative tax measures to finance additional public services and infrastructure repair and replacement arising from logistics operations with the City of Rialto, and provide direction to staff.

BACKGROUND:

The proliferation of logistics warehousing within the City of Rialto (“City”) has had significant impacts on the City’s infrastructure and public services, including truck traffic enforcement. The City has 31.2 million square feet of existing warehouse space and an additional 2.6 million either planned or approved. The result is 23,000 daily truck trips within the City. 1 Moreover, t he Inland Empire region’s geography coupled with the combined emissions of diesel t rucks, trains and planes have resulted in the Riverside - San Bernardino-Ontario area having the worst air quality in the United States as of 20192.

The generation of additional revenue to pay the costs of both the necessary ongoing services, and the repair and replacement of infrastructure, may be accomplished through the imposition of a tax.

DISCUSSION:

There are three methods of taxation to generate revenue that may be used for financing services and/or improvements needed as a result of impacts on the City arising from the proliferation of logistics operations located within the City. The three methods are a parcel tax, a Mello -Roos Community Facilities District special tax, and a business license tax.

All three types of taxes may be apportioned on the basis of the number of loading docks at the property or business that is subject to the tax. A comparison table is attached hereto as Exhibit A. The amount of revenue that may be generated by any of the three alternative taxes is dependent on the method of apportioning the tax and the rate of the

1 A Region in Crisis: The Rationale for a Public Health State of Emergency in the Inland Empire, January 2023, Robert Redford Conservancy for Southern California Sustainability, Pitzer College.

2 U.S. Environmental Protection Agency, Air Quality Index Report, 2019.

47 Honorable Mayor and Members of the City Council
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tax, both factors that will be determined by the City Council and cal culated by a special tax consultant.

Parcel Tax
Parcel taxes are authorized under the California Constitution, Article XIII, Section 4, and they require a two-thirds (66.67%) vote for approval. Parcel tax revenues can be used for any type of spending, including construction costs, employee salaries, and other projects or spending needs. Because a parcel tax is a special tax, the specific uses of the tax must be specified and the revenues limited to use for such purposes.

Parcel taxes are typically a flat amount based on the type of use on the parcel subject to the tax, such as residential, commercial, industrial. A parcel tax may also be apportioned on the basis of square feet of building space or the number loading docks at a warehouse.

Furthermore, a pa rcel tax may be structured to apply only to parcels zoned for specific uses, such as industrial uses, including warehousing and logisitics. The parcels that will be subjected to a parcel tax is a determination made by the City Council. The property owners are responsible for paying a parcel tax although it may be passed through to a tenant subject to appropriate lease provisions.

An election on a parcel tax measure is of the registered voters within the City and may be held either by a mail ballot election or a regular election. The mail ballot election date for 2023 on which a parcel tax measure may be conducted is the last Tuesday in August, 29, 2023. Alternatively, the regular established election date for 2023 is November 7, 2023.

Mello-Roos Community Facilities District Special Tax
Mello-Roos special taxes are authorized under the Mello-Roos Community Facilities Act of 1982, Government Code section 53311, et seq., and they require a two-thirds (66.67%) vote for approval. Mello -Roos tax revenues can be used for a wide variety of services, including police, fire, recreation, library, and street and road maintenance; and to finance acquisition and construction of any tangible property with an estimated useful life of five years or longer. Mello-Roos taxes are special taxes, and therefore, the use of the revenue must be specified and the revenues restricted to such uses.

Mello-Roos taxes are typically structured on the basis of density of development, square footage of construction, or flat acreage charges. The requirement is that the method of apportionment be based on a reasonable basis as determined by the City Council.

Therefore, a Mello-Roos tax may also be apportioned on the basis of the number of loading docks at an industrial building. Furthermore, a Mello-Roos community facilities district may be created to include only parcels zoned for specific uses, such as industrial uses, including as warehousing and logisitics. Similar to a parcel tax, it is at the City Council’s discretion to determine the parcels and uses that will be subject to the tax. As 48 Honorable Mayor and Members of the City Council
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with a parcel tax, the property owners are responsible for paying a parcel tax although it may be passed through to a tenant subject to appropriate lease provisions.

Prior to setting and conducting an election for a Mello -Roos tax, a noticed hearing must be held on the proposed district to provide for protests against the establishment of the district, the extent of the dis trict, or the furnishing of specified types of public facilities or services. If no majority protest occurs, the City Council may then adopt a resolution of formation and submit the levy of the special tax to the voters in the next general election, or in a special election to be held at least 90 days, but not more than 180 days, following the adoption of the resolution of formation. The election may be conducted by mail ballot.

If the tax will apply to existing parcels with warehouse uses, the election w ill be of the registered voters within the City. If only new warehouse development will be subject to the tax, the election may be of either the registered voters or the landowners.

Business License Tax
Business license taxes imposed to raise revenue are authorized under California Government Code section 37101, and they require a majority (50% +1) vote for approval.

A business license tax is a general tax and its receipts are general revenues and may be used for any type of spending, including construction costs, employee salaries, and other projects or spending needs. Accordingly, a business license tax may not be characterized as being specifically for a limited purpose or it may be deemed a special tax and require two-thirds voter approval.

Business license taxes may be imposed as a flat amount based on gross receipts .

However, business license taxes may also be apportioned on the basis of the number of square feet of gross floor area of building space devoted primarily to distribution center use; or a business license tax may be apportioned based on the number of truck docks at a logistics or distribution business. Because the City already has a generally applicable business license tax ordinance, a business license tax applied to logistics businesse s or distribution centers would be drafted in the form of an amendment to the existing ordinance.

An election on a business license tax measure is of the registered voters within the City and may be held either by a mail ballot election or a regular election. The mail ballot election date for 2023 on which a parcel tax election may be conducted is the last Tuesday in August, which is August 29, 2023. Alternatively, the election may be held on the regular established election date for 2023 which is November 7, 2023. However, in either case, placing a measure on the ballot in 2023 would require a unanimous vote of the City Council that the placement of the tax on the ballot is an emergency. Otherwise, a general tax must be consolidated with a regularly scheduled general election for members of the City Council, which will next occur in 2024. (Cal. Const. Art. XIII, Sec. 2.) 49 Honorable Mayor and Members of the City Council
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CONCLUSION:

There are three types of taxes the City Council may select from to place on the ballot for the purpose of raising revenue to finance services and/or improvements relating to the impacts of logistics operations within the City. All three types —parcel tax, Mello -Roos tax, and business license tax —may be used for both services and improvements. The three tax types may all be apportioned on the basis of number of truck docks or some other reasonable basis.

All three types may be presented to the voters through a mail ballot election. The parcel tax and the Mello-Roos taxes are subject to a 2/3rds approval vote. The business license tax is subject to a majority approval vote. The parcel tax may be placed on the ballot for August 29, 2023, as a mail ballot election or on November 7, 2023 as a regular election.

The Mello-Roos tax may be placed on the ballot for an election held not less than 90 days nor more than 180 days after adoption of a resolution of formation, as a mail ballot election, or on November 7, 2023, as a regular election. The business license ta x may be placed on the ballot for August 29, 2023, as a mail ballot election or on November 7, 2023, as a regular election, subject to a unanimous City Council vote that the placement on the ballot in 2023 is an emergency. Otherwise, the tax must be consolidated with a regularly scheduled general election for members of the City Council.

50 EXHIBIT A

TAX TYPE COMPARISON

TYPE PARCEL TAX MELLO-ROOS BUSINESS LICENSE
TAX
General or Special Special Special General
Approval Vote 2/3 2/3 Majority
Eligible Voters Registered
voters
Registered
voters/landowners*
Registered voters
Use for Services Yes Yes Yes
Use for
Improvements
Yes Yes Yes
Apportion on basis of
loading dock number
Yes Yes Yes
Regular Election
Date
11/7/23 11/7/23 11/7/23**
Mail Ballot Elec. Date 8/29/23 90-180 days after
Formation Resolution
8/29/23**

* Eligible voters are the City’s registered voters if existing warehouse parcels are subject to the tax; eligible voters may be landowners is only new warehouse development will be subject to the tax.

** Requires a unanimous City Council vote that the placement on the ballot in 2023 is an emergency.

Economic Development CommitteeJuly 26, 2023

Economic Development Committee
July 26, 2023