Agenda, regular meeting — San Bruno City Council, June 13, 2023 (part 1 of 2)

"The City With a Heart"
Rico E. Medina, Mayor
Tom Hamilton, Vice Mayor
Sandy Alvarez, Councilmember, District 1
Marty Medina, Councilmember, District 4
Michael Salazar, Councilmember
AGENDA
SAN BRUNO CITY COUNCIL REGULAR MEETING
June 13, 2023
7:00 PM
City Councilmembers and members of the public may attend in person at the San Bruno Senior Center, or by teleconference, via Zoom or telephone.

IN PERSON* MEETING LOCATION
San Bruno Senior Center
1555 Crystal Springs Road
San Bruno, CA 94066
*Please turn off all electronic devices before the start of the meeting to prevent disruptions*
Zoom Link
https://sanbrunocagov.zoom.us/j/86547051882?
pwd=Z1JlcjVhdWNYNXJDZUhLVE9EcS9Jdz09
Phone Line: 16465588656
Webinar ID: 865 4705 1882
Webinar Password: 975803
PUBLIC COMMENT: In person attendees who want to provide public comment, will be asked to fill out a speaker card and turn it into the City Clerk. Virtual attendees can comment by using the “Raise Hand” feature in Zoom to request to speak. For dialin comments press *9 to “Raise Hand” and *6 to unmute. Public comment may also be emailed to [email protected] . Comments received via email will not be read aloud during the meeting.

ACCESSIBILITY: In compliance with the Americans with Disabilities Act, individuals requiring special accommodations or modifications to participate in this meeting should contact the City Clerk’s Office 48 hours prior to the meeting at (650) 6167061 or [email protected] .
*Any disclosable public writings related to an open session item on a regular meeting agenda and distributed by the City to at least a majority of the City Council less than 72 hours prior to that meeting are available for public inspection at the City Clerk's Office at City Hall located at 567 El Camino Real, San Bruno, California during normal business hours. In addition, the City may also post such documents on the City’s Website at sanbruno.ca.gov/AgendaCenter .

1. CALL TO ORDER

2. ROLL CALL

3. PLEDGE OF ALLEGIANCE

4. PUBLIC COMMENTS FOR ITEMS NOT ON THE AGENDA
Individuals allowed three minutes. It is the Council’s policy to refer matters raised in this forum to staff for investigation and/or action where appropriate. The Brown Act prohibits the Council from discussing or acting upon any matter not agendized pursuant to State Law.

5. ANNOUNCEMENTS/PRESENTATIONS
Public comment will be requested after each topic in this section a. Issue Proclamation Declaring June 1824, 2023 National Mosquito Control Awareness Week b. Issue Proclamation in Recognition of Juneteenth as National Freedom Day

6. CONSENT CALENDAR
All items are considered routine or implement an earlier Council action and may be enacted by one motion; there will be no separate discussion, unless requested. There will be a single public comment period for all items in this section unless a Councilmember requests to pull an item for a separate vote. a. Approve the Draft Special Meeting Minutes for the Meetings of June 3, 2023 b. Approve Accounts Payable for May 22, 2023, May 30, 2023 and June 5, 2023 c. Accept Payroll for May 21, 2023
d. Approve Investment Report Dated April 30, 2023
e. Consider Adoption of a Resolution Adopting a List of Projects for Fiscal Year 202324 Funded by SB1: The Road Repair and Accountability Act of 2017
f. Consider Adoption of a Resolution Authorizing Purchase of Water Well Equipment From MISCOwater in the Amount of $136,346
g. Consider Adoption of a Resolution Authorizing the City Manager to Execute a FiveYear Contract With Flowers Electric and Service Co., Inc. to Provide Streetlight Maintenance and Electrical Repair Services in an Amount Not to Exceed $60,000 for Fiscal Year 202324 h. Consider Adopting Resolution Granting Fireworks Stand Permits for 2023 i. Consider Adoption of a Resolution:
• Authorizing the City Manager to Execute an Agreement With the County of San Mateo Accepting $100,000 From the Small Business PostPandemic Recovery Grant Program • Allocating $100,000 to Develop and Administer a Small Business Grant Program for Fund Distribution to Eligible Local San Bruno Small Businesses in Fiscal Year 202324 j. Consider Adoption of a Resolution Granting Consent to the City of Burlingame to Form the San Francisco Peninsula Tourism Marketing District (SFPTMD) and Include the City of San Bruno k. Consider Adoption of a Resolution Authorizing the City Manager to Amend the Agreement With Callander and Associates Landscape Architecture for Additional Design Services With a Third Amendment for Centennial Park in an Amount Not to Exceed $17,250, and Approving a Budget Amendment for the FY 202223 Operating Budget to Appropriate $17,250 From the Citywide Development Impact Fees Fund to the Community Facilities Impact Fee Fund

7. PUBLIC HEARING(S)
Public comment will be requested after each topic in this section a. Hold Public Hearing and Consider Adoption of a Resolution Approving the Proposed Increase to Wastewater (Sewer) Rates for FY 202324 Through 202728 b. Hold Public Hearing and Consider Adoption of a Resolution Approving the Fiscal Year 202324 Rates for Solid Waste Collection Services With Recology San Bruno and Approve an Amendment to the Solid Waste Collection Services Agreement Between the City of San Bruno and Recology San Bruno to Incorporate a Street Sweeping and Catch Basin Collection Fee c. Hold Public Hearing and Adopt a Resolution Approving the Master Fee Schedule for Fiscal Year 202324

8. CONDUCT OF BUSINESS
Public comment will be requested after each topic in this section a. Receive Report on the Fiscal Year 202324 San Bruno Community Foundation Operating Budget
b. Consider Introducing, Reading by Title Only, and Waiving Further Reading of an Ordinance Amending Title 10 of Chapter 10.08 of the San Bruno Municipal Code to Provide for the Collection of Sewer Service Charges on the San Mateo County Tax Roll

9. COUNCIL COMMITTEE REPORT OUT
Public comment will be requested after each topic in this section

10. COMMENTS FROM COUNCIL MEMBERS
Public comment will be requested after each topic in this section a. Rico Medina:

On June 1, 2023, We Had a Gathering in Front of City Hall and Raised the Progress Pride Flag and a Proclamation Was Issued Declaring June 2023 as Pride Month in the City of San Bruno.

11. CLOSED SESSION
a. CONFERENCE WITH LABOR NEGOTIATORS
Agency Designated Representatives: Mayor Rico E. Medina and Councilmember Michael Salazar
Unrepresented Employee: City Manager

12. ADJOURNMENT – The Next Regular City Council Meeting Will be Held on June 27, 2023 at 7:00 P.M.

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1. CALL TO ORDER

2. ROLL CALL

3. PLEDGE OF ALLEGIANCE

9. COUNCIL COMMITTEE REPORT OUT
Public comment will be requested after each topic in this section

10. COMMENTS FROM COUNCIL MEMBERS
Public comment will be requested after each topic in this section a. Rico Medina:

On June 1, 2023, We Had a Gathering in Front of City Hall and Raised the Progress Pride Flag and a Proclamation Was Issued Declaring June 2023 as Pride Month in the City of San Bruno.

11. CLOSED SESSION
a. CONFERENCE WITH LABOR NEGOTIATORS
Agency Designated Representatives: Mayor Rico E. Medina and Councilmember Michael Salazar
Unrepresented Employee: City Manager

12. ADJOURNMENT – The Next Regular City Council Meeting Will be Held on June 27, 2023 at 7:00 P.M.

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1. CALL TO ORDER

2. ROLL CALL

3. PLEDGE OF ALLEGIANCE

9. COUNCIL COMMITTEE REPORT OUT
Public comment will be requested after each topic in this section

10. COMMENTS FROM COUNCIL MEMBERS
Public comment will be requested after each topic in this section a. Rico Medina:

On June 1, 2023, We Had a Gathering in Front of City Hall and Raised the Progress Pride Flag and a Proclamation Was Issued Declaring June 2023 as Pride Month in the City of San Bruno.

11. CLOSED SESSION
a. CONFERENCE WITH LABOR NEGOTIATORS
Agency Designated Representatives: Mayor Rico E. Medina and Councilmember Michael Salazar
Unrepresented Employee: City Manager

12. ADJOURNMENT – The Next Regular City Council Meeting Will be Held on June 27, 2023 at 7:00 P.M.

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"The City With a Heart"
Rico E. Medina, Mayor
Tom Hamilton, Vice Mayor
Sandy Alvarez, Councilmember, District 1
Marty Medina, Councilmember, District 4
Michael Salazar, Councilmember

MINUTES

SAN BRUNO CITY COUNCIL SPECIAL MEETING
June 3, 2023
8:30 AM

1. CALL TO ORDER
The meeting was called to order at 8:30 a.m.

2. ROLL CALL
Councilmembers Alvarez, M. Medina, Salazar, Vice Mayor Hamilton, and Mayor R. Medina were all present.

3. PUBLIC COMMENTS FOR ITEMS NOT ON THE AGENDA
No members of the public wished to speak under Public Comment.

4. CLOSED SESSION
a. PUBLIC EMPLOYEE APPOINTMENT PURSUANT TO GOVERNMENT
CODE SECTION 54957
Title: City Manager
No members of the public wished to speak on this item.

There was no reportable action taken.

10. ADJOURNMENT
This meeting adjourned at 3:06 p.m. The next Regular City Council Meeting will be held on Tuesday, June 13, 2023 at 7:00 p.m.

These City Council meeting minutes were prepared by Lupita Huerta, City Clerk, and presented to the City Council for approval at the regular meeting of June 13, 2023.

Lupita Huerta
City Clerk
Rico E. Medina
Mayor

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DocuSign Envelope ID: 9F50AB3F-483C-4BBD-99EB-A0DF2D1D5EAE 6/6/2023

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DocuSign Envelope ID: 9F50AB3F-483C-4BBD-99EB-A0DF2D1D5EAE

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DocuSign Envelope ID: 9F50AB3F-483C-4BBD-99EB-A0DF2D1D5EAE

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO

DATE: June 13, 2023

TO: Honorable Mayor and Members of the City Council

FROM: Alex D. McIntyre, Interim City Manager

PREPARED BY: Anh Tran, Management Analyst II

SUBJECT: Payroll Acceptance

City Council acceptance of the City payroll distributed May 26, 2023 is recommended.

The Labor Summary report reflecting the total payroll amount of $1,837,508.38 for bi- weekly pay period ending May 21, 2023 by fund is shown below:

Fund Amount

Fund: 001 - GENERAL FUND 1,317,299.18
Fund: 002 - GENERAL FUND RESERVE 4,489.00
Fund: 006 - AMERICAN RESCUE PLAN ACT 72,081.98
Fund: 121 - FEDERAL/STATE GRANTS 18,834.19
Fund: 122 - SOLID WASTE/RECYCLE 254.77
Fund: 132 - AGENCY ON AGING 818.14
Fund: 137 - DEVELOPER PROJECT CONTRIBUTIONS 8,429.78
Fund: 201 - PARKS AND FACILITIES CAPITAL 431.77
Fund: 203 - STREET IMPROVE. PROJECTS 10,095.17
Fund: 207 - TECHNOLOGY CAPITAL 3,813.82
Fund: 611 - WATER FUND 104,344.38
Fund: 621 - STORMWATER FUND 30,239.71
Fund: 631 - WASTEWATER FUND 100,839.62
Fund: 641 - CITYNET SERVICES FUND 88,755.24
Fund: 701 - CENTRAL GARAGE 15,753.42
Fund: 702 - FACILITY MAINT.FUND 37,474.41
Fund: 707 - TECHNOLOGY DEVELOPMENT 18,283.70
Fund: 711 - SELF INSURANCE 5,270.10
Total: 1,837,508.38

_________________________________
Bobby Magee, Interim Finance Director Date DocuSign Envelope ID: 8DED0CAC-9C6C-4DBE-8285-34A6F6FBBE39 5/29/2023

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO

DATE: June 13, 2023

TO: Honorable Mayor and Members of the City Council

FROM: Alex D. McIntyre, Interim City Manager

PREPARED BY: Matthew Lee, P.E., Public Works Director

SUBJECT: Consider Adoption of a Resolution Adopting a List of Projects for Fiscal Year 2023-24 Funded by SB1: The Road Repair and Accountability Act of 2017

BACKGROUND:

The City of San Bruno’s (City) Capital Improvement Program (CIP) includes the Pavement Management Program (PMP) to repair and apply preventative maintenance treatment to local, collector, and arterial streets. The PMP provides an ongoing condition assessment of City streets and recommends the streets to be selected for rehabilitation to cost effectively maximize pavement longevity. Street condition is measured in terms of pavement condition index (PCI), a numerical index between 0 and 100 in which 0 represents a failed street and 100 represents a newly repaved street. The City maintains approximately 89 miles of streets and the City has a current average PCI score of 60.

Similar to other cities throughout the Bay Area, the City utilizes the Metropolitan Transportation Commission’s (MTC) Streetsaver program to serve as a database for tracking the condition of streets throughout the City and to recommend streets to be selected for pavement maintenance. Streetsaver analyzes the pavement lifecycle of each individual street in order to select the appropriate treatment to apply. While the Streetsaver prioritization methodology maximizes the City’s average PCI for the entire network, it also defers maintenance for those streets that are in the worst shape due to insufficient PMP funding.

The CIP budget allocated for the PMP is being supplemented by funding provided to the City by the passage of Senate Bill 1 (SB1) also referred to as the Road Repair and Accountability Act of 2017. SB1 created the Road Maintenance and Rehabilitation Account (RMRA) and increased the fuel excise taxes and vehicle registration fees in order to fund road maintenance and rehabilitation projects on local streets and roads systems. The State began collection on this new funding source on November 1, 2017. For the upcoming Fiscal Year 2023-24, the City is projected to receive an estimated $1,088,061 of SB1 funding.

The 2018 California Statewide Local Streets and Roads Needs Assessment found that the City streets and roads are in an “at-risk” condition (PCI 50-69) and this revenue will contribute towards the maintaining of the roadway network within the City.

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Honorable Mayor and Members of the City Council
June 13, 2023

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In an effort to facilitate accountability and transparency within SB1 and prior to receiving funding from the State, each local agency is required to submit to the California Transportation Commission (CTC) a list of projects proposed to be funded with the SB1 funds and adopt those projects by resolution at a regular public meeting. This project list and resolution adopting those projects must be submitted to the CTC for approval by July 1, 2023, in order to receive SB1 funding for the upcoming fiscal year. In September 2017, rather than continuing to defer maintenance on failed streets the City Council recommended that this new funding source be utilized to perform reconstruction on some of the City’s worst streets to reduce the deferred maintenance backlog. Selection of the street segment to receive reconstruction was made by prioritizing the street rehabilitations at locations that would provide the most benefit to City residents.

The design of the 2021-22 Slurry Seal Project, funded by Measures A, G, and W funds, was recently completed and construction awarded in May 2023. Construction is anticipated to begin in Summer 2023 and complete during the Fall/Winter 2023. Two additional pavement projects are currently on an actively accelerated schedule for design completion this calendar year. The 2021-22 Street Reconstruction Project, funded by SB1, is estimated for design completion in Summer/Fall 2023 and construction to begin in Fall/Winter 2023. The 2022-23 Street Rehabilitation Project, funded by Measure A, G, and W funds, is scheduled for design completion in Summer 2023 and construction to begin in Fall/Winter 2023. Both construction timelines depend on weather conditions. Due to the complexity of the reconstruction project, additional design activities such as pot holing and surveying may result in a longer design schedule. Staff anticipates returning to City Council to request for authorization to award construction contracts for the two pavement projects in Summer/Fall 2023.

SB1 and Measures A, G, and W in the approximate amount of $16,800,000 are assisting the City with the planning, design and construction of pavement projects during fiscal years 2022-23 and 2023-24.

DISCUSSION:

In 2017, a City Council Subcommittee recommended a methodology for prioritizing and selecting street segments to receive rehabilitation utilizing SB1 funds. That methodology was developed by directing staff to prioritize the rehabilitation of streets in the worst condition and to use selection criteria such that the streets selected for reconstruction would provide the highest public benefit. Since the allocated funds are insufficient to reconstruct all the worst streets, an assessment was created to equitably determine which streets should be prioritized for reconstruction that would provide the most benefit to City residents. The evaluation considered the following factors: existing pavement condition, proximity to public parks, gathering places, schools, bus routes, multi-family residential (MFR) buildings with at least three units, and property density. Each street can receive up to ten possible points, with point breakdowns as shown in Table 1 below and the highest scoring streets being prioritized and recommended for reconstruction.

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Honorable Mayor and Members of the City Council
June 13, 2023

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Table 1 – SB1 Prioritization Point Breakdown

FACTOR POINTS
PCI 4 POINT MAX
MFR 2 POINT MAX
SCHOOL 1 POINT
PARK 1 POINT
GATHERING 1 POINT
BUS ROUTE 1 POINT

DENSITY TIEBREAKER

Streets in the worst shape with PCI 0-10 are allocated four points while streets in better shape with PCI 31-40 receive one point. A street that contains at least 25% MFR buildings is allocated two points while a street with at least one MFR building receives one point. Property density is calculated by dividing the pavement area by the number of properties on that street with the denser streets ranking higher. Property density is used as a tiebreaker for streets with the same point scores. For reference, PCI and density information are provided in Attachment 2.

Based on this selection methodology, the street segment listed in Table 2 is being recommended to be reconstructed utilizing funding from SB1 in Fiscal Year 2023-24. A total pavement area of 47,630 square feet of 1,900,000 square feet of pavement area listed in Attachment 2 is being recommended for treatment. The preliminary estimated project cost is approximately $1,080,000. For reference, the prioritization list for street reconstruction based on this selection methodology is provided in Attachment 2.

Table 2 – Project List for Fiscal Year 2023-24

STREET NAME BEGIN END PAVEMENT

AREA (SF)

ESTIMATED

PROJECT COST
SCENIC
COURT

PARKVIEW

DRIVE END
7,285 $ 190,000
LOMITA
AVENUE
LINDEN

AVENUE CITY LIMITS
15,840 $ 350,000

HAMILTON
AVENUE

CRESTMOOR
DRIVE

24,505 $ 540,000

ESTIMATED
TOTAL 47,630 $1,080,000

The reconstruction of the above listed street segments will be completed as part of the 2023-24 Street Reconstruction Project. Design on this project is anticipated to begin Fall / Winter 2023 with construction anticipated beginning in the Summer / Fall of 2024.

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June 13, 2023

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SB1 funds received for Fiscal Year 2022-23 are currently being used to fund the Pavement Evaluation Services on failed and near failed streets. This evaluation will determine if the streets are structurally failed by collecting core pavement samples and performing deflection testing. Additionally, the evaluation will develop design recommendations. Upon completion of the pavement evaluation, the City will be provided with a recommended pavement treatment that will allow the City to accurately budget and plan for the treatment of failed streets, some of which could potentially be addressed with a less expensive rehabilitation or resurfacing treatment. The evaluation is currently in progress and expected to be completed in Summer 2023.

Projects identified to received SB1 funds during the Fiscal Years 2018-19 through 2021-22 are currently in the design phase as part of the 2021-22 Street Reconstruction Project.

Pavement evaluation and analysis was completed in January 2023. Design completion is estimated in Summer/Fall 2023 and construction to begin in Fall/Winter 2023 depending on weather conditions.

FISCAL IMPACT:

The City is required to identify the specific streets to be repaired using SB1 funds in FY2023-24 in order to be eligible to receive the funding. The City is projected to receive an estimated $1,088,061 of SB1 funding.

ENVIRONMENTAL IMPACT:

The action is not a project subject to CEQA. City Council’s action is not considered a “Project” per CEQA Guidelines and therefore no further environmental analysis is required.

RECOMMENDATION:

Consider adoption of a resolution adopting a list of projects for Fiscal Year 2023-24 funded by SB1: The Road Repair and Accountability Act of 2017.

ALTERNATIVES:

1. Direct staff to amend the proposed prioritization methodology for use of SB1 funds.

2. Select different street segments to be repaired in FY2023-24 using SB1 funds.

ATTACHMENTS:

1. Resolution

2. Prioritization List for Street Reconstruction

3. Project Location Map

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RESOLUTION NO. 2023 - ___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN BRUNO ADOPTING A LIST OF PROJECTS FOR FISCAL YEAR 2023-24 FUNDED BY SB1: THE ROAD REPAIR AND ACCOUNTABILITY ACT OF 2017
WHEREAS, Senate Bill 1 (SB1), The Road Repair and Accountability Act of 2017 (Chapter 5, Statutes of 2017) was passed by the Legislature and Signed into law by the Governor in April 2017 to address the significant multi-modal transportation funding shortfalls statewide; and
WHEREAS, SB1 includes accountability and transparency provisions that will ensure the residents of the City of San Bruno (City) are aware of the projects proposed for funding in our community and which projects have been completed each fiscal year; and WHEREAS, the City must adopt by resolution a list of projects proposed to receive fiscal year funding from the Road Maintenance and Rehabilitation Account (RMRA), created by SB1, which must include a description and the location of each proposed project, a proposed schedule for the project’s completion, and the estimated useful life of the improvement; and
WHEREAS, the City, will receive an estimated $1,088,061 in RMRA funding in Fiscal Year 2023-24 from SB1; and
WHEREAS, this is the seventh year in which the City is receiving SB1 funding and enables the City to continue essential road maintenance and rehabilitation projects, safety improvements, and increasing access and mobility options for the traveling public that would not have otherwise been possible without SB1; and WHEREAS, the City has undergone a robust public process to ensure public input into our community’s transportation priorities/the project list; and WHEREAS, the City used a Pavement Management System to develop the SB1 project list to ensure revenues are being used on the reconstruction of streets that would provide the highest public benefit; and
WHEREAS, SB1 funding will help the City maintain and rehabilitate three roads this year and on similar projects into the future; and
WHEREAS, the 2018 California Statewide Local Streets and Roads Needs Assessment found that the City streets and roads are in a “at-risk” condition and this revenue will contribute towards the maintaining of the roadway network within the City; and WHEREAS, the SB1 project list and overall investment in our local streets and roads infrastructure with a focus on basic maintenance and safety, investing in complete streets infrastructure, and using cutting-edge technology, materials and practices, will significantly help in reducing the City’s deferred maintenance backlog.

NOW, THEREFORE, BE IT RESOLVED that the City Council hereby adopts a

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resolution approving the following:

1. The foregoing recitals are true and correct.

2. The following list of proposed projects will be funded in-part or solely with Fiscal Year 2023-24 Road Maintenance and Rehabilitation Account revenues:
---oOo---
I hereby certify that foregoing Resolution No. 2023 - ______ was introduced and adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following vote:

AYES: Councilmembers:

NOES: Councilmembers
ABSENT: Councilmembers:

Lupita Huerta, City Clerk
Project Name Description Location Scheduled
Start
Scheduled
Completion
Useful
Life
2023-24 Street
Reconstruction
Project
This project includes the
design and construction
to reconstruct or
rehabilitate various
project streets. Included
project elements are
pavement design,
preparation of contract
documents, installation of
accessible curb ramps,
and pavement
reconstruction of failed
streets.

Project streets are
located as follows:

Scenic Court
between Parkview
Drive and End,
Lomita Avenue
between Linden
Avenue and City
Limits, and
Hamilton Avenue
between Trenton
Drive and
Crestmoor Drive
September
2023
November
2024 15 YRS

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RANKING SCORE STREET BEGIN END PCI Bus Route School Gathering Place Recreation MFR RatioDENSITY
(SF/PROPERTY)
Pavement
Area (SF)
1 4 SCENIC COURT PARKVIEW DRIVE END 3 --- --- --- --- 0% 662 7,285 2 4 LOMITA AVENUE LINDEN AVENUE CITY LIMITS 4 --- --- --- --- 0% 792 15,840 3 4 HAMILTON AVENUE TRENTON DRIVE CRESTMOOR DRIVE 4 --- --- --- --- 0% 817 24,505 4 4 TOYON WAY ROLLINGWOOD DRIVE CATALPA WAY 1 --- --- --- --- 0% 830 33,180 5 4 BAYSHORE CIRCLE EB HUNTINGTON AVE EAST HERMAN STREET 4 --- --- --- --- 0% 875 10,500 6 4 ALCOTT DRIVE BENNINGTON DRIVE ROSEWOOD DRIVE 1 --- --- --- --- 0% 998 23,954 7 4 OXFORD LANE CRESTMORE DRIVE (N) OXFORD LANE (N) 24 --- --- --- --- 67% 1,155 10,395 8 4 WENTWORTH DRIVE N. CITY LIMITS OLYMPIC DRIVE 5 --- --- --- --- 0% 1,158 19,680 9 4 OXFORD LANE CRESTMORE DRIVE (S) OXFORD LANE (S) 22 --- --- --- --- 100% 1,658 6,633 10 4 MORELAND DRIVE RIVERSIDE DRIVE LONGVIEW DRIVE 2 X --- --- --- 0% 3,570 32,130 11 3 REID AVENUE LINDEN AVENUE ELM AVENUE 8 --- --- --- --- 0% 624 9,990 12 3 ACACIA AVENUE CRYSTAL SPRINGS AVENUE ANGUS AVENUE 23 --- X --- --- 0% 627 70,200 13 3 LINDEN COURT LINDEN AVENUE CUL-DE-SAC 11 --- --- --- --- 0% 670 5,361 14 3 DIAMOND STREET HERMAN STREET BUENA VISTA AVENUE 26 --- --- --- X 0% 701 9,810 15 3 CHILTON LANE HIGHLAND DRIVE END 7 --- --- --- --- 0% 742 18,560 16 3 PALOMAR COURT DONNER AVENUE DEAD END 12 --- --- --- --- 0% 745 18,617 17 3 MONTGOMERY AVENUE SCOTT STREET NORTH CITY LIMITS 8 --- --- --- --- 0% 808 33,120 18 3 FLEETWOOD DRIVE CATALPA WAY ROLLINGWOOD DRIVE 25 --- --- --- X 0% 896 76,125 19 3 ESSEX COURT TRENTON DRIVE END 9 --- --- --- --- 0% 955 7,642 20 3 LOWELL AVENUE BENNINGTON DRIVE ROSEWOOD DRIVE 13 --- --- --- --- 0% 984 28,544 21 3 KEEFE COURT ROSEWOOD DRIVE CUL-DE-SAC 13 --- --- --- --- 0% 1,019 6,112 22 3 LONDON COURT CRESTMOOR DRIVE CUL-DE-SAC 14 --- --- --- --- 0% 1,097 23,030 23 3 POPLAR AVENUE SANTA LUCIA AVENUE CRYSTAL SPRINGS AVENUE38 --- --- X --- 2% 1,129 50,804 24 3 BRYANT WAY SKYLINE BLVD CUL-DE-SAC 14 --- --- --- --- 0% 1,235 16,052 25 3 ATLANTIC AVENUE SAN MATEO AV RR TRACKS 11 --- --- --- --- 0% 1,558 9,350 26 3 ROLLINGWOOD DRIVE SNEATH LANE FLEETWOOD RIVE 13 X --- --- --- 0% 1,781 62,320 27 3 HIGHLAND DRIVE ELSTON DRIVE PACIFIC HEIGHTS BLVD 9 --- --- --- --- 0% 2,610 26,096 28 3 HUNTINGTON AVENUE SNEATH LANE NOOR AVENUE (N. CITY LIMITS)20 X --- --- --- 0% 10,080 60,480 29 3 CRYSTAL SPRINGS RD PUMP STATION CRESTMOOR DRIVE 36 --- --- --- --- 100% 53,000 53,000 30 2 SCOTT STREET HERMAN STREET HUNTINGTON AVENUE EAST34 --- --- --- --- 14% 573 12,606 31 2 BUENA VISTA AVENUEEAST HUNTINGTON AVENUE HERMAN STREET 31 --- --- --- --- 13% 639 10,230 32 2 CHERRY AVENUE NILES AVENUE JENEVEIN AVENUE 26 --- --- --- --- 0% 696 27,160 33 2 BIRCH COURT GREENWOOD DRIVE CUL-DE-SAC 26 --- --- --- --- 0% 797 7,174 34 2 LEXINGTON WAY KINGSTON AVENUE CRESTMOOR DRIVE 24 --- --- --- --- 0% 831 29,087 35 2 CHERRY AVENUE PARK AVENUE SAN BRUNO AVENUE 24 X --- --- --- 0% 933 39,200 36 2 CORONADO WAY END HIGHLAND DRIVE 25 --- --- --- --- 0% 959 37,408 37 2 EUCALYPTUS WAY ROLLINGWOOD DRIVE SEQUOIA AVENUE 20 --- --- --- --- 0% 991 36,680 38 2 ELDER COURT EUCALYPTUS WAY CUL-DE-SAC 24 --- --- --- --- 0% 998 5,988 39 2 ARBOR COURT GREENWOOD DRIVE CUL-DE-SAC 25 --- --- --- --- 0% 1,001 6,004 40 2 PIEDMONT AVENUE CRESTMOOR DRIVE MADISON AVENUE 20 --- --- --- --- 0% 1,148 33,300 41 2 OAKMONT DRIVE OLYMPIC DRIVE N. CITY LIMITS 19 --- --- --- --- 0% 1,158 74,100 42 2 RIVERSIDE DRIVE SNEATH LANE MORELAND DRIVE 34 X --- --- --- 0% 1,451 15,960 43 2 SKYLINE BLVD CAMBRIDGE LANE BRYANT WAY 24 --- --- --- --- 0% 1,818 27,270 44 2 HIGHLAND DRIVE MOULTON DRIVE YSABEL DRIVE 24 --- --- --- --- 0% 1,894 20,832 45 2 LINDEN AVENUE JENEVEIN AVENUE KAINS AVENUE 38 --- X --- --- 0% 2,148 47,250 Attachment 2 - Prioritization List for Street Reconstruction

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RANKING SCORE STREET BEGIN END PCI Bus Route School Gathering Place Recreation MFR RatioDENSITY
(SF/PROPERTY)
Pavement
Area (SF)
46 2 ANGUS AVENUE WEST EL CAMINO REAL LINDEN AVENUE 35 --- --- --- X 0% 2,250 6,750 47 2 GLENVIEW DRIVE RIDGEWAY AVENUE SAN BRUNO AVENUE 39 --- --- --- --- 10% 5,550 55,500 48 2 SAN BRUNO AVENUE WB100 W/O CRESTMOOR DRIVE GLENVIEW DRIVE 26 --- --- --- --- 0% 7,085 28,340 49 2 SAN BRUNO AVENUE WB GLENVIEW DRIVE SKYLINE BLVD 22 --- --- --- --- 0% 10,250 10,250 50 2 BAYHILL DRIVE CHERRY AVENUE END 17 --- --- --- --- 0% 10,500 31,500 51 2 SAN BRUNO AVENUE EB CRESTMOOR DRIVE SKYLINE BLVD 25 --- --- --- --- 0% 11,172 55,862 52 1 PEPPER DRIVE CEDAR AVENUE CEDAR AVENUE 31 --- --- --- --- 0% 577 39,806 53 1 WHITECLIFF WAY TRENTON DRIVE CHARLESTON AVENUE 29 --- --- --- --- 0% 674 16,849 54 1 PORTOLA WAY END DE SOTO WAY 31 --- --- --- --- 0% 706 9,175 55 1 ANGUS AVENUE WEST ELM AVENUE ACACIA AVENUE 39 --- --- --- --- 0% 710 11,367 56 1 OLIVE COURT KAINS AVENUE CUL-DE-SAC 35 --- --- --- --- 0% 716 13,603 57 1 TURNBERRY DRIVE N. CITY LIMITS ST. CLOUD DRIVE 39 --- --- --- --- 0% 733 17,600 58 1 SYCAMORE AVENUE KAINS AVENUE MAGNOLIA AVENUE 35 --- --- --- --- 0% 746 34,320 59 1 COLUSA COURT SNEATH LANE CUL-DE-SAC 35 --- --- --- --- 0% 760 9,117 60 1 GLENBROOK LANE ROSEWOOD DRIVE CUL-DE-SAC 38 --- --- --- --- 0% 795 12,724 61 1 SUMMIT ROAD SUSAN DRIVE ELSTON DRIVE 36 --- --- --- --- 0% 800 28,800 62 1 PLUMWOOD PLACE CHESTNUT AVENUE END 36 --- --- --- --- 0% 805 4,830 63 1 CHARLESTON AVENUE TRENTON DRIVE CRESTMOOR DRIVE 35 --- --- --- --- 0% 834 20,010 64 1 INYO COURT SNEATH LANE CUL-DE-SAC 28 --- --- --- --- 0% 851 9,364 65 1 RIDGEWAY AVENUE CRESTMOOR DRIVE SKYLINE BLVD 35 --- --- --- --- 0% 861 21,518 66 1 MORELAND DRIVE CITY LIMITS RIVERSIDE DRIVE 36 --- --- --- --- 0% 904 9,044 67 1 KINGSTON AVENUE TRENTON DRIVE CRESTMOOR DRIVE 36 --- --- --- --- 0% 919 22,968 68 1 LINDEN AVENUE KAINS AVENUE ELM AVENUE 30 --- --- --- --- 0% 991 22,788 69 1 RIVIERA COURT END OAKMONT DRIVE 29 --- --- --- --- 0% 997 12,965 70 1 KENT COURT CRESTMOOR DRIVE CUL-DE-SAC 29 --- --- --- --- 0% 1,027 10,266 71 1 ELDORADO COURT CRESTMOOR DRIVE CUL-DE-SAC 31 --- --- --- --- 0% 1,076 10,759 72 1 SCOTT STREET SAN MATEO AVENUE HERMAN STREET 30 --- --- --- --- 0% 1,272 6,358 73 1 FLEETWOOD DRIVE ROLLINGWOOD DRIVE BERKSHIRE DRIVE 24 --- --- --- --- 0% 1,273 98,040 74 1 GREENWOOD WAY ROLLINGWOOD DRIVE COTTONWOOD DRIVE 40 --- --- --- --- 0% 1,392 6,960 75 1 PEACHWOOD COURT CHESTNUT AVENUE CUL-DE-SAC 27 --- --- --- --- 0% 1,445 23,121 76 1 EXETER DRIVE SUNSET DRIVE YSABEL DRIVE 40 --- --- --- --- 0% 2,140 32,096 Attachment 2 - Prioritization List for Street Reconstruction

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Legend
1:8,000
City of San Bruno
This map was automatically generated using Geocortex Essentials.Notes1,333.3666.67THIS MAP IS NOT TO BE USED FOR NAVIGATIONCity of San Bruno Information Services1,333.30 FeetNAD_1983_StatePlane_California_III_FIPS_0403_FeetThis map is a user generated static output from an Internet mapping site and is forreference only. Data layers that appear on this map may or may not be accurate,current, or otherwise reliable.

City LimitsStreet Sections
Street Sections

SCENIC CT
Attachment 3 – Project Location Map

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex McIntyre, Interim City Manager
PREPARED BY:Matthew Lee, P.E., Public Works Director
SUBJECT: Consider Adoption of a Resolution Authorizing Purchase of Water Well Equipment From MISCOwater in the Amount of $136,346
BACKGROUND:

The City of San Bruno’s water supply consists of purchased surface water and local groundwater. The City’s current groundwater wells have been in operation since 1991 and supplies up to 2.4 million gallons of water per day to San Bruno residents. The plant treats water from the Westside Basin and blends it with regional system water to help meet demand of the community.

The San Bruno Water Division uses chloramines to disinfect the water. This disinfection process consists of chemical feed pumps, storage tanks, and online analyzers. The current chemical feed system equipment for water treatment, which has been in continuous use for almost 20 years. These older pumps present several challenges, including escalating costs for an older technology, lack of reliability, and hardware that is difficult to repair. Furthermore, the City’s chemical feed systems are nearing the end of their lifecycles, and due to their age, replacement parts are in short supply.

DISCUSSION:

This is a sole source equipment acquisition that has been reviewed and authorized by City Procurement staff. The City’s well testing and treatment equipment systems are manufactured by The ProMinent Group, a Heidelberg, Germany-based company. MISCOwater, previously AquaMetric, of San Leandro, is Northern California’s sole authorized and licensed supplier of ProMinent parts and equipment. Company representatives came on-site, completed a condition assessment of the City’s aging water treatment equipment, and negotiated a proposal. The other authorized California supplier is in Los Angeles. The Southern California supplier is not authorized to sell ProMinent equipment outside their territory.

The City will purchase four ammonia hydroxide skid units and four sodium hypochlorite skid units from MISCOwater. Each of the City’s four wells will get one of each skid unit type.

ProMinent technicians will come to San Bruno to supervise the installation, testing, and certification of the new equipment.

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FISCAL IMPACT:

Total cost of the equipment is $136,346, which includes sales tax and delivery, and will be funded by the FY 2022-23 Water Quality Well System Upgrades and Sweeney Ridge Tank Chlorine Generator Installation Capital Improvement Program project budget. As of May 31, 2023, there is $600,000 available in the project budget which is sufficient for this equipment purchase.

ENVIRONMENTAL IMPACT:

The action is not a project subject to CEQA. City Council’s action is not considered a “Project” per Title 14 California Code of Regulations (CCR) §15378(b)(5) and would not result in a direct or reasonably foreseeable indirect physical change in the environment (per Title 14 CCR § 15060(c)(2)). Therefore, no further environmental analysis is required.

RECOMMENDATION:

Adopt Resolution authorizing purchase of water well equipment from MISCOwater in the amount of $136,346.

ALTERNATIVES:

Do not authorize the purchase of one or more of these equipment items and defer to a later time.

ATTACHMENTS:

1. Resolution

2. FY 2022-23 Capital Improvement Program Budget Project Description: “Water Quality Well System Upgrades and Sweeney Ridge Tank Chlorine Generator Installation”

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1 1
7 8
2 RESOLUTION NO. 2023- ___

RESOLUTION AUTHORIZING PURCHASE OF
WATER WELL EQUIPMENT FROM MISCOWATER IN THE AMOUNT OF $136,346 WHEREAS, the City of San Bruno Water Division desires to purchase four ammonia hydroxide units and four sodium hypochlorite units, which are water quality testing and chemical treatment units used to automatically test and inject chemicals when needed to maintain consistent water quality in the holding tanks of the City’s four wells (Corporation Yard, Lions Field, City Park, and Forest Lane); and
WHEREAS, as part of the approved FY 2022-23 Capital Improvement Program’s (CIP) Water Quality Well System Upgrades and Sweeney Ridge Tank Chlorine Generator Installation project, aging water quality testing and treatment equipment will be replaced at all four city wells; and
WHEREAS, water testing and treatment units are proprietary technology, and such equipment must be compatible with existing ProMinent systems servicing San Bruno’s water treatment facilities; and
WHEREAS, MISCOwater of San Leandro, California, is the sole authorized and licensed regional supplier of ProMinent equipment, and they are a professional potable water equipment provider with extensive experience providing services for water utility districts throughout California.

WHEREAS, the total cost to purchase the equipment is $136,346, which includes all costs for the equipment, sales tax, and delivery, funded from the $600,000 in available funds from the FY 2022-23 Water Quality Well System Upgrades and Sweeney Ridge Tank Chlorine Generator Installation Capital Improvement Program (CIP) project budget; and NOW, THEREFORE, BE IT RESOLVED: that the San Bruno City Council hereby authorizes purchase of water well equipment from MISCOwater in the amount of $136,346.

Dated: June 13, 2023

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2 1
7 8
2 ---oOo---
I, the undersigned, hereby certify that the foregoing Resolution No. 2023 - ______ was introduced and duly adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following roll call vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

Lupita Huerta
City Clerk

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PROJECT #: NEW Total Project Budget: 600,000$
DEPARTMENT: Public Works Total

FUNDING SOURCES
Prior
Appropriations
Estimated
Carryover
New
Request
Total
Appropriations FY2023-24 FY2024-25 FY2025-26 FY2026-27
FY2023-27
Budget
Water Fund - - 600,000 600,000 - - - - 600,000 Total -$ $ - $ 600,000 600,000$ $ - $ - $ - $ - 600,000 $ PROJECT APPROPRIATIONS Project #
Prior
Appropriations
Estimated
Carryover New Request
Total
Appropriations FY2023-24 FY2024-25 FY2025-26 FY2026-27
FY2023-27
Budget
Construction - - 600,000 600,000 - - - - 600,000 Total -$ $ - $ 600,000 600,000$ $ - $ - $ - $ - 600,000 $ Insert Picture Here
Project Details
Initial Funding Year FY2022-23
Target Completion Year FY2022-23
Expended as of July 1, 2021 $0
FY2022-23
Water Quality Well System Upgrades & Sweeney Ridge Tank Chlorine Generator Installation Water Capital
Well & Tank Upgrades
Project Description:

Well Water Quality Testing System Upgrades:

This project will install new water quality testing equipment at all City wells (Corporation Yard, Lions Field, City Park, and Forest Lane). Project work includes: 1) Installation of Residual Control System (RCS) units, with multiple probes that test and analyze various water quality categories; and 2) Replacing older and out- dated chemical feed pump systems that release chemicals into well holding tanks to maintain water quality levels. Both systems will be connected to the City's SCADA real-time computer monitoring system.

Sweeney Ridge Tank Chlorine Generator Installation:

This project will install a new generator system that will convert salt into chlorine used to maintain water quality. This tank is located at a very remote location, and currently liquid chlorine must be trucked in daily.

This new equipment will measure out and provide more reliable and consistent chlorine levels and requires less crew and equipment to maintain.
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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Matthew Lee, P.E., Public Works Director
SUBJECT: Consider Adoption of a Resolution Authorizing the City Manager to Execute a Five-Year Contract With Flowers Electric and Service Co., Inc. to Provide Streetlight Maintenance and Electrical Repair Services in an Amount Not to Exceed $60,000 for Fiscal Year 2023-24
BACKGROUND:

The City owns, operates, and maintains approximately 2,100 streetlights. The majority of these lights are Cobra head fixtures with the exception of 92 ornamental light fixtures along San Mateo Avenue and Bayhill Drive. In 2017, the City replaced all City-owned high pressure sodium lights, originally installed over 50 years ago, with Light Emitting Diode (LED) lights that use less energy, have a longer lifespan, and create better visibility.

Like most cities in the area, the City contracts with a private company for annual streetlight maintenance and electrical repair services. Current streetlight maintenance activities include repair and replacement of streetlight poles, pipe arms, installation of new foundations for knocked down poles, replacement of failed fixture heads, miscellaneous electrical work, and performing emergency response as needed.

These annual maintenance and repair activities are separate from any Capital Improvement project to replace or upgrade the City’s streetlight system and components.

DISCUSSION:

The City issued a Request for Proposals (RFP) for streetlight maintenance and electrical repair services in April 2023. The project’s scope of work consists of having a certified electrical contractor provide as needed services to repair and replace streetlight facility components. The contractor will also provide general electrical maintenance and repair as needed. The contractor must be available 24 hours a day, seven days a week and have a facility within 20 miles of the City of San Bruno.

The City received three proposals:

Company Location

1. Flowers Electric and Service Company, Inc. South San Francisco, CA

2. Mattole Valley Electric San Francisco, CA

3. St. Francis Electric, LLC San Leandro, CA

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6 0
3 Based on a review of the proposals for team qualifications, completeness, and relevant experience, staff is recommending Flowers Electric and Service Company, Inc. of South San Francisco, California, to provide as needed streetlight maintenance and electrical repair services in an amount not to exceed $60,000 for fiscal year 2023-24.

Mattole Valley Electric did not submit a complete proposal and were disqualified. St. Francis Electric, LLC also does not meet the requirement to have a facility within 20 miles of San Bruno since their office is in San Leandro.

Based on the evaluation, staff is recommending Flowers Electric and Service Company, Inc. to provide the as needed streetlight maintenance and electrical repair services. Flowers Electric is a highly qualified electrical contractor, has demonstrated the project understanding, and has substantial electrical construction experience. Flowers Electric has successfully completed streetlight maintenance and electrical repair projects for the cities of South San Francisco and San Bruno and has also completed private sector lighting and electrical installation projects.

This contract has the option to be renewed annually for a total possible term of five (5) years and can be terminated by the City at any time. The City reimburses the private contractor for labor and equipment, with major parts, including streetlight poles and pole arms, supplied by the City.

Separately, based of St. Francis Electric’s qualifications and experience, including successfully completing previous San Bruno projects, they will be requested to apply to be on the City’s Pre- Qualified List of contractors and considered for future work.

FISCAL IMPACT:

The FY 2023-24 Streets Operating Budget has a proposed budget of $60,000 for contract repair and maintenance of the City’s streetlights, which is unchanged from the FY 2022-23 budget. Future contract amounts will be reviewed and determined during the annual budget process.

The Department has selected a multi-year contract to maintain a consistent level of service and to minimize the resources involved with an annual bidding process. Under the City’s Purchasing Policy, this multi-year contract exceeds the City Manager’s $75,000 approval authority and requires City Council authorization.

ENVIRONMENTAL IMPACT:

RECOMMENDATION:

Adopt resolution authorizing the City Manager to execute a five-year contract with Flowers Electric and Service Co., Inc. to provide streetlight maintenance and electrical repair services in an amount not to exceed $60,000 for Fiscal Year 2023-24.

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6 0
3 ALTERNATIVES:

Direct further review of the received proposals to potentially select a different firm. The contract with the current streetlight maintenance repair provider terminates June 30, 2023. Repair services may be delayed until a new contractor is selected.

ATTACHMENTS:

1. Resolution

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RESOLUTION NO. 2023 - ___

RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A CONTRACT WITH FLOWERS ELECTRIC AND SERVICE CO., INC. TO

PROVIDE STREETLIGHT MAINTENANCE AND ELECTRICAL REPAIR SERVICES IN AN AMOUNT NOT TO EXCEED $60,000 FOR FISCAL YEAR 2023-24 WHEREAS, the City of San Bruno desires to utilize the services of a well-qualified contractor to assist the City with streetlight maintenance and electrical repair services of the City’s approximately 2,100 streetlights; and
WHEREAS, services include, but are not limited to, providing as needed repair and replacement of streetlight poles, pipe arms, installation of new foundations for knocked down poles, replacement of failed fixture heads, and performing emergency response; provide general electrical maintenance and repair as needed; contractor must be available 24 hours a day, seven days a week and have a facility within 20 miles of the City of San Bruno; and
WHEREAS, the City issued a request for proposals on April 19, 2023 and received three proposals; and
WHEREAS, Flowers Electric and Service Co., Inc. was determined to be most qualified to provide streetlight maintenance and electrical repair services, have nearby facilities and resources to provide adequate emergency response, and submitted the overall lowest repair costs; and
WHEREAS, the City has negotiated a scope of work with Flowers Electric and Service Co., Inc. for an amount not to exceed $60,000 during fiscal year 2023-24; and WHEREAS, the proposed FY 2023-24 Streets Operating Budget has an $60,000 program allocation for contract repair and maintenance of the City’s street lights, an amount unchanged from the FY 2022-23 budget; and
WHEREAS, the contract has the option to be renewed annually for a total possible term of five (5) years and can be terminated by the City at any time.

NOW, THEREFORE, BE IT RESOLVED that the City Council authorizes the City Manager to execute a contract with Flowers Electric and Service Co., Inc. to provide streetlight maintenance and electrical repair services in an amount not to exceed $60,000 for fiscal year 2023-24.

Dated: June 13, 2023

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2 ---oOo---
I, the undersigned, hereby certify that the foregoing Resolution No. 2023 - ______ was introduced and duly adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following roll call vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

Lupita Huerta
City Clerk

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Lupita Huerta, City Clerk
SUBJECT: Consider Adopting Resolution Granting Fireworks Stand Permits for 2023 BACKGROUND:

The City of San Bruno Municipal Code allows by special permit, the sale of “Safe and Sane” fireworks at temporary fireworks stands. Non-profit organizations based in San Bruno and serving the San Bruno community submitted applications to operate a fireworks stand, to the City Clerk’s office in early May.

On June 24, 2008, the City Council adopted Resolution No. 2008-67 to establish rules and regulations pertaining to the issuance of Firework Stand Permits. Section 9 of Resolution No. 2008-67 provides that the City Clerk shall review all applications to determine whether the applicant has met all eligibility requirements for a Firework Stand Permit and to identify each applicant as either “grandfathered” or “lottery” status. Section 3 of Resolution 2008-67 provides the following application requirements:
“A. City Form. All applications for permits to sell "safe and sane" fireworks shall be submitted in writing to the city clerk on city-provided form.

B. Application deadline. In order to be considered for a permit, an application shall be filed by the deadline designated by the city clerk.

C. One application only. No applicant shall submit more than one application for a permit to sell "safe and sane" fireworks within the city. If more than one application is submitted by or on behalf of any organization, including through any affiliate of such local serving organization, only the first application received shall be processed. All additional requests shall be deemed void.

Any attempt to transfer an application shall void any and all applications filed by or on behalf of both the transferor/local serving organization and the transferee/local serving organization.

D. Application information and documents. Each applicant shall provide the following the information and documentations:

1. Permit Application- Required Information. Each applicant shall provide the following information on a city-provided application form proscribed by the city:
a. Identifying information of the organization (name, mailing address, and any other information designated on the form);
b. Identification of principal officers of the organization (name, title, and city of residence);
c. Statement of tax-exempt status including tax identification number or declaration that organization's primary purpose is charitable and not for profit; d. Street address or description of the site where stand is proposed to be located; and

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e. Property owner's name and valid phone number for a contact person.

2. Application Permit- Required Documentation. Each applicant shall provide the following documentation attached to an application form proscribed by the city:
a. Written authorization from the property owner or designated agent granting permission to the applicant to use the site for this purpose; b. A description of the major activities and functions of the organization; c. A statement describing how this organization meets the criteria of a "local serving organization" as stated in Section (C) of the definition section of this Resolution and relevant documentation to support each factor;
d. A description of how monies earned from fireworks sales will be used; e. If applying for a grandfathered permit, a photocopy of the prior year's permit; f. Acknowledgment and agreement by the authorized representative of the applicant to the indemnification/hold harmless agreement (revised from time to time by the city attorney) as stated on the application;
g. Any additional information or documentation that the city may request to verify an applicant’s permit request; and
h. Verification by the authorized representative of the applicant that the information and documentation provided is complete and accurate and submitted under penalty of perjury.
i. Copy of paid invoice from Finance Department as proof of payment for pro rata share of cost recovery fee from prior fireworks use period.” The City Clerk’s Office reviewed the applications for completeness and verified that a representative from each organization attended the Mandatory Fireworks Safety Seminar that was conducted by the Fire and Police Departments this year on Wednesday, June 7, 2023. The City Clerk’s office also received confirmation from the Finance Department that each organization paid their post sales assessment from last year and are in good standing.

DISCUSSION:

As required in the San Bruno Municipal Code, only eighteen (18) “Safe and Sane” fireworks stands are permitted, of which eight (8) are grandfathered status and the remaining are lottery status. Grandfathered permits were assigned to organizations with properly issued permits in effect on July 4, 1997. As of the deadline, 13 applications were received for 2023. The 13 applications have been reviewed by the City Clerk and the City Clerk determined whether or not the applications satisfied the conditions in Section 3 of Resolution No. 2008-67.

The following applicants applied for Fireworks Stand Permits for 2023:

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Parent Boosters of 72 Grandfathered Permittee Yes
San Bruno Girls Softball League Grandfathered Permittee Yes San Bruno Lions Club Lottery Permittee Yes
San Bruno Police Association Grandfathered Permittee Yes San Bruno Rotary Club Grandfathered Permittee Yes
San Bruno Soccer Lottery Permittee Yes
San Bruno Youth Baseball 1 Lottery Permittee Yes
San Bruno Youth Baseball 2 Lottery Permittee Yes
FISCAL IMPACT:

The total cost to the City for fireworks-related activities is recovered from fireworks stand permit holders. The City charges a permit fee of $1,427 and allocates the additional cost of all services performed by the City to permit holders according to a formula based upon each group’s gross sales. The costs incurred by the City include community and fireworks user education, enforcement of all fireworks regulations, and community clean up following July 4th.

ENVIRONMENTAL IMPACT:

The action is not a project subject to CEQA.  City Council’s action is not considered a “Project” per CEQA Guidelines and therefore no further environmental analysis is required.

RECOMMENDATION:

Adopt Resolution Granting Fireworks Stand Permits for 2023.

ALTERNATIVES:

1. The sale of Safe and Sane Fireworks was voter approved in the November 5, 2005 Municipal Election. Unless new material facts are presented at the Council meeting, fireworks stand permit evaluation and issuance of permits to compliant applicants will be processed.

2. Do not issue permits and direct the City Council to form a Subcommittee to review applications.

ATTACHMENTS:

1. Resolution

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RESOLUTION NO. 2023 - ___

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN BRUNO GRANTING FIREWORKS STAND PERMITS FOR 2023
WHEREAS, Chapter 6.50 of the San Bruno Municipal Code authorizes the limited sale of safe and sane fireworks by special permit (a “Firework Stand Permit”); and WHEREAS, the City Clerk has received 13 applications for a Firework Stand Permit; and
WHEREAS, on June 24, 2008, the City Council adopted Resolution No. 2008-67 to establish rules and regulations pertaining to the issuance of Firework Stand Permits; and WHEREAS, Section 9 of Resolution No. 2008-67 provides that the City Clerk shall review all applications to determine whether the applicant has met all eligibility requirements for a Firework Stand Permit and to identify each applicant as either “grandfathered” or “lottery” status; and
WHEREAS, paragraph 4 of Section 6 of the City Council Policies and Procedures, adopted on December 13, 2022, provides that the City Clerk will present the applications and the information required by Resolution No 2008-67 to the City Council for its determination about granting a Firework Stand Permit; and WHEREAS, attached hereto as Exhibit A is a list of the applicants along with the information required by Resolution No. 2008-67.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of San Bruno hereby grants a Firework Stand Permit for 2023 to each eligible applicant listed on Exhibit A.
---oOo---
I hereby certify that foregoing Resolution No. 2023 - ______ was introduced and adopted by the San Bruno City Council at a regular meeting on ___________, 2023, by the following vote:

AYES: Councilmembers:

NOES: Councilmembers
ABSENT: Councilmembers:

Lupita Huerta, City Clerk

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2 EXHIBIT A

APPLICANTS FOR FIREWORK STAND PERMITS
The following applicants applied for Fireworks Stand Permits for 2023:

Applicant Name Permittee Type Eligible for Permit
Yes / No
American Legion Post #409 Grandfathered Permittee Yes
Boosters 71 Grandfathered Permittee Yes
Camp St. Andrews Lottery Permittee Yes
Capuchino Sports Boosters Grandfathered Permittee Yes
Lowen 83’ FC Grandfathered Permittee Yes
Parent Boosters of 72 Grandfathered Permittee Yes
San Bruno Girls Softball League Grandfathered Permittee Yes San Bruno Lions Club Lottery Permittee Yes
San Bruno Police Association Grandfathered Permittee Yes San Bruno Rotary Club Grandfathered Permittee Yes
San Bruno Soccer Lottery Permittee Yes
San Bruno Youth Baseball 1 Lottery Permittee Yes
San Bruno Youth Baseball 2 Lottery Permittee Yes

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Jennifer Dianos, Assistant to the City Manager Maria Langbauer, Economic Development Manager
SUBJECT: Consider Adoption of a Resolution:
• Authorizing the City Manager to Execute an Agreement With the County of San Mateo Accepting $100,000 From the Small Business Post- Pandemic Recovery Grant Program
• Allocating $100,000 to Develop and Administer a Small Business Grant Program for Fund Distribution to Eligible Local San Bruno Small Businesses in Fiscal Year 2023-24
BACKGROUND:

In 2022, the City of San Bruno was contacted by San Mateo County (County) to participate in a pilot grant program to offer technical assistance to support the long-term viability of local small businesses adversely impacted by the COVID-19 public health emergency. Since that time, San Bruno has partnered with the County and two other partner agencies in the County to develop an opportunity for local small businesses with use of the County’s American Rescue Plan Act (ARPA) funding.

As we all know, COVID-19 impacted many small retail and restaurant businesses in San Bruno and throughout the County. For a period of time while there was an active Shelter at Home order and spacing restrictions, some businesses were required to close and/or modify operations to accommodate specified health order restrictions. Many small businesses have struggled to return to pre-pandemic levels of operations. Although many retail and restaurant businesses restrictions have been lifted, many customers still prefer the modified operations such as curbside pick-up, and increased distances while shopping or dining inside.

During COVID-19, the City of San Bruno partnered with other local resource providers, such as SAMCEDA and Skyline’s Bay Area Entrepreneur Center, to offer small business grants.

DISCUSSION:

The San Mateo County Board of Supervisors will consider allocating ARPA funding for a grant program called the small Business Post Pandemic Recovery Grant Program. The Program will help retail and restaurant businesses that were impacted by the pandemic and its negative economic consequences to mitigate their financial hardship and meet post-pandemic customer expectations. The Program will provide qualifying small businesses in the three pilot cities - South San Francisco, San Bruno, and San Mateo - with technical assistance and grant funds.

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The program will include two components: 1) technical assistance and 2) grant program.

The technical assistance will be led by the County and will focus on space design and physical improvements to qualifying small businesses to help ensure compliance with applicable regulations. If the program is approved, the County will offer three in-person and virtual training sessions for small business that qualify and will include information on the below listed topics as well as collaborate with City staff and eligible businesses to deliver resource material.

The three trainings subject areas are:

Topic 1: Overview of disabled access compliance requirements for retail and restaurant businesses including compliance with Federal, State, and local government regulations related to disabled access compliance (i.e., Americans with Disabilities Act (ADA) and the California Disabled Persons Act).

Topic 2: Regulatory considerations when making physical improvements to a business location such as local building requirements and permits, licenses, and fees.

Topic 3: Additional responsibilities of a small business owner and a property owner when making physical improvements to a business location such as hiring contractors and insurance requirements.

The grant program component, if approved, will be an opportunity for San Bruno to develop and administer awarded funds and will develop comprehensive guidelines to administer a grant program to small businesses impacted by the pandemic. Grant funds may be used for operational business modifications, and operational expenses. To be eligible for a grant, an impacted small business must be located in San Bruno, have no more than 15 employees, earn less than $3 million in annual gross income, not be dominant in its field of operation, have a current San Bruno business license, attend technical training sessions, and submit the required documents demonstrating negative COVID impacts.

San Bruno will also explore the viability of working with South San Francisco, San Mateo and/or their partners to help promote and administer the grant program. Alternatively, San Bruno will utilize staff resources to develop and administer the program.

The total proposed grant amount to San Bruno is $100,000. The agreement between San Bruno and the County, if approved, will allow for 10% de minimis federal indirect cost rate, and will have specific reporting requirements in compliance with general ARPA funding. Ideally the program, depending on how it is developed, will provide $5,000 to 18-20 businesses or $10,000 to 9-10 businesses.

Next Steps
Should the City Council approve San Bruno’s participation in this program, City staff will route the County agreement for signatures and provide it to the County for full consideration of the program and funding. Should the County Board of Supervisors approve the program and allocation of funds, which is anticipated to occur in July 2023, City staff will then proceed in fully developing program requirements and program roll out.

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The program is likely to be administered during the Fall/Winter timeframe, and the funds and reporting will need to be dispersed and finalized by the end of the 2023-24 fiscal year.

FISCAL IMPACT:

Staff resources are required to develop and administer this grant. It is anticipated that the City Manager’s Office will lead the effort to fully exhaust the grant funds within the agreement timeline. Minimal additional costs could include printing of flyers and forms, however there is an effort to digitize material and collaborate with stakeholders.

The program will be administered in fiscal year 2023-2024. The $100,000 is not currently allocated, however it falls in line with the City Council strategic initiatives of economic support of small businesses.

ENVIRONMENTAL IMPACT:

There is no environmental impact. The action is not a project subject to CEQA.  City Council’s action is not considered a “Project” per CEQA Guidelines and therefore no further environmental analysis is required.

RECOMMENDATION:

Consider Adoption of a Resolution:
•Authorizing the City Manager to Execute an Agreement with the County of San Mateo Accepting $100,000 from the Small Business Post-Pandemic Recovery Grant Program •Allocating $100,000 to Develop and Administer a Small Business Grant Program of fund distribution to eligible Local San Bruno Small Businesses in fiscal year 2023-24.

ALTERNATIVES:

1. Direct staff to not participate in the County’s pilot grant program.

2. Direct staff to identify third party administrator to fully administer the grant program, however this will likely result in an additional cost.

3. Direct staff to return to the City Council with the specific program requirements before approving, however this may delay the process and jeopardize being eligible for the County’s pilot program.

ATTACHMENTS:

1. Resolution

2. DRAFT Grant Agreement with San Mateo County

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RESOLUTION NO. 2023 - _____

RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT WITH THE COUNTY OF SAN MATEO ACCEPTING $100,000 FROM THE SMALL BUSINESS POST- PANDEMIC RECOVERY GRANT PROGRAM AND ALLOCATING $100,000 TO DEVELOP

AND ADMINISTER A SMALL BUSINESS GRANT PROGRAM FOR FUND DISTRIBUTION TO ELIGIBLE LOCAL SAN BRUNO SMALL BUSINESSES IN FISCAL YEAR 2023-24

WHEREAS, in 2022, the City of San Bruno was contacted by San Mateo County to participate in a pilot grant program to offer technical assistance to support the long-term viability of local small businesses adversely impacted by the COVID-19 public health emergency; and WHEREAS, COVID-19 impacted many small retail and restaurant businesses in San Bruno and throughout the County; and
WHEREAS, the San Mateo County Board of Supervisors will consider allocating ARPA funding for a grant program called the small Business Post Pandemic Recovery Grant Program to help retail and restaurant businesses that were impacted by the pandemic and its negative economic consequences to mitigate their financial hardship and meet post -pandemic customer expectations; and
WHEREAS, the program will include two components: 1) technical assistance, and 2) grant program with the County providing the technical assistance and San Bruno administering the grant portion of the program; and
WHEREAS, the total proposed grant amount to San Bruno is $100,000 with the agreement between San Bruno and the County, if approved, to allow for 10% de minimis federal indirect cost rate, and will have specific reporting requirements in compliance with general ARPA funding.

WHEREAS, the San Mateo County Board of Supervisors will consider the adoption of the grant program at their July 11, 2023 Board Meeting and their allocation of funds to San Bruno. If approved, the City will then develop a full grant program for grant distribution to small businesses in San Bruno that meet the established grant eligibility criteria.

NOW, THEREFORE, BE IT RESOLVED , by the City Council of the City of San Bruno authorizes the City Manager to execute an agreement with the County of San Mateo accepting $100,000 from the Small Business Post-Pandemic Recovery Grant Program and allocating $100,000 to develop and administer a small business grant program for fund distribution to eligible local San Bruno small businesses in fiscal year 2023-24. ---oOo---

I hereby certify that foregoing Resolution No. 2023 - ____ was introduced and adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following vote:

AYES:

NOES:

ABSENT:
_________________________________
Lupita Huerta, City Clerk

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GRANT AGREEMENT

BETWEEN THE COUNTY OF SAN MATEO AND THE CITY OF SAN BRUNO

This Grant Agreement (“Agreement”) is entered into as of the Effective Date (defined herein) by and between the County of San Mateo, a political subdivision of the state of California (the “County”), and the City of San Bruno (“Grantee”), (County and Grantee may be collectively referred to herein as “Parties” and individually as “Party”).
* * *
WHEREAS, since its emergence in early 2020, th e COVID-19 pandemic has negatively impacted public health and the economy on a global scale, in the country and in San Mateo County; and WHEREAS, the County has taken extensive steps to prevent and address the spread of the pandemic and to respond to the public health emergency and its negative economic impacts; and WHEREAS, the County has received State and Lo cal Fiscal Recovery Funds under the federal American Rescue Plan Act (“ARPA Funds”) which can be used among other applications to respond to the public health emergency and its negative economic impacts; and WHEREAS, small businesses in the County have been impacted by the pandemic and its negative economic consequences, including through decreased revenue or gross receipts, financial insecurity, increased costs, capacity to weather financial hard ship and/or challenges covering payroll, rent or mortgage, and other operating costs and have needs for technical assistance for business planning purposes; and
WHEREAS, the County wishes to establish a grant program to aid impacted small businesses within the County, known as the Small Business Post-Pandemi c Recovery Grant Program (the “Program”) to be administered by certain cities to facilitate the distribution of grants under the Program in connection with responding to the pandemic and its negative economic impacts; and WHEREAS, in furtherance of the County’s effort s in response to the COVID-19 public health emergency and its negative economic impacts, the Part ies desire to enter into this agreement by which the County will, pursuant to the terms and conditions set forth in this Agreement, grant ARPA Funds to Grantee in the amount set forth herein for use ex clusively for ARPA-eligible expenses incurred in connection with the Program.

NOW, THEREFORE, it is agreed by the Parties to this Agreement as follows:

1. Attachments
The following exhibits are attached hereto and incorp orated by reference as if fully set forth herein:

Exhibit A – Program; Exhibit B – Grant Disbursement; and Attachment E - Additional Agreement Provisions.

2. Grant
Subject to the terms and conditions specified herein, the County hereby grants to Grantee a grant in a total amount not to exceed One Hundred Thousand Dollars and Zero Cents ($100,000.00) in ARPA Funds (the “Grant”) provided that (i) in no event shall the County’s total fiscal obligation under this Agreement exceed the amount of the Grant; and (ii) Grantee sh all only use the Grant for the Grant Purpose as set forth below in Section 3.

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3. Grant Purpose
a. The Parties agree that the purpose of the Grant is to provide funding exclusively for ARPA-eligible expenses reasonably and necessarily incurred in connection with the Program, as further set forth in Exhibit A (“Grant Purpose”). The Grant shall not be used for any other purpose without the prior written consent of the County.

b. Grantee agrees that at no time will any Grant funds be used: (i) to attempt to influence the outcome of any specific public election, or to participate in, or intervene in (including the publishing or distributing of statements) any political campaign on behalf of (or in opposition to) any candidate for public office; (ii) to attempt to influence the selection, nomination, election or appointment of any individual to any public office or office in a political organization within the meaning of Internal Revenue Code Section 527(e)(2); and/or (iii) for any activity that is in violation of federal, state, or local law or any effort to induce or encourage violations of law or public policy.

4. Grant Disbursement. See Exhibit B for terms and conditions relating to disbursement of the Grant.

5. Grantee’s Representations and Warranties
Grantee represents and warrants the following:
a. Grantee shall use its best efforts to ensure that the Program serves smal l businesses that have been negatively impacted by the COVID-19 pandemic and its economic consequences and shall establish and implement protocols to verify that such individuals, households and/or small businesses are eligible for assist ance under ARPA and maintain records of same. Grantee shall ensure that the Program is developed and oper ated in compliance wi th applicable law and regulations.
b. Grantee has full power, authority, and legal right to execute and deliver this Agreement and all other agreements, documents, and instruments contemplated hereby or thereby and to incur and perform its obligations hereunder and thereunder.
c. Grantee is not in default under or in violation of any indenture or agreement to which it is a party or by which it is bound, or any order, regulation, ruling, or requirement of a court or other public body or authority. No creditor has given Grantee a notice or threatened to give it any notice of default under any material agreement. No event has occurred and is continuing and no condition exists that would constitute an event of default or an event which, with the lapse of time or the giving of notice, or both, would become an event of default. d. No action, suit or proceeding (and to its knowledge, no investigation) is pending against Grantee before any court or administrative agency, (i) the outcome of which, by itself or taken together with other such litigation, would be reasonably expected to have a mate rial adverse effect on Grantee’s business, assets, operations, or financial condition, or (ii) which purports to affect the legality, enforceability, or validity of this Agreement. e. Grantee is in material compliance with all fede ral, state and local laws, rules, regulations, ordinances, and orders applicable to it, including, without limitation, all applicable health and safety, environmental, and building and zoning laws.

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f. Grantee will submit an IRS W-9 Form to the County and such other documentation as reasonably requested by the County to facilitate disbursement of the Grant.

Grantee agrees to provide records sufficient to subs tantiate its representations and warranties upon the County’s request. Grantee understands and agrees that the foregoing representations and warranties are material to the County’s approval of the Grant.

6. Reporting Requirements
Grantee shall provide the County with written quarterly reports, submitted electronically on Grantee’s official letterhead to the attention of the person identified by the County in Section 13 of this Agreement, or their designee(s), detailing: (a) Program status and progress toward meeting the Grant Purpose; (b) expenditures to which the Grant funds have been applied as specified in Exhibit B; and (c) any further reporting reasonably requested by the County to effectuate the terms and conditions of the Grant. For purposes of this Agreement, the quarterly reporting periods while the Agreement remains in place are from January 1 through March 31, from April 1 thro ugh June 30, from July 1 through September 30, and from October 1 through December 31, and Grantee’s quarterly reporting shall be due within seven (7) days after end of each quarter.

7. Relationship of Parties/Subaward
a. Notwithstanding any publicity or other referenc es to the County, the Parties understand and agree that any activities funded by the Grant are not performed by the Grantee or any other person or entity as an independent contractor of the County, or as an employee of the County, and that neither the Grantee, nor its employees, officers, agents, representatives, contractors or subsidiaries acquire any of the rights, privileges, powers, or advantages of County contactors or County employees. The Grantee acknowledges and agrees that it is not, and will not hold itself out as, an agent, partner, or co-venturer of th e County, and that this Agreement is not intended to and does not create an agency, partnership, or joint venture between the Parties. This Agreement is entered into for the sole benefit of the Parties and is not for the benefit of, nor may any provision hereof, be enforced by any other pe rson or entity; thus nothing contained herein or in the Parties’ course of dealings shall be construed as conferring any third-party beneficiary status on any person or entity not a party to this Agreement.

b. The Parties understand that the funds provided by the County under this Agreement are a subaward of ARPA Funds. (Fed. Award Id No. SFLRP0201; Asst. List No. 21027). This means that if Grantee expends more than $750,000 in Federal awards during the fiscal year, Grantee agrees to submit to audit under the Single Audit Act and its implementing regulations at 2 CFR Part 200, Subpart F. This is not a research and development award.

c. Because Grantee is receiving a subaward of ARPA Funds, the County must take steps to ensure that Grantee meets the audit requirements and uses the ARPA Funds in accordance with applicable laws, regulations, and award terms and conditions. Thus, Grantee agrees upon request to promptly (i) identify in writing to the County any ARPA, CARES Act, or other federal awards/subawards it has received within the past three years and amounts thereof; (ii) provide the County with a copy of any audit reports, including Single Audit reports, within the past three years; (iii) identify its respective current management personnel and systems; and (iv) identify any approved federally recognized indirect cost rate negotiated with the Federal Government. Unless an approved federally recognized indirect cost rate applies, the de minimis indirect cost rate (10%)

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shall apply to the subaward.

d. Grantee agrees to cooperate and assist with effe ctive subrecipient monitoring by the County to ensure compliance with all terms and conditions of ARPA and its implementing rules, regulations, reporting, and recordkeeping requirements, including, without limitation, by making itself available for and cooperating with audits and on-s ite reviews and timely completing applicable close-out requirements.

8. Term & Termination
Subject to compliance with all terms and conditions, the term of this Agreement shall commence on July 1, 2023 and continue in effect through June 30, 2024, subject to all Grantee reporting/auditing obligations under the Agreement, which shall survive the Agreement and be due as set forth herein. This Agreement will not automatically renew, nor shall it create any reliance on the possibility of future grants. Grantee understands and agrees that, to the extent all Grant funds are not expended or disbursed at the time of termination, Grantee must promptly return all unexpended funds to the County, and any unexpended or undisbursed funds at the time of termination shall be forfeited.

County may suspend and/or terminate this Agreement if Grantee fails to comply with the terms of this Agreement (including breach of any representation a nd warranty provided herein) and may, in its sole discretion, withhold or cancel pending and future disbursements of funds and/or require Grantee to return some or all funds disbursed under this Agreement.

See Attachment E for additional terms of termination.

9. Duty to Defend, Indemnify and Hold Harmless
Pursuant to Government Code Se ction 895.4, Grantee shall indemnif y and save harmless County and its officers, agents, employees, and servants from all claims, suits, or actions of every name, kind, and description resulting from this Agreement, the perfor mance of any work or services funded under this Agreement, or payments made pursuant to this Ag reement brought for, or on account of, any of the following:
(A) injuries to or death of any person, including as to Grantee or its respective employees/officers/agents;
(B) damage to any property of any kind whatsoever and to whomsoever belonging; (C) any sanctions, penalties, or claims of damages resulting from the Grantee’s failure to comply, if applicable, with the requirements set forth in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and all Federal regulations promulgated thereunder, as amended; or
(D) any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of County and/or its officers, agents, employees, or servants. However, Grantee’s duty to indemnify and save harmless under this Section shall not apply to injuries or damage for which County has been found in a court of competent jurisdiction to be solely liable by reason of its own negligence or willful misconduct.

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The duty of Grantee to indemnify and save harmless as set forth by this Section shall include the duty to defend as set forth in Section 2778 of the California Civil Code.

10. Insurance
a. General Requirements
Grantee shall not commence work funded under this Agreement unless and until all insurance required under this Section has been obtained and such insurance has been approved by County’s Risk Management, and Grantee shall use diligence to obta in such insurance and to obtain such approval.

Grantee shall furnish County with certificates of insurance evidencing the required coverage, or adequate proof of self-insurance pursuant to Government Code Section 989, et seq., and there shall be a specific contractual liability endorsement extending their coverage to include the contractual liability assumed by Grantee pursuant to this Agreement. These certificates (or equivalent proof of statutory self-insurance) shall specify or be endorsed to provide that thirty (30) days’ notice must be given, in writing, to County of any pending change in the limits of liability or of any cancellation or modification of the policy. b. Workers’ Compensation and Employer’s Liability Insurance Grantee shall have in effect during the entire te rm of this Agreement workers’ compensation and employer’s liability insurance providing full statut ory coverage. In signing this Agreement, Grantee certifies, as required by Section 1861 of the California Labor Code, that (a) it is aware of the provisions of Section 3700 of the California Labor Code, which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in a c c o r d a n c e w i t h t h e p r o v i s i o n s o f t h e L a b o r Code, and (b) it will comply with such provisions before commencing the performance of work funded under this Agreement.
c. Liability Insurance
Grantee shall take out and maintain during the term of this Agreement such bodily injury liability and property damage liability insurance as shall protect Grantee and all of its employees/officers/agents while performing work funded by this Agreement from any and all claims for damages for bodily injury, including accidental death, as well as any and all claims fo r property damage which may arise from Grantee’s operations under this Agreement, whether such operations be by Grantee, any contractor, anyone directly or indirectly employed by them, or an agent of either of them. Such insurance shall be combined single limit bodily injury and property damage for each occurrence and shall not be less than the amounts specified below:
(A) Comprehensive Genera l Liability…………. $1,000,000
(B) Motor Vehicle Liability Insurance…………. $1,000,000
(C) Professional Liabilit y……….………………. $1,000,000
County and its officers, agents, employees, and servants shall be named as additional insured on any such policies of insurance (or equivalent proof of statutory self-insurance), which shall also contain a provision that (a) the insurance afforded thereby to County a nd its officers, agents, employees, and servants shall be primary insurance to the full limits of liability of th e policy and (b) if the County or its officers, agents, employees, and servants have other insurance agains t the loss covered by such a policy, such other insurance shall be excess insurance only.

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In the event of the breach of any provision of this Se ction, or in the event any notice is received which indicates any required insurance coverage will be diminished or canceled, County, at its option, may, notwithstanding any other provision of this Agreemen t to the contrary, immediately declare a material breach of this Agreement and suspend all further payment under this Agreement.

11. Assignability and Subcontracting
Grantee shall not assign this Agreement or any portio n of it to a third party. Any such assignment or subcontract without County’s prior written consent shall give County the right to automatically and immediately terminate this Agreement without penalty or advance notice and the County shall have the right to a refund of all funds disbursed under this Agreement. This provision shall not prohibit Grantee from retaining service providers to provide services in connection with the Program.

12. Compliance With Laws
Grantee agrees that all work funded under this Ag reement shall be performed in accordance with all applicable Federal, State, County, and municipal laws, ordinances, and regulations, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Federal Regulations promulgated thereunder, as amended (if applicable), the Business Associate requirements set forth in Attachment H (if attached), the Americ ans with Disabilities Act of 1990, as amended, and Section 504 of the Rehabilitation Act of 1973, which proh ibits discrimination on the basis of disability in programs and activities receiving any Federal or Count y financial assistance. Such services shall also be performed in accordance with all applicable ordinances and regulations, including but not limited to appropriate licensure, certification regulations, and provisions pertaining to confidentiality of records. In the event of a conflict between the terms of this Agreement and any applicable State, Federal, County, or municipal law or regulation, the requirements of the applicable law or regulation will take precedence over the requirements set forth in this Agreement. Grantee will timely and accurately complete, sign, and submit all necessary documentation of compliance.

13. Notices
Any notice, request, demand, or other communication required or permitted under this Agreement shall be deemed to be properly given when both: (1) transmitted via email to the email address listed below; and (2) sent to the physical address listed below by either being deposited in the United States mail, postage prepaid, or deposited for overnight delivery, charges prepaid, with an established overnight courier that provides a tracking number showing confirmation of receipt.

In the case of County, to: In the case of Grantee, to:

Justin Mates
400 County Center, 1st Floor
Redwood City, CA 94063
(650) 363-4136
[email protected]
Jennifer Dianos/Assistant to the City Manager
City of San Bruno
567 El Camino Real
San Bruno, CA 94066
(650) 616-7007
(650) 616-7056
[email protected]

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14. Electronic Signature
The Parties wish to permit this Agreement and future documents relating to this Agreement to be digitally signed in accordance with California law and County’ s Electronic Signature Administrative Memo. Any party to this Agreement may revoke such agreement to permit electronic signatures at any time in relation to all future documents by providing notice pursuant to this Agreement.

15. Payment of Permits/Licenses
Grantee bears responsibility to obtain any license, permit, or approval required from any agency for work/services to be funded under this Agreement prior to commencement of said work/services. Failure to do so will result in forfeit of any right to reimbursement under this Agreement.

16. Effective Date
This Agreement shall be effective upon the date that all signatories have executed the Agreement (the “Effective Date”).
* * *
THIS AGREEMENT IS NOT VALID UNTIL SIGNED BY ALL PARTIES. NO FUNDS WILL BE DISTRIBUTED UNTIL THIS DOCUMENT HAS BEEN SIGNED BY THE COUNTY’S AUTHORIZED DESIGNEE. [Signatures on following page]

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For Grantee City of San Bruno:

_____________________________
(signature)
Authorized Representative
Grantee

_____________________________
(please print name)
Authorized Representative
City

_______________
Date
_____________________________
Name of Grantee

For County:

______________________________
(Signature)
Authorized Designee
County of San Mateo

____________________________
(please print name)
Authorized Designee
County of San Mateo

______________
Date

__________________________
Job Title (please print)

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Exhibit A- Program

The Program is designed to mitigate financial hardship and to help prepare COVID-impacted small businesses, including retail and restaurant businesses, to meet post-pandemic customer expectations through technical assistance trainings, consultations, and a grant program operated by the three participating pilot cities. Eligible impacted small businesses may use their grants to pay for business process modifications and operational expenses.

Grantee, as one of the three participating pilot cities, shall complete the following tasks within nine (9) months of the Effective Date.

1. Program Details. Grantee shall finalize all grant program details, which must, at minimum, include the following:

a. Determine grant amount(s), which in all cases must be reasonably proportional to the harm suffered by the qualifying small business recipient.

b. Establish eligibility criteria for impacted small businesses; provided, however, that all recipients of assistance under the Program must (i) be a small business—defined, for these purposes, to mean a business having no more than 15 employees, that is independently owned and operated, earns less than $3 million in annual gross income, and that is not dominant in its field of operation; (ii) have, where required, a valid business license; (iii) have a currently operating physical business address within Grantee’s jurisdictional boundaries; and (iv) have suffered financial hardship as a result of the COVID-19 pandemic. To receive a grant, impacted small businesses must also attend sessions in which Good City Company will provide technical assistance.

c. In coordination with Good City Company, create an outreach program/strategy designed to raise awareness of the Program among qualifying small businesses and distribute materials in languages in which outreach is provided.

d. Design an application process that is accessible to eligible impacted small businesses.

e. Establish a grant administration process, which process could include contracting with a third-party administrator for such services, provided that Grantee shall employ controls to ensure that costs for the third-party administrator are reasonable and necessary.

2. Written Summary of Program Details . Within 60 days after the Effective Date, Grantee shall provide a written summary of the Program details determined above in Section 1 of this Exhibit A to the County Project Manager (County shall notify Grantee of designated County Project Manager and their contact information), the Good City Company Program lead, and the other pilot city leads to share information, discuss design logic, review any common issues or concerns with implementation of the Program.

3. Implementation and Disbursement. Grantee shall implement the Program and distribute cash grants according to the Program details determined above in Section 1 of this Exhibit A.

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4. Records. Grantee shall maintain records of all eligible small businesses receiving grants, to include the following information:

a. Type of small business
b. Small business owner demographics, including racial and ethnic background and gender c. Summary of how impacted small businesses used the grant funds received

5. Monthly Updates. Grantee shall meet with County Project Manager monthly to provide updates regarding the Program, including status of Program roll-out, number of grants distributed to impacted small businesses to date, and review of any outstanding issues or concerns.

6. Final Report. After all grants are awarded to impacted small businesses, Grantee shall provide a summary report that includes, at minimum, demographic information of grant recipients, types of businesses assisted, comments/feedback from five or more grantees, and any additional information requested by County.

7. Cooperation. Grantee agrees to cooperate with the County to determine and carry out other responsibilities as agreed upon between the County and Grantee to implement the Program.

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Exhibit B – Grant Disbursement

a. Installments. Subject to Grantee’s compliance with the terms and conditions of the Agreement and the procedures specified herein, the County shall disburse the Grant to Grantee in two installments of $50,000 each, with the first installment disbursed after the Effective Date and within 30 days of receipt of Grantee’s disbursement request. The second installment shall be disbursed, subject to the True-Up Process specified below in Section (d), on or befo re December 31, 2023 following the County’s approval of Grantee’s written request(s) for disbursement. In no event shall the County’s disbursements exceed the total amount of the Grant.

b. Disbursement Requests. Grantee’s written requests for disbursement and cost reporting shall (i) be submitted electronically to the County on Grantee’s official letterhead to the attention of the person identified in Section 13 of this Agreement, or their designee(s), and (ii) include the date of the request, disbursement amount per the specified installments (as applicable), and this Agreement’s number.

c. Quarterly Cost Reporting . Grantee’s quarterly reporting required under Section 6 of this Agreement shall also include Grantee’s actual cost s incurred for the Program for the preceding quarter with supporting documentation for such costs to wh ich the Grant funds have been applied, including without limitation, invoices, receipts, payroll, and activity logs sufficient to substantiate the costs. Invoice documentation must be accompanied by a line-item accounting for monthly expenses and evidence of work performed, or costs incurred, including, but not limited to, timesheets, copies of bills, and/or packing slips. Grantee shall include a writte n certification that th e costs were actually incurred for the Program and that the supporting documentation is true, correct and complete.

d. True-Up Process . The County shall review Grantee’s quarterly cost reporting and supporting documentation and periodically reconcile the actual Program costs reported and substantiated with the amount of the disbursed installments of the Grant. To the extent that Grantee’s reasonable and necessary, actual costs of the Program incurred exceed the amount of the prior installment of the Grant, the excess amounts may be applied or otherwise credited against future installments of the Grant; to the extent that Grantee’s reasonable and necessary, actual costs of the Program incurred are less than the amount of the prior installment of the Grant, the County may adjust the amount of later installments accordingly. In no event, however, shall the County’s total disburseme nts exceed the total amount of the Grant. The County’s disbursement of the second installment of the Grant is conditioned upon Grantee’s compliance with its quarterly cost reporting obligations and ot her terms and conditions of this Agreement. Grantee shall promptly return to County any amount of the Grant that has not been spent as of June 30, 2024.

e. Indirect cost rate . Grantee confirms it does not have an approved federally recognized indirect cost rate and, as such, the allocable indirect costs against the Grant funds may be charged at a rate not to exceed the 10% de minimis federal indirect cost rate.

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1 Attachment E – Additional Agreement Provisions

A. Termination

This Agreement may be terminated by Grantee or by the County Executive or their designee at any time without a requirement of good cause upon thirty (30) days’ advance written notice to the other party. Subject to availability of funding, Grantee shall be entitled to receive payment for work/services provided prior to termination of the Agreement. Such payment shall be that prorated portion of the full payment determined by comparing the work/services actually completed to the work/services required by the Agreement.

County may terminate this Agreement or a portion of the services referenced in the Attachments and Exhibits based upon the unavailability of Federal, State, or County funds by providing written notice to Grantee as soon as is reasonably possible after County learns of said unavailability of outside funding.

County may terminate this Agreement for cause. In order to terminate for cause, County must first give Grantee notice of the alleged breach. Grantee shall have five business days after receipt of such notice to respond and a total of ten calendar days after receipt of such notice to cure the alleged breach. If Grantee fails to cure the breach within this period, County may immediately terminate this Agreement without further action. The option available in this paragraph is separate from the ability to terminate without cause with appropriate notice described above. In the event that County provides notice of an alleged breach pursuant to this section, County may, in extreme circumstances, immediately suspend performance of services and payment under this Agreement pending the resolution of the process described in this paragraph. County has sole discretion to determine what constitutes an extreme circumstance for purposes of this paragraph, and County shall use reasonable judgment in making that determination. Subject to availability of funding, Grantee shall be entitled to receive payment on a prorated basis for work/services actually completed and delivered prior to termination of the Agreement and for which there is no dispute.

B. Retention of Records; Right to Monitor and Audit

(1) Grantee agrees to maintain records and financial documents for five years after termination of the Agreement and agrees to cooperate with the County to provide or make available such records to the US Treasury upon request, and to any authorized oversight body, including but not limited to the Government Accountability Office (“GAO”), US Treasury’s Office of Inspector General, and the Pandemic Relief Accountability Committee. Grantee shall be subject to examination and/or audit by County, a Federal agency, and the State of California.

(2) Grantee shall comply with all program and fiscal reporting requirements set forth by applicable Federal, State, and local agencies and as required by County.

(3) Grantee agrees upon reasonable notice to provide to County, to any Federal or State department having monitoring or review authority, to County’s authorized representative, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement, and to evaluate the quality, appropriateness, and timeliness of services performed.

(4) In compliance with the Disaster Recovery Act of 2018, the County and the Grantee acknowledge and agree that no language in this contract is intended to prohibit audits or internal reviews by the FEMA Administrator or the Comptroller General of the United States.

(5) Grantee shall cooperate with the County to ensure compliance with the American Rescue Plan Act and its implementing rules, regulations, reporting and recordkeeping requirements, including without limitation cooperation, as requested, in connection with the County’s preparation

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2 of Interim Reports, Project and Expenditure Reports and Recovery Plan Performance Reports and any other reports required by the US Treasury.

C. Merger Clause; Amendments

The Agreement, including the Exhibits and Attachments attached to the Agreement and incorporated by reference, constitutes the sole Agreement of the parties to the Agreement and correctly states the rights, duties, and obligations of each party as of the Agreement’s date. In the event that any term, condition, provision, requirement, or specification set forth in the body of the Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in any Exhibit and/or Attachment to the Agreement, the provisions of the body of the Agreement shall prevail; provided, however, that, in the event that any term, condition, provision, requirement, or specification set forth in the body of the Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in Attachment E, the provisions of Attachment E shall prevail. Any prior agreement, promises, negotiations, or representations between the parties not expressly stated in this document are not binding. All subsequent modifications or amendments shall be in writing and signed by the parties.

D. Dispute Resolution; Controlling Law; Venue

The validity of this Agreement and of its terms, the rights and duties of the parties under this Agreement, the interpretation of this Agreement, the performance of this Agreement, and any other dispute of any nature arising out of this Agreement shall be governed by the laws of the State of California without regard to its choice of law or conflict of law rules. Any dispute arising out of this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court for the Northern District of California. In the event of breach or other dispute arising out of this Agreement, County reserves the right to pursue all remedies, legal, contractual, administrative or otherwise against Grantee, including the recovery of any sanctions and penalties authorized by law.

E. Suspension and Debarment

(1) This contract is a covered transaction for purposes of 2 C.F.R. pt. 180 and 2 C.F.R. pt. 3000. As such, the Grantee is required to verify that none of Grantee’s principals (defined at 2 C.F.R. § 180.995) or its affiliates (defined at 2 C.F.R. § 180.905) are excluded (defined at 2 C.F.R. § 180.940) or disqualified (defined at 2 C.F.R. § 180.935).

(2) Grantee agrees to comply with 2 C.F. R. pt. 180, subpart C and 2 C.F.R. pt. 3000, subpart C, throughout the term of this Agreement and must include a requirement to comply with these regulations in any lower tier covered transaction it enters into.

(3) This certification is a material representat ion of fact relied upon by County If it is later determined that the Grantee did not comply with 2 C.F.R. pt. 180, subpart C and 2 C.F.R. pt. 3000, subpart C, in addition to remedies available to County, the Federal Government may pursue available remedies, including but not limited to suspension and/or debarment.

F. Procurement of Recovered Materials

In the performance of this contract, Grantee shall make maximum use of products containing recovered materials that are United States Environmental Protection Agency (“EPA”)-designated items unless the product cannot be acquired. Information about this requirement, along with the list of EPA- designated items, is available at EPA’s Comprehensive Procurement Guidelines web site, https://www.epa.gov/smm/comprehensive- procurement-guideline-cpg-program. Grantee also agrees to comply with all other applicable requirements of Section 6002 of the Solid Waste Disposal Act.

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3 G. Clean Air Act and Water Pollution Act Compliance

(1) Grantee agrees to comply with all applic able standards, orders or regulations issued pursuant to the Clean Air Act, as amended, 42 U.S.C. § 7401 et seq. and the Federal Water Pollution Act, as amended 33 U.S.C. 1251. et. seq.

(2) Grantee agrees to report each violation to the County understands and agrees that the County will, in turn, report each violation as required to assure notification to the Federal Emergency Management Agency, and the appropriate Environmental Protection Agency Regional Office.

(3) Grantee agrees to include these requirements in each subcontract exceeding $150,000 financed in whole or in part with Federal assistance provided by FEMA.

H. Compliance with the Contract Work Hours and Safety Standards Act

(1) Overtime requirements. No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek.

(2) Violation; liability for unpaid wages; liqui dated damages. In the event of any violation of the clause set forth in paragraph (b)(1) of this section the contractor and any subcontractor responsible therefor shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United States (in the case of work done under contract for the District of Columbia or a territory, to such District or to such territory), for liquidated damages.

Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in paragraph (b)(1) of this section, in the sum of $26 for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in paragraph (b)(1) of this section.

(3) Withholding for unpaid wages and liquidated damages. The County shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the contractor or subcontractor under any such contract or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same prime contractor, such sums as may be determined to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in paragraph (b)(2) of this section.

(4) Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set forth in paragraph (b)(1) through (4) of this section and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in paragraphs (b)(1) through (4) of this section.

I. Byrd Anti-Lobbying Amendment, 31 U.S.C. § 1352 (as amended)

Contractors who apply or bid for an award of $100,000 or more shall file with the County the required certification (see below). Each tier certifies to the tier above that it will not and has not used Federal appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, officer or employee of

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4 Congress, or an employee of a Member of Congress in connection with obtaining any Federal contract, grant, or any other award covered by 31 U.S.C. § 1352. Each tier shall also disclose any lobbying with non-Federal funds that takes place in connection with obtaining any Federal award.

Such disclosures are forwarded from tier to tier up to the recipient who in turn will forward the certification(s) to the awarding agency.

The required certification shall state the following (see 44 C.F.R. Appendix A to Part 18):

CERTIFICATION REGARDING LOBBYING

Certification for Contracts, Grants, Loans, and Cooperative Agreements

The undersigned certifies, to the best of his or her knowledge and belief, that:

1. No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.

2. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions.

3. The undersigned shall require that the language of this certification be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall certify and disclose accordingly.

This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by section 1352, title 31, U.S. Code. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.

Grantee certifies or affirms the truthfulness and accuracy of each statement of its certification and disclosure, if any. In addition, the Grantee understands and agrees that the provisions of 31 U.S.C. Chap. 38, Administrative Remedies for False Claims and Statements, apply to this certification and disclosure, if any.

___________________________________________
Signature of Grantee’s Authorized Official

___________________________________________
Name and Title of Grantee’s Authorized Official

___________________________________________
Date

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Darcy Smith, Assistant City Manager
Maria Langbauer, Economic Development Manager
SUBJECT:Consider Adoption of a Resolution Granting Consent to the City of Burlingame to Form the San Francisco Peninsula Tourism Marketing District (SFPTMD) and Include the City of San Bruno
BACKGROUND:

In 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law). SFP and San Mateo County lodging businesses seek to modernize the SMCTBID by forming a new District, the SFPTMD, pursuant to the Property and Business Improvement District Law of 1994.

Overview of Tourism Marketing Districts
Tourism Marketing Districts (TMDs) utilize the efficiencies of private sector operation in the market-based promotion of tourism. These special assessment districts allow lodging business owners to organize their efforts to increase tourism. Lodging business owners within the TMD fund the TMD, and those funds are used to provide services that are desired by and benefit the lodging businesses within the TMD.

TMD benefits include the following:

•Funds cannot be diverted for other government programs; •They are customized to fit the needs of each destination; •They allow for a wide range of services; including: destination marketing, tourism promotion, and sales lead generation;
•They are designed, created and governed by those who will pay the assessment; and •They provide a stable funding source for tourism promotion.

In California, TMDs are primarily formed pursuant to the Property and Business Improvement District Law of 1994. This law allows for the creation of a special benefit assessment districts to raise funds within a specific geographic area. The key difference between TMDs and other special benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the TMD.

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Honorable Mayor and Members of the City Council
June 13, 2023

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DISCUSSION:

This agenda item presents for the City Council consideration adoption of the resolution (Attachment 1) granting consent to the City of Burlingame to form the SFPTMD and include the City of San Bruno in the SFPTMD. The action will enable the City of Burlingame and the San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP) to move forward with the SFPTMD formation process. Upon successful formation, the SFPTMD will be governed by SFP and by the Management District Plan and will be facilitated by the Burlingame City Council. On May 15, 2023, the City of Burlingame adopted Resolution No. 049-2023 declaring its intention to establish the SFPTMD and Resolution No. 050-2023 requesting consent from the cities of Belmont, Brisbane, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County to form the SFPTMD (Attachment 2).

Proposed San Francisco Peninsula Tourism Marketing District The SFPTMD is a benefit assessment district proposed to create a revenue source to help fund marketing and sales promotion efforts for San Francisco Peninsula area lodging businesses.

This approach has been used successfully in other destination areas throughout the state to improve tourism and drive additional room nights to assessed lodging businesses. The proposed SFPTMD includes all lodging businesses located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County. SFP and lodging business owners decided to pursue formation of the SFPTMD in order to create a revenue source devoted to marketing the San Francisco Peninsula area as a tourist, meeting and event destination. If established, the SFPTMD would generate approximately $10,895,479 on an annual basis for promotion of travel and tourism specific to the San Francisco Peninsula area. There is no costs or fees for the City of San Bruno.

The Management District Plan (Attachment 3) includes the proposed boundary of the SFPTMD, a service plan and budget and a proposed means of governance. The SFPTMD will include all lodging businesses located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County.

The annual assessment rate is one-and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries.

Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty.

The proposed SFPTMD will have a five (5) year life, beginning October 1, 2023, or as soon as

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Honorable Mayor and Members of the City Council
June 13, 2023

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possible thereafter, and ending five (5) years from its start date. The assessment will be implemented beginning October 1, 2023, or as soon as possible thereafter. Once per year beginning on the anniversary of SFPTMD formation there is a thirty (30) day period in which business owners paying fifty percent (50%) or more of the assessment may protest and begin proceedings to terminate the SFPTMD.

The City of Burlingame shall be responsible for collecting the assessments on a monthly basis (including any delinquencies, penalties and interest) from each lodging business located in the boundaries of the SFPTMD. The City of Burlingame shall take all reasonable efforts to collect the assessments from each lodging business. The City of Burlingame shall be paid a fee equal to one percent (1%) of the amount of assessment collected or a flat fee of $60,000, whichever is greater each year to cover its costs of collection and administration.

FISCAL IMPACT:

There is no fiscal impact from adoption of the resolution. Because the SFPTMD programs are intended to increase room night sales for assessed lodging businesses within the SFPTMD, there may be an increase in transit occupancy tax collections by the City over the five-year life of the SFPTMD.

ENVIRONMENTAL IMPACT:

The adoption of a resolution granting consent to the City of Burlingame to form the San Francisco Peninsula Tourism Marketing District (SFPTMD) and include the City of San Bruno does not have the potential for creation of a significant environmental impact pursuant to the California Environmental Quality Act (CEQA), and as such are exempt from further environmental consideration per CEQA Guidelines Section 15061(b)(3).

RECOMMENDATION:

That the City Council consider adoption of a resolution granting consent to the City of Burlingame to form the San Francisco Peninsula Tourism Marketing District (SFPTMD) and include the City of San Bruno.

ALTERNATIVES:

1. Do not adopt the resolution. Staff does not recommend this option.

2. Direct staff to make changes to the resolution.

ATTACHMENTS:

1. Resolution

2. City of Burlingame Adopted Resolutions No. 049-2023 and 050-2023

3. SFPTMD Management District Plan

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RESOLUTION NO. 2023 - _____

RESOLUTION GRANTING CONSENT TO THE CITY OF BURLINGAME TO FORM THE SAN

FRANCISCO PENINSULA TOURISM MARKETING DISTRICT (SFPTMD) WHEREAS, in 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law) by City of Burlingame Ordinance No. 1648; and
WHEREAS, the City of San Bruno granted consent to the City of Burlingame to be included within the boundaries of the SMCTBID by San Bruno City Council Resolution No. 2001-4; and
WHEREAS, the City of Burlingame, San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP), and San Mateo County lodging businesses seek to modernize the SMCTBID by forming a new District, the San Francisco Peninsula Tourism Marketing District (SFPTMD), pursuant to the Property and Business Improvement District Law of 1994; and
WHEREAS, the Property and Business Improvement Law of 1994, Streets and Highways Code § 36600 et seq., authorizes the City of Burlingame to establish business improvement districts for the purposes of driving increased business sales directly to payors; and WHEREAS, the City Council of the City of Burlingame has requested consent to form the SFPTMD in the City of San Bruno with adoption of Burlingame City Council Resolution No. 050- 2023, dated May 15, 2023.

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of San Bruno, that:

Section 1: The above recitals are true and correct.

Section 2: The City of Burlingame is hereby granted consent to include the City of San Bruno in the SFPTMD, for the formation of the SFPTMD and future renewals.

Section 3: The Clerk of the City of San Bruno is hereby directed to transmit a certified copy of this Resolution to the Clerk of the City of Burlingame.

Section 4: This Resolution is effective upon its adoption.

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---oOo---
I hereby certify that foregoing Resolution No. 2023 - ____ was introduced and adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following vote:

AYES:

NOES:

ABSENT:

_________________________________
Lupita Huerta, City Clerk

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RESOLUTION NO. 049-2023 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BURLINGAME DECLARING ITS INTENTION TO ESTABLISH THE SAN FRANCISCO PENINSULA TOURISM MARKETING DISTRICT (SFPTMD) AND FIXING THE TIME AND PLACE OF A PUBLIC MEETING AND A PUBLIC HEARING THEREON AND GIVING NOTICE THEREOF WHEREAS, in 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law) by Resolution No. 074-2001; and WHEREAS, the City of Burlingame (City), San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP), and San Mateo County lodging businesses seek to modernize the SMCTBID by forming a new District, the San Francisco Peninsula Tourism Marketing District (SFPTMD), pursuant to the Property and Business Improvement District Law of 1994; and WHEREAS, the Property and Business Improvement Law of 1994, Streets and Highways Code § 36600 et seq., authorizes the City to establish business improvement districts for the purposes of promoting tourism; and WHEREAS, lodging business owners, and representatives from the City of Burlingame have met to consider the formation of the SFPTMD; and WHEREAS, SFP has drafted a Management District Plan (Plan) that sets forth the proposed boundary of the SFPTMD, a service plan and budget, and a proposed means of governance; and WHEREAS, the proposed SFPTMD includes all lodging businesses, existing and in future, in the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County; and WHEREAS, consent to include lodging businesses in their respective jurisdictions will be requested from the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County; and WHEREAS, lodging businesses who will pay more than fifty percent (50%) of the assessment under the SFPTMD have petitioned the City Council to establish the SFPTMD. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL THAT: 1. The recitals set forth herein are true and correct. 2. The City Council finds that lodging businesses that will pay more than fifty percent (50%) of the assessment proposed in the Plan have signed and submitted petitions in support of the formation of the SFPTMD. The City Council accepts the petitions and adopts this Resolution of Intention to establish the SFPTMD and to levy an assessment on certain lodging businesses within the SFPTMD boundaries in accordance with the Property and Business Improvement District Law of 1994.

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3. The City Council finds that the Plan satisfies all requirements of Streets and Highways Code § 36622. 4. The City Council declares its intention to establish the SFPTMD and to levy and collect assessments on lodging businesses within the SFPTMD boundaries pursuant to the Property and Business Improvement District Law of 1994. 5. The SFPTMD shall include all lodging businesses, existing and in the future, located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County as shown in the map attached as Exhibit A. 6. The name of the district shall be San Francisco Peninsula Tourism Marketing District (SFPTMD). 7. The annual assessment rate is one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. 8. The assessments levied for the SFPTMD shall be applied toward sales and marketing programs to market assessed lodging businesses in the San Francisco Peninsula area as tourist, meeting, and event destinations, as described in the Plan. Funds remaining at the end of any year may be used in subsequent years in which SFPTMD assessments are levied as long as they are used consistent with the requirements of this resolution and the Plan. 9. The proposed SFPTMD will have a five (5) year life, beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date, unless renewed pursuant to Streets and Highways Code § 36660. 10. Bonds shall not be issued. 11. The time and place for the public meeting to hear testimony on establishing the SFPTMD and levying assessments are set for June 20, 2023, at 7:00 PM, or as soon thereafter as the matter may be heard, at City Hall, 501 Primrose Road, Burlingame, CA 94010. 12. The time and place for the public hearing to establish the SFPTMD and the levy of assessments are set for July 5, 2023, at 7:00 PM, or as soon thereafter as the matter may be heard, at City Hall, 501 Primrose Road, Burlingame, CA 94010. The City Clerk is directed to provide written notice to the lodging businesses subject to assessment of the

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date and time of the meeting and hearing, and to provide that notice as required by Streets and Highways Code § 36623, no later than May 21, 2023. 13. At the public meeting and hearing, the testimony of all interested persons for or against the establishment of the SFPTMD may be received. If at the conclusion of the public hearing, there are of record written protests by the owners of the lodging businesses within the proposed SFPTMD that will pay more than fifty percent (50%) of the estimated total assessment of the entire SFPTMD, no further proceedings to establish the SFPTMD shall occur for a period of one (1) year. 14. The complete Plan is on file with the City Clerk and may be reviewed upon request. 15. This resolution shall take effect immediately upon its adoption by the City Council. ______________________________ Michael Brownrigg, Mayor I, Meaghan Hassel-Shearer, City Clerk of the City of Burlingame, certify that the foregoing Resolution was introduced at a regular meeting of the City Council on the 15th day of May, 2023, and was adopted thereafter by the following vote: AYES: Councilmembers: BEACH, BROWNRIGG, COLSON, ORTIZ, STEVENSON NOES: Councilmembers: NONE ABSENT: Councilmembers: NONE ______________________________ Meaghan Hassel-Shearer, City Clerk

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EXHIBIT A District Boundaries

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1 RESOLUTION NO. 050- 2023

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BURLINGAME REQUESTING

CONSENT OF THE CITIES OF BELMONT, BRISBANE, EAST PALO ALTO, FOSTER CITY,

HALF MOON BAY, MENLO PARK, MILLBRAE, PACIFICA, REDWOOD CITY, SAN BRUNO,

SAN CARLOS, SAN MATEO, SOUTH SAN FRANCISCO, AND THE UNINCORPORATED

AREA OF SAN MATEO COUNTY TO FORM THE SAN FRANCISCO PENINSULA TOURISM

MARKETING DISTRICT
WHEREAS, the City Council of the City of Burlingame ( the Council) desires to begin proceedings to form the San Francisco Peninsula Tourism Marketing District ( SFPTMD); and WHEREAS, certain lodging business owners have requested that the Council form the SFPTMD; and
WHEREAS, a portion of the territory proposed to be included in the SFPTMD lies within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County ( the Cities and County), as shown on the map attached hereto as Exhibit A and incorporated herein by such attachment; and
WHEREAS, the area of the Cities and County that lies within the boundaries of the proposed SFPTMD will, in the opinion of the Council, be benefited by the improvements and activities, and the purpose sought to be accomplished by the work can best be accomplished by a single comprehensive scheme of work.

NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF BURLINGAME that:

Section 1: The above recitals are true and correct.

Section 2: Consent of the cities of Belmont, Brisbane, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County, through their City Councils and Board of Supervisors, is hereby requested to form the SFPTMD, and to grant to the Council of the City of Burlingame jurisdiction for all the purposes in connection with the creation, operation, and future renewals of the proposed SFPTMD.

Section 3: The Burlingame City Clerk is hereby directed to transmit a certified copy of this Resolution to the clerks of the Granting Cities and County.

Michael Brownrigg, Mayor
DocuSign Envelope ID: 72BCEE96- 8B4D- 43A3- 8C06- E6F3ED870850

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2 I, Meaghan Hassel- Shearer, City Clerk of the City of Burlingame, certify that the foregoing Resolution was introduced at a regular meeting of the City Council on the 15th day of May, 2023, and was adopted thereafter by the following vote:

AYES: Councilmembers: BEACH, BROWNRIGG, COLSON, ORTIZ, STEVENSON NOES: Councilmembers: NONE
ABSENT: Councilmembers: NONE
Meaghan Hassel- Shearer, City Clerk
DocuSign Envelope ID: 72BCEE96- 8B4D- 43A3- 8C06- E6F3ED870850

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3 Exhibit A
Boundary Map
DocuSign Envelope ID: 72BCEE96- 8B4D- 43A3- 8C06- E6F3ED870850

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SAN FRANCISCO PENINSULA TOURISM MARKETING DISTRICT MANAGEMENT DISTRICT PLAN Prepared pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq. January 23, 2023 2023-2028

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Table of Contents I. OVERVIEW .............................................................................................................................................. 3 II. BACKGROUND ....................................................................................................................................... 5 III. BOUNDARY ............................................................................................................................................. 6 IV. ASSESSMENT BUDGET AND SERVICES ............................................................................................ 7 A. ANNUAL SERVICE PLAN ................................................................................................................................... 7 B. ANNUAL BUDGET ............................................................................................................................................ 9 C. CALIFORNIA CONSTITUTIONAL COMPLIANCE .................................................................................................. 9 D. ASSESSMENT .................................................................................................................................................. 11 E. PENALTIES AND INTEREST ............................................................................................................................. 12 F. TIME AND MANNER FOR COLLECTING ASSESSMENTS .................................................................................... 13 V. GOVERNANCE ..................................................................................................................................... 14 A. OWNERS’ ASSOCIATION ................................................................................................................................. 14 B. BROWN ACT AND CALIFORNIA PUBLIC RECORDS ACT COMPLIANCE ............................................................. 14 C. ANNUAL REPORT ........................................................................................................................................... 14 APPENDIX 1 – LAW ........................................................................................................................................ 15 APPENDIX 2 – ASSESSED BUSINESSES ..................................................................................................... 26 APPENDIX 3 – BENEFITS BY BUSINESS CATEGORY ............................................................................. 31 APPENDIX 4 – SMG CONSULTING ANALYSIS .......................................................................................... 33 Prepared by Civitas (800)999-7781 www.civitasadvisors.com

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SFPTMD Management District Plan 3 January 23, 2023
I. OVERVIEW Developed by the San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP) and San Mateo County lodging businesses, the San Francisco Peninsula Tourism Marketing District (SFPTMD) is an assessment district proposed to provide specific benefits to payors, by funding marketing and sales promotion efforts for assessed businesses. This approach has been used successfully in other destination areas throughout the country to provide the benefit of additional room night sales directly to payors. In 2001, the San Mateo County Tourism Business Improvement District (SMCTBID) was formed pursuant to the Parking and Business Improvement Area Law of 1989 (89 Law). This effort seeks to modernize the SMCTBID by disestablishing the 89 Law District and forming a new District, the SFPTMD, pursuant to the Property and Business Improvement District Law of 1994 (94 Law). Location: The SFPTMD includes all lodging businesses, existing and in the future, located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County, as shown on the map in Section III. Services: The SFPTMD is designed to provide specific benefits directly to payors by increasing awareness and demand for room night sales, meetings, and conventions. Sales and marketing programs will increase demand for overnight tourism and market payors as tourist, meeting and event destinations, thereby increasing demand for room night sales, meetings, and conventions. Budget: The total SFPTMD annual assessment budget for the initial year of its five (5) year operation is anticipated to be approximately $10,895,479. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as room sales do. Cost: The annual assessment rate is one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. Collection: The City of Burlingame shall be responsible for collecting the assessments on a monthly basis (including any delinquencies, penalties and interest) from each lodging business located in the boundaries of the SFPTMD. The City shall take all reasonable efforts to collect the assessments from each lodging business.

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SFPTMD Management District Plan 4 January 23, 2023
Duration: The SFPTMD will have a five (5) year life, beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date. After five (5) years, the SFPTMD may be renewed pursuant to the 94 Law if business owners support continuing the SFPTMD programs. Once per year, beginning on the anniversary of SFPTMD formation, there is a thirty (30) day period in which owners paying fifty percent (50%) or more of the assessment may protest and initiate a hearing on SFPTMD termination. Management: The San Mateo County/Silicon Valley Convention and Visitors Bureau dba The San Francisco Peninsula (SFP) shall serve as the SFPTMD’s Owners’ Association. The Owners’ Association is charged with managing funds and implementing programs in accordance with this Plan, and must provide annual reports to the Burlingame City Council. The SFP shall create a SFPTMD Committee tasked with determining how SFPTMD funds are spent, within the designated programs in this Plan, subject to final approval by the SFP Board. The SFPTMD Committee shall include lodging business owners or representatives paying the SFPTMD assessment.

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SFPTMD Management District Plan 5 January 23, 2023
II. BACKGROUND TMDs are an evolution of the traditional Business Improvement District. The first TMD was formed in West Hollywood, California in 1989. Since then, over 100 California destinations have followed suit. In recent years, other states have begun adopting the California model – Massachusetts, Montana, South Dakota, Washington, Colorado, Texas and Louisiana have adopted TMD laws. Several other states are in the process of adopting their own legislation. The cities of Wichita, Kansas and Newark, New Jersey used an existing business improvement district law to form a TMD. And, some cities, like Portland, Oregon and Memphis, Tennessee have utilized their home rule powers to create TMDs without a state law. California’s TMDs collectively raise over $300 million annually for local destination marketing. With competitors raising their budgets, and increasing rivalry for visitor dollars, it is important that San Francisco Peninsula tourism businesses invest in stable, commerce-specific marketing programs. TMDs utilize the efficiencies of private sector operation in the market-based promotion of tourism districts. TMDs allow tourism business owners to organize their efforts to increase commerce. Tourism business owners within the TMD pay an assessment and those funds are used to provide services that increase commerce. In California, most TMDs are formed pursuant to the Property and Business Improvement District Law of 1994. This law allows for the creation of a benefit assessment district to raise funds within a specific geographic area. The key difference between TMDs and other benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the district. There are many benefits to TMDs: • Funds must be spent on services and improvements that provide a specific benefit only to those who pay; • Funds cannot be diverted to general government programs; • They are customized to fit the needs of payors in each destination; • They allow for a wide range of services; • They are designed, created and governed by those who will pay the assessment; and • They provide a stable, long-term funding source for tourism promotion.

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SFPTMD Management District Plan 6 January 23, 2023
III. BOUNDARY The SFPTMD includes all lodging businesses, existing and in the future, located within the boundaries of the cities of Belmont, Brisbane, Burlingame, East Palo Alto, Foster City, Half Moon Bay, Menlo Park, Millbrae, Pacifica, Redwood City, San Bruno, San Carlos, San Mateo, South San Francisco, and the unincorporated area of San Mateo County, illustrated by the map below. “Lodging business” means: any hotel, motel, inn, bed and breakfast, or other similar structure or portion thereof that is rented for dwelling, lodging, or sleeping purposes on a transient basis. Tourist home or house, studio hotel, bachelor hotel, lodginghouse, roominghouse, apartment house, dormitory, public or private club, mobile home or house trailer at a fixed location, are not included in the definition of “lodging business.” The boundary is shown on the map below. A list of lodging businesses proposed to be assessed in the SFPTMD can be found in Appendix 2.

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SFPTMD Management District Plan 7 January 23, 2023
IV. ASSESSMENT BUDGET AND SERVICES A. Annual Service Plan Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to the payors that are not provided to those not charged, and which do not exceed the reasonable cost to the City of conferring the benefits or granting the privileges. The privileges and services provided with the SFPTMD funds are sales and marketing programs available only to assessed businesses. A service plan assessment budget has been developed to deliver services that benefit the assessed businesses. A detailed annual assessment budget will be developed and approved by the SFP. The table below illustrates the initial annual assessment budget allocations. These activities and allocations will also apply in subsequent years. The total initial assessment budget is $10,895,479.

Although actual revenues will fluctuate due to market conditions, the proportional allocations of the budget shall remain the same. However, the City and the SFP board shall have the authority to adjust budget allocations between the categories by no more than twenty (20%) of the total budget per year. A description of the proposed improvements and activities for the initial year of operation is below. The same activities are proposed for subsequent years. In the event of a legal challenge against the SFPTMD, any and all assessment funds may be used for the costs of defending the SFPTMD. In the first year of operation, the costs of creating the SFPTMD may be repaid by deducting repayment funds proportionally from budget categories. Each budget category includes all costs related to providing that service. For example, the sales and marketing budget includes the cost of staff time dedicated to overseeing and implementing the sales and marketing program. Staff time dedicated purely to administrative tasks is allocated to the administrative portion of the budget. The costs of an individual staff member may be allocated to multiple budget categories. The staffing levels necessary to provide the services below will be determined by the SFP Board on an as- needed basis.

Sales, Marketing, & Advocacy, $9,805,931 , 90%
Administration & Operations, $871,638 , 8%Contingency/Reserve, $108,955 , 1%City Collection Fee,$108,955 , 1% Initial Annual Assessment Budget: $10,895,479

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SFPTMD Management District Plan 8 January 23, 2023
Sales, Marketing, & Advocacy A sales and marketing program will promote assessed businesses as tourist, meeting, and event destinations. The sales and marketing program will have a central theme of promoting San Francisco Peninsula as a desirable place for overnight visits. The program will have the goal of increasing overnight visitation and room night sales at assessed businesses, and may include the following activities: • Funds to support group business to offset costs within the destination, thereby generating room nights for assessed businesses; • Payment of bid fees, incentives or other costs associated with bringing large scale events to the destination that generate room nights for assessed businesses; • Funds to support events and/or local partnerships that increase the public notoriety of the destination as a tourist, meetings, or event destination – thereby increasing consumer demand for assessed businesses; • Support of public relation strategies that increase the profile of the destination as a tourist, meetings, or event destination – thereby increasing consumer demand for assessed businesses; • Strategic partnerships, sponsorships, or other alliances that reinforce the destination within the travel marketplace and position the San Francisco Peninsula as a destination of choice for meetings, events, and leisure travel to assessed businesses; • Internet marketing efforts to increase awareness and optimize internet presence to drive overnight visitation and room sales to assessed businesses; • Print ads in magazines and newspapers, television ads, and radio ads targeted at potential visitors to drive overnight visitation and room sales to assessed businesses; • Attendance of trade shows to promote assessed businesses; • Familiarization tours of the destination and assessed businesses; • Preparation and production of collateral promotional materials such as brochures, flyers and maps featuring assessed businesses; • Attendance of professional industry conferences and affiliation events to promote assessed businesses; • Lead generation activities designed to attract tourists and group events to assessed businesses; • Director of Sales and General Manager meetings to plan and coordinate tourism promotion efforts for assessed businesses; • Education of hospitality staff on service and safety (related to alcohol and food) designed to create a visitor experience that will bring repeat visits to assessed businesses; • Education of lodging business management and the Owners’ Association on advocacy and marketing strategies best suited to meet assessed businesses’ needs; and • Other activities that increase the profile and notoriety of The San Francisco Peninsula as an overnight travel destination and promote greater room night sales for assessed businesses. Administration & Operations The administration and operations portion of the budget shall be utilized for administrative staffing costs, office costs, and other general administrative costs such as insurance, legal, and accounting fees. Contingency/Reserve The budget includes a contingency line item to account for uncollected assessments, if any. If there are contingency funds collected, they may be held in a reserve fund or utilized for other program, administration or renewal costs at the discretion of the SFP Board. Policies relating to contributions to the reserve fund, the target amount of the reserve fund, and expenditure of monies from the reserve

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fund shall be set by the SFP Board. Contingency/reserve funds may be spent on SFPTMD programs or administrative and renewal costs in such proportions as determined by the SFP Board. The reserve fund may be used for the costs of renewing the SFPTMD. City Collection Fee As lead agency, the City of Burlingame shall retain a fee equal to one percent (1%) of the amount of assessment collected or a flat fee of $60,000, whichever is greater each year, to cover their costs of collection and administration. B. Annual Budget The total five (5) year improvement and service plan budget is projected at approximately $10,895,479 annually, or $64,132,237 through 2028. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as room sales do. The following chart has been prepared based on a five-year projection developed by SMG Consulting. The full report can be found in Appendix 4. Fiscal Year Sales, Marketing, & Advocacy Administration & Operations Contingency / Reserve City Collection Fee Total 2023-24 $9,805,931 $871,638 $108,955 $108,955 $10,895,479 2024-25 $10,612,716 $943,353 $117,919 $117,919 $11,791,907 2025-26 $11,437,986 $1,016,710 $127,089 $127,089 $12,708,873 2026-27 $12,422,508 $1,104,223 $138,028 $138,028 $13,802,787 2027-28 $13,439,872 $1,194,655 $149,332 $149,332 $14,933,191 Total $57,719,013 $5,130,579 $641,322 $641,322 $64,132,237 C. California Constitutional Compliance The SFPTMD assessment is not a property-based assessment subject to the requirements of Proposition 218. Courts have found Proposition 218 limited the term ‘assessments’ to levies on real property.1 Rather, the SFPTMD assessment is a business-based assessment, and is subject to Proposition 26. Pursuant to Proposition 26 all levies are a tax unless they fit one of seven exceptions. Two of these exceptions apply to the SFPTMD, a “specific benefit” and a “specific government service.” Both require that the costs of benefits or services do not exceed the reasonable costs to the City of conferring the benefits or providing the services. 1. Specific Benefit Proposition 26 requires that assessment funds be expended on, “a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the 1 Jarvis v. the City of San Diego 72 Cal App. 4th 230

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privilege.”2 The services in this Plan are designed to provide targeted benefits directly to assessed businesses, and are intended only to provide benefits and services directly to those businesses paying the assessment. These services are tailored not to serve the general public, businesses in general, or parcels of land, but rather to serve the specific businesses within the SFPTMD. The activities described in this Plan are specifically targeted to increase demand for room night sales for assessed lodging businesses within the boundaries of the SFPTMD, and are narrowly tailored. SFPTMD funds will be used exclusively to provide the specific benefit of increased demand for room night sales directly to the assessees. Assessment funds shall not be used to feature non-assessed lodging businesses in SFPTMD programs, or to directly generate sales for non-assessed businesses. The activities paid for from assessment revenues are business services constituting and providing specific benefits to the assessed businesses. Nothing in this Plan limits the ability of the SFP Corporation to enter into private contracts with non-assessed lodging businesses for the provision of services to those businesses. The assessment imposed by this SFPTMD is for a specific benefit conferred directly to the payors that is not provided to those not charged. The specific benefit conferred directly to the payors is an increase in demand for room night sales. The specific benefit of an increase in demand for room night sales for assessed lodging businesses will be provided only to lodging businesses paying the district assessment, with marketing and sales programs promoting lodging businesses paying the SFPTMD assessment. The marketing and sales programs will be designed to increase room night sales at each assessed lodging businesses. Because they are necessary to provide the marketing and sales programs that specifically benefit the assessed lodging businesses, the administration and contingency services also provide the specific benefit of increased demand for room night sales to the assessed lodging businesses. Although the SFPTMD, in providing specific benefits to payors, may produce incidental benefits to non-paying businesses, the incidental benefit does not preclude the services from being considered a specific benefit. The legislature has found that, “A specific benefit is not excluded from classification as a ‘specific benefit’ merely because an indirect benefit to a non-payor occurs incidentally and without cost to the payor as a consequence of providing the specific benefit to the payor.”3 2. Specific Government Service The assessment may also be utilized to provide, “a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.”4 The legislature has recognized that marketing and promotions services like those to be provided by the SFPTMD are government services within the meaning of Proposition 265. Further, the legislature has determined that “a specific government service is not excluded from classification as a ‘specific government service’ merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the payor as a consequence of providing the specific government service to the payor.”6 3. Reasonable Cost SFPTMD services will be implemented carefully to ensure they do not exceed the reasonable cost of such services. The full amount assessed will be used to provide the services described herein. Funds will be managed by the SFP, and reports submitted on an annual basis to the City. Only assessed 2 Cal. Const. art XIII C § 1(e)(1) 3 Government Code § 53758(a) 4 Cal. Const. art XIII C § 1(e)(2) 5 Government Code § 53758(b) 6 Government Code § 53758(b)

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lodging businesses will be featured in marketing materials, receive sales leads generated from SFPTMD-funded activities, be featured in advertising campaigns, and benefit from other SFPTMD-funded services. Non-assessed lodging businesses will not receive these, nor any other, SFPTMD-funded services and benefits. The SFPTMD-funded programs are all targeted directly at and feature only assessed businesses. It is, however, possible that there will be a spill-over benefit to non-assessed businesses. If non-assessed lodging businesses receive incremental room nights, that portion of the promotion or program generating those room nights shall be paid with non-SFPTMD funds. SFPTMD funds shall only be spent to benefit the assessed businesses, and shall not be spent on that portion of any program which directly generates incidental room nights for non-assessed businesses. D. Assessment The annual assessment rate is one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. The services provided in the SFPTMD are all targeted to benefit payors, however, not all programs benefit payors equally. The determination of the assessment rates of one- and one-half percent (1.5%) of gross short-term sleeping room rental revenue for lodging businesses with 5,000 square feet or more of dedicated meeting space, and 0.75% for all other lodging businesses within the SFPTMD’s boundaries, was calculated based on benefit received by payors. SMG Consulting was engaged to conduct a Hotel Revenue Proportionality Estimate analysis to quantify the estimated benefit the lodging business types will receive from SFPTMD services. By analyzing the projected number of rooms sold and the total amount of revenue estimated to be generated from sales and marketing programs, SMG Consulting found that properties with 5,000 square feet or more of dedicated meeting space will receive approximately double the amount of benefit to all other lodging businesses. The SFPTMD Sales, Marketing, and Advocacy program included in the budget has services that are intended to drive convention and meetings to the SFPTMD. Since lodging businesses with 5,000 square feet or more of dedicated meeting space are uniquely suited to accommodate large conventions and will benefit from overnight stays as a result of SFPTMD services intended to bring such business activity to the SFPTMD, they are assessed at a higher rate than other lodging businesses in the SFPTMD. The term “dedicated meeting space” as used herein means: a permanent room or space whose primary use is dedicated for group and social meetings, meals, and/or functions. The space has been designed for and is marketed and sold as group or event function space. The term “gross sleeping room rental revenue” as used herein means: the consideration charged, whether or not received, for the occupancy of space in a lodging business valued in money, whether to be received in money, goods, labor or otherwise, including all receipts, cash, credits and property and services of any kind or nature, without any deduction therefrom whatsoever. Gross sleeping room rental revenue shall not include any federal, state, or local taxes collected, including but not

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limited to transient occupancy taxes. Based on the benefit received, assessments will not be collected on stays of more than thirty (30) consecutive days; stays provided to airline cockpit and/or cabin crews pursuant to an agreement between a hotel and an airline, which is in furtherance of or to facilitate such crews’ performance of their jobs for the airline, including layovers between flights; employees of the state or federal government if room charges are paid directly by their employing agency and copies of official travel orders are submitted as applicable; and any properly credentialed officer or employee of a foreign government who is exempt by reason of express provision of federal law or international treaty. The assessment is levied upon and a direct obligation of the assessed lodging business. However, the assessed lodging business may, at its discretion, pass the assessment on to transients. The amount of assessment, if passed on to each transient, shall be disclosed in advance and separately stated from the amount of rent charged and any other applicable taxes, and each transient shall receive a receipt for payment from the business. If the SFPTMD assessment is identified separately it shall be disclosed as the “SFPTMD Assessment.” As an alternative, the disclosure may include the amount of the SFPTMD assessment and the amount of the assessment imposed pursuant to the California Tourism Marketing Act, Government Code §13995 et seq. and shall be disclosed as the “Tourism Assessment.” The assessment is imposed solely upon, and is the sole obligation of the assessed lodging business even if it is passed on to transients. The assessment shall not be considered revenue for any purpose, including calculation of transient occupancy taxes. Bonds shall not be issued. E. Penalties and Interest The SFPTMD shall reimburse the City of Burlingame for any costs associated with collecting unpaid assessments. If sums in excess of the delinquent SFPTMD assessment are sought to be recovered in the same collection action by the City, the SFPTMD shall bear its pro rata share of such collection costs. Assessed businesses which are delinquent in paying the assessment shall be responsible for paying: 1. Original Delinquency: Any lodging business that fails to remit any assessment imposed within the time required shall pay a penalty of five percent (5%) of the amount of the assessment in addition to the amount of the assessment. 2. Continued Delinquency: Any lodging business that fails to remit any delinquent remittance on or before a period of fifteen (15) days following the date on which the remittance first became delinquent shall pay a second delinquency penalty of five percent (5%) of the amount of the assessment in addition to the amount of the assessment and the five percent (5%) penalty first imposed. An additional penalty of five percent (5%) shall be paid for each fifteen (15) days thereafter which the remittance is delinquent. 3. Fraud: If the City determines that the nonpayment of any remittance due under this chapter is due to fraud, a penalty of twenty-five percent (25%) of the amount of the assessment shall be added thereto in addition to the penalties stated in subsections (1) and (2) of this section. 4. Interest: In addition to the penalties imposed, any lodging business that fails to remit any assessment imposed shall pay interest at the rate of one percent (1%) per month or fraction thereof on the amount of the assessment, exclusive of penalties, from the date on which the remittance first became delinquent until paid.

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SFPTMD Management District Plan 13 January 23, 2023
F. Time and Manner for Collecting Assessments The SFPTMD assessment will be implemented beginning October 1, 2023, or as soon as possible thereafter, and ending five (5) years from its start date. The City of Burlingame shall be responsible for collecting the assessment on a monthly basis, (including any delinquencies, penalties and interest) from each lodging business located in the boundaries of the SFPTMD. The City shall take all reasonable efforts to collect the assessments from each lodging business. The City shall forward the assessments collected to the Owners’ Association.

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V. GOVERNANCE A. Owners’ Association The Burlingame City Council, through adoption of this Management District Plan, has the right, pursuant to Streets and Highways Code §36651, to identify the body that shall implement the proposed program, which shall be the Owners’ Association of the SFPTMD as defined in Streets and Highways Code §36612. The San Francisco Peninsula (SFP) will serve as the SFPTMD’s Owners’ Association. The Owners’ Association is charged with managing funds and implementing programs in accordance with the Management District Plan, and must provide annual reports to Burlingame City Council. The SFP shall create a SFPTMD Committee tasked with determining how SFPTMD funds are spent, within the designated programs in this Plan, subject to final approval by the SFP Board. The SFPTMD Committee shall include lodging business owners or representatives paying the SFPTMD assessment. B. Brown Act and California Public Records Act Compliance An Owners’ Association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. The Owners’ Association is, however, subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act. These regulations are designed to promote public accountability. The Owners’ Association acts as a legislative body under the Ralph M. Brown Act (Government Code §54950 et seq.). Thus, meetings of the SFP board and certain committees must be held in compliance with the public notice and other requirements of the Brown Act. The Owners’ Association is also subject to the record keeping and disclosure requirements of the California Public Records Act. Accordingly, the Owners’ Association shall publicly report any action taken and the vote or abstention on that action of each member present for the action. C. Annual Report The SFP shall present an annual report at the end of each year of operation to the City Council pursuant to Streets and Highways Code §36650 (see Appendix 1). The annual report shall include: • Any proposed changes in the boundaries of the improvement district or in any benefit zones or classification of businesses within the district. • The improvements and activities to be provided for that fiscal year. • An estimate of the cost of providing the improvements and the activities for that fiscal year. • The method and basis of levying the assessment in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his or her business for that fiscal year. • The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year. • The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.

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APPENDIX 1 – LAW *** THIS DOCUMENT IS CURRENT THROUGH THE 2022 SUPPLEMENT *** (ALL 2021 LEGISLATION) STREETS AND HIGHWAYS CODE DIVISION 18. PARKING PART 7. PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994 CHAPTER 1. General Provisions ARTICLE 1. Declarations 36600. Citation of part This part shall be known and may be cited as the “Property and Business Improvement District Law of 1994.” 36601. Legislative findings and declarations; Legislative guidance The Legislature finds and declares all of the following: (a) Businesses located and operating within business districts in some of this state’s communities are economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate facilities, services, and activities in the business districts. (b) It is in the public interest to promote the economic revitalization and physical maintenance of business districts in order to create jobs, attract new businesses, and prevent the erosion of the business districts. (c) It is of particular local benefit to allow business districts to fund business related improvements, maintenance, and activities through the levy of assessments upon the businesses or real property that receive benefits from those improvements. (d) Assessments levied for the purpose of conferring special benefit upon the real property or a specific benefit upon the businesses in a business district are not taxes for the general benefit of a city, even if property, businesses, or persons not assessed receive incidental or collateral effects that benefit them. (e) Property and business improvement districts formed throughout this state have conferred special benefits upon properties and businesses within their districts and have made those properties and businesses more useful by providing the following benefits: (1) Crime reduction. A study by the Rand Corporation has confirmed a 12-percent reduction in the incidence of robbery and an 8-percent reduction in the total incidence of violent crimes within the 30 districts studied. (2) Job creation. (3) Business attraction. (4) Business retention. (5) Economic growth. (6) New investments. (f) With the dissolution of redevelopment agencies throughout the state, property and business improvement districts have become even more important tools with which communities can combat blight, promote economic opportunities, and create a clean and safe environment. (g) Since the enactment of this act, the people of California have adopted Proposition 218, which added Article XIII D to the Constitution in order to place certain requirements and restrictions on the formation of, and activities, expenditures, and assessments by property-based districts. Article XIII D of the Constitution provides that property-based districts may only levy assessments for special benefits. (h) The act amending this section is intended to provide the Legislature’s guidance with regard to this act, its interaction with the provisions of Article XIII D of the Constitution, and the determination of special benefits in property-based districts. (1) The lack of legislative guidance has resulted in uncertainty and inconsistent application of this act, which discourages the use of assessments to fund needed improvements, maintenance, and activities in property-based districts, contributing to blight and other underutilization of property. (2) Activities undertaken for the purpose of conferring special benefits upon property to be assessed inherently produce incidental or collateral effects that benefit property or persons not assessed. Therefore, for special benefits to exist as a separate and distinct category from general benefits, the incidental or collateral effects of those special benefits are inherently part of those special benefits. The

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mere fact that special benefits produce incidental or collateral effects that benefit property or persons not assessed does not convert any portion of those special benefits or their incidental or collateral effects into general benefits. (3) It is of the utmost importance that property-based districts created under this act have clarity regarding restrictions on assessments they may levy and the proper determination of special benefits. Legislative clarity with regard to this act will provide districts with clear instructions and courts with legislative intent regarding restrictions on property-based assessments, and the manner in which special benefits should be determined. 36602. Purpose of part The purpose of this part is to supplement previously enacted provisions of law that authorize cities to levy assessments within property and business improvement districts, to ensure that those assessments conform to all constitutional requirements and are determined and assessed in accordance with the guidance set forth in this act. This part does not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. 36603. Preemption of authority or charter city to adopt ordinances levying assessments Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)). 36603.5. Part prevails over conflicting provisions Any provision of this part that conflicts with any other provision of law shall prevail over the other provision of law, as to districts created under this part. 36604. Severability This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes. ARTICLE 2. Definitions 36606. “Activities” “Activities” means, but is not limited to, all of the following that benefit businesses or real property in the district: (a) Promotion of public events. (b) Furnishing of music in any public place. (c) Promotion of tourism within the district. (d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Other services provided for the purpose of conferring special benefit upon assessed real property or specific benefits upon assessed businesses located in the district. 36606.5. “Assessment” “Assessment” means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and providing activities that will provide certain benefits to properties or businesses located within a property and business improvement district. 36607. “Business” “Business” means all types of businesses and includes financial institutions and professions. 36608. “City”

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“City” means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which includes only cities, counties, or a city and county, or the State of California. 36609. “City council” “City council” means the city council of a city or the board of supervisors of a county, or the agency, commission, or board created pursuant to a joint powers agreement and which is a city within the meaning of this part. 36609.4. “Clerk” “Clerk” means the clerk of the legislative body. 36609.5. “General benefit” “General benefit” means, for purposes of a property-based district, any benefit that is not a “special benefit” as defined in Section 36615.5. 36610. “Improvement” “Improvement” means the acquisition, construction, installation, or maintenance of any tangible property with an estimated useful life of five years or more including, but not limited to, the following: (a) Parking facilities. (b) Benches, booths, kiosks, display cases, pedestrian shelters and signs. (c) Trash receptacles and public restrooms. (d) Lighting and heating facilities. (e) Decorations. (f) Parks. (g) Fountains. (h) Planting areas. (i) Closing, opening, widening, or narrowing of existing streets. (j) Facilities or equipment, or both, to enhance security of persons and property within the district. (k) Ramps, sidewalks, plazas, and pedestrian malls. (l) Rehabilitation or removal of existing structures. 36611. “Management district plan”; “Plan” “Management district plan” or “plan” means a proposal as defined in Section 36622. 36612. “Owners’ association” “Owners’ association” means a private nonprofit entity that is under contract with a city to administer or implement improvements, maintenance, and activities specified in the management district plan. An owners’ association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners’ association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners’ association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code), for all records relating to activities of the district. 36614. “Property” “Property” means real property situated within a district. 36614.5. “Property and business improvement district”; “District” “Property and business improvement district,” or “district,” means a property and business improvement district established pursuant to this part.

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36614.6. “Property-based assessment” “Property-based assessment” means any assessment made pursuant to this part upon real property. 36614.7. “Property-based district” “Property-based district” means any district in which a city levies a property-based assessment. 36615. “Property owner”; “Business owner”; “Owner” “Property owner” means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. “Business owner” means any person recognized by the city as the owner of the business. “Owner” means either a business owner or a property owner. The city council has no obligation to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature of the business owner, the signature of the authorized agent of the business owner shall be sufficient. 36615.5. “Special benefit” “Special benefit” means, for purposes of a property-based district, a particular and distinct benefit over and above general benefits conferred on real property located in a district or to the public at large. Special benefit includes incidental or collateral effects that arise from the improvements, maintenance, or activities of property-based districts even if those incidental or collateral effects benefit property or persons not assessed. Special benefit excludes general enhancement of property value. 36616. “Tenant” “Tenant” means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner. ARTICLE 3. Prior Law 36617. Alternate method of financing certain improvements and activities; Effect on other provisions This part provides an alternative method of financing certain improvements and activities. The provisions of this part shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and effective and is unaffected by this part. CHAPTER 2. Establishment 36620. Establishment of property and business improvement district A property and business improvement district may be established as provided in this chapter. 36620.5. Requirement of consent of city council A county may not form a district within the territorial jurisdiction of a city without the consent of the city council of that city. A city may not form a district within the unincorporated territory of a county without the consent of the board of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without the consent of the city council of the other city. 36621. Initiation of proceedings; Petition of property or business owners in proposed district (a) Upon the submission of a written petition, signed by the property or business owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied, the city council may initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district. The amount of assessment attributable to property or a business owned by the same property or business owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be included in

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determining whether the petition is signed by property or business owners who will pay more than 50 percent of the total amount of assessments proposed to be levied. (b) The petition of property or business owners required under subdivision (a) shall include a summary of the management district plan. That summary shall include all of the following: (1) A map showing the boundaries of the district. (2) Information specifying where the complete management district plan can be obtained. (3) Information specifying that the complete management district plan shall be furnished upon request. (c) The resolution of intention described in subdivision (a) shall contain all of the following: (1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement as to whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities, and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section 36623. 36622. Contents of management district plan The management district plan shall include, but is not limited to, all of the following: (a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. If the assessment will be levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner to reasonably determine whether a business is located within the district boundaries. If the assessment will be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property and to allow a business owner to reasonably determine whether a business is located within the district boundaries. (b) The name of the proposed district. (c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected property and businesses included, which may be made by reference to any plan or map that is on file with the clerk. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements, maintenance, and activities proposed for each year of operation of the district and the maximum cost thereof. If the improvements, maintenance, and activities proposed for each year of operation are the same, a description of the first year’s proposed improvements, maintenance, and activities and a statement that the same improvements, maintenance, and activities are proposed for subsequent years shall satisfy the requirements of this subdivision. (e) The total annual amount proposed to be expended for improvements, maintenance, or activities, and debt service in each year of operation of the district. If the assessment is levied on businesses, this amount may be estimated based upon the assessment rate. If the total annual amount proposed to be expended in each year of operation of the district is not significantly different, the amount proposed to be expended in the initial year and a statement that a similar amount applies to subsequent years shall satisfy the requirements of this subdivision. (f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against his or her property or business. The plan also shall state whether bonds will be issued to finance improvements. (g) The time and manner of collecting the assessments. (h) The specific number of years in which assessments will be levied. In a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years. Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district.

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(i) The proposed time for implementation and completion of the management district plan. (j) Any proposed rules and regulations to be applicable to the district. (k) (1) A list of the properties or businesses to be assessed, including the assessor’s parcel numbers for properties to be assessed, and a statement of the method or methods by which the expenses of a district will be imposed upon benefited real property or businesses, in proportion to the benefit received by the property or business, to defray the cost thereof. (2) In a property-based district, the proportionate special benefit derived by each identified parcel shall be determined exclusively in relationship to the entirety of the capital cost of a public improvement, the maintenance and operation expenses of a public improvement, or the cost of the activities. An assessment shall not be imposed on any parcel that exceeds the reasonable cost of the proportional special benefit conferred on that parcel. Only special benefits are assessable, and a property-based district shall separate the general benefits, if any, from the special benefits conferred on a parcel. Parcels within a property-based district that are owned or used by any city, public agency, the State of California, or the United States shall not be exempt from assessment unless the governmental entity can demonstrate by clear and convincing evidence that those publicly owned parcels in fact receive no special benefit. The value of any incidental, secondary, or collateral effects that arise from the improvements, maintenance, or activities of a property-based district and that benefit property or persons not assessed shall not be deducted from the entirety of the cost of any special benefit or affect the proportionate special benefit derived by each identified parcel. (l) In a property-based district, the total amount of all special benefits to be conferred upon the properties located within the property-based district. (m) In a property-based district, the total amount of general benefits, if any. (n) In a property-based district, a detailed engineer’s report prepared by a registered professional engineer certified by the State of California supporting all assessments contemplated by the management district plan. (o) Any other item or matter required to be incorporated therein by the city council. 36623. Procedure to levy assessment (a) If a city council proposes to levy a new or increased property assessment, the notice and protest and hearing procedure shall comply with Section 53753 of the Government Code. (b) If a city council proposes to levy a new or increased business assessment, the notice and protest and hearing procedure shall comply with Section 54954.6 of the Government Code, except that notice shall be mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the public hearing. The city council may waive any irregularity in the form or content of any written protest. A written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each written protest shall contain a description of the business in which the person subscribing the protest is interested sufficient to identify the business and, if a person subscribing is not shown on the official records of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that the person subscribing is the owner of the business or the authorized representative. A written protest that does not comply with this section shall not be counted in determining a majority protest. If written protests are received from the owners or authorized representatives of businesses in the proposed district that will pay 50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than 50 percent, no further proceedings to levy the proposed assessment against such businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date of the finding of a majority protest by the city council. (c) If a city council proposes to conduct a single proceeding to levy both a new or increased property assessment and a new or increased business assessment, the notice and protest and hearing procedure for the property assessment shall comply with subdivision (a), and the notice and protest and hearing procedure for the business assessment shall comply with subdivision (b). If a majority protest is received from either the property or business owners, that respective portion of the assessment shall not be levied. The remaining portion of the assessment may be levied unless the improvement or other special benefit was proposed to be funded by assessing both property and business owners. 36624. Changes to proposed assessments At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or modify the proposed assessment or the type or types of improvements, maintenance, and activities to be funded with the

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revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and business improvement district that will exclude territory that will not benefit from the proposed improvements, maintenance, and activities. Any modifications, revisions, reductions, or changes to the proposed assessment district shall be reflected in the notice and map recorded pursuant to Section 36627. 36625. Resolution of formation (a) If the city council, following the public hearing, decides to establish a proposed property and business improvement district, the city council shall adopt a resolution of formation that shall include, but is not limited to, all of the following: (1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property, businesses, or both within the district, a statement on whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements need not be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district. (4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received. (5) A statement that the properties, businesses, or properties and businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements, maintenance, and activities to be conferred on businesses and properties in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements, maintenance, or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district. Notwithstanding the foregoing, improvements and activities that must be provided outside the district boundaries to create a special or specific benefit to the assessed parcels or businesses may be provided, but shall be limited to marketing or signage pointing to the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements, maintenance, and activities funded by the proposed assessments, and, for a property-based district, that property within the district will receive a special benefit. (8) In a property-based district, the total amount of all special benefits to be conferred on the properties within the property-based district. (b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant to Section 36627 shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan. 36627. Notice and assessment diagram Following adoption of the resolution establishing district assessments on properties pursuant to Section 36625, the clerk shall record a notice and an assessment diagram pursuant to Section 3114. No other provision of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part. 36628. Establishment of separate benefit zones within district; Categories of businesses The city council may establish one or more separate benefit zones within the district based upon the degree of benefit derived from the improvements or activities to be provided within the benefit zone and may impose a different assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to be provided within the district and may impose a different assessment or rate of assessment on each category of business, or on each category of business within each zone. 36628.5. Assessments on businesses or property owners

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The city council may levy assessments on businesses or on property owners, or a combination of the two, pursuant to this part. The city council shall structure the assessments in whatever manner it determines corresponds with the distribution of benefits from the proposed improvements, maintenance, and activities, provided that any property-based assessment conforms with the requirements set forth in paragraph (2) of subdivision (k) of Section 36622. 36629. Provisions and procedures applicable to benefit zones and business categories All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business improvement district apply to the establishment, modification, or disestablishment of benefit zones or categories of business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the procedure to establish, modify, or disestablish a property and business improvement district. 36630. Expiration of district; Creation of new district If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and the district may be renewed pursuant to this part. CHAPTER 3. Assessments 36631. Time and manner of collection of assessments; Delinquent payments The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part may be charged interest and penalties. 36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property (a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part. (b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part. (c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part. 36633. Time for contesting validity of assessment The validity of an assessment levied under this part shall not be contested in an action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section 36625. An appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment. 36634. Service contracts authorized to establish levels of city services The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed. 36635. Request to modify management district plan The owners’ association may, at any time, request that the city council modify the management district plan. Any modification of the management district plan shall be made pursuant to this chapter. 36636. Modification of plan by resolution after public hearing; Adoption of resolution of intention

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(a) Upon the written request of the owners’ association, the city council may modify the management district plan after conducting one public hearing on the proposed modifications. The city council may modify the improvements and activities to be funded with the revenue derived from the levy of the assessments by adopting a resolution determining to make the modifications after holding a public hearing on the proposed modifications. If the modification includes the levy of a new or increased assessment, the city council shall comply with Section 36623. Notice of all other public hearings pursuant to this section shall comply with both of the following: (1) The resolution of intention shall be published in a newspaper of general circulation in the city once at least seven days before the public hearing. (2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days before the public hearing, to each business owner or property owner affected by the proposed modification. (b) The city council shall adopt a resolution of intention which states the proposed modification prior to the public hearing required by this section. The public hearing shall be held not more than 90 days after the adoption of the resolution of intention. 36637. Reflection of modification in notices recorded and maps Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Section 36627. CHAPTER 3.5. Financing 36640. Bonds authorized; Procedure; Restriction on reduction or termination of assessments (a)The city council may, by resolution, determine and declare that bonds shall be issued to finance the estimated cost of some or all of the proposed improvements described in the resolution of formation adopted pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500)) or in conjunction with Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part. (b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years. (c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt. CHAPTER 4. Governance 36650. Report by owners’ association; Approval or modification by city council (a) The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and activities described in the report. The owners’ association’s first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used. (b) The report shall be filed with the clerk and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information: (1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. (2) The improvements, maintenance, and activities to be provided for that fiscal year.

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(3) An estimate of the cost of providing the improvements, maintenance, and activities for that fiscal year. (4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year. (5) The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year. (6) The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part. (c) The city council may approve the report as filed by the owners’ association or may modify any particular contained in the report and approve it as modified. Any modification shall be made pursuant to Sections 36635 and 36636. The city council shall not approve a change in the basis and method of levying assessments that would impair an authorized or executed contract to be paid from the revenues derived from the levy of assessments, including any commitment to pay principal and interest on any bonds issued on behalf of the district. 36651. Designation of owners’ association to provide improvements, maintenance, and activities The management district plan may, but is not required to, state that an owners’ association will provide the improvements, maintenance, and activities described in the management district plan. If the management district plan designates an owners’ association, the city shall contract with the designated nonprofit corporation to provide services. CHAPTER 5. Renewal 36660. Renewal of district; Transfer or refund of remaining revenues; District term limit (a) Any district previously established whose term has expired, or will expire, may be renewed by following the procedures for establishment as provided in this chapter. (b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed district includes additional parcels or businesses not included in the prior district, the remaining revenues shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels shall be refunded to the owners of these parcels or businesses. (c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments, improvements, or activities of a renewed district be the same as the original or prior district. CHAPTER 6. Disestablishment 36670. Circumstances permitting disestablishment of district; Procedure (a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the district, may be disestablished by resolution by the city council in either of the following circumstances: (1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of law in connection with the management of the district, it shall notice a hearing on disestablishment. (2) During the operation of the district, there shall be a 30-day period each year in which assessees may request disestablishment of the district. The first such period shall begin one year after the date of establishment of the district and shall continue for 30 days. The next such 30-day period shall begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30-day period. Upon the written petition of the owners or authorized representatives of real property or the owners or authorized representatives of businesses in the district who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment. (b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the

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owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention. 36671. Refund of remaining revenues upon disestablishment or expiration without renewal of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district (a) Upon the disestablishment or expiration without renewal of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished or expires. All outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund.

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APPENDIX 2 – ASSESSED BUSINESSES HOTEL NAME SITE ADDRESS CITY ST ZIP AC HOTEL SAN FRANCISCO AIRPORT/OYSTER POINT WATERFRONT 1333 Veterans Blvd So. San Francisco CA 94080 AIRPORT INN 751 Airport Blvd So. San Francisco CA 94080 ALL SEASONS LODGE 800 El Camino Real So. San Francisco CA 94080 ALOFT SAN FRANCISCO AIRPORT 401 E. Millbrae Ave Millbrae CA 94030 AMERICANA INN MOTEL 760 El Camino Real So. San Francisco CA 94080 AMERICAS BEST VALUE INN - PACIFICA 2160 Francisco Blvd Pacifica CA 94044 ANCHOR INN PACIFICA 500 San Pedro Ave Pacifica CA 94044 ARISTOCRAT HOTEL, BW SIGNATURE COLLECTION 1410 Cabrillo Hwy S Half Moon Bay CA 94019 ATHERTON INN 1201 W Selby Lane Redwood City CA 94061 ATHERTON PARK INN & SUITES 2834 El Camino Real Redwood City CA 94061 BAY LANDING HOTEL 1550 Bayshore Hwy Burlingame CA 94010 BAYHILL INN 950 El Camino Real San Bruno CA 94066 BEACH HOUSE HOTEL 4100 Cabrillo Hwy N Half Moon Bay CA 94019 BELMONT PALMS 700 El Camino Real Belmont CA 94002 BEST WESTERN COYOTE POINT 480 N Bayshore Blvd San Mateo CA 94401 BEST WESTERN INN 316 El Camino Real Redwood City CA 94062 BEST WESTERN PLUS EXECUTIVE SUITES 25 5th Ave Redwood City CA 94063 BEST WESTERN PLUS GROSVENOR HOTEL 380 S Airport Blvd So. San Francisco CA 94080 BUDGET INN 2526 El Camino Real Redwood City CA 94061 CANYON RANCH WELLNESS RETREAT 16350 Skyline Blvd Woodside CA 94062 CAPRI MOTEL 2380 El Camino Real Redwood City CA 94063 THE CATRINA HOTEL 2110 S El Camino Real San Mateo CA 94403 COMFORT INN & SUITES - SAN BRUNO 611 San Bruno Ave E San Bruno CA 94066 COMFORT INN & SUITES SFO NORTH 121 E. Grand Ave So. San Francisco CA 94080 COSTANOA LODGE+CAMP+RESORT 2001 Rossi Rd Pescadero CA 94060 COUNTRY INN & SUITES BY RADISSON 251 El Camino Real San Carlos CA 94070 COURTYARD REDWOOD CITY 600 Bair Island Rd Redwood City CA 94063 COURTYARD SAN FRANCISCO AIRPORT 1050 Bayhill Dr San Bruno CA 94066 COURTYARD SAN MATEO FOSTER CITY 550 Shell Blvd Foster City CA 94404 CROWNE PLAZA FOSTER CITY-SAN MATEO 1221 Chess Dr Foster City CA 94404 CROWNE PLAZA S.F. AIRPORT 1177 Airport Blvd Burlingame CA 94010 CYPRESS INN ON MIRAMAR BEACH 407 Mirada Rd Half Moon Bay CA 94019 DAYS INN - REDWOOD CITY 2650 El Camino Real Redwood City CA 94061 DAYS INN S.F. AIRPORT-OYSTER POINT - SSF 1113 Airport Blvd So. San Francisco CA 94080 DELUXE INN - REDWOOD CITY 1402 Stafford St Redwood City CA 94062

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DELUXE INN - SSF 920 El Camino Real So. San Francisco CA 94080 DOUBLETREE BY HILTON S.F. AIRPORT 835 Airport Blvd Burlingame CA 94010 DOUBLETREE BY HILTON S.F. AIRPORT NORTH 5000 Sierra Point Parkway Brisbane CA 94005 DOUBLETREE BY HILTON SF / SOUTH AIRPORT BLVD 275 S Airport Blvd So. San Francisco CA 94080 THE DYLAN HOTEL AT SFO 110 S El Camino Real Millbrae CA 94030 EMBASSY SUITES S.F. AIRPORT SOUTH SAN FRANCISCO 250 Gateway Blvd So. San Francisco CA 94080 EMBASSY SUITES S.F. AIRPORT - WATERFRONT 150 Anza Blvd Burlingame CA 94010 EXTENDED STAY AMERICA - BELMONT 120 Sem Lane Belmont CA 94002 EXTENDED STAY AMERICA - SAN CARLOS 3 Circle Star Way San Carlos CA 94070 EXTENDED STAY AMERICA - SAN MATEO 1830 Gateway Dr San Mateo CA 94404 FAIRFIELD INN & SUITES SAN FRANCISCO PACIFICA 500 Old County Rd Pacifica CA 94044 FAIRFIELD INN & SUITES SAN FRANCISCO SAN CARLOS 555 Skyway Rd San Carlos CA 94070 FAIRFIELD INN & SUITES SFO OYSTER POINT AREA 127 W. Harris Avenue So. San Francisco CA 94080 FOUR POINTS BY SHERATON HOTEL & SUITES 264 S Airport Blvd So. San Francisco CA 94080 FOUR SEASONS HOTEL SILICON VALLEY 2050 University Ave East Palo Alto CA 94303 GARDEN MOTEL 1690 Broadway Redwood City CA 94063 GATEWAY INN & SUITES 516 El Camino Real San Bruno CA 94066 GOOD LIVING INN 1562 El Camino Real San Carlos CA 94070 GOOD NITE INN 485 Veterans Blvd Redwood City CA 94063 GRAND BAY SAN FRANCISCO 223 Twin Dolphin Dr Redwood City CA 94065 GRAND HYATT AT SFO 55 S. McDonnell Road San Francisco CA 94128 HALF MOON BAY INN 401 Main St Half Moon Bay CA 94019 HALF MOON BAY LODGE 2400 Cabrillo Hwy S Half Moon Bay CA 94019 HAMPTON INN & SUITES SFO SOUTH - BURLINGAME 1755 Bayshore Hwy Burlingame CA 94010 HAMPTON INN & SUITES - SAN MATEO 2940 S. Norfolk St. San Mateo CA 94403 HAMPTON INN SFO NORTH - SSF 300 Gateway Blvd So. San Francisco CA 94080 HARBOR VIEW INN 51 Ave Alhambra El Granada CA 94018 HILTON GARDEN INN SAN MATEO 2000 Bridgepoint Circle San Mateo CA 94404 HILTON GARDEN INN SFO - BURLINGAME 765 Airport Blvd Burlingame CA 94010 HILTON GARDEN INN - SFO NORTH - SSF 670 Gateway Blvd So. San Francisco CA 94080 HILTON S.F. AIRPORT BAYFRONT 600 Airport Blvd Burlingame CA 94010 HOLIDAY INN & SUITES SAN MATEO-SF SFO 330 N Bayshore Blvd San Mateo CA 94401 HOLIDAY INN EXPRESS & SUITES BELMONT 1650 El Camino Real Belmont CA 94002 HOLIDAY INN EXPRESS REDWOOD CITY CENTRAL 1836 El Camino Real Redwood City CA 94063 HOLIDAY INN EXPRESS SFO NORTH - SSF 373 S Airport Blvd So. San Francisco CA 94080

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SFPTMD Management District Plan 28 January 23, 2023
HOLIDAY INN EXPRESS SFO SOUTH - BURLINGAME 1250 Bayshore Hwy Burlingame CA 94010 HOME2 SUITES BY HILTON SFO NORTH 550 Gateway Blvd So. San Francisco CA 94080 HOMEWOOD SUITES BY HILTON BELMONT 1201 Shoreway Road Belmont CA 94002 HOMEWOOD SUITES BY HILTON SFO AIRPORT NORTH 2000 Shoreline Court Brisbane CA 94005 HOTEL 1550 1550 El Camino Real San Bruno CA 94066 HOTEL ALUXOR 500 El Camino Real San Bruno CA 94066 HOTEL AURA SFO 190 El Camino Real San Bruno CA 94066 HOTEL BELMONT 560 El Camino Real Belmont CA 94002 HOTEL FOCUS SFO 111 Mitchell Ave So. San Francisco CA 94080 HOTEL NOVA SFO BY FAIRBRIDGE 410 S Airport Blvd So. San Francisco CA 94080 HOTEL V 222 S Airport Blvd So. San Francisco CA 94080 HYATT HOUSE BELMONT/REDWOOD SHORES 400 Concourse Dr Belmont CA 94002 HYATT PLACE SAN CARLOS 26 El Camino Real San Carlos CA 94070 HYATT REGENCY SAN FRANCISCO AIRPORT 1333 Bayshore Hwy Burlingame CA 94010 INN @ BAYSHORE 140 N Bayshore Blvd San Mateo CA 94401 INN AT MAVERICKS 346 Princeton Ave El Granada CA 94018 INN AT ROCKAWAY 200 Rockaway Beach Ave Pacifica CA 94044 INN BY THE SFO 701 Airport Blvd So. San Francisco CA 94080 LA QUINTA INN & SUITES S.F. AIRPORT WEST 1390 El Camino Real Millbrae CA 94030 LA QUINTA INN S.F. AIRPORT NORTH 20 Airport Blvd So. San Francisco CA 94080 LARKSPUR LANDING HOTEL SSF 690 Gateway Blvd So. San Francisco CA 94080 LIA HOTEL 950 El Camino Real San Carlos CA 94070 LIGHTHOUSE HOTEL 105 Rockaway Beach Ave Pacifica CA 94044 MARRIOTT FAIRFIELD INN & SUITES SFO 250 El Camino Real Millbrae CA 94030 MILL ROSE INN 615 Mill St Half Moon Bay CA 94019 MILLWOOD INN & SUITES 1375 El Camino Real Millbrae CA 94030 THE MIRAMAR INN & SUITES 3020 Cabrillo Hwy N Half Moon Bay CA 94019 MOTEL 6 - BELMONT 1101 Shoreway Rd Belmont CA 94002 NANTUCKET WHALE INN 779 Main St Half Moon Bay CA 94019 NICHE HOTEL 868 Main St Redwood City CA 94063 OCEAN VIEW INN 8425 Cabrillo Hwy Montara CA 94037 THE OCEANFRONT HOTEL 211 Mirada Rd Half Moon Bay CA 94019 OCEANO HOTEL & SPA 280 Capistrano Rd Half Moon Bay CA 94019 PACIFICA BEACH HOTEL 525 Crespi Dr Pacifica CA 94044 PARK POINTE HOTEL 245 S. Airport Blvd So. San Francisco CA 94080 PESCADERO CREEK INN 393 Stage Rd Pescadero CA 94060

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SFPTMD Management District Plan 29 January 23, 2023
QUALITY INN HALF MOON BAY 2930 Cabrillo Hwy N Half Moon Bay CA 94019 RAMADA LIMITED SUITES 721 Airport Blvd So. San Francisco CA 94080 REDWOOD CREEK INN 1090 El Camino Real Redwood City CA 94063 REDWOOD MOTOR COURT 3706 Rolison Rd Redwood City CA 94063 REGENCY INN SFO 411 San Bruno Ave E San Bruno CA 94066 RESIDENCE INN SAN FRANCISCO AIRPORT/MILLBRAE 161 N. Rollins Road Millbrae CA 94030 RESIDENCE INN REDWOOD CITY SAN CARLOS 800 E. San Carlos Ave San Carlos CA 94070 RESIDENCE INN SAN FRANCISCO AIRPORT/SAN MATEO 2000 Winward Way San Mateo CA 94404 THE RITZ-CARLTON, HALF MOON BAY One Miramontes Point Rd Half Moon Bay CA 94019 RITZ INN 151 El Camino Real San Bruno CA 94066 ROYAL INN 120 Hickey Blvd So. San Francisco CA 94080 SAN BENITO HOUSE 356 Main St Half Moon Bay CA 94019 SAN CARLOS INN 1140 Morse Blvd San Carlos CA 94070 SAN FRANCISCO AIRPORT MARRIOTT WATERFRONT 1800 Old Bayshore Hwy Burlingame CA 94010 SAN MATEO MARRIOTT 1770 So. Amphlett Blvd San Mateo CA 94402 SEA BREEZE MOTEL 100 Rockaway Beach Ave Pacifica CA 94044 SEAL COVE INN 221 Cypress Ave Moss Beach CA 94038 SEQUOIA INN 526 El Camino Real Redwood City CA 94063 SFO AIRPORT HOTEL, EL RANCHO INN 1100 El Camino Real Millbrae CA 94030 SILICON VALLEY INN 630 El Camino Real Belmont CA 94002 SONESTA ES SUITES SFO SAN BRUNO 1350 Huntington San Bruno CA 94066 SONESTA ES SUITES SFO OYSTER POINT WATERFRONT 1350 Veterans Blvd So. San Francisco CA 94080 SONESTA SELECT SFO OYSTER POINT WATERFRONT 1300 Veterans Blvd So. San Francisco CA 94080 SPRINGHILL SUITES BELMONT REDWOOD SHORES 1401 Shoreway Rd Belmont CA 94002 SUPER 8 S.F. AIRPORT - SAN BRUNO 421 El Camino Real San Bruno CA 94066 TOWNEPLACE SUITES SAN MATEO FOSTER CITY 1299 Chess Drive Foster City CA 94404 TRAVELERS INN 100 Hickey Blvd So. San Francisco CA 94080 TRAVELODGE SFO NORTH 326 S Airport Blvd So. San Francisco CA 94080 VAGABOND INN EXECUTIVE S.F. AIRPORT BAYFRONT 1640 Old Bayshore Hwy Burlingame CA 94010 VILLA MONTES HOTEL, ASCEND HOTEL COLLECTION 620 El Camino Real San Bruno CA 94066 THE WESTIN S.F. AIRPORT 1 Old Bayshore Hwy Millbrae CA 94030 ZABALLA HOUSE BED & BREAKFAST 324 Main St Half Moon Bay CA 94019 Hotel Nia 200 Independence Drive Menlo Park CA 94025 Park James 1400 El Camino Real Menlo Park CA 94025 Rosewood Sand Hill 2825 Sand Hill Road Menlo Park CA 94025

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SFPTMD Management District Plan 30 January 23, 2023
Stanford Park Hotel 100 El Camino Real Menlo Park CA 94025 Residence Inn 555 Glenwood Avenue Menlo Park CA 94025 Best Western Plus Riviera 15 El Camino Real Menlo Park CA 94025 Hotel Lucent 727 El Camino Real Menlo Park CA 94025 Menlo Park Inn 1315 El Camino Real Menlo Park CA 94025 Red Cottage Inn 1704 El Camino Real Menlo Park CA 94025

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SFPTMD Management District Plan 31 January 23, 2023
APPENDIX 3 – BENEFITS BY BUSINESS CATEGORY Program Service Tier 1 (1.5%) Tier 2 (0.75%) General Listing on www.thesanfranciscopeninsula.com with link to hotel booking page X X General Inclusion in Sales, Marketing and Promotional Opportunities X X General Inclusion in SFP's Consumer Brochures X X General Access to SFP's research reports and insights X X General Represented by SFP at industry conferences and events X X General Access to California Hotel Lodging Association's industry advocacy efforts and training materials X X Consumer Opportunity to participate in Consumer Marketing Campaigns X X Consumer Public Relations participation opportunities X X Consumer Familiarization Tour (Press and Influencer) Opportunities X X Consumer Inclusion Opportunity in Social Media Efforts X X Consumer Inclusion Opportunity in Destination Video and Photo Shoots X X Consumer New project and special event opportunities X X Travel Trade Trade Show Opportunities X X Travel Trade Sales Mission Opportunities X X Travel Trade Lead Opportunities X X Travel Trade Familiarization Tour Leads (Press and Travel Trade) Opportunities X X Meetings Lead Distribution X Meetings Site Inspections X Meetings Convention Services Support X Meetings Opportunity to participate in Sales Missions X Meetings Opportunity to participate in Client Events X Meetings Industry tradeshow participation X Meetings Participation in local industry chapter meetings and events X Meetings Familiarization Tours X Meetings Marketing Campaigns X Meetings Inclusion in Meetings Market Brochures X Meetings Opportunity for Sponsorship of Group Events X Meetings Custom Event Landing Page for Groups: Things To Do Nearby With Your Selected Venue (Itinerary) X

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SFPTMD Management District Plan 32 January 23, 2023
Meetings Distribution of hot rates and dates to planners X Meetings Co-op advertising opportunities in key meeting publications X Meetings Social media mentions/posts promoting groups space X Meetings Inclusion on Meeting Planner section of website X Meetings Opportunity to be highlighted in meeting planner newsletter X Meetings Access to SF Travel group leads via our alliance with SFT X

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SFPTMD Management District Plan 33 January 23, 2023
APPENDIX 4 – SMG CONSULTING ANALYSIS

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SFPTMD Management District Plan 34 January 23, 2023
SF Peninsula Tourism Business Improvement District Pro Forma Review

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SFPTMD Management District Plan 35 January 23, 2023
Overview In 2001, the Organization established a Tourism Business Improvement District (TBID) under the Parking and Business Improvement Area Law of 1989 (’89 Law) and now wishes to convert to a Tourism Marketing District (TMD) under the Property and Business Improvement District Law of 1994 (’94 Law). The organization is moving forward with a Tourism Business Improvement District (TBID) transition that will increase its funding above $6 million annually to be available for tourism promotion efforts. The TBID contribution is a significant budget increase for the organization. In developing the proposal for the TBID renewal and the subsequent approval of the lodging industry, the organization staff has prepared a TMD Benefits Proforma to estimate the potential return on investment from the new TBID funds. This staff assessment includes the proposed allocation and use of new funds for different tourism promotion efforts (sales, advertising, public relations, social media, etc.) and the projected return on investment for those funds. Proforma Review The TMD Benefits Proforma review includes a review of the staff proforma to check the assumptions and estimates and make suggestions and recommendations. Scope of Work The following is a review of the proforma developed for the TBID renewal. The analysis was done using the information supplied by The San Francisco Peninsula CVB. Project elements include the following: I. DEVELOP SMITH TRAVEL RESEARCH TRENDLINE AND ANNUAL GROWTH RATE FOR LODGING REVENUE. DEVELOP MULTI-YEAR FORECAST. Ø DETERMINE THE PROJECTABLE RATE OF GROWTH. • REVIEW STAFF DRAFT PROFORMA, INCLUDING ASSUMPTIONS AND FINAL ESTIMATES. I. COMPARE PROFORMA ESTIMATES WITH TRENDLINE AND ASSESS WITH POTENTIALLY DIFFERENT SCENARIOS (HIGH, MEDIUM, AND LOW ESTIMATES). Limiting Conditions The following analysis and estimates are based on the best information and time available. The results and opinions provided are a guide for consideration, and we do not claim as to the accuracy of the final results.

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SFPTMD Management District Plan 36 January 23, 2023
Model Development We developed an SF Peninsula Tourism Economic Model to develop lodging revenue and room night projections with the addition of new properties and the potential of Menlo Park Inclusion. The model was developed utilizing the past ten years of monthly lodging data from Smith Travel Research. The model measures a variety of economic activities, including the following: II. LODGING REVENUE PROJECTIONS THROUGH 2027 III. ROOM NIGHT PROJECTION THROUGH 2027 IV. TBID REVENUE WITHOUT MENLO PARK V. TBID REVENUE WITH MENLO PARK VI. TBIB REVENUE WITH NEW PROPERTIES VII. TBID REVENUE WITHOUT NEW PROPERTIES. The SF Peninsula Tourism Economic Model can be adjusted to test or consider different scenarios. Model Methodology The future growth of ADR and room nights is using a Bayesian Structural Times Series (BSTS) model, a technique for fitting historical data and forecasting future trends (Scott and Varian, Predicting the Present with Bayesian Structural Time Series 2013). BSTS was chosen for its ability to forecast future trends, including seasonal variation, using robust time series data. In this case, data is available in monthly intervals from July 2012. This model was fit by specifying a semi-local linear trend. Confidence intervals bound a mean forecast to quantify the degree of uncertainty in the future (Scott, Fitting Bayesian structural time series with the bsts R package 2017). Rather than having the pandemic disruption influence the forecasts, only data from July 2012 through December 2019 was taken as input. Revenue is simply forecast as the product of ADR and room nights. Given the fact that the STR reports track all cities in San Mateo County, the revenue forecast is reduced in proportion to the number of room nights in the TMD (15,699/17,190) or 91.3 percent. TMD fee revenue is also forecast in proportion to available rooms, with 42 percent A-level property rooms paying 1.5 percent of gross room revenue. The balance is paid by B-level property rooms at 0.75 percent. Construction of three new B-level properties is underway and will bring 451 rooms online. These rooms are assumed to be available from January 2023. There are 533 A-level property rooms and 338 B-level property rooms in Menlo Park. Potential gross room and TMD fee revenue is forecast on the basis of room count proportionality. Model Assumptions The model forecasts mean values of ADR and room nights along with 2.5 percent confidence intervals. This report is based on mean values. By constructing the model in this manner, we are

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SFPTMD Management District Plan 37 January 23, 2023
assuming that the conditions supporting ADR and room night growth prior to the pandemic will continue from 2023 forward. Sources of variation include the impact of macroeconomic conditions, actual timing of new construction (planned and unplanned), promotions and policies such as airline crew waivers. Model Limitations The baseline SF Peninsula Tourism Economic Model provides a static look based on a given set of assumptions. Forecasts of future events are inherently uncertain as the recent pandemic reminded us. As noted above, the model can be adjusted to estimate specific scenarios in detail in which case the relative differences generally provide the most value. Findings Table 1 below summarizes Room Nights, Revenue, and Average Daily Rate (ADR) projections. Table 1: Room Night, Revenue, and Average Daily Rate Projections 2021-2027 A. THE MODEL INCLUDES GROWTH RATE PROJECTIONS FOR EACH OF THOSE CATEGORIES. NOTE THE SIGNIFICANT REVENUE GROWTH PROJECTION IN 2022 AND 2023, AFTER WHICH THE GROWTH SLOWS DOWN INTO A MORE CONSISTENT PATTERN AFTER 2023. (SEE TABLE 1 ABOVE) B. THE TMD BENEFITS PROFORMA DEVELOPED BY STAFF HAS LODGING RATES BETWEEN $200 AND $293, WHICH IS WITHIN ESTIMATES OR THE PROJECTED AVERAGE DAILY RATE OF THE SF PENINSULA TOURISM ECONOMIC MODEL. (SEE TABLE 2) A. REGARDING TBID REVENUE PROJECTION, THE TMD BENEFITS PROFORMA ANTICIPATES TBID REVENUE OF APPROXIMATELY $6M. BASED ON THE SF PENINSULA TOURISM ECONOMIC MODEL'S ASSUMPTIONS, TBID COLLECTIONS COULD BE HIGHER STARTING IN 2022 (APPROXIMATELY $8M). (SEE TABLE 2) B. THE MODEL CONSIDERS THE NEW CONSTRUCTION OF HOTELS (451 UNITS) WHICH INCREASES THE POTENTIAL TBID REVENUE GENERATION BY APPROXIMATELY $207,000. (SEE TABLE 2) C. ADDITIONALLY, THE MODEL CONSIDERS THE POTENTIAL ADDITION OF MENLO PARK HOTELS BEING A PART OF THE TBID. THE ADDITION OF MENLO PARK HOTELS WOULD INCREASE TBID CONTRIBUTIONS BY APPROXIMATELY $638,000 STARTING IN 2023. (SEE TABLE 2) 2021 2022 2023 2024 2025 2026 2027
Room nights 3,201,6723,273,8943,356,7843,470,1923,592,1483,720,5753,824,263 RN annual growth 2.3% 2.5% 3.4% 3.5% 3.6% 2.8%
Revenue (thousands)$430,563$784,357$1,053,955$1,140,669$1,229,371$1,335,188$1,444,536 Rev annual growth 82.2%34.4%8.2% 7.8% 8.6% 8.2%
ADR $134 $240 $314 $329 $342 $359 $378
ADR annual growth 78.2%31.1%4.7% 4.1% 4.9% 5.3%

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SFPTMD Management District Plan 38 January 23, 2023
Table 2: TMD Room Revenue and Fee Projections
Inventory Notes: Changes in Hotel Inventory 318 rooms lost to Project Home Key (housing the un-housed) during 2020/2021 Possibly December 15, 2022 or early 2023 Red Roof Inn, Burlingame 213 Rooms Possibly in 2023 El Rancho Inn, Millbrae 219 Rooms 2023 (Buyer is getting financing together, no set month for demolishing.) Holiday Inn Express, Burlingame 148 Rooms Possibly 2023 (Entitlements approved Sept 2022. No word when developer will start work.) Comfort Inn & Suites, South San Francisco 166 Rooms 2021 2022 2023 2024 2025 2026 2027A rooms 6607 Base YearTotal available 15699 TBID ProjectionB rooms 9092 A Revenue $101,204,557 $330,100,605$405,089,050$438,417,832$472,510,240$513,181,465$555,203,3951.50%$2,718,068 $4,951,509$6,076,336$6,576,267$7,087,654$7,697,722$8,328,141 B Revenue $249,358,533 $454,256,803$557,449,620$603,313,899$650,229,026$706,197,349$764,032,6660.75% Total TBID/TMD$4,588,257 $8,358,435$10,257,208$11,101,122$11,964,371$12,994,202$14,058,366 New ConstructionNew rooms 2023 (B) 451 Total w/new hotels$10,464,596$11,325,573$12,206,276$13,256,929$14,342,629% increase in B 5.0% Menlo ParkNew rooms 2023 (A) 533% increase in A 8.1%New rooms 2023 (B) 338% increase in B 3.5% Total w/Menlo $10,895,479$11,791,907$12,708,873$13,802,787$14,933,191 Field Code Changed

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SFPTMD Management District Plan 39 January 23, 2023
Appendix

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SFPTMD Management District Plan 40 January 23, 2023
Appendix 1: San Mateo County Room Revenue
Source: STR Reports and Consulting Team.
$0$200,000,000$400,000,000$600,000,000$800,000,000$1,000,000,000$1,200,000,000$1,400,000,000$1,600,000,000 201320142015201620172018201920202021202220232024202520262027 Annual San Mateo County Room RevenueHistoric STR Report Values through October 2022 and Forecast to 2027

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SFPTMD Management District Plan 41 January 23, 2023
Appendix 2: San Mateo County ADR
Source: STR Reports and Consulting Team.
$0$100$200$300$400$500$600$700$800$900Jul-12Apr-13Jan-14Oct-14Jul-15Apr-16Jan-17Oct-17Jul-18Apr-19Jan-20Oct-20Jul-21Apr-22Jan-23Oct-23Jul-24Apr-25Jan-26Oct-26Jul-27Apr-28Jan-29Oct-29Jul-30Apr-31Jan-32Oct-32Jul-33Apr-34 Monthly San Mateo County ADR Forecast to 2034
Historical97.5% quantileForecast mean2.5% quantile

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SFPTMD Management District Plan 42 January 23, 2023
Appendix 3: San Mateo County Room Nights
Source: STR Reports and Consulting Team.
0200,000400,000600,000800,0001,000,0001,200,000
Jul-12Apr-13Jan-14Oct-14Jul-15Apr-16Jan-17Oct-17Jul-18Apr-19Jan-20Oct-20Jul-21Apr-22Jan-23Oct-23Jul-24Apr-25Jan-26Oct-26Jul-27Apr-28Jan-29Oct-29Jul-30Apr-31Jan-32Oct-32Jul-33Apr-34 Monthly San Mateo County Room Night Forecast to 2034
Historical97.5% quantileForecast mean2.5% quantile

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Damian Sandholm, Acting Community Services Director SUBJECT: Consider Adoption of a Resolution Authorizing the City Manager to Amend the Agreement With Callander and Associates Landscape Architecture for Additional Design Services With a Third Amendment for Centennial Park in an Amount Not to Exceed $17,250, and Approving a Budget Amendment for the FY 2022-23 Operating Budget to Appropriate $17,250 From the Citywide Development Impact Fees Fund to the Community Facilities Impact Fee Fund
BACKGROUND:

Centennial Park is located at the intersection of Jenevein Avenue and San Mateo Avenue and serves as the visual entrance for those that enter Downtown via Jenevein Avenue. The park is currently closed to members of the public and barricaded with ropes because the area has never been landscaped for public use and subsurface footings from a prior structure on the site have not been mitigated or removed. The Plaza includes a variety of plants that lack curb appeal and plantings in the middle of the Plaza which serve as a dividing barrier within the space.

The City began working with Callander Associates Landscape Architecture (CALA) on July 5, 2021, to develop a conceptual design to activate Centennial Park with a short-term design solution for the site. The approved amount for this original Consultant Services Agreement was $25,628. Technical issues identified at the site indicated any design solution would require more complex work with grading and electrical work, and Staff amended the contract with CALA in the amount of $44,403 so it could develop a concept for Council review.

Staff brought draft conceptual plans to City Council for direction on May 10, 2022. The direction was for Staff to work with the City Council Downtown Committee to create a final concept plan.

On August 23, 2022, City Council approved the Conceptual Plan developed with the City Council Downtown Committee and directed Staff to proceed and reach out to the San Bruno Community Foundation to request funding for the project.

On November 2, 2022, the City was awarded a Strategic Grant from the San Bruno Community Foundation in the amount of $500,000 to support the Centennial Park renovation contingent on the City Council approving the gap funding required to fully fund the project.

On December 13, 2022, City Council authorized the City Manager to amend the Agreement with CALA for additional design services with a second amendment to include preparation of

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Honorable Mayor and Members of the City Council
June 13, 2023

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9 construction documents for Centennial Park in an amount not to exceed $105,484 and allocated $25,515 from the Citywide Development Impact Fees - Community Facilities Impact Fee Fund.

DISCUSSION:

Included in the original design was a bioswale area of approximately 200 square feet as well as a simple lighting plan. The bioswale area was designed to be a sloped pervious surface and feature plantings and groundcover. However, as originally designed, this area included no connection to the City’s stormwater system. While not required, connecting to the stormwater system is considered best practice, since during periods of intense rainfall the bioswale area could potentially overflow, washing dirt, bark and other materials downstream and potentially offsite into the parking lot adjacent to Centennial Park.

The bioswale can be further enhanced to be designed as a bioretention area to treat rainwater.

The project is not a regulated project under the City’s Municipal Regional Stormwater Permit, and thus not required to install bioretention facilities. However, doing so would help advance the City’s adopted Green Infrastructure Plan. The proposal to connect the bioretention area to the City’s stormwater system and provide enhanced treatment requires additional design work. This work includes a redesign of the area with a liner, underdrain system, catch basin, gravel drainage layer, bioretention soil media, storm drain lateral, and storm drain connection to the existing main stormwater system.

The original lighting plan included only festoon lighting as well as small lighting fixtures for wayfinding. However, Staff has requested a more intensive lighting plan to provide public safety in the area. This will require additional pedestrian fixtures within the plaza. This task will include design modifications to indicate proposed locations and fixture types to maximize area lighting.

FISCAL IMPACT:

The approved original Agreement, First Amendment, and Second Amendment with CALA totaled $175,515. The attached scope for the Third Amendment is $17,250. This additional scope will bring the total design through construction documents cost to $192,765.

This additional $17,250 will be allocated from the Citywide Development Impact Fees - Community Facilities Impact Fee Fund. The final construction cost will be determined once the project is bid and will be subject to separate City Council action.

ENVIRONMENTAL IMPACT:

The action is not a project subject to CEQA. City Council’s action is not considered a “Project” per CEQA Guidelines and therefore no further environmental analysis is required.

RECOMMENDATION:

Adopt a Resolution authorizing the City Manager to amend the agreement with Callander and Associates Landscape Architecture for additional design services with a Third Amendment for

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Honorable Mayor and Members of the City Council
June 13, 2023

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9 Centennial Park in an amount not to exceed $17,250 and approving a budget amendment for the FY 2022-23 Operating Budget to appropriate $17,250 from the Citywide Development Impact Fees Fund to the Community Facilities Impact Fee Fund.

ALTERNATIVES:

1. Do not approve the Agreement amendment with CALA and direct Staff to issue a new request for proposal for the additional work. The cost of this alternative will not be cost effective due to bringing on a new consultant to design a limited scope of work.

2. Do not approve the Agreement amendment with CALA and do not authorize the work associated with the proposed amendment to proceed.

ATTACHMENTS:

1. Resolution

2. Amendment No. 3 to Agreement for Consultant Services with Exhibit A, Project Description & Scope of Services

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RESOLUTION NO. 2023- ____

RESOLUTION AUTHORIZING THE CITY MANAGER TO AMEND THE AGREEMENT

WITH CALLANDER AND ASSOCIATES LANDSCAPE ARCHITECTURE FOR

ADDITIONAL DESIGN SERVICES WITH A THIRD AMENDMENT TO INCLUDE DESIGN

OF A BIORETENTION SYSTEM AND ENHANCED LIGHTING DESIGN FOR CENTENNIAL PARK IN AN AMOUNT NOT TO EXCEED $17,250, AND APPROVING A BUDGET AMENDMENT FOR THE FY 2022-23 OPERATING BUDGET TO APPROPRIATE $17,250 FROM THE CITYWIDE DEVELOPMENT IMPACT FEES FUND

TO THE COMMUNITY FACILITIES IMPACT FEE FUND
WHEREAS, Centennial Park is located at the intersection of Jenevein Avenue and San Mateo Avenue and serves as a visual entry to San Bruno’s Downtown; and WHEREAS, the City entered into an agreement with Callander and Associates Landscape Architecture on July 5, 2021 in the amount of $25,628 to develop a site-specific plan for improvements to the park; and
WHEREAS, after identifying certain issues at the site that required a site survey, electrical engineering, and an increase in the project area, an amendment to the agreement with Callander and Associates Landscape Architecture was issued on October 28, 2021 in the amount of $44,403; and
WHEREAS, on December 13, 2022, City Council approved the expenditure of up to $105,484 for the development of construction documents for the project; and WHEREAS, after identifying that the creation a bioretention system and the need for a more intensive lighting plan for safety purposes requires additional design work; and WHEREAS, an amendment to the professional services agreement is required to complete design work for Centennial Park.

NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby authorizes the City Manager to amend the agreement with Callander and Associates Landscape Architecture for additional design services to include design of a bioretention system and enhanced lighting design for Centennial Park in an amount not to exceed $17,250, and approving a budget amendment for the FY 2022-23 Operating Budget to Appropriate $17,250 from the Citywide Development Impact Fees Fund to the Community Facilities Impact Fee Fund.
---oOo---
I hereby certify that foregoing Resolution No. 2023 –
was introduced and adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

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ABSENT: Councilmembers:
_________________________________
Lupita Huerta
City Clerk

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AMENDMENT NO. 3 TO AGREEMENT FOR CONSULTANT SERVICES

FOR CENTENNIAL PLAZA PROJECT

1. This Amendment No. 3, dated May 22, 2023, relates to the Agreement for Consultant Services, dated July 5, 2021 (“Original Agreement”), between the City of San Bruno (“City”) and Callander Associates Landscape Architecture, Inc. (“Contractor”), as amended by Amendment No. 1, dated October 28, 2021, and Amendment No. 2, dated December 14, 2022 (the Original Agreement, as amended, being the “Consultant Services Agreement”).

2. Subject to the terms and conditions of the Consultant Services Agreement, Contractor shall diligently perform all the services described in the Project Description & Scope of Services attached hereto as Exhibit A. The scope of services added by this Amendment No. 3 include, but are not limited to, the development of construction documents including demolition and erosion control plan, water and storm drain utility plan, grading and drainage plan, irrigation plan, planting plan, electrical plan for the Centennial Plaza project.

3. The compensation to Contractor for this Amendment No. 3 will increase the amount payable pursuant to the Consultant Services Agreement as follows:

Consultant Services Agreement $25,628.00
Amendment No. 1 $44,403.00
Amendment No. 2 $105,484.00
Amendment No. 3 $17,250.00
Total: $192,765.00

4. All other terms and conditions of the Agreement will remain in full force and effect.

CITY OF SAN BRUNO CONTRACTOR:

Alex D. McIntyre, Interim City Manager Brian Fletcher
Principal, Callander Associates
Landscape Architecture, Inc.

ATTEST:

Lupita Huerta, City Clerk
APPROVED AS TO FORM:

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1 7
9 3
Trisha Ortiz, City Attorney

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www.callanderassociates.com
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ADDITIONAL SERVICES AUTHORIZATION #4
TO: Mr. Tim Wallace, Community Services Superintendent
San Bruno Public Library
701 Angus Ave., W.

San Bruno, CA 94066
[email protected]
(650)616-7084
RE: CENTENNIAL PLAZA/proposal for additional design services The planning submittal and subsequent review resulted in several desired changes to the design as well as an unanticipated resubmittal of the application. These proposed additional services are to address these items.

The following additional services will be provided on this project in accordance with our agreement dated July 5th, 2021 and are considered an amendment thereto:

The items shown in bold-face italics are deliverables.

Scope

1. Planning Resubmittal and Presentation: The original scope did not anticipate any modifications or resubmittal of the planning application nor did it anticipate a presentation to the Planning Commission. This task includes preparation of edits to the application per the comments received and resubmittal of the planning application documents. CALA will present the project at a single Planning Commission meeting and assist in fielding questions.

2. Design Modifications: During the review of the 35% construction documents staff desired a couple modifications that were outside the anticipated improvements which will require additional design services including; a. Bioretention Area: This task includes modifying the currently proposed retention planting area to a true bioretention planting area. This would entail redesign of the area with a liner, underdrain system, catch basin, gravel drainage layer, bioretention soil media, storm drain lateral, and storm drain connection to existing main. The depth of the existing main is unknown and will require coordination with the city to confirm its depth. It’s assumed completing a C.3 checklist for small projects is not required. b. Lighting Upgrades: Per city comments, increase the lighting levels within the plaza to IEC standards for public use. This will require additional pedestrian fixtures within the plaza. This task will include modifications to the planning application to indicate proposed locations and fixture types. The task also includes design of the additional lighting system and incorporation into the construction document submittals at 95% and Bid.

BURLINGAME GOLD RIVER SAN JOSE
1633 Bayshore Highway, Suite 133
Burlingame, CA 94010
650.375.1313
12150 Tributary Point Drive, Suite 140
Gold River, CA 95670
916.985.4366
2025 Gateway Place, Suite 285
San Jose, CA 95110
408.275.0565
21042_ASA#4_DesignAdditions.doc

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Additional Services Authorization #4
RE: CENTENNIAL PLAZA/proposal for additional design services Revised May 19, 2023

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Compensation
Hrs CALA
4,229.00
Freyer & Laureta SEC TOTAL

1. Planning Resubmittal and Presentation (allowance)

2. Design Modifications (allowance)
Reimbursables (allowance)

25.00 25.00
$
$
$
$
$
$
-
5,390.00
-
$
$
$
- $
$
$
4,229.00
12,190.00
831.00
4,160.00
831.00
2,640.00
-
TOTAL 50.00 $ 9,220.00 $ 5,390.00 $ 2,640.00 $ 17,250.00 Schedule
Callander Associates will proceed to commence the above services upon receipt of a signed copy of this authorization concurrently with completion of our other service.

Signatures
Callander Associates Landscape
Architecture, Inc.

Agreed and authorized to proceed for:

City of San Bruno
Brian Fletcher, ASLA Signature date
Principal | Landscape Architect CA #4671
Name & Title
Attachment: Standard Schedule of Compensation dated 2023 Task Matrix dated 05/19/23
Centennial Plaza, San Bruno SEC 23070 dated 04/13/23
Centennial Plaza Improvements Freyer & Laureta dated 05/19/2023 Notice: Landscape architects are licensed by the State of California.

Terms and conditions are subject to change after ninety days. 21042_ASA#4_DesignAdditions.doc
© copyrighted 2023 Callander Associates
Landscape Architecture, Inc.

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www.callanderassociates.com
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Standard Schedule of Compensation 2023 San Jose & Burlingame Live+WorkConnect Sustain

GENERAL
The following list of fees and reimbursable expense items shall be used in the provision of services described in the agreement. These amounts shall be adjusted in January, upon issuance of an updated Standard Schedule of Compensation:

Hourly Rates
Principal
Senior Associate
Associate
Arborist/Construction Manager
Senior Project Manager
Project Manager 1
Project Manager 2
Job Captain
Designer 1
Designer 2
Assistant Designer
Accounting
Senior Project Administrator
Project Administrator
$240 /hour
$218 /hour
$208 /hour
$183 /hour
$188 /hour
$180 /hour
$171 /hour
$158 /hour
$148 /hour
$135 /hour
$120 /hour
$182 /hour
$138 /hour
$123 /hour
Reimbursable Expenses Rates
Expenses cost + 15%
printing and reproductions, postage and
delivery, mileage, travel expenses (hotel /
food), testing and outside services, and other
project related expenses
Communications and Insurance Surcharge
Subconsultant Administration

2.5% of total fees
10% of Subconsultant Costs

PAYMENTS
Payments are due within ten days after monthly billing. Callander Associates reserves the right to suspend services for non-payment if payment is not received within a period of 60 days after invoice date. Additionally invoices 60 days past due are subject to a 1.5% per month interest charge. Retainer amounts, if indicated, are due upon signing the agreement and shall be applied to the final invoice for the project.

BURLINGAME GOLD RIVER SAN JOSE
1633 Bayshore Highway, Suite 133
Burlingame, CA 94010
T 650.375.1313
12150 Tributary Point Drive, Suite 140
Gold River, CA 95670
T 916.985.4366
2025 Gateway Place, Suite 285
San Jose, CA 95110
T 408.275.0565

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Task Matrix
Centennial Plaza/proposal for additional design services 05/19/2023
Callander Associates' Personnel and Rates
Principal
@ $240
Proj Manager 2
@ $171
Designer 1
@ $148
$'s
Freyer & Laureta
Subconsultant Fees
$'s
SEC
Subconsultant
$'s
CA Fees
$'sPhase Description hrs $'s hrs $'s hrs hrs

1. Planning Resubmittal and Presentation (allowance)
Planning Resubmittal and Presentation
SUBTOTAL 1.0

1. 4.0 $ 960.00 7.0 $ 1,197.00 14.0 $ 2,072.00 25.0 $ 4,229.00 4,229.00
10%
$ -
-
-
$ -
-
-

4.0 $ 960.00 7.0 $ 1,197.00 14.0 $ 2,072.00 25.0 $ $ $
Subconsultant Administration $ $

2. Design Modifications (allowance)
Design Modifcations2. -

0.5 0.5

1.0 $
$
$
$
- -

8.0 $
$
$
$
- -

4.0 4.0

8.0 $
$
$
$
- -

12.5 12.5

25.0 $
$
$
$
- $ -
4,900.00
-
$ -
-a. Bioretention Area 120.00
120.00
240.00
1,368.00
1,368.00
2,736.00
592.00
592.00
1,184.00
2,080.00
2,080.00
4,160.00
10%
$
$
$
$
$
$
$
$
b. Lighting Upgrades 8.0 2,400.00
2,400.00
240.00
SUBTOTAL 2.0 16.0 4,900.00
490.00Subconsultant Administration
hrs CALA Freyer & Laureta SEC

1. 2.

Planning Resubmittal and Presentation (allowance) 25.00 Design Modifications (allowance) 25.00
Reimbursables (allowance)
$
$
$
4,229.00
4,160.00
831.00
$ - $
$
$
-
2,640.00
-
$
$
5,390.00
-

50.00 $ 9,220.00 $ 5,390.00 $ 2,640.00
21042_FEE_Asa#4.xlsx
© copyrighted 2023 Callander Associates
Landscape Architecture, Inc.

Page 1 of 1 ends

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FEE ESTIMATE: CENTENNIAL PLAZA IMPROVEMENTS

CALLANDER ASSOCIATES

CITY OF SAN BRUNO, CALIFORNIA

CIVIL ENGINEERING DESIGN SERVICES
FREYER & LAURETA, INC.PREPARED BY:

Task Hours
Principal Associate
Engineer
Staff Total Cost
per TaskEngineer II
Task 1: Additional Civil Engineering Services
Additional civil engineering design work related to bioretention area Additional civil engineering design work related to storm drain connection Investigate and coordinate with City on existing storm drain depth 1 2
1 2
4 2
4 8
4 $1,220
$2,440
$1,220
Task Subtotal: 4 8 16 $4,900
$4,900FEE ESTIMATE TOTAL:

F&L Hourly Rates (2023) $250 $185 $150
Notes:

1. Not all staff positions are listed. Other staff positions may be utilized and will be billed at hourly rates according to F&L's 2023 Rate Schedule. The Not to Exceed Budget will remain the same.

2. Breakdown by task is for estimating purposes only. Level of effort between tasks may vary.

3. Total and Subtotals are rounded to nearest $100.

Last Printed: 5/19/2023 FREYER LAURETA, INC. Civil Engineers · Surveyors · Construction Managers

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April 13, 2023
Ms. Diana Castro
Mr. Brian Fletcher, President
Callander Associates
1633 Bayshore Highway, Suite 133
Burlingame, CA 94010
[email protected]
650-375-1313
We are pleased to confirm Centennial Plaza, San Bruno SEC 23070 added scope as follows:

Additional area lights
Design includes:

Building lighting and power engineering
Site lighting with point by point photometrics plan
Services include:

Preparation of 95% and bid drawings for architect and owner review
Construction cost estimate
Preparation of construction drawings
Title 24 energy compliance forms
Conferences
Incorporation of plan check comments
Assistance during bidding
Review of submittals and shop drawings
Respond to RFIs, addendums
Change order review
As built drawings from contractor mark ups
Services exclude:

Any scope and services not noted above

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We are pleased to quote the above scope as follows:

Construction documents through bidding:

Electrical engineering...........$ 2,400
Indicate acceptance of this proposal by signature below.

SIGNED
Rickert Henriksen
ME (M29,816), EE (E10,629)
FPE (FP01,497), LEED AP
President _____________________________

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City Council Agenda Item
Staff Report

The Wastewater Enterprise Fund accounts for all operational and capital expenditures needed to operate, maintain, and improve these critical utility systems. The Fund operates without tax support as each is funded solely by ratepayers. The City Council last adopted a multi-year sewer rate increase plan on May 23, 2017, setting rates for a five-year period through June 30, 2021. The 2017-21 rates for both the Water and Sewer enterprise Funds were based on a 10- year financial plan and adjusted the same amounts each year. The annual rate increase for Sewer was 5%. The City Council cancelled the final year of the 5-year sewer rate increase schedule at the February 9, 2021 City Council Meeting.

The City awarded a contract in March 2022 to Bartle Wells Associates to update the City’s sewer and water rate model to ensure revenues continue covering operational costs and necessary infrastructure improvements. Work on the study has been on-going since that time and, as such, staff did not propose rate increases for the current fiscal year (FY) 2022-23. The combination of the cancellation of the 2021 rate increase and the fact that staff did not propose to increase rates in FY 2022-23, has resulted in sewer rates remaining unchanged since 2020.

City Council Meeting History on Sewer Rate Discussion
Staff and the Bartle Wells Associates consultants have met and presented status updates and rate recommendations to the City Council over the last six months. At the December 13, 2022 City Council Meeting, staff provided a brief update on the Rate Study development progress. On February 14, 2023 and February 28, 2023, the City Council held Study Sessions on the Sewer Rate Study. Staff reviewed the Rate Study findings, the 5% rate recommendations, and the Proposition 218 notification process. The Rate Study Report that was reviewed at the City Council meetings is provided in Attachment 2. At the February 28, 2023 City Council Meeting, Councilmembers directed staff to return to the City Council to initiate the Proposition 218 Notice. Councilmembers also directed staff to separate the sewer and water rate proposals. Staff are scheduled to present the proposed water rate increases to the City Council in the latter part of 2023 for a January 1, 2024 effective date.

At the April 25, 2023 meeting, the City Council directed staff to proceed with a notification to all

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Honorable Mayor and Members of the City Council
June 13, 2023

Page 2 of 4 ends

property owners and residents of the proposed change in water and wastewater rates and the Public Hearing. The notification process was implemented in accordance with the notice and protest provisions of Proposition 218, which established legal requirements for imposing or increasing property-related taxes fees and charges.

DISCUSSION:

After reviewing the fixed, operational, and capital improvement priorities, City staff and Bartle Wells Associates developed a financial plan to adequately fund these costs over the next 5 years. Table 1 below shows the proposed rate schedule for sewer utility rate payers.

Table 1: Proposed Rate Schedule

Proposed Sewer Rate Increases
July 1
2023
July 1
2024
July 1
2025
July 1
2026
July 1
2027
5% 5% 5% 5% 5%
Table 2 below shows the proposed fixed and variable sewer rates for FY 2023-24 through 2027- 28 for residential and commercial services. Sewer service charges are billed bi-monthly, or once every two months, on the City’s combined utility bill.

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Honorable Mayor and Members of the City Council
June 13, 2023

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Table 2: Sample Monthly Wastewater Rates
Note: One hundred cubic feet (ccf) equals approximately 748 gallons.

Proposition 218 requires the City to provide mailed notice at least 45 days before the hearing to the record owners of each identified parcel upon which the rates are proposed for imposition. Notices were mailed on April 17, 2023. If written protests against the proposed rates are presented by a majority of owners of the identified parcels, the City cannot impose the proposed rates.

Table 3 below outlines the City’s implementation of the proposed process for considering the proposed rate adjustment effective July 1, 2023.

Current
Sewer July 1 July 1 July 1 July 1 July 1
Rates 2023 2024 2025 2026 2027
Single Family Residential $32.27 $33.96 $35.74 $37.61 $39.59 $41.66 All Other Customers (Based on Water Meter Size)
Meter Size
3/4-inch $32.27 $33.96 $35.74 $37.61 $39.59 $41.66
1-inch 53.78 56.60 59.57 62.69 65.98 69.43
1-1/2 inch 107.57 113.20 119.14 125.38 131.95 138.87
2-inch 172.11 181.13 190.62 200.61 211.12 222.19
3-inch 322.70 339.61 357.41 376.14 395.85 416.60
4" & Larger 537.83 566.02 595.68 626.90 659.76 694.33
Residential $12.37 $12.98 $13.61 $14.28 $14.97 $15.71
Commercial
C-1 Light Commercial $11.50 $12.05 $12.63 $13.23 $13.87 $14.53 C-2 Medium Commercial 12.37 12.98 13.61 14.28 14.97 15.71 C-3 Heavy Commercial 17.61 18.54 19.51 20.54 21.62 22.76 C-4 Special Commercial 22.86 24.11 25.42 26.81 28.27 29.82 Government 12.37 12.98 13.61 14.28 14.97 15.71
Industrial
I-1 Light Industrial $12.37 $12.98 $13.61 $14.28 $14.97 $15.71 I-2 Industrial Flow 8.88 9.27 9.68 10.10 10.54 11.01
COD per lb3 0.68 0.72 0.76 0.81 0.85 0.90
SS per lb 1.41 1.49 1.58 1.68 1.78 1.88
Proposed Wastewater Rates
Proposed Wastewater Rates Effective On or After

MONTHLY SERVICE CHARGES
Fixed monthly charge per account

QUANTITY CHARGES
Billed per hundred cubic feet (hcf) based on customer classification

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Honorable Mayor and Members of the City Council
June 13, 2023

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Table 3: Rate Setting Resolution Adoption Timeline

April 25, 2023 Council directed staff to provide 45-day notice about proposed rates June 13, 2023 City Council to hold public hearing, consider any protests, and take action to adopt new rates for FY 2023-24 through FY 2027-28 by resolution
July 1, 2023 July 1 - New rates take effect
FISCAL IMPACT:

The proposed rate structure will provide 5% in total additional revenues to support operational and capital needs, including replacement of aging infrastructure, for the 5-year time period from 2023-24 through 2027-28.

Over the 5-year financial planning period, total planned wastewater capital investment is $54 million. The proposed rate model was structured so that rate revenue alone will be sufficient to cover operational and capital costs over the 5-year period and the City does not anticipate debt- financing will be necessary.

ENVIRONMENTAL IMPACT:

The action is not a project subject to CEQA. City Council’s action is not considered a “Project” per CEQA Guidelines and therefore no further environmental analysis is required.

RECOMMENDATION:

Hold public hearing and consider adoption of a resolution approving the proposed increase to Wastewater (Sewer) Rates for FY 2023-24 through 2027-28.

ALTERNATIVES:

Do not proceed with the process to adopt new rates.

ATTACHMENTS:

1. Resolution

2. Final Water & Sewer Rate Study Report

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1 1
6 3
7 RESOLUTION NO. 2023- ___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN BRUNO APPROVING SEWER RATE INCREASES FOR FISCAL YEAR 2023-24 THROUGH 2027-28 WHEREAS, the Wastewater Enterprise Fund accounts for all operational and capital expenditures necessary to operate, maintain, and improve this critical utility system; and WHEREAS, the Wastewater Enterprise Fund is supported by proceeds collected from ratepayers and the City is required to ensure that revenues fully cover all costs to operate and maintain the utilities; and
WHEREAS, the City Council last adjusted sewer rates on May 26, 2017 that set rates for a five-year period through June 30, 2021; and
WHEREAS, the City Council cancelled the final year of the five-year sewer rate schedule at the February 9, 2021 City Council Meeting; and
WHEREAS, the City awarded a contract in March 2022 to Bartle Wells Associates of Berkeley, California, to update the City’s sewer and water rate model and prepare a Water and Sewer Rate Study to ensure revenues continue covering operational costs and necessary infrastructure improvements. After reviewing the fixed, operational, and capital improvement priorities, City staff and Bartle Wells Associates developed a financial plan to adequately fund these costs over the next five years; and
WHEREAS, the City Council held two Study Sessions on the Sewer Rate Study on February 14, 2023, and February 28, 2023; and
WHEREAS, the Sewer Rate Study rate evaluation reveals that rate increases over the next five years, from fiscal year 2023-24 through fiscal year 2027-28, are needed for the sewer (wastewater) utility to cover necessary operating and capital improvement costs; and WHEREAS, the Sewer Rate Study recommends minor changes to the rate structure to more accurately assign various costs to San Bruno customers; and

WHEREAS, on April 29, 2023, the City Clerk caused a notice of the time and place of a public hearing on the proposed Rates to be mailed as required by Section 6 of Article XIIID of the California Constitution (“Proposition 218”); and
WHEREAS, each notice described the amount of proposed Rates, the basis upon which the amount of the proposed Rates was calculated, the reason for the proposed Rates, and the date, time, and location of a public hearing on the proposed rates; and WHEREAS, on June 13, 2023, the City Council conducted a public hearing on the proposed Rates and heard and considered all objections and protests thereto and at the close of the public hearing, the City Council determined that written protests had not been presented by a majority of owners of the identified parcels.

NOW, THEREFORE, BE IT RESOLVED THAT the San Bruno City Council hereby approves the Rates in the amounts provided in Exhibit A and incorporated by this reference, effective July 1, 2023.

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2 1
6 3
7 Exhibit A
Note: One hundred cubic feet (ccf) equals approximately 748 gallons.

MONTHLY SERVICE CHARGES
Fixed monthly charge per account

QUANTITY CHARGES
Billed per hundred cubic feet (hcf) based on customer classification

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3 1
6 3
7 ---oOo---
I, the undersigned, hereby certify that the foregoing Resolution No. 2023 - ______ was introduced and duly adopted by the San Bruno City Council at a regular meeting on June 13, 2023, by the following roll call vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

Lupita Huerta
City Clerk

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2023 Water & Sewer Rate Study
February 2023
City of San Bruno

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Bartle Wells Associates
2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel: 510.653.3399
www.bartlewells.com
2023 Water & Sewer Rate Study
February 2023
Prepared by:

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February 23, 2023
City of San Bruno
567 El Camino Real
San Bruno, CA 94066
Attn: Matthew Lee, Public Works Director
Re: 2023 Water & Sewer Rate Study
Bartle Wells Associates is pleased to submit the attached 2023 Water & Sewer Rate Study . The study develops long-term financial projections for the City’s water and sewer utilities and recommends rates designed to fund the City’s projected costs of providing water and sewer service. The proposed rates are phased in over the next five years to fund water and sewer utility operations and support adequate funding for rehabilitation and replacement of aging water and sewer system infrastructure.

After two years of no water or sewer rate increases, the report recommends the City resume its historical practice of implementing gradual annual rate increases to keep revenues aligned with projected funding needs. The report recommends a series of overall 6% annual water rate increases and 5% annual sewer rate increases in each of the next five years. Proposed rates also include some minor adjustments to the water and sewer rate structures designed to keep the City’s rates aligned with the costs of providing service.

San Bruno’s water and sewer rates are both currently in the middle range compared to other regional agencies in San Mateo County and are projected to remain in the middle range with implementation of the proposed rate increases.

I enjoyed working with the City on this assignment and appreciate the ongoing collaboration, input and assistance received from City staff. Please contact me anytime if you have questions about this report or other issues related to utility rates and finance.

BARTLE WELLS ASSOCIATES
Alex Handlers, CIPMA
Principal/Vice-President
2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel 510 653 3399
www.bartlewells.com

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BARTLE WELLS ASSOCIATES
San Bruno 2023 Water & Sewer Rate Study

TABLE OF CONTENTS
1 Background, Objectives & Proposed Rates ..................................................... 1

1.1 Background ..................................................................................................................... 1

1.2 Water System Overview ................................................................................................. 1

1.3 Sewer System Overview ................................................................................................. 2

1.4 Capital Improvement Funding Needs............................................................................. 2

1.5 Policy Goals & Objectives ............................................................................................... 3

1.6 Regional Water & Sewer Rate Survey ............................................................................ 3

1.7 Proposed Water & Sewer Rates ..................................................................................... 4 2 Legal Requirements & Rate Methodology ...................................................... 7

2.1 Constitutional Rate Requirements ................................................................................. 7

2.1.1 Article 10, Section 2 ............................................................................................. 7

2.1.2 Article 13D, Section 6 ........................................................................................... 7

2.2 Rate-Setting Methodology ............................................................................................. 8 3 Water Financial Plan & Rate Derivation ....................................................... 10

3.1 Current & Historical Water Rates ................................................................................. 10

3.2 Regional Water Rate Survey ......................................................................................... 12

3.3 Financial Challenges / Key Drivers of Rate Increases ................................................... 13

3.3.1 Capital Improvements & Replacement of Aging Infrastructure ........................ 13

3.3.2 Wholesale Water Rate Increases ....................................................................... 14

3.3.3 Ongoing Operating Cost Inflation ...................................................................... 15

3.4 Outstanding Debt Service ............................................................................................. 15

3.5 Water Enterprise Financial Projections ........................................................................ 16

3.6 Projected Water Rate Increases ................................................................................... 19

3.7 Water Use ................................................................................................................... 20

3.8 Water Rate Derivation .................................................................................................. 23

3.9 Cost Recovery Allocations ............................................................................................ 23

3.10 Water Accounts & Meter Equivalents .......................................................................... 24

3.11 Fixed Monthly Service Charges .................................................................................... 25

3.12 Water Quantity Charge Derivation .............................................................................. 26

3.13 Proposed Water Rates .................................................................................................. 30

3.14 Water Rate Impacts ...................................................................................................... 31

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BARTLE WELLS ASSOCIATES
San Bruno 2023 Water & Sewer Rate Study

4 Sewer Financial Plan & Rate Derivation ....................................................... 32

4.1 Current & Historical Sewer Rates ................................................................................. 32

4.2 Regional Sewer Rate Survey ......................................................................................... 34

4.3 Financial Challenges / Key Drivers of Rate Increases ................................................... 35

4.3.1 Capital Improvements & Replacement of Aging Infrastructure ........................ 35

4.3.2 Ongoing Operating Cost Inflation ...................................................................... 35

4.4 Outstanding Debt Service ............................................................................................. 36

4.5 Sewer Enterprise Financial Projections ........................................................................ 37

4.6 Sewer Rate Projections ................................................................................................ 40

4.7 Sewer Use ................................................................................................................... 41

4.8 Sewer Rate Derivation .................................................................................................. 42

4.9 Cost Recovery Allocations ............................................................................................ 42

4.10 Sewer Accounts & Billing Equivalents .......................................................................... 43

4.11 Fixed Monthly Service Charges .................................................................................... 44

4.12 Sewer Quantity Charge Derivation ............................................................................... 45

4.13 Proposed Sewer Rates .................................................................................................. 47

4.14 Sewer Rate Impacts ...................................................................................................... 49

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BARTLE WELLS ASSOCIATES
San Bruno 2023 Water & Sewer Rate Study

LIST OF TABLES
Table 1 – Proposed Water Rates .................................................................................................... 5 Table 2 – Proposed Sewer Rates ..................................................................................................... 6 Table 3 – Water Rates ................................................................................................................... 10 Table 4 – Water Capital Improvement Program ........................................................................... 13 Table 5 – Outstanding Water Debt Service .................................................................................. 15 Table 6 – 10-Year Water Cash Flow Projections ........................................................................... 17 Table 7 – Projected Water Rate Increases .................................................................................... 19 Table 8 – Water Use by Class & Tier ............................................................................................. 20 Table 9 – Water Use by Month ..................................................................................................... 21 Table 10 – Sources of Water Supply by Month ............................................................................ 22 Table 11 – Cost Recovery Allocation ............................................................................................. 23 Table 12 – Fixed & Quantity Charge Revenue Recovery .............................................................. 24 Table 13 – Water Accounts & Meter Equivalents ......................................................................... 25 Table 14 – Fixed Rate Derivation January 1, 2028 ........................................................................ 25 Table 15 – Projected Fixed Services Charges January 1, 2028 ..................................................... 26 Table 16 – Projected Water Sales ................................................................................................. 28 Table 17 – Water Quantity Charge Derivation ............................................................................. 29 Table 18 – Proposed Water Rates ................................................................................................ 30 Table 19 – Water Rate Impacts ..................................................................................................... 31 Table 20 – Sewer Rates ................................................................................................................. 33 Table 21 – Sewer Capital Improvement Program ......................................................................... 35 Table 22 – Outstanding Sewer Debt Service ................................................................................. 36 Table 23 – 10-Year Sewer Cash Flow Projections ......................................................................... 38 Table 24 – Projected Sewer Rate Increases .................................................................................. 40 Table 25 – Sewer Use by Class ...................................................................................................... 41 Table 26 – Fixed & Variable Revenue Recovery ........................................................................... 42 Table 27 – Sewer Accounts & Billing Equivalents ......................................................................... 43 Table 28 – Fixed Sewer Rate Derivation ....................................................................................... 44 Table 29 – Variable Rate Recovery from Wastewater Flow & Strength....................................... 45 Table 30 – Sewer Flow & Loadings by Customer Class ................................................................. 46 Table 31 – Derivation of Unit Rates for Wastewater Flow & Strength ........................................ 46 Table 32 – Sewer Quantity Charges by Customer Class ............................................................... 47 Table 33 – Proposed Sewer Rates ................................................................................................. 48 Table 34 – Single Family Residential Sewer Rate Impacts ............................................................ 49 Table 35 – Commercial Sewer Rate Impacts ................................................................................ 50

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BARTLE WELLS ASSOCIATES
San Bruno 2023 Water & Sewer Rate Study

LIST OF FIGURES
Figure 1 – Combined Single Family Residential Water & Sewer Rate Survey ................................ 4 Figure 2 – Single Family Residential Water Rate Survey .............................................................. 12 Figure 3 – Historical & Projected SFPUC Wholesale Water Rates ................................................ 14 Figure 4 – Water Utility Projected Revenues & Expenses ............................................................ 18 Figure 5 – Historical & Projected Water Rate Increases ............................................................... 19 Figure 5 – Single Family Water Use by Tier .................................................................................. 27 Figure 7 – Single Family Residential Sewer Rate Survey............................................................... 34 Figure 8 – Sewer Utility Projected Revenues & Expenses ............................................................ 39 Figure 9 – Historical & Projected Sewer Rate Increases ............................................................... 40

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1 BACKGROUND, OBJECTIVES & PROPOSED RATES

1.1 Background
The City of San Bruno is located approximately 12 miles south of downtown San Francisco in San Mateo County, California. The City encompasses roughly 5.5 square miles and has a population of approximately 43,000. The City was incorporated in 1914 and is a General Law City. The City provides water and sewer service to residential, commercial, institutional, and light industrial accounts in and adjacent to the City.

The City’s water and sewer utilities are self-supporting enterprises that rely predominantly on revenues from water and sewer rates to fund the costs of providing service.

The City has provided good financial stewardship via adoption of gradual annual water and sewer rate increases most years for the past 20 years. These increases have put the water and sewer enterprises on a much stronger financial footing, helped keep rates aligned with the costs of providing service and supported a significant increase in funding for rehabilitation and replacement of aging water and sewer system infrastructure.

The City last conducted water and sewer rate studies in 2017 leading to adoption of 5 years of 5% annual water and sewer rate increases effective July 1, 2017 through 2021. However, the City cancelled the final 5% water and sewer rate increases that had been scheduled to become effective July 1, 2021 and has subsequently been able to defer raising rates. Current rates have been in effect since July 1, 2020.

San Bruno’s water and sewer rates are both currently in the middle range compared to other regional agencies in San Mateo County. The City’s combined water and sewer charges for a typical single family home were the median, with half of other agencies either higher or lower than San Bruno, based on a survey of 19 regional agencies. With the proposed rate increases, the City’s water and sewer bills are projected to remain in the middle range. Many other regional agencies have adopted or are anticipating rate increases in upcoming years. The City bill’s customers via a combined bi-monthly bill that includes water rates, sewer rates, and garbage rates.

1.2 Water System Overview
The City owns and operates a water system that includes 5 groundwater wells, 8 water storage tanks and pump stations, and roughly 120 miles of water main pipelines. Most of the City’s water pipelines are original metal pipes with a life expectancy of about 50 years. Many of these pipelines are 70 to 100 years old and subject to leaks and breaks. Over the past 5 years, the City has averaged about 100 water main breaks per year. The City’s aging water infrastructure requires significant rehabilitation and replacement.

The City has been proactively addressing its capital improvement needs but needs to continue its long- term programs to replace aging infrastructure.

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The City’s water supply includes local groundwater production, which typically accounts for roughly 2/3rds of total supply, and wholesale water purchased from the San Francisco Public Water Commission (SFPUC), which accounts for roughly 1/3rd of water supply. A small amount of water purchased from the North Coast County Water District.

1.3 Sewer System Overview
The City owns and operates a sewer collection system that includes roughly 90 miles of sewer pipelines (comprised of approximately 2,415 pipe segments) and 6 sewer pump stations. Wastewater is conveyed to the South San Francisco - San Bruno Water Quality Control Plant (WQCP) for treatment and effluent disposal via the North Bay System Unit. The WQCP is jointly owned by San Bruno and the City of South San Francisco pursuant to a Joint Powers Agreement and is located in and operated by South San Francisco. San Bruno owns approximately 25% of the capacity in the WQCP.

Similar to the water system, the City’s aging sewer infrastructure requires significant rehabilitation and replacement. Over the past decade, the City has rehabilitated and rebuilt it sewer pump stations but needs to continue its long-term sewer mainline replacement program. To minimize impact and maximize efficiency, the City replaces both water and sewer pipelines concurrently. The City is also contractually responsible to fund its share of infrastructure improvements to the Water Quality Control Plant.

1.4 Capital Improvement Funding Needs
While the City has completed a significant amount of capital improvements over the past decade, in recent years some projects were temporarily delayed due to staffing limitations and other factors including time needed for planning, design and permitting. These deferred costs helped enable the City to cancel its water and sewer rate increases that were scheduled to go into effect in 2021 and pass along the savings to customers via no rate increases for the past 2 years. However, the City has been proceeding with its capital program and has a number of large projects in design which will soon require funding.

Both water and sewer enterprises are facing substantial capital improvement funding needs in upcoming years. The City currently anticipates funding roughly $85 million of water system capital improvements and roughly $71 million of wastewater system capital improvements over the next 5 years. The improvements are needed to address existing deficiencies, rehabilitate and/or replace aging infrastructure that has reached the end of its useful life, and support safe and reliable service.

Water capital improvements planned for the next 5 years include the replacement and seismic upgrade of 3 older water storage tanks as well as replacement of aging water pipelines and various other improvements to wells, pressure regulating stations, and pump stations. Wastewater capital improvements primarily consist of rehabilitation and replacement of aging sewer pipelines but also include pump station improvements and San Bruno’s share of capital improvements to the Water Quality Control Plant.

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1.5 Policy Goals & Objectives
Key policy goals and objectives of the water and sewer rate studies include:

1. Develop water and sewer rates that:
a. recover the City’s costs of providing water and sewer service b. are fair and equitable to all customers
c. are easy to understand and implement
d. comply with the legal requirements of Proposition 218 and other California law e. provide adequate funding for capital improvement needs including near-term funding priorities and long-term rehabilitation and replacement of aging infrastructure

2. Recommend rates that maintain long-term financial sustainability of the water and sewer utilities and put the water and sewer enterprises on course for balances budgets.

3. Aim for steady, gradual annual rate increases to help minimize the annual impact on customers and mitigate the potential for larger, periodic rate spikes.

4. Maintain a prudent level of fund reserves.

1.6 Regional Water & Sewer Rate Survey
The chart on the following page compares the combined water and sewer bills for a typical single family home to those of other agencies in San Mateo County. Rates can vary widely from agency to agency due to a wide range of factors. The City’s combined water and sewer rates for a typical home are in the middle range compared to other regional agencies.

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Figure 1 – Combined Single Family Residential Water & Sewer Rate Survey

1.7 Proposed Water & Sewer Rates
The tables on the following pages show schedules of proposed water and sewer rates. Consistent with the City’s historical practices, the proposed rates are phased in gradually over the next 5 years. Proposed rates account for both overall rate increases as well as some relatively minor rate structure adjustments to keep rates aligned with the cost of providing service. As proposed, water rate increases would become effective on January 1 of each year, when water is low, and sewer rate increases would continue to become effective on July 1 at the beginning of each fiscal year.

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Table 1 – Proposed Water Rates

Current Water Jan-1 Jan-1 Jan-1 Jan-1 Jan-1Rates 2024 2025 2026 2027 2028Overall Rate Increase Target6% 6% 6% 6% 6%MONTHLY SERVICE CHARGESFixed monthly charge based on meter size.Meter SizeCapacity Ratio 3/4-inch1.00$25.58 $27.11 $28.73 $30.45 $32.27 $34.221-inch1.6742.63 45.18 47.88 50.75 53.78 57.03 1-1/2 inch3.3385.27 90.37 95.77 101.50 107.57 114.07 2-inch5.33136.43 144.59 153.23 162.40 172.11 182.51 3-inch10.00255.80 271.10 287.30 304.50 322.70 342.20 4-inch16.67426.33 451.83 478.83 507.50 537.83 570.33 6-inch33.33852.67 903.67 957.67 1,015.00 1,075.67 1,140.67 8-inch53.331,364.27 1,445.87 1,532.27 1,624.00 1,721.07 1,825.07 10-inch76.671,961.13 2,078.43 2,202.63 2,334.50 2,474.03 2,623.53 QUANTITY CHARGESBilled based on metered water consumption ($ per hundred cubic feet or hcf)a) Single-Family ResidentialBi-Monthly Use Tier 1 0 - 10 hcf $9.01 $9.57 $10.16 $10.79 $11.46 $12.18 Tier 2 11 - 20 hcf 10.78 11.42 12.09 12.80 13.56 14.36 Tier 3 > 20 hcf 14.33 15.12 15.95 16.83 17.75 18.72 b) All Other Accounts (All Water Use)All Use 10.11 $10.68 $11.28 $11.91 $12.58 $13.27Accounts served by water procured from NCCWD are also charged a Differential Cost of Supply Chargereflecting the higher cost of water procured from this source.Note: One hundred cubic feet (hcf) is equivalent to approximately 748 gallons.

Proposed Rates Effective On or AfterProposed Water Rates

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Table 2 – Proposed Sewer Rates

CurrentSewer July 1 July 1 July 1 July 1 July 1Rates 2023 2024 2025 2026 2027Overall Rate Increase Target %5%5%5%5%5%MONTHLY SERVICE CHARGESFixed monthly charge per accountSingle Family Residential$32.27 $33.96 $35.74 $37.61 $39.59 $41.66All Other Customers (Charge Based on Water Meter Size)Meter Size3/4-inch $32.27 $33.96 $35.74 $37.61 $39.59 $41.661-inch 53.78 56.60 59.57 62.69 65.98 69.431-1/2 inch 107.57 113.20 119.14 125.38 131.95 138.872-inch 172.11 181.13 190.62 200.61 211.12 222.193-inch 322.70 339.61 357.41 376.14 395.85 416.604" & Larger 537.83 566.02 595.68 626.90 659.76 694.33QUANTITY CHARGESBilled per hundred cubic feet (hcf)Residential$12.37 $12.98 $13.61 $14.28 $14.97 $15.71CommercialC-1 Light Commercial 11.50 12.05 12.63 13.23 13.87 14.53C-2 Medium Commercial 12.37 12.98 13.61 14.28 14.97 15.71C-3 Heavy Commercial 17.61 18.54 19.51 20.54 21.62 22.76C-4 Special Commercial 22.86 24.11 25.42 26.81 28.27 29.82Governmental12.37 12.98 13.61 14.28 14.97 15.71IndustrialI-1 Light Industrial 12.37 12.98 13.61 14.28 14.97 15.71I-2 Industrial Flow 8.88 9.27 9.68 10.10 10.54 11.01COD per lb30.68 0.72 0.77 0.82 0.87 0.93SS per lb 1.41 1.49 1.58 1.68 1.78 1.882 Non-residential accounts are billed based on metered water use during each billing period.3 Based on South San Francisco WQCP wastewater loadings of COD 728 mg/l and BOD 358 mg/l.UPDATENote: One hundred cubic feet (hcf) is equivalent to approximately 748 gallons.

Proposed Sewer Rates Effective On or AfterProposed Sewer Rates 1 Residential accounts are billed based on average metered water use from two bi-monthly billing periods from January through April. All other accounts are billed based on total metered use.

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2 LEGAL REQUIREMENTS & RATE METHODOLOGY

2.1 Constitutional Rate Requirements
The California Constitution includes two key articles that directly govern or impact the City’s water and sewer rates: Article 10 and Article 13D. The rates developed in this study were designed to comply with both of these constitutional mandates as well as various provisions of the California law that support and add further guidance for implementing these constitutional requirements. In accordance with the constitutional provisions, the proposed rates are designed to a) recover the City’s cost of providing water and sewer service, b) equitably recover revenues in proportion to the cost for serving each customer, and c) promote conservation and discourage waste.

2.1.1 Article 10, Section 2
Article 10, Section 2 of the California Constitution was established by voter-approval in 1976 and requires public agencies to maximize the beneficial use of water, prevent waste, and encourage conservation.

Section 2 states that:

It is hereby declared that because of the conditions prevailing in this State the general welfare requires that the water resources of the State be put to beneficial use to the fullest extent of which they are capable, and that the waste or unreasonable use or unreasonable method of use of water be prevented, and that the conservation of such waters is to be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare.

2.1.2 Article 13D, Section 6
Proposition 218 was adopted by California voters in 1996 and added Articles 13C and 13D to the California Constitution. Article 13D, Section 6 governs property-related charges, which the California Supreme Court subsequently ruled includes ongoing utility service charges such as water, sewer, and garbage rates.

Article 13D, Section 6 establishes a) procedural requirements for imposing or increasing property-related charges, and b) substantive requirements for those charges. Article 13D also requires voter approval for new or increased property-related charges but exempts rate increases for water, sewer, and garbage services from requiring voter approval as these rates support essential services.

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The substantive requirements of Article 13D, Section 6 require the City’s water and sewer rates to meet the following conditions:
1) Revenues derived from the fee or charge shall not exceed the funds required to provide the property related service.
2) Revenues derived from the fee or charge shall not be used for any purpose other than that for which the fee or charge was imposed.
3) The amount of a fee or charge imposed upon any parcel or person as an incident of property ownership shall not exceed the proportional cost of the service attributable to the parcel. 4) No fee or charge may be imposed for a service unless that service is actually used by, or immediately available to, the owner of the property in question. 5) No fee or charge may be imposed for general governmental services, such as police or fire services, where the service is available to the public at large in substantially the same manner as it is to property owners.

A number of court decisions over past 20 years have added some legal clarification regarding these substantive rate requirements. The water and sewer rates derived in this report are based on cost-of- service methodologies that are designed to equitably recover costs from water and sewer customers and comply with all legal requirements.

2.2 Rate-Setting Methodology
The rates developed in this report use a cost-of-service methodology to establish an equitable system of fixed and variable service charges designed to recover costs of providing service. The general methodology used in this study is summarized on the diagram on the following page.

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Revenue RequirementsDetermine future funding requirements from ratesCost AllocationEquitably apportion costs to rate componentsRate DesignDevelop rates that recover revenues in proportion to the cost of providing serviceIdentify near-term & long-term operating and capital funding needsEvaluate financing alternatives for capital improvementsEstablish fund reserve targets for financial planningDevelop financial projections and evaluate financial scenariosDetermine future annual revenue requirements for rate setting Allocate costs for fixed and variable rate recoveryIdentify accounts by customer class and/or meter sizeCalculate fixed charges based on system demand per customer class and/or meter sizeAnalyze historical usage data and project future water & sewer demandAllocate costs assigned for usage-based rate recovery to water rate tiers & sewer use classes Review existing water and sewer rate structuresApply unit costs of service to characteristics of each customer classDevelop fixed charges that recover costs in proportion to meter size or customer typeDevelop volumetric rates that recover costs apportioned to each tier or sewer strength classPhase in rate increases over time, to the extent possible, to help minimize annual impacts Cost of Service Rate-Setting Methodology

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3 WATER FINANCIAL PLAN & RATE DERIVATION

3.1 Current & Historical Water Rates
The City has provided strong financial stewardship by gradually raising water rates most years over the past 20 years to keep rates in line with escalating costs of providing water service. Table 3 shows a recent history of the City’s water rates. The City bills customers bi-monthly (once every 2 months) via a combined utility bill.

Table 3 – Water Rates

July 1 July 1 July 1 July 1 July 1 July 1 2016 2017 2018 2019 2020 2021 Rate Increase %5% 5% 5% 5% 5% MONTHLY SERVICE CHARGESCurrently CancelledFixed monthly charge based on meter size.in effectMeter Size3/4-inch $21.13 $22.10 $23.20 $24.36 $25.58 $26.861-inch 35.22 36.83 38.67 40.60 42.63 44.761-1/2 inch 70.43 73.67 77.33 81.20 85.27 89.532-inch 112.69 117.87 123.73 129.92 136.43 143.253-inch 211.30 221.00 232.00 243.60 255.80 268.594-inch 352.17 368.33 386.67 406.00 426.33 447.656-inch 704.33 736.67 773.33 812.00 852.67 895.308-inch 1,126.93 1,178.67 1,237.33 1,299.20 1,364.27 1,432.4710-inch 1,619.97 1,694.33 1,778.67 1,867.60 1,961.13 2,059.18QUANTITY CHARGESBilled based on metered water consumption ($ per hundred cubic feet or hcf)a) Single-Family ResidentialBi-Monthly Use Tier 1 0 - 10 hcf $7.36 $7.78 $8.17 $8.58 $9.01 $9.46 Tier 2 11 - 20 hcf 8.83 9.31 9.78 10.27 10.78 11.32 Tier 3 > 20 hcf 11.78 12.38 13.00 13.65 14.33 15.05b) All Other Accounts (All Water Use)8.32 8.73 9.17 9.63 10.11 10.62

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The City’s water rates include two components:
 Fixed Monthly Service Charges that vary based on meter size. These charges are levied independent of water use and recover a portion of the City’s fixed costs for providing service. The City incurs a substantial amount of costs ensuring that water is available at all times to meet customer needs on demand. The fixed Monthly Service Charges varies by meter size, with larger meters paying higher charges based on each meter’s capacity and associated demand placed on the water system.  Volumetric Water Quantity Charges billed based on metered water use. Single family residential customers are billed according to a 3-tiered inclining rate structure with water first billed in Tier 1 and subsequently billed in higher tiers as water use increases each billing period. All other customers including commercial, institutional and multi-family accounts are billed a uniform rate for all water use. Water Quantity Charges are billed per hundred cubic feet (hcf), with 1 hcf equal to approximately 748 gallons of water. Hence, City’s current quantity charges range from approximately 1.20 cents to

1.92 cents per gallon.

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3.2 Regional Water Rate Survey
The following chart compares the City’s current water rates to those of other regional agencies for a typical single family home using 6 hundred cubic feet of water per month. This level of use equates to approximately 150 gallons per day. The City’s water rates are currently in the middle range compared to other regional agencies in San Mateo County and are projected to remain in the middle range as many other agencies have adopted or are anticipating rate increases in upcoming years.

Figure 2 – Single Family Residential Water Rate Survey

Note: The survey assumes same level of water use for all agencies for comparative purposes. Agencies in northern San Mateo County and on the Pacific Coast tend to have lower water use per home than agencies in central and southern San Mateo County.

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3.3 Financial Challenges / Key Drivers of Rate Increases Going forward, the City’s water enterprise is facing a number of financial challenges that will require the City to resume its historical practice of implementing gradual annual water rates over the next 5 years.

Key drivers of future rate increases are summarized as follows.

3.3.1 Capital Improvements & Replacement of Aging Infrastructure The City’s water system includes many facilities that are reaching the end of their useful lives. Most of the City’s water pipelines are original metal pipes with a life expectancy of about 50 years. Many of these pipelines are 70 to 100 years old and subject to leaks and breaks. Over the past 5 years, the City has averaged about 100 water main breaks per year. As shown the table below, the City anticipates funding approximately $85 million of water system capital improvement projects over the next 5 years. Water capital improvements planned for the next 5 years include the replacement of 3 older water tanks as well as replacement of aging water pipelines and various other improvements to wells, pressure regulating stations, and pump stations. The improvements are needed to address existing deficiencies, rehabilitate and/or replace aging infrastructure that has reached the end of its useful life, and support safe and reliable water service.

Table 4 – Water Capital Improvement Program

2023/24 2024/25 2025/26 2026/27 5-Yr TotalPrior Approp Est. Carryover New Fundi ng TotalFunding SourcesWater Fund 28,181,000 14,619,000 10,354,000 24,973,000 1,600,000 16,900,000 30,250,000 11,200,000 84,923,000SFPUC 315,000 315,000 315,000 315,000 Total Funding Sources 28,496,000 14,934,000 10,354,000 25,288,000 1,600,000 16,900,000 30,250,000 11,200,000 85,238,000Water Capital Improvement Program Budget Appropriations [1]Main Improvement & Replacement Program 10,650,000 6,730,000 900,000 7,630,000 6,300,000 2,800,000 9,000,000 25,730,000Pump Station Improvement & Replacement 2,273,000 1,350,000 4,550,000 5,900,000 950,000 950,000 7,800,000Water Tank Improvement & Replacement Commodore Tank Installation 1,500,000 1,500,000 750,000 2,250,000 17,750,000 20,000,000 Cunningham Drive Tank Replacements 1,437,000 542,000 542,000 9,000,000 9,542,000 Princeton Tank Replacement 500,000 500,000 700,000 1,200,000 2,000,000 3,200,000 Sweeney Ridge Tank Replacement 1,094,000 890,000 890,000 9,500,000 10,390,000Advanced Water Meter 6,017,000 504,000 504,000 504,000Acappella Well Project 2,348,000 1,032,000 3,000,000 4,032,000 4,032,000Pressure Reg Station Impvt & Replacement 1,600,000 1,557,000 (346,000) 1,211,000 450,000 450,000 2,111,000Well Rehabilitation 1,077,000 329,000 200,000 529,000 200,000 200,000 200,000 200,000 1,329,000Wtr Qual Well Syst Upgrades & Sweeny Rdg Tank Chlorine0 600,000 600,000 600,000 Total Capital Funding 28,496,000 14,934,000 10,354,000 25,288,000 1,600,000 16,900,000 30,250,000 11,200,000 85,238,000Estimated Annual Water Capital Improvement Expenditures [2] Average Annual Expenditures 17,048,000 17,048,000 17,048,000 17,048,000 17,048,000 85,240,0001 Source: City of San Bruno Revised 5-Year Water Capital Program (Updated 11.4.22 & 1.23.23); budget appropriation required for project contract awards.2 Source: Assumes average annual expenditures over the 5-year period. 2022/23

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3.3.2 Wholesale Water Rate Increases
The San Francisco Public Utility Commission (SFPUC) is in the process of completing a roughly $5 billion capital program of seismic upgrades and reliability enhancements to its aging Hetch-Hetchy regional water system that provides water supply to many Bay Area communities. To help fund these improvements and ensure adequate revenue recovery over a period of declining water sales, the SFPUC has substantially increased it wholesale water rates since 2010. After 2016, the SFPUC was temporarily able to defer wholesale rate increases due to an overcollection of revenues that resulted in a buildup of fund reserves in a Balancing Account that has been drawn down over the past 5 years. The Balancing Account is now mostly depleted and the SFPUC began resuming annual wholesale rate increases with a 16% increase effective July 1, 2022 and additional rate increases projected in future years. The following chart shows historical and projected SFPUC wholesale water rates. The chart shows both the underlying SFPUC wholesale rate as well as the additional BAWSCA bond surcharge that wholesale agencies pay.

Figure 3 – Historical & Projected SFPUC Wholesale Water Rates

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3.3.3 Ongoing Operating Cost Inflation
In addition, the City faces ongoing cost inflation for its own operating and maintenance expenses. Water and sewer cost inflation has historically been significantly higher than the Consumer Price Index (CPI) for consumer goods and services. The City avoided some expenses in recent years due to unfilled staff positions and participation in the Groundwater Storage and Recovery Agreement with SFPUC, but these cost savings were only temporary. In addition to rate increases for capital needs and other purposes, gradual annual rate increases are needed each year to support the City’s own operating expenses and keep up with cost inflation.

3.4 Outstanding Debt Service
The following table shows debt service repayment schedule by fiscal year for the City’s water enterprise, which includes one outstanding debt obligation, the 2017 Water Revenue Bonds.

Table 5 – Outstanding Water Debt Service
Fiscal Year 2017 WaterEnding Revenue Bonds2023 $683,6502024 684,0502025 681,5502026 683,5502027 684,8002028 685,3002029 685,0502030 684,0502031 682,3002032 684,8002033 681,3002034 682,0502035 684,9002036 682,3002037 684,4002038 681,6002039 683,2002040 684,0002041 684,0002042 683,2002043 681,6002044 684,2002045 685,8002046 681,4002047 681,200Rate Covenant: 1.25x debt service coverage requirementOptional Redemption starting July 1, 2027

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3.5 Water Enterprise Financial Projections
Bartle Wells Associates developed 10-year water enterprise cash flow projections to identify future funding needs and evaluate water rate increases. The table on the following page shows 10-year water enterprise cash flow projections. The projections incorporate the latest information available as well as a number of reasonable and slightly conservative assumptions. Key assumptions include:
 Operating and maintenance costs are based on the 2022/23 budget and escalate at the annual rate of 4% to account for future cost inflation.
 Growth from new development and/or redevelopment is conservatively projected at the equivalent of 20 new single family homes per year for financial planning purposes.  Water sales are projected to remain constant at the same level experienced in the prior fiscal year.  SFPUC wholesale water rates are based on the latest SFPUC projections.  The projections assume the current fiscal year 2022/23 is a Recovery/Take year under the Groundwater Storage & Recovery (GSR) Agreement but do not assume any GSR designations in future years.
 Capital improvement costs are based on the City’s latest 5-Year Capital Improvement Program with future capital costs projected at $7.5 million per year with 3% annual cost escalation.  In recent years, the water enterprise has accrued a healthy levels of fund reserves that includes some excess reserves available for capital projects that were deferred in recent years but are scheduled for completion over the next few years. The projections assume approximately $32 million of these fund reserves will be drawn down over the next few years to help fund water system capital needs while rate increases are gradually phased in.
 The financial projections include a projected debt issuance in 2025 to generate $24 million to help fund the elevated levels of capital improvement funding needs over the next 5 years while enabling the City to implement gradual rate increases. The actual amount and timing of this potential future debt issue may vary based on the financing needs at the time debt is issued. Debt service is estimated based on a 4.5% average interest rate and assumes a 30-year repayment term.  For financial planning purposes, the financial projections assume a minimum fund reserve target equal to 50% of annual operating, maintenance and debt service costs, plus $5 million for emergency capital reserves. Maintaining a prudent minimal level of fund reserves provides a financial cushion for dealing with unanticipated expenses, revenue shortfalls, and non-catastrophic emergency capital repairs. The fund reserve target will escalate over time as the City’s expenses gradually increase.  The table also calculates annual debt service coverage based on a) total revenues less operating and maintenance expenses, divided by b) annual debt service.

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Table 6 - 10-Year Water Cash Flow Projections

2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32Effective Date of Rate Increases Jan-1 Jan-1 Jan-1 Jan-1 Jan-1 Jan-1 Jan-1 Jan-1 Jan-1Overall Rate Adjustment0.0% 6% 6% 6% 6% 6% 5% 5% 4% 4%Growth (3/4" Meter Equivalents) 20 20 20 20 20 20 20 20 20 20Annual % Change in Water Sales -2.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Total Water Sales (hcf) 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000 1,281,000Plus 10% Unaccounted Water 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000 1,409,000Groundwater Production (hcf) 900,000 900,000 900,000 900,000 900,000 900,000 900,000 900,000 900,000 900,000SFPUC Water Supply (hcf) 509,000 509,000 509,000 509,000 509,000 509,000 509,000 509,000 509,000 509,000GSR Credit hcf (3,915 AF, 1,705,000 hcf)(509,000)- - - - - - - - - SFPUC Rate per hcf $4.75 $5.20 $5.30 $5.40 $5.50 $5.60 $5.70 $5.80 $5.90 $6.00Interest Earnings Rate 1.5% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%City Cost Escalation 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%Beginning Fund Balances$49,842,000 $41,012,000 $29,781,000 $18,918,000 $19,470,000 $20,253,000 $19,211,000 $18,625,000 $18,434,000 $18,565,000REVENUESWater Service Charges 4,288,000 4,417,000 4,678,000 4,954,000 5,248,000 5,559,000 5,862,000 6,154,000 6,431,000 6,690,000Water Quantity Charges 11,858,00012,196,00012,928,00013,704,00014,526,00015,397,00016,246,00017,058,00017,828,00018,541,000 Subtotal Rate Revenues 16,146,000 16,613,000 17,606,000 18,658,000 19,774,000 20,956,000 22,108,000 23,212,000 24,259,000 25,231,000Investment Income 748,000 820,000 596,000 378,000 389,000 405,000 384,000 373,000 369,000 371,000Connection/Mtr Inst/Capacity Fees 100,000 160,000 160,000 160,000 160,000 160,000 160,000 160,000 160,000 160,000Other/Miscellaneous 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000______________________________________________________________________________________________________________Total Revenues17,014,000 17,613,000 18,382,000 19,216,000 20,343,000 21,541,000 22,672,000 23,765,000 24,808,000 25,782,000Projected Debt Proceeds12,000,000 12,000,000EXPENSESOperating & MaintenanceSalaries & Benefits 3,050,000 3,172,000 3,299,000 3,431,000 3,568,000 3,711,000 3,859,000 4,013,000 4,174,000 4,341,000Less Capitalized Project Staffing(500,000) (500,000) (500,000) (500,000) (500,000) (375,000) (386,000) (398,000) (410,000) (422,000)Supplies & Materials 1,914,000 1,991,000 2,071,000 2,154,000 2,240,000 2,330,000 2,423,000 2,520,000 2,621,000 2,726,000Utilities 570,000 593,000 617,000 642,000 668,000 695,000 723,000 752,000 782,000 813,000SFPUC/NCCWD Wholesale Water 2,418,000 2,647,000 2,698,000 2,749,000 2,800,000 2,850,000 2,901,000 2,952,000 3,003,000 3,054,000SFPUC GSR Credits (3,915 AF)(2,418,000)000000000SFPUC Meter Charges 153,000 159,000 165,000 172,000 179,000 186,000 193,000 201,000 209,000 217,000BAWSCA Bond Surcharge 165,000 180,000 180,000 180,000 180,000 180,000 180,000 180,000 180,000 180,000Internal/Intergovt Charges 2,760,000 2,870,000 2,985,000 3,104,000 3,228,000 3,357,000 3,491,000 3,631,000 3,776,000 3,927,000______________________________________________________________________________________________________________ Subtotal 8,112,000 11,112,000 11,515,000 11,932,000 12,363,000 12,934,000 13,384,000 13,851,000 14,335,000 14,836,000Debt Service2017 Water Revenue Bonds 684,000 684,000 682,000 684,000 685,000 685,000 685,000 684,000 682,000 685,000Projected 2025 Bonds (4.5% 30-Yr)0001,000,0001,464,0001,464,0001,464,0001,464,0001,464,0001,464,000______________________________________________________________________________________________________________ Subtotal 684,000 684,000 682,000 1,684,000 2,149,000 2,149,000 2,149,000 2,148,000 2,146,000 2,149,000As s umes total 5-year capita l expenditures are s pread evenl y over the fi rs t 5 years Future capital expenditures are projected at $7.5 mill ion per year with 3% cos t es cala tionCapital Improvements17,048,000 17,048,000 17,048,000 17,048,000 17,048,000 7,500,000 7,725,000 7,957,000 8,196,000 8,442,000Total Expenses25,844,000 28,844,000 29,245,000 30,664,000 31,560,000 22,583,000 23,258,000 23,956,000 24,677,000 25,427,000Revenues Less Expenses(8,830,000) (11,231,000) (10,863,000) 552,000 783,000 (1,042,000) (586,000) (191,000) 131,000 355,000Ending Fund Balances41,012,000 29,781,000 18,918,000 19,470,000 20,253,000 19,211,000 18,625,000 18,434,000 18,565,000 18,920,000Min Rsrv Target: 50% O&M&D + $5M CIP9,400,00010,900,00011,100,00011,810,00012,260,00012,540,00012,770,00013,000,00013,240,00013,490,000Debt Service Coverage 13.01 9.50 10.07 4.33 3.71 4.01 4.32 4.62 4.88 5.09Note: The projections assume 2022/23 is a Recovery/Take Year under the Groundwater Storage & Recovery (GSR) Agreement, but do not assume any GSR designations for future years.

San Bruno Water Cash Flow ProjectionsProjected 2025 Bonds (tbd)

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The following chart graphically shows a 10-year breakdown of projected water enterprise revenues and expenses. The proposed rate increases are designed to put the City on a long-term path toward supporting balanced budgets while providing adequate funding for ongoing rehabilitation and replacement of aging water system infrastructure to support safe and reliable service. As shown on the chart, the projections account for an elevated level of capital funding over the next 5 years which will require an approximately $32 million drawdown of fund reserves and potential subsequent issuance of debt in 2025. Longer-term capital needs are projected to be funded on a pay-as-you-go basis.

Figure 4 – Water Utility Projected Revenues & Expenses

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3.6 Projected Water Rate Increases
The cash flow projections indicate the need to raise rates by 6% each year for the next 5 years in order to meet the water utility’s projected operating and capital funding needs. These projected rate increases follow a period of no rate increases over the past 2 years as shown below. With the proposed rates, the average annual water rate increase since 2016 equates to approximately 4.3%

Table 7 – Projected Water Rate Increases

Figure 5 – Historical & Projected Water Rate Increases

The 6% water rate increases represent the overall level of annual rate increases proposed. Actual impacts to customers’ monthly water bills may vary a little based on meter size and water use due to minor modifications to the rate structure designed to keep water rates aligned with the cost of providing service.

July 1 July 1 January 1 January 1 January 1 January 1 January 12021 2022 2024 2025 2026 2027 20285% 0% 0% 6% 6% 6% 6% 6%Projected Water Rate Increases

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3.7 Water Use
The following table shows a 3-year history of water use including a breakdown of bi-monthly use by customer class and tier. Water use can vary from year to year due to many factors such as weather and conservation efforts. Although the City’s water was relatively consistent over the past few years, it was roughly 6% lower in the past fiscal year 2021/22 than it had been in the prior two years.

Table 8 – Water Use by Class & Tier

The tables on the following pages show a breakdown of monthly water use and sources of supply since fiscal year 2017/18.

Bi-Monthly Period Jul/Aug Sep/Oct Nov/Dec Jan/Feb Mar/Apr May/Jun Total % of Ttl2019/20 Water Use (hcf)Single Family ResidentialTier 1 80,782 81,262 79,325 75,940 76,832 80,759 474,900 36.0%Tier 2 30,324 32,382 27,636 21,331 21,942 30,689 164,304 12.4%Tier 3 9,18011,5048,1965,2974,7668,45647,3993.6%Subtotal 120,286 125,148 115,157 102,568 103,540 119,904 686,603 52.0%Multi-Family Res 65,628 62,797 58,349 55,421 54,608 58,394 355,197 26.9%Commercial/Other 58,01061,99850,72536,62935,40036,258279,02021.1%Total 243,924 249,943 224,231 194,618 193,548 214,556 1,320,820 100.0%2020/21 Water Use (hcf)Single Family ResidentialTier 1 83,196 83,489 81,204 77,104 75,823 79,654 480,470 36.2%Tier 2 37,264 37,332 30,916 23,923 21,240 28,208 178,883 13.5%Tier 3 13,80714,42210,1206,9056,0558,16859,4774.5%Subtotal 134,267 135,243 122,240 107,932 103,118 116,030 718,830 54.1%Multi-Family Res 64,705 64,345 61,194 57,009 54,279 58,768 360,300 27.1%Commercial/Other 51,91846,20241,21726,88635,67447,202249,09918.8%Total 250,890 245,790 224,651 191,827 193,071 222,000 1,328,229 100.0%2021/22 Water Use (hcf)Single Family ResidentialTier 1 80,047 79,364 75,757 73,990 74,239 75,992 459,389 37.1%Tier 2 29,550 28,295 21,455 19,480 19,191 22,227 140,198 11.3%Tier 3 10,0669,9476,0436,3475,7826,95345,1383.6%Subtotal 119,663 117,606 103,255 99,817 99,212 105,172 644,725 52.0%Multi-Family Res 57,095 55,823 54,100 52,405 51,446 54,348 325,217 26.2%Commercial/Other 53,04855,49334,68435,85343,46646,806269,35021.7%Total 229,806 228,922 192,039 188,075 194,124 206,326 1,239,292 100.0%Source: Based on detailed utility billing data files, excludes City water use which is billed separately.

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Table 9 – Water Use by Month

Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May JunTotal (hcf)Ttl (AF) % of Ttl2017/18 Water Use (hcf)Residential 98,929 84,385 105,093 82,391 98,284 74,142 88,842 71,291 85,285 68,624 85,930 76,210 1,019,406 2,340 75.0%Commercial 27,776 30,657 30,668 26,609 24,779 17,467 16,300 17,972 17,100 16,051 20,681 25,619 271,679 624 20.0%City 9,395 9,857 10,193 8,627 5,787 1,989 1,462 1,958 1,861 2,278 5,082 9,033 67,522 155 5.0%________________________________________________________________________________________________________________________ Total 136,100 124,899 145,954 117,627 128,850 93,598 106,604 91,221 104,246 86,953 111,693 110,862 1,358,607 3,119 100.0%2018/19 Water Use (hcf)Residential 99,235 83,302 108,893 81,401 107,093 74,114 96,641 69,252 82,283 65,068 90,124 75,180 1,032,586 2,370 75.1%Commercial 26,792 27,975 29,575 26,397 22,340 19,005 15,114 16,228 16,541 18,965 23,859 27,192 269,983 620 19.6%City 10,455 12,030 9,621 8,496 6,467 2,753 1,300 2,206 4,901 1,830 5,690 6,433 72,182 166 5.3%________________________________________________________________________________________________________________________ Total 136,482 123,307 148,089 116,294 135,900 95,872 113,055 87,686 103,725 85,863 119,673 108,805 1,374,751 3,156 100.0%2019/20 Water Use (hcf)Residential 104,044 82,122 105,703 82,444 99,083 74,819 86,683 69,158 86,527 72,266 99,115 79,921 1,041,885 2,392 74.5%Commercial 25,820 29,117 31,174 27,895 27,219 20,221 16,385 18,247 8,851 26,180 16,201 19,345 266,655 612 19.1%City 9,721 11,705 11,645 10,375 9,644 5,438 3,168 3,703 4,331 5,831 5,300 9,451 90,312 207 6.5%________________________________________________________________________________________________________________________ Total 139,585 122,944 148,522 120,714 135,946 100,478 106,236 91,108 99,709 104,277 120,616 108,717 1,398,852 3,211 100.0%2020/21 Water Use (hcf)Residential 108,328 88,279 113,474 85,834 106,905 76,531 93,931 70,930 88,345 69,007 97,563 77,828 1,076,955 2,472 77.2%Commercial 23,179 25,626 22,382 21,042 21,441 16,602 13,273 12,950 14,605 19,118 21,564 23,818 235,600 541 16.9%City 12,279 13,084 9,574 7,521 7,544 3,835 3,021 3,193 2,539 5,093 7,324 7,907 82,914 190 5.9%________________________________________________________________________________________________________________________ Total 143,786 126,989 145,430 114,397 135,890 96,968 110,225 87,073 105,489 93,218 126,451 109,553 1,395,469 3,204 100.0%2021/22 Water Use (hcf)Residential 99,080 77,895 97,460 76,264 90,525 66,937 84,523 67,597 84,441 66,277 88,813 71,236 971,048 2,229 74.3%Commercial 26,237 27,172 26,813 26,114 16,330 17,680 16,246 19,162 19,766 20,740 20,296 23,226 259,782 596 19.9%City 9,587 8,452 9,797 8,310 3,327 3,362 2,616 4,340 5,693 6,429 6,808 8,162 76,883 176 5.9%________________________________________________________________________________________________________________________ Total 134,904 113,519 134,070 110,688 110,182 87,979 103,385 91,099 109,900 93,446 115,917 102,624 1,307,713 3,002 100.0%2022/23 Water Use (hcf)Residential 94,289 74,070 97,618 70,837 88,780 68,015 493,609 1,133 73.7%Commercial 24,753 25,427 26,369 23,052 21,271 16,979 137,851 316 20.6%City 7,795 8,335 8,707 5,842 4,371 3,031 38,081 87 5.7%________________________________________________________________________________________________________________________ Total 126,837 107,832 132,694 99,731 114,422 88,025 - - - - - - 669,541 1,537 100.0%Source: Based on monthly water use data provided by the City of San Bruno.

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Table 10 – Sources of Water Supply by Month

Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May JunTotal (hcf)Ttl (AF) % of Ttl2017/18 Water Supply (hcf)Wells 12,930 13,080 13,036 13,253 11,747 13,486 8,840 14,262 13,061 14,323 13,494 13,829 155,341 357 10.4%SFPUC 113,342 135,352 130,261 109,369 97,616 105,668 91,871 87,626 93,886 92,934 122,593 129,285 1,309,803 3,007 88.0%NCCWD 2,043 2,044 2,029 2,028 1,977 1,976 1,860 1,859 1,836 1,836 1,961 1,962 23,411 54 1.6%________________________________________________________________________________________________________________________ Total 128,315 150,476 145,326 124,650 111,340 121,130 102,571 103,747 108,783 109,093 138,048 145,076 1,488,555 3,417 100.0%2018/19 Water Supply (hcf)Wells 12,768 4,124 14,166 6,508 13,484 14,709 6,853 13,580 14,364 15,582 13,649 9,825 139,612 321 9.6%SFPUC 119,235 136,866 119,224 97,586 104,661 99,365 94,911 86,332 94,926 102,297 113,596 129,565 1,298,564 2,981 89.1%NCCWD 2,057 2,056 3,888 1,638 1,638 1,071 1,071 975 975 946 946 1,234 18,495 42 1.3%________________________________________________________________________________________________________________________ Total 134,060 143,046 137,278 105,732 119,783 115,145 102,835 100,887 110,265 118,825 128,191 140,624 1,456,671 3,344 100.0%2019/20 Water Supply (hcf)Wells 1,227 14,456 11,484 7,453 10,864 - 13,174 13,809 14,703 1,282 12,824 9,030 110,306 253 7.2%SFPUC 131,267 137,064 122,585 115,869 108,311 120,738 83,960 105,336 107,464 106,008 125,419 136,511 1,400,532 3,215 91.9%NCCWD 1,234 1,502 1,503 873 874 885 885 946 947 1,163 1,164 1,172 13,148 30 0.9%________________________________________________________________________________________________________________________ Total 133,728 153,022 135,572 124,195 120,049 121,623 98,019 120,091 123,114 108,453 139,407 146,713 1,523,986 3,499 100.0%2020/21 Water Supply (hcf)Wells 14,349 12,423 14,479 14,520 14,105 13,412 14,091 17,765 15,635 5,342 10,500 18,783 165,404 380 11.0%SFPUC 128,986 135,657 110,866 109,817 109,187 99,794 82,640 94,325 105,412 118,954 122,494 110,268 1,328,400 3,050 88.2%NCCWD 1,172 1,172 1,172 1,176 1,175 841 841 1,043 1,044 1,043 1,044 1,050 12,773 29 0.8%________________________________________________________________________________________________________________________ Total 144,507 149,252 126,517 125,513 124,467 114,047 97,572 113,133 122,091 125,339 134,038 130,101 1,506,577 3,459 100.0%2021/22 Water Supply (hcf)Wells 69,697 78,147 73,858 65,865 76,177 82,308 79,135 80,041 96,250 76,332 93,581 90,099 961,490 2,207 64.9%SFPUC 68,454 60,969 62,029 53,223 35,552 29,115 27,064 26,805 33,345 27,250 41,465 41,949 507,220 1,164 34.3%NCCWD 1,051 957 957 978 978 1,043 1,044 972 972 975 976 1,137 12,040 28 0.8%________________________________________________________________________________________________________________________ Total 139,202 140,073 136,844 120,066 112,707 112,466 107,243 107,818 130,567 104,557 136,022 133,185 1,480,750 3,399 100.0%2022/23 Water Supply (hcf)Wells 90,682 81,262 88,581 90,282 72,254 69,615 492,676 1,131 66.4%SFPUC 46,952 53,782 35,958 33,412 35,594 38,392 244,090 560 32.9%NCCWD 1,137 1,110 1,109 1,136 1,135 5,627 13 0.8%________________________________________________________________________________________________________________________ Total 138,771 136,154 125,648 124,830 108,983 108,007 - - - - - - 742,393 1,704 100.0%Source: Based on monthly water use data provided by the City of San Bruno.

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3.8 Water Rate Derivation
The following sections develop rates projected to become effective on January 1, 2028 in fiscal year 2027/28, the fifth and final year of the proposed rate increases. Rates in intervening years are phased in from current levels to the proposed levels calculated for 2027/28.

3.9 Cost Recovery Allocations
The following table allocates costs for recovery from the City’s fixed and quantity charges. Based on the allocations, fixed monthly charges are designed to recover a little under 26% of total rate revenues and water quantity charges will recover roughly 74% of total rate revenues. These allocation percentages are consistent with the City’s current rate structure. The table also further allocated costs be recovered from Quantity Charges associated with Base Costs vs. Extra Capacity. Base Costs represent expenses associated with providing system capacity and water service under base, wet weather months with the lowest levels of water use and account for most of the costs to be recovered from Quantity Charges. Extra Capacity costs are expenses related to providing system capacity and water service to meet peak demands in excess of base use and are conservatively allocated at a little less than 5.7% of total costs.

Table 11 – Cost Recovery Allocation

Projected Expenses Fixed Fixed 2027/28 Charges Base CostsExtra CapacityCharges Base CostsExtra CapacityEXPENSESOperating & MaintenanceSalaries & Benefits $3,711,000 25.0% 70.0% 5.0% $927,750 $2,597,700 $185,550Less Capitalized Project Staffing (375,000) 25.0% 70.0% 5.0% (93,750) (262,500) (18,750)Supplies & Services/Equipment 2,330,000 25.0% 70.0% 5.0% 582,500 1,631,000 116,500Utilities 695,000 0.0% 100.0% 0.0% 0 695,000 0SFPUC/NCCWD Wholesale Water (net) 2,850,000 0.0% 100.0% 0.0% 0 2,850,000 0SFPUC Meter Charges 186,000 25.0% 75.0% 0.0% 46,500 139,500 0BAWSCA Bond Surcharge 180,000 0.0% 100.0% 0.0% 0 180,000 0Internal/Intergovt Charges 3,357,000 35.0% 65.0% 0.0% 1,174,950 2,182,050 0_______________________________________________________________ Subtotal12,934,00020.4%77.4%2.2%2,637,95010,012,750283,300Debt Service 2,149,00033.0%57.0%10.0%709,1701,224,930214,900Capital Improvements (Pay-Go)7,500,00033.0%57.0%10.0%2,475,0004,275,000750,000Total Expenses22,583,000 25.8% 68.7% 5.5% 5,822,120 15,512,680 1,248,200NET FUNDING REQUIRED FROM WATER RATESTotal Expenses 22,583,000 25.8% 68.7% 5.5% 5,822,120 15,512,680 1,248,200Less Funding Sources Other Than Rates (585,000) 25.8% 74.2% 0.0% (150,819) (434,181) 0_______________________________________________________________Net Total 21,998,000 25.78% 68.54% 5.67% 5,671,301 15,078,499 1,248,200 Cost Recovery %Cost Recovery $Quantity ChargesQuantity Charges

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The following table uses the percentage cost allocations derived on Table 11 to allocate the amount of total targeted water rates revenues for recovery from the City’s fixed and quantity charges in order to derive rates for January 1, 2028, the final year of the proposed 5-year rate increase period.

Table 12 – Fixed & Quantity Charge Revenue Recovery

3.10 Water Accounts & Meter Equivalents
The table on the following page shows the number of accounts by meter size along the relative capacity of each meter size compared to that of the base 3/4-inch meter, based on meter capacity standards developed by the American Water Works Association. For example, a 3-inch meter has roughly the same capacity as ten 3/4-inch meters and generates the same demand as ten 3/4-inch meters. The table calculated the total number of 3/4-inch meter equivalents served by the City.

TARGET WATER RATE REVENUESAnnualized Rate Revenues with Jan-1, 2028 Rate Increase $22,016,000RATE RECOVERY ALLOCATIONSFixed Service ChargesAllocation % 25.78%Allocation $ $5,675,942Water Quantity ChargesBase Rate RecoveryAllocation % 68.54%Allocation $ $15,090,837Extra Capacity Rate RecoveryAllocation % 5.67%Allocation $ $1,249,221

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Table 13 – Water Accounts & Meter Equivalents

3.11 Fixed Monthly Service Charges
The following table derives the fixed charge for the base 3/4-inch meter effective January 1, 2028 by dividing the targeted level of revenues allocated for fixed rate recovery by the projected number of 3/4- inch meter equivalents, resulting in a fixed monthly charge of $34.22 per meter equivalent.

Table 14 – Fixed Rate Derivation January 1, 2028

Meter Meter Number AWWA Meter 3/4" MeterCode Size of Accts Capacity Ratio EquivalentsWT01 3/4" 10,573 1.00 10,573 WT02 1" 351 1.67 585 WT03 1-1/2" 210 3.33 700 WT04 2" 307 5.33 1,637 WT05 3" 16 10.00 160 WT06 4" 2 16.67 33 WT07 6" 1 33.33 33 WT08 8" 1 53.33 53 WT09 10" - 76.67 - ______________Total 11,460 13,722 _______________Source: Estimated active accounts as of January 2023.Fixed ChargeMeter Size Jan-1, 2028Fixed Rate Recovery $$5,675,942Meter EquivalentsCurrent Meter Equivalents 13,722 Plus Growth through 2027/28 100Total 13,822 Fixed Service Charge per Meter EquivalentAnnual Charge$410.65Monthly Charge $34.22

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The following table calculates the fixed charges for all meter sizes by multiplying the charge for the base 3/4-inch meter by the meter capacity ratio for each meter size, resulting in fixed charges that are proportional to meter capacity.

Table 15 – Projected Fixed Services Charges January 1, 2028

3.12 Water Quantity Charge Derivation
The tables in this section derive water quantity charges for January 1, 2028. The charts on the following page show a breakdown of single family water use by tier per each bi-monthly billing cycle over the past 3 fiscal years. The orange dotted line on the charts shows the level of water use under base, wet weather months with the lowest levels of water use each year which are largely reflective of indoor water demand.

Water use over this level represents peak demands in excess of base use. As shown, a small portion of water use in Tier2 and a large portion of water use in Tier 3 exceed base usage levels.

Fixed ChargeJan-1, 2028Fixed Monthly Service Charge per Meter Equivalent$34.22Fixed Monthly Service ChargesSingle Family Up to 1", 1.5"? $34.22Meter MeterSizeCapacity Ratio3/4" 1.00 $34.221" 1.67 57.031.5" 3.33 114.072" 5.33 182.513" 10.00 342.204" 16.67 570.336" 33.33 1,140.678" 53.33 1,825.0710" 76.67 2,623.53

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Figure 6 – Single Family Water Use by Tier

80,78281,26279,32575,94076,83280,75930,32432,38227,63621,33121,94230,6899,18011,5048,1965,2974,7668,456120,286125,148115,157102,568103,540119,904020,00040,00060,00080,000100,000120,000140,000160,000Jul/Aug Sep/Oct Nov/Dec Jan/Feb Mar/Apr May/JunTier 1Tier 2Tier 32019/20 Single Family Residential Water Use by Tier (hcf)Base SFR Use(Avg Use from Jan-Apr) 83,19683,48981,20477,10475,82379,65437,26437,33230,91623,92321,24028,20813,80714,42210,1206,9056,0558,168134,267135,243122,240107,932103,118116,030020,00040,00060,00080,000100,000120,000140,000160,000Jul/Aug Sep/Oct Nov/Dec Jan/Feb Mar/Apr May/JunTier 1Tier 2Tier 32020/21 Single Family Residential Water Use by Tier (hcf)Base SFR Use (Avg Use from Jan-Apr) 80,78281,26279,32575,94076,83280,75930,32432,38227,63621,33121,94230,6899,18011,5048,1965,2974,7668,456120,286125,148115,157102,568103,540119,904020,00040,00060,00080,000100,000120,000140,000160,000Jul/Aug Sep/Oct Nov/Dec Jan/Feb Mar/Apr May/JunTier 1Tier 2Tier 32021/22 Single Family Residential Water Use by Tier (hcf)Base SFR Use(Avg Use from Jan-Apr)

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The following table shows a 5-year projection of water sales by rate class. The projections are based on water sales from the prior fiscal year 2021/22 and assume no change in use.

Table 16 – Projected Water Sales

Water Quantity Charges are derived based on a Base vs. Extra Capacity approach:
 Base costs are defined as expenses associated with providing system capacity and water service under base, wet weather months with the lowest levels of water use. These costs benefit all water use on a proportionate basis and are recovered equally from each unit of water sold. Base costs account for most of the City’s costs of service.
 Extra Capacity costs are defined as expenses related to providing and maintaining system capacity and water service to meet peak demands in excess of base use. These costs are allocable to higher levels of water use. Water system facilities must generally be oversized to meet peak demands, which require additional system capacity similar to the need for additional lanes on a highway to meet peak rush hour demands even though fewer lanes would otherwise be adequate for non-rush hour traffic. The City also incurs some costs that should be recovered more from higher levels of use, such as costs related to the City’s water conservation program.

Base Year2021/22 2023/24 2024/25 2025/26 2026/27 2027/28Annual Change in Water Sales 0% 0% 0% 0% 0%Single Family Residential UseTierMonthly UseTier 1 0 - 10 hcf 459,389 459,400 459,400 459,400 459,400 459,400Tier 2 11 - 20 hcf 140,198 140,200 140,200 140,200 140,200 140,200Tier 3 >20 hcf 45,13845,10045,10045,10045,10045,100Subtotal 644,725 644,700 644,700 644,700 644,700 644,700All Other Billed Use594,567 594,600 594,600 594,600 594,600 594,600Total1,239,292 1,239,300 1,239,300 1,239,300 1,239,300 1,239,300Change % 0.0% 0.0% 0.0% 0.0% 0.0%Projected Water Use (hcf)

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The following table derives Water Quantity Charges effective January 1, 2028 by dividing a) the costs allocated for recovery from each rate tier by b) the projected volume of water sales in each tier.  Base costs attributable equally to all water use are allocated on a pro-rata basis to water use in all rate classes.
 Extra Capacity costs related to meeting demands in excess of base use are allocated more toward higher tiers in recognition that these costs are incurred due to higher levels of water use. Costs related to peak demands are attributed to 20% of Tier 2 water use, and 60% of Tier 3 water use based on analysis of historical water use. For example, 60% of Tier 3 water use throughout the year is in excess of base levels of use and is corresponding allocated a share of Extra Capacity costs. These costs are amortized over total annual Tier 3 use resulting in Tier 3 rates that recover the allocated costs over the course of the years. No costs related to Extra Capacity are designated for recovery from Tier 1.
 The rates for each customer class and tier are based on the combined Base and Extra Capacity costs assigned to each tier, divided by the volume of water projected to be sold in each tier.

Table 17 – Water Quantity Charge Derivation

AllTier 1 Tier 2 Tier 3 Other0 - 10 hcf 11 - 20 hcf >20 hcf CustomersWater Use (hcf)459,400 140,200 45,100 594,600A) Base Cost Allocation % of Total Use 37.1% 11.3% 3.6% 48.0%B) Extra Capacity Cost Allocation % of Water in Class/Tier for Peak Cost Recovery 0.0% 20.0% 60.0% 10.0% Volume of Water for Peak Cost Recovery 0 28,040 27,060 59,460 % of Total Water for Peak Cost Recovery 0.0% 24.5% 23.6% 51.9%VARIABLE RATE COST RECOVERYBase $15,090,837 $5,594,070 $1,707,202 $549,178 $7,240,387Extra Capacity 1,249,2210305,763295,076648,383 Total 16,340,058 5,594,070 2,012,965 844,255 7,888,769Water Use (hcf) 459,400 140,200 45,100 594,600Quantity Charge ComponentsBase $12.18 $12.18 $12.18 $12.18Extra Capacity 0.002.186.541.09 Total Charge per hcf 12.18 14.36 18.72 13.27 Single Family Residential

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3.13 Proposed Water Rates
The table on the following page shows a 5-year schedule of proposed water rates incorporating a) the overall level of required rate increases needed to fund the costs of providing service, b) the updated cost allocations that apportion costs to the various components of City’s water rate structure. Proposed water rates are scheduled to become effective on January 1 of each year, when water use is low. The rates shown for each year are projected to gradually increase by the same percentage each year from current rates to the rates derived for January 1, 2028.

Table 18 – Proposed Water Rates

Proposed Rates Effective On or AfterProposed Water Rates

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3.14 Water Rate Impacts
The following table shows the impacts of the proposed water rates single family residential and non- residential customers with a range of water use. As previously noted, while the rates reflect overall 6% annual rate increases, the impacts vary a little based on meter size and water use due to the minor modifications to the rate structure.

Table 19 – Water Rate Impacts

CurrentUse (hcf) Rates 2024 2025 2026 2027 2028Overall Rate Increase Target6% 6% 6% 6% 6%Single Family Residential, 3/4" Meter (Bi-Monthly Billing)Bi-Monthly UseLow 6 hcfBi-Monthly Bill$105.22 $111.64 $118.42 $125.64 $133.30 $141.52Monthly Equivalent52.61 55.82 59.21 62.82 66.65 70.76Monthly Increase3.21 3.39 3.61 3.83 4.11% Increase6.1% 6.1% 6.1% 6.1% 6.2%Median 10 hcfBi-Monthly Bill$141.26 $149.92 $159.06 $168.80 $179.14 $190.24Monthly Equivalent70.63 74.96 79.53 84.40 89.57 95.12Monthly Increase4.33 4.57 4.87 5.17 5.55% Increase6.1% 6.1% 6.1% 6.1% 6.2%Average 12 hcfBi-Monthly Bill$162.82 $172.76 $183.24 $194.40 $206.26 $218.96Monthly Equivalent81.41 86.38 91.62 97.20 103.13 109.48Monthly Increase4.97 5.24 5.58 5.93 6.35% Increase6.1% 6.1% 6.1% 6.1% 6.2%Mod-High 20 hcfBi-Monthly Bill$249.06 $264.12 $279.96 $296.80 $314.74 $333.84Monthly Equivalent124.53 132.06 139.98 148.40 157.37 166.92Monthly Increase7.53 7.92 8.42 8.97 9.55% Increase6.0% 6.0% 6.0% 6.0% 6.1%Commercial/Multi-Family (Monthly Billing)Monthly Use3/4" Meter 10 hcfMonthly Bill$126.68 $133.91 $141.53 $149.55 $158.07 $166.92Monthly Increase7.23 7.62 8.02 8.52 8.85% Increase5.7% 5.7% 5.7% 5.7% 5.6%1" Meter 25 hcfMonthly Bill$295.38 $312.18 $329.88 $348.50 $368.28 $388.78Monthly Increase16.80 17.70 18.62 19.78 20.50% Increase5.7% 5.7% 5.6% 5.7% 5.6%2" Meter 100 hcfMonthly Bill$1,147.43 $1,212.59 $1,281.23 $1,353.40 $1,430.11 $1,509.51Monthly Increase65.16 68.64 72.17 76.71 79.40% Increase5.7% 5.7% 5.6% 5.7% 5.6%4" Meter 200 hcfMonthly Bill$2,448.33 $2,587.83 $2,734.83 $2,889.50 $3,053.83 $3,224.33Monthly Increase139.50 147.00 154.67 164.33 170.50% Increase5.7% 5.7% 5.7% 5.7% 5.6% Charges with Proposed Rated Effective Jan-1

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4 SEWER FINANCIAL PLAN & RATE DERIVATION

4.1 Current & Historical Sewer Rates
The City has provided good financial stewardship by gradually raising sewer rates most years over the past 20 years to keep rates in line with escalating costs of providing water service. The table on the following page shows a recent history of the City’s sewer rates. The City bills customers bi-monthly (once every 2 months) via a combined utility bill.

The City’s sewer rates include two components:
 A fixed Monthly Service Charge that varies based on meter size. These fixed charges are levied independent of usage and recover a portion of the City’s fixed costs for providing service. The City incurs a substantial amount of costs ensuring that sewer system capacity is available at all times to meet customer needs on demand. The fixed Monthly Service Charge varies by meter size, with larger meters paying higher charges based on the increased capacity needs and demand placed on the sewer system.
 Volumetric Sewer Quantity Charges billed based on metered water use. Residential accounts are billed based on average winter water use from two billing periods between December and April.

Residential use during this period excludes most outdoor irrigation and is a better reflection of residential wastewater discharge. All other customers are billed based on water used each billing period. Sewer Quantity Charges are billed per hundred cubic feet (hcf), with 1 hcf equal to approximately 748 gallons of water. Hence, the City’s current Residential Quantity Charges equate to approximately 1.43 cents per gallon of wastewater discharge.

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Table 20 – Sewer Rates
2017 2018 2019 2020 2021
Rate Increase % 5% 5% 5% 5% 5%
MONTHLY SERVICE CHARGES Currently Cancelled
Fixed monthly charge per account in effect
Single Family Residential $27.88 $29.27 $30.73 $32.27 $33.88 All Other Customers (Charge Based on Water Meter Size)
Meter Size
3/4-inch $27.88 $29.27 $30.73 $32.27 $33.88
1-inch 46.47 48.78 51.22 53.78 56.47
1-1/2 inch 92.93 97.57 102.43 107.57 112.93
2-inch 148.69 156.11 163.89 172.11 180.69
3-inch 278.80 292.70 307.30 322.70 338.80
4" & Larger 464.67 487.83 512.17 537.83 564.67

QUANTITY CHARGES
Billed per hundred cubic feet (hcf)
Residential $10.69 $11.22 $11.78 $12.37 $12.99
Commercial
C-1 Light Commercial 9.93 10.43 10.95 11.50 12.08
C-2 Medium Commercial 10.69 11.22 11.78 12.37 12.99 C-3 Heavy Commercial 15.21 15.97 16.77 17.61 18.49 C-4 Special Commercial 19.74 20.73 21.77 22.86 24.00 Governmental 10.69 11.22 11.78 12.37 12.99
Industrial
I-1 Light Industrial 10.69 11.22 11.78 12.37 12.99 I-2 Industrial Flow 7.68 8.06 8.46 8.88 9.32
COD per lb 0.59 0.62 0.65 0.68 0.71
SS per lb 1.22 1.28 1.34 1.41 1.48
Note: 1 hcf = 100 cubic feet or approximately 748 gallons.

Sewer Rates Effective July 1
Residential Quantity Charges are billed based on average metered water use from two bi-monthly billing periods during wet weather months between either Nov-Mar or Dec-Apr.

Non-Residential Quantity Charges are billed based on metered water use during each billing period.

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4.2 Regional Sewer Rate Survey
The chart below compares the City’s current sewer service charges to those of other regional agencies for a typical single family home with 5 hundred cubic feet of monthly winter water use. This level of use equates to almost 125 gallons per day. Roughly half of the agencies have 100% fixed residential wastewater charges that do not vary based on volume of wastewater discharge, and the other half (including San Bruno) have rates that include a volumetric component based on metered water use during the wet winter months, a period of minimal outdoor irrigation . The City’s sewer rates are currently in the-middle range compared to other regional agencies and are expected to remain in the middle range as many other regional agencies have already adopted or are anticipating rate increases in upcoming years.

Figure 7 – Single Family Residential Sewer Rate Survey

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4.3 Financial Challenges / Key Drivers of Rate Increases Going forward, the City’s sewer enterprise is facing a number of financial challenges that will require the City to resume its historical practice of implementing gradual annual sewer rates over the next 5 years.

Key drivers of future rate increases are summarized as follows.

4.3.1 Capital Improvements & Replacement of Aging Infrastructure Many of the City’s sewer collection system pipelines are at or approaching the end of their useful lives and in need of replacement. The City anticipates funding approximately $71 million of wastewater system capital improvement projects over the next 5 years as shown on the following table. This total includes roughly $46 million of improvements to the City’s sewer collection system – mostly consisting of sewer pipeline replacements – and about $25 million for the City’s share of upgrades to the Water Quality Control Plant, which include an estimated $14 million for the City’s share of a biosolids handling improvement project that South San Francisco anticipates financing via debt.

Table 21 – Sewer Capital Improvement Program

4.3.2 Ongoing Operating Cost Inflation
The City is contractually responsible for paying its share of operating, maintenance and debt service expenses for the Water Quality Control Plant and effluent disposal system. Costs for wastewater treatment operations have increased in recent years with no corresponding increases to the City’s sewer rates, and are projected to continue to gradually increase in future years. 2023/24 2024/25 2025/26 2026/27 5-Yr Total
Prior Approp Es t. Carryover New Funding Total
Funding Sources
Wastewater Fund 36,796,000 15,169,000 5,300,000 17,969,000 12,000,000 13,200,000 5,750,000 22,000,000 70,919,000 Wastewater Capital Improvement Projects
Main Improvement & Replacement Program 13,360,000 8,466,000 1,700,000 10,166,000 10,000,000 11,200,000 3,750,000 6,000,000 41,116,000 Pump Station Improvement & Replacement 10,760,000 5,203,000 100,000 5,303,000 5,303,000 Subtotal Sewer Collection System 24,120,000 13,669,000 1,800,000 15,469,000 10,000,000 11,200,000 3,750,000 6,000,000 46,419,000 Water Quality Control Plant Ongoing Upgrades 12,676,000 1,500,000 1,000,000 2,500,000 2,000,000 2,000,000 2,000,000 2,000,000 10,500,000 WQCP Biosolids Handling Improvements (est) [1] 14,000,000 14,000,000 Total Capital Funding 36,796,000 15,169,000 2,800,000 17,969,000 12,000,000 13,200,000 5,750,000 22,000,000 70,919,000 Estimated Annual Wastewater Capital Expenditures (Excludes Debt-Financing for WQCP Biosolids Improvements) Sewer Collection System Upgrades [2] 9,284,000 9,284,000 9,284,000 9,284,000 9,284,000 46,420,000 Water Quality Control Plant Upgrades 2,500,000 2,000,000 2,000,000 2,000,000 2,000,000 10,500,000 Average Annual Expenditures 11,784,000 11,284,000 11,284,000 11,284,000 11,284,000 56,920,000 Source: City of San Bruno Revised 5-Year Wastewater Capital Program (Updated 11.4.22); budget appropriation required for project contract awards. 1 South San Francisco anticipates financing a biosolids handling improvement project with long-term debt, with a portion allocated to San Bruno 2 Source: Assumes average annual expenditures over the 5-year period for City sewer collection system upgrades. 2022/23

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In addition, the City faces ongoing cost inflation for its own operating and maintenance expenses. Water and sewer cost inflation has historically been significantly higher than the Consumer Price Index (CPI) for consumer goods and services. In addition to rate increases for capital needs, annual rate increases are needed over the next 5 years to support the City’s operating expenses and keep up with cost inflation.

4.4 Outstanding Debt Service
The following table shows a schedule of outstanding sewer enterprise debt by fiscal year. Debt includes a) two outstanding series of wastewater revenue bonds issued by the City and directly secured by the net revenues of the City’s sewer enterprise, and b) the City’s allocated share of three State Revolving Fund (SRF) Loans obtained by South San Francisco for the Water Quality Control Plant.

Table 22 – Outstanding Sewer Debt Service

FiscalYear2013 Wastewater2017 Wastewater1999 SRF Loan2007 SRF Loan2018 SRF LoanEnding Revenue Revenue C-06-4614-111 C-06-4728-110June 30 Bonds Bonds 18.01% 32.70% 26.92% Total2023 $542,600 $1,442,850 $589,551 $458,471 - $3,033,4722024 544,475 1,439,450 - 458,471 796,976 3,239,3722025 541,225 1,438,200 - 458,471 796,976 3,234,8722026 547,225 1,440,700 - 458,471 796,976 3,243,3722027 546,975 1,441,700 - 458,471 796,976 3,244,1222028 544,975 1,441,200 - - 796,976 2,783,1512029 546,825 1,439,200 - - 796,976 2,783,0012030 547,275 1,440,700 - - 796,976 2,784,9512031 540,675 1,440,450 - - 796,976 2,778,1012032 543,400 1,438,450 - - 796,976 2,778,8262033 - 1,439,700 - - 796,976 2,236,6762034 - 1,438,950 - - 796,976 2,235,9262035 - 1,438,300 - - 796,976 2,235,2762036 - 1,441,900 - - 796,976 2,238,8762037 - 1,439,600 - - 796,976 2,236,5762038 - 1,442,200 - - 796,976 2,239,1762039 - 1,438,200 - - 796,976 2,235,1762040 - 1,437,800 - - 796,976 2,234,7762041 - 1,440,800 - - 796,976 2,237,7762042 - 1,442,000 - - 796,976 2,238,9762043 - 1,441,400 - - 796,976 2,238,3762044 - 1,439,000 - - - 1,439,0002045 - 1,439,800 - - - 1,439,8002046 - 1,438,600 - - - 1,438,6002047 - 1,440,400 - - - 1,440,400 San Bruno Debt Obligations1San Bruno Share of WQCP Debt Obligations2

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4.5 Sewer Enterprise Financial Projections
Bartle Wells Associates developed 10-year sewer enterprise cash flow projections to identify future funding needs and evaluate sewer rate increases. The table on the following page shows 10-year sewer enterprise cash flow projections. The projections incorporate the latest information available as well as a number of reasonable and slightly conservative assumptions. Key assumptions include:
 Operating and maintenance costs are based on the 2022/23 budget and escalate at the annual rate of 4% to account for future cost inflation.
 Growth from new development and/or redevelopment is conservatively projected at the equivalent of 20 new single family homes per year for financial planning purposes.  Billed sewer use is projected to remain constant at the same level as the prior fiscal year 2021/22.  Capital improvement costs are based on the City’s latest 5-Year Capital Improvement Program with capital costs in subsequent years projected at $10 million per year – including $7.5 million annually for City sewer collection system improvements and $2.5 million annually for the City’s share of WQCP improvements – with 3% annual cost escalation.
 In recent years, the sewer enterprise has accrued a healthy levels of fund reserves that includes some excess reserves available for capital projects that were deferred in recent years but are scheduled for completion over the next few years. The projections assume approximately $21 million of these fund reserves will be drawn down in upcoming years to fund sewer system capital needs while rate increases are gradually phased in.
 The financial projections include $800,000 of new debt service starting fiscal year 2026/27 for the City’s share of debt service for an anticipated biosolids handling improvement project at the WQCP that the South San Francisco anticipates financing via debt. The actual amount and timing of this potential future debt issue may vary based on the actual project cost and timing. Debt service is estimated assuming South San Francisco obtains a loan from the Clean Water State Revolving Fund (SRF) Loan program or the Water Infrastructure and Financing Innovation Act (WIFIA) financing program with an 3.75% average interest rate and a 30-year repayment term.  For financial planning purposes, the financial projections assume a minimum fund reserve target equal to 50% of annual operating, maintenance and debt service costs, plus $5 million for emergency capital reserves. Maintaining a prudent minimal level of fund reserves provides a financial cushion for dealing with unanticipated expenses, revenue shortfalls, and non-catastrophic emergency capital repairs. The fund reserve target will escalate over time as the City’s expenses gradually increase.  The table also calculates annual debt service coverage on the City’s wastewater debt as well as total debt including the City’s share of WQCP debt issued by South San Francisco. Debt service coverage is calculated based on a) total revenues less operating and maintenance expenses, divided by b) annual debt service.

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Table 23 - 10-Year Sewer Cash Flow Projections

2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 2030/31 2031/32Effective Date of Rate Increases July 1 July 1 July 1 July 1 July 1 July 1 July 1 July 1 July 1Overall Rate Adjustment0% 5% 5% 5% 5% 5% 5% 5% 5% 4%Growth (3/4" Meter Equivalents) 20 20 20 20 20 20 20 20 20Annual % Change in Billed Sewer Use0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Interest Earnings Rate 1.5% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%WQCP Cost Escalation 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%City Cost Escalation 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%Beginning Unrestricted Fund Rsrvs$47,280,000 $42,137,000 $37,891,000 $34,115,000 $30,838,000 $27,314,000 $26,117,000 $25,287,000 $24,861,000 $24,888,000REVENUESSewer Rate Revenues 19,100,000 20,055,000 21,058,000 22,111,000 23,217,000 24,378,000 25,597,000 26,877,000 28,221,000 29,350,000Connection & Capacity Fees 100,000 132,000 132,000 132,000 132,000 132,000 132,000 132,000 132,000 132,000Investment Income 600,000 843,000 758,000 682,000 617,000 546,000 522,000 506,000 497,000 498,000Other/Miscellaneous 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000 20,000______________________________________________________________________________________________________________Total Revenues19,820,000 21,050,000 21,968,000 22,945,000 23,986,000 25,076,000 26,271,000 27,535,000 28,870,000 30,000,000EXPENSESOperating & MaintenanceSalaries & Benefits 2,586,000 2,689,000 2,797,000 2,909,000 3,025,000 3,146,000 3,272,000 3,403,000 3,539,000 3,681,000Less Capitalized Project Staffing(500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000) (500,000)Supplies & Services 1,295,000 1,347,000 1,401,000 1,457,000 1,515,000 1,576,000 1,639,000 1,705,000 1,773,000 1,844,000Wastewater Treatment SSF 3,957,000 4,115,000 4,280,000 4,451,000 4,629,000 4,814,000 5,007,000 5,207,000 5,415,000 5,632,000Internal Charges 2,811,000 2,923,000 3,040,000 3,162,000 3,288,000 3,420,000 3,557,000 3,699,000 3,847,000 4,001,000Vehicle & Equip Replacement 0 200,000 208,000 216,000 225,000 234,000 243,000 253,000 263,000 274,000______________________________________________________________________________________________________________ Subtotal 10,149,000 10,774,000 11,226,000 11,695,000 12,182,000 12,690,000 13,218,000 13,767,000 14,337,000 14,932,000Debt Service2013 Wastewater Bonds 542,000 544,000 541,000 547,000 547,000 545,000 547,000 547,000 541,000 543,0002017 Wastewater Bonds 1,440,000 1,439,000 1,438,000 1,441,000 1,442,000 1,441,000 1,439,000 1,441,000 1,440,000 1,438,000Share of WQCP Debt, Subordinate1,048,0001,255,0001,255,0001,255,0001,255,000797,000797,000797,000797,000797,000Share of New WQCP Debt, Projected0000800,000800,000800,000800,000800,000800,000______________________________________________________________________________________________________________ Subtotal All Debt 3,030,000 3,238,000 3,234,000 3,243,000 4,044,000 3,583,000 3,583,000 3,585,000 3,578,000 3,578,000Other Non-OperatingAs s umes tota l 5-yea r capital expenditures are s prea d evenly over the fi rs t 5 yea rs Future ca pital expenditures a re projected at $10 mill ion per yea r with 3% cos t es cala tionCity Sewer System Capital Projects 9,284,000 9,284,000 9,284,000 9,284,000 9,284,000 7,500,000 7,725,000 7,957,000 8,196,000 8,442,000City Share of WPCP Capital Projects 2,500,000 2,000,000 2,000,000 2,000,000 2,000,000 2,500,000 2,575,000 2,652,000 2,732,000 2,814,000______________________________________________________________________________________________________________ Subtotal 11,784,000 11,284,000 11,284,000 11,284,000 11,284,000 10,000,000 10,300,000 10,609,000 10,928,000 11,256,000Total Expenses24,963,000 25,296,000 25,744,000 26,222,000 27,510,000 26,273,000 27,101,000 27,961,000 28,843,000 29,766,000Revenues Less Expenses(5,143,000) (4,246,000) (3,776,000) (3,277,000) (3,524,000) (1,197,000) (830,000) (426,000) 27,000 234,000Ending Unrestricted Fund Balances42,137,000 37,891,000 34,115,000 30,838,000 27,314,000 26,117,000 25,287,000 24,861,000 24,888,000 25,122,000Min Rsrv Target: 50% O&M&D + $5M11,590,00012,010,00012,230,00012,470,00013,110,00013,140,00013,400,00013,680,00013,960,00014,260,000Debt Service Coverage On Parity Debt (Min>1.25)4.885.185.435.665.936.246.576.937.347.61 On Total Debt Incl Subord SSF Debt Pymts3.19 3.17 3.32 3.47 2.92 3.46 3.64 3.84 4.06 4.21 San Bruno Sewer Cash Flow Projections

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The following chart graphically shows a 10-year breakdown of projected sewer enterprise revenues and expenses. The proposed rate increases are designed to put the City on a long-term path toward supporting balanced budgets while providing adequate funding for ongoing rehabilitation and replacement of aging sewer system infrastructure to support safe and reliable service. As shown on the chart, the projections assume the City draws down approximately $21 million of fund reserves to help fund projected capital improvements while rates are being phased in.

Figure 8 – Sewer Utility Projected Revenues & Expenses

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4.6 Sewer Rate Projections
The cash flow projections indicate the need to raise sewer rates by 5.0% each year for the next 5 years in order to support the sewer utility’s projected operating and capital funding needs. These projected rate increases follow a period of no rate increases over the past 2 years as shown below. With the proposed rates, the average annual sewer rate increase since 2016 equates to approximately 4.3%.

Table 24 – Projected Sewer Rate Increases

Figure 9 – Historical & Projected Sewer Rate Increases

The 5% sewer rate increases represent the overall level of annual rate increases proposed. Actual impacts to customers’ monthly water bills may vary a little based on customer class and billed usage due to minor modifications to the rate structure designed to keep sewer rates aligned with the cost of providing service.

July 1 July 1 July 1 July 1 July 1 July 1 July 12021 2022 2023 2024 2025 2026 20275% 0% 0% 5% 5% 5% 5% 5%Projected Sewer Rate Increases

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4.7 Sewer Use
The table below shows a history of sewer use by customer class per bi-monthly billing period.

Table 25 – Sewer Use by Class
Bi-Monthly Period Jul/Aug Sep/Oct Nov/Dec Jan/Feb Mar/Apr May/Jun Total % of Ttl2019/20 Sewer Use (hcf)RESIDENTIALBased on prior year winter water useSEWR1 151,990 151,670 153,270 151,514 151,980 151,424 911,848 77.7%SEWR1L 4,9285,5165,6405,8005,7085,84433,4362.8%Subtotal 156,918 157,186 158,910 157,314 157,688 157,268 945,284 80.6%COMMERCIAL/OTHERC-1 Light Comm 2,269 2,689 2,418 2,175 2,087 1,789 13,427 1.1%C-2 Medium Comm 18,253 20,759 17,189 14,164 11,496 9,905 91,766 7.8%C-3 Heavy Comm 13,785 14,098 13,481 12,580 8,024 5,976 67,944 5.8%C-4 Special Comm 16 16 15 14 15 14 90 0.0%Governmental 11,533 13,627 11,648 3,658 4,463 7,816 52,745 4.5%Industrial Light 2171712515472526102,0480.2%Subtotal 46,073 51,360 45,002 33,138 26,337 26,110 228,020 19.4%Total 202,991 208,546 203,912 190,452 184,025 183,378 1,173,304 100.0%2020/21 Sewer Use (hcf)RESIDENTIALBased on prior year winter water useSEWR1 157,130 156,214 155,940 156,076 156,598 156,450 938,408 80.0%SEWR1L 5,5966,1326,3306,4106,5386,61837,6243.2%Subtotal 162,726 162,346 162,270 162,486 163,136 163,068 976,032 83.2%COMMERCIAL/OTHERC-1 Light Comm 1,700 1,901 2,005 1,974 2,076 2,341 11,997 1.0%C-2 Medium Comm 12,596 11,722 11,881 10,306 13,431 14,497 74,433 6.3%C-3 Heavy Comm 8,761 8,693 9,051 7,388 8,893 10,244 53,030 4.5%C-4 Special Comm 25 21 16 18 20 19 119 0.0%Governmental 12,014 9,621 5,235 2,967 4,235 7,019 41,091 3.5%Industrial Light 3433333333464003212,0760.2%Subtotal 35,439 32,291 28,521 22,999 29,055 34,441 182,746 15.6%Total 198,165 194,637 190,791 185,485 192,191 197,509 1,158,778 98.8%2021/22 Sewer Use (hcf)RESIDENTIALBased on prior year winter water useSEWR1 158,022 158,924 158,792 158,632 158,212 158,032 950,614 81.0%SEWR1L 6,7105,6485,8385,7805,9365,96035,8723.1%Subtotal 164,732 164,572 164,630 164,412 164,148 163,992 986,486 84.1%COMMERCIAL/OTHERC-1 Light Comm 2,215 2,104 2,111 2,313 2,264 2,020 13,027 1.1%C-2 Medium Comm 15,623 15,249 11,798 12,466 11,638 12,761 79,535 6.8%C-3 Heavy Comm 10,967 11,961 10,464 10,554 10,894 11,101 65,941 5.6%C-4 Special Comm 18 18 13 16 17 18 100 0.0%Governmental 7,062 6,147 2,895 3,229 4,392 5,214 28,939 2.5%Industrial Light 3323593763543563932,1700.2%Subtotal 36,217 35,838 27,657 28,932 29,561 31,507 189,712 16.2%Total 200,949 200,410 192,287 193,344 193,709 195,499 1,176,198 100.2%Source: Based on detailed utility billing data files, may include some non-billed usage.

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4.8 Sewer Rate Derivation
The following sections develop rates projected to become effective on July 1, 2027 at the start of fiscal year 2027/28, the fifth and final year of the proposed rate increases. Rates in intervening years are phased in from current levels to the proposed levels calculated for 2027/28.

4.9 Cost Recovery Allocations
The following table allocates costs for recovery from the City’s fixed and quantity charges. Based on the allocations, fixed monthly charges are designed to recover a little under 24%% of total rate revenues and water quantity charges will recover roughly 76% of total rate revenues. These allocation percentages are consistent with the City’s current rate structure.

Table 26 – Fixed & Variable Revenue Recovery

ProjectedEXPENSES 2027/28 Exps Fixed Variable Fixed Variable Operating & MaintenanceSalaries & Benefits$3,146,00030%70%$943,800$2,202,200Less Capitalized Project Staffing(500,000)30%70%(150,000)(350,000)Supplies & Services 1,576,000 30% 70% 472,800 1,103,200Wastewater Treatment SSF 4,814,000 0% 100% 0 4,814,000Internal Charges 3,420,000 30% 70% 1,026,000 2,394,000Vehicle & Equip Replacement 234,000 30% 70% 70,200 163,800______________ ____ ____________________ Subtotal 12,690,000 19% 81% 2,362,800 10,327,200Debt Service2013 Wastewater Bonds 545,000 30% 70% 163,500 381,5002017 Wastewater Bonds 1,441,000 30% 70% 432,300 1,008,700Share of WQCP Debt, Subordi nate797,000 30% 70% 239,100 557,900Share of New WQCP Debt, Projected800,000 30% 70% 240,000 560,000______________ ____ ____________________ Subtotal 3,583,000 30% 70% 1,074,900 2,508,100Other Non-OperatingExcluding Debt-Funded ProjectsCity Sewer System Capital Projects7,500,000 30% 70% 2,250,000 5,250,000City Share of WPCP Capital Projects2,500,000 30% 70% 750,000 1,750,000______________ ____ ____________________ Subtotal 10,000,000 30% 70% 3,000,000 7,000,000Total26,273,000 24.5% 75.5% 6,437,700 19,835,300Less Revenue Offsets(698,000) 50% 50% (349,000) (349,000)Net Revenue Recovery %25,575,000 23.8% 76.2% 6,088,700 19,486,300 Cost Allocation %Cost Allocation $

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4.10 Sewer Accounts & Billing Equivalents
The following table shows the number of sewer accounts by customer class and meter size along with the associated number of fixed rate billing equivalents. Single family residential accounts billed a uniform fixed charge per home and are assigned a capacity ratio of 1.00. Commercial sewer accounts pay fixed charges based on meter size. The table calculated the number of fixed rate billing equivalents for commercial accounts based on standard American Water Works Association meter capacity ratios. For example, a 3-inch meter has roughly the same capacity as ten 3/4-inch meters and is correspondingly assigned 10 fixed rate billing equivalents.

Table 27 – Sewer Accounts & Billing Equivalents

Meter Meter Number Meter Fixed RateCode Size of Accts Capacity Ratio EquivalentsSingle Family ResidentialAll SFR 9621 1.00 9,621 All Other AccountsWT01 3/4" 620 1.00 620 WT02 1" 116 1.67 193 WT03 1-1/2" 54 3.33 180 WT04 2" 152 5.33 811 WT05 3" 5 10.00 50 WT06 4" & Larger 2 16.67 33 ______________Subtotal 949 1,887 Total 10,570 11,508 _______________Source: Estimated active accounts as of January 2023.

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4.11 Fixed Monthly Service Charges
The following table derives the fixed charge per single family home or billing equivalent by dividing the targeted level of revenues allocated for fixed rate recovery by the total projected number fixed rate billing equivalents, resulting in a fixed monthly sewer charge of $41.66 per home or commercial meter equivalent.

Table 28 – Fixed Sewer Rate Derivation

Allocation to Fixed Rate RecoveryTotal Target Rate Revenues 2027/28 $24,378,000Fixed Rate Recovery % 23.8%Fixed Rate Recovery $ $5,803,727Sewer Fixed Rate EquivalentsCurrent Fixed Rate Equivalents 11,508 Plus Projected Growth Through 2027/28 100Total Sewer Fixed Rate Equivalents11,608 Charge per Fixed Rate Equivalent Annual Charge $499.96 Monthly Charge 41.66

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4.12 Sewer Quantity Charge Derivation
The tables in this section derive sewer quantity charges for each customer class effective for fiscal year 2027/28. The following table allocates variable costs for recovery based on wastewater flow and strength.

Wastewater strength is measured by a) Biological Oxygen Demand (BOD) and b) Suspended Solids (SS).

Overall, 68.4% of variable rate costs are allocated for recovery based on the volume of wastewater flow and 31.6% of variable rate costs are allocated for recovery based on wastewater strength.

Table 29 – Variable Rate Recovery from Wastewater Flow & Strength

VariableEXPENSES Cost RecoveryFlowBODSSFlowBODSSOperating & MaintenanceSalaries & Benefits$2,202,20080%10.0%10.0%$1,761,760$220,220$220,220Less Capitalized Project Staffing(350,000) 80% 10.0% 10.0% (280,000) (35,000) (35,000)Supplies & Services 1,103,200 80% 10.0% 10.0% 882,560 110,320 110,320Wastewater Treatment SSF 4,814,000 50% 25.0% 25.0% 2,407,000 1,203,500 1,203,500Internal Charges 2,394,000 80% 10.0% 10.0% 1,915,200 239,400 239,400Vehicle & Equip Replacement 163,800 80% 10.0% 10.0% 131,040 16,380 16,380____________ ____ ____ ________________________ Subtotal 10,327,200 66.0% 17.0% 17.0% 6,817,560 1,754,820 1,754,820Debt Service2013 Wastewater Bonds 381,500 80% 10.0% 10.0% 305,200 38,150 38,1502017 Wastewater Bonds 1,008,700 80% 10.0% 10.0% 806,960 100,870 100,870Share of WQCP Debt, Subordina te557,90050%25.0%25.0%278,950139,475139,475Share of New WQCP Debt, Projected560,00050%25.0%25.0%280,000140,000140,000____________ ____ ____ ________________________ Subtotal 2,508,100 66.6% 16.7% 16.7% 1,671,110 418,495 418,495Other Non-OperatingExcluding Debt-Funded ProjectsCity Sewer System Capital Projects 5,250,000 80% 10.0% 10.0% 4,200,000 525,000 525,000City Share of WPCP Capital Projects 1,750,000 50% 25.0% 25.0% 875,000 437,500 437,500____________ ____ ____ ________________________ Subtotal 7,000,000 72.5% 13.8% 13.8% 5,075,000 962,500 962,500Total19,835,300 68.4% 15.8% 15.8% 13,563,670 3,135,815 3,135,815 Variable Cost Recovery %Variable Cost Recovery $

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The table below shows an estimate of projected sewer flow and wastewater strength loadings by customer class. The table also shows the relative wastewater strength factor for each customer class relative to residential wastewater strength based on the cost recovery percentages for wastewater flow and strength shown on the prior table.

Table 30 – Sewer Flow & Loadings by Customer Class

The next table derives unit rates for wastewater flow and strength by dividing the costs allocated to flow, BOD and SS by each of these parameters total estimated wastewater loadings resulting unit rates for flow, BOD and SS that can be applied to the wastewater characteristics of each customer class.

Table 31 – Derivation of Unit Rates for Wastewater Flow & Strength

WastewaterFlow StrengthBasis (hcf) (MG) BOD SS BOD SS FactorRes Single Family ResWinter Use1642,000480.2200200801,054801,0541.00Res Multi-Family ResWinter Use1328,000245.4200200409,261409,2611.00C-1 Light Commercial Annual Use 13,000 9.7 150 150 12,166 12,166 0.93C-2 Medium Commercial Annual Use 78,000 58.3 200 200 97,324 97,324 1.00C-3 Heavy Commercial Annual Use 65,000 48.6 500 500 202,759 202,759 1.45C-4 Special Commercial Annual Use 100 0.1 800 800 499 499 1.90G Governmental Annual Use 26,000 19.4 200 200 32,441 32,441 1.00I-1 Light Industrial Annual Use 2,000 1.5 200 200 2,495 2,495 1.00Total 1,154,100 863.3 216 216 1,558,000 1,558,000WastewaterWastewaterStrength (mg/l)Loadings (lbs)EstimatedWastewater Flow Allocation to Variable Rate RecoveryTotal Target Rate Revenues 2027/28 $24,378,000Variable Charge Recovery % 76.2%Variable Charge Recovery $ $18,574,273Allocation to Flow, BOD, SSFlowBODSSCost Allocation % 68.38% 15.81% 15.81%Cost Allocation $ $12,701,000 $2,936,000 $2,936,000Total Annual Loadings 1,154,100 1,558,000 1,558,000Units hcf lbs lbsUnit Costs $11.01 $1.88 $1.88per hcf per lb per lb

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The following table calculates sewer quantity charges for each customer class for July 1, 2027 based the unit rates derived in the prior table and the wastewater strength associated with each customer class. All classes pay the same amount for wastewater flow, however customer classes with higher-strength wastewater pay more for costs associated with wastewater strength.

Table 32 – Sewer Quantity Charges by Customer Class

4.13 Proposed Sewer Rates
The table on the following page shows a 5-year schedule of proposed sewer rates incorporating a) the overall level of required rate increases needed to fund the costs of providing service, b) the updated cost allocations that apportion costs to the various components of City’s sewer rate structure. Proposed sewer rates are scheduled to become effective July 1 at the beginning of each fiscal year. The rates shown for each year are projected to gradually increase by the same percentage each year from current rates to the rates derived for July 1, 2027.

Total Flow BOD SS Rate Customer Class BOD SS $11.01 $1.88 $1.88 per hcf Res Residential 200 200 $11.01 $2.35 $2.35 $15.71C-1 Light Commercial 150 150 11.01 1.76 1.76 14.53C-2 Medium Commercial 200 200 11.01 2.35 2.35 15.71C-3 Heavy Commercial 500 500 11.01 5.88 5.88 22.76C-4 Special Commercial 800 800 11.01 9.41 9.41 29.82G Governmental 200 200 11.01 2.35 2.35 15.71I-1 Light Industrial 200 200 11.01 2.35 2.35 15.71WastewaterUnit Rates ($ per hcf or lb)Strength (mg/l)

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Table 33 – Proposed Sewer Rates

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4.14 Sewer Rate Impacts
The following tables show the impacts of the proposed sewer rates on a range of single family residential and commercial customers.

Table 34 – Single Family Residential Sewer Rate Impacts

% of Bills Currentat or Sewer July 1 July 1 July 1 July 1 July 1Below Charges 2023 2024 2025 2026 2027Overall Sewer Rate Increase5.0% 5.0% 5.0% 5.0% 5.0%Single Family Residential, 3/4" Meter (Bi-Monthly Billing)Bi-Monthly UseLow 6 hcf25%Bi-Monthly Bill$138.76 $145.77 $153.14 $160.89 $169.02 $177.57(3 hcf / month)Monthly Equivalent69.38 72.89 76.57 80.44 84.51 88.78Monthly Increase3.51 3.68 3.87 4.07 4.27% Increase5.1% 5.1% 5.1% 5.1% 5.1%Typical 10 hcf50%Bi-Monthly Bill$188.24 $197.68 $207.59 $217.99 $228.92 $240.40(5 hcf / month)Monthly Equivalent94.12 98.84 103.79 109.00 114.46 120.20Monthly Increase4.72 4.95 5.20 5.46 5.74% Increase5.0% 5.0% 5.0% 5.0% 5.0%Mod-High 16 hcf80%Bi-Monthly Bill$262.46 $275.53 $289.25 $303.65 $318.77 $334.64(8 hcf / month)Monthly Equivalent131.23 137.76 144.62 151.82 159.39 167.32Monthly Increase6.53 6.86 7.20 7.56 7.94% Increase5.0% 5.0% 5.0% 5.0% 5.0%High 24 hcf90%Bi-Monthly Bill$361.42 $379.33 $398.13 $417.86 $438.57 $460.31(12 hcf / month)Monthly Equivalent180.71 189.67 199.06 208.93 219.29 230.15Monthly Increase8.96 9.40 9.87 10.35 10.87% Increase5.0% 5.0% 5.0% 5.0% 5.0% Projected Charges with Rates Effective

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Table 35 – Commercial Sewer Rate Impacts

Monthly CurrentBillable Sewer July 1 July 1 July 1 July 1 July 1Use (hcf) Charges 2023 2024 2025 2026 2027Overall Sewer Rate Increase5.0% 5.0% 5.0% 5.0% 5.0%Commercial Low Strength C-13/4" Meter 10 hcfMonthly Bill$147.27 $154.47 $162.03 $169.95 $178.26 $186.98Monthly Increase7.20 7.55 7.92 8.31 8.72% Increase4.9% 4.9% 4.9% 4.9% 4.9%Commercial Medium Strength C-23/4" Meter 10 hcfMonthly Bill$155.97 $163.71 $171.84 $180.38 $189.34 $198.74Monthly Increase7.74 8.13 8.53 8.96 9.40% Increase5.0% 5.0% 5.0% 5.0% 5.0%1" Meter 25 hcfMonthly Bill$363.03 $380.98 $399.83 $419.60 $440.35 $462.12Monthly Increase17.95 18.84 19.77 20.76 21.77% Increase4.9% 4.9% 4.9% 4.9% 4.9%1-1/2" Meter50 hcfMonthly Bill$726.07 $761.97 $799.66 $839.20 $880.70 $924.26Monthly Increase35.90 37.69 39.54 41.50 43.56% Increase4.9% 4.9% 4.9% 4.9% 4.9%2" Meter 100 hcfMonthly Bill$1,409.11 $1,478.66 $1,551.65 $1,628.24 $1,708.62 $1,792.97Monthly Increase69.55 72.99 76.59 80.37 84.35% Increase4.9% 4.9% 4.9% 4.9% 4.9%4" Meter 200 hcfMonthly Bill$3,011.83 $3,161.09 $3,317.74 $3,482.17 $3,654.75 $3,835.89Monthly Increase149.26 156.65 164.43 172.59 181.13% Increase5.0% 5.0% 5.0% 5.0% 5.0%Commercial High Strength C-33/4" Meter 10 hcfMonthly Bill$208.37 $219.34 $230.88 $243.03 $255.82 $269.28Monthly Increase10.97 11.54 12.15 12.79 13.46% Increase5.3% 5.3% 5.3% 5.3% 5.3%1" Meter 25 hcfMonthly Bill$494.03 $520.04 $547.41 $576.22 $606.56 $638.48Monthly Increase26.01 27.38 28.81 30.33 31.92% Increase5.3% 5.3% 5.3% 5.3% 5.3%2" Meter 100 hcfMonthly Bill$1,933.11 $2,034.87 $2,141.98 $2,254.74 $2,373.43 $2,498.37Monthly Increase101.76 107.11 112.76 118.69 124.94% Increase5.3% 5.3% 5.3% 5.3% 5.3% Projected Charges with Rates Effective

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City Council Agenda Item
Staff Report

CITY OF SAN BRUNO
DATE:June 13, 2023
TO:Honorable Mayor and Members of the City Council
FROM:Alex D. McIntyre, Interim City Manager
PREPARED BY:Bobby Magee, Interim Finance Director
Matthew Lee, P.E., Public Works Director
SUBJECT: Hold Public Hearing and Consider Adoption of a Resolution Approving the Fiscal Year 2023-24 Rates for Solid Waste Collection Services With Recology San Bruno and Approve an Amendment to the Solid Waste Collection Services Agreement Between the City of San Bruno and Recology San Bruno to Incorporate a Street Sweeping and Catch Basin Collection Fee
BACKGROUND:

The City of Can Bruno’s (City) new Franchise Agreement1 (Agreement) with Recology San Bruno became effective on January 1, 2023. According to this Agreement, Recology is entitled to annual rate adjustments based on a Detailed Rate Year analysis every three years, beginning with Year Four, and an Interim Rate Year analysis for the other years, beginning with Year Three.

The new Agreement also included a 6.03% rate increase for residential services and a 16.81% rate increase for commercial and debris box services that began on January 1, 2023, with a plan to adjust rates again in mid-2023 and at the beginning of each fiscal year thereafter as described above.

Table 1 below shows the rate increase as part of the Agreement for July 1, 2023, for services as follows:

Table 1: Rate Adjustments
Sector Effective Date
July 1, 2023 Example
Residential 9.58% $3.30 monthly increase for a 32-gallon residential cart
Commercial & Debris Box 9.58% $9.25 monthly increase for a 64-gallon commercial cart
The requested service rate adjustments are reflective of higher-than-normal inflation and new and enhanced services included in the Agreement. The proposed 9.58% rate adjustment includes three components, as follows:
1 https://www.sanbruno.ca.gov/399/Solid-Waste-Recycling

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Honorable Mayor and Members of the City Council
June 13, 2023

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San Bruno City CouncilJune 13, 2023

San Bruno City Council
June 13, 2023