Agenda packet — San Carlos City Council, August 22, 2022

1 CITY OF SAN CARLOS
City Council/Successor Agency to the
Redevelopment Agency/Housing Authority
Regular Meeting

August 22, 2022 7:00 P.M.

Council Chambers, City Hall
600 Elm Street, San Carlos, CA 94070
www.cityofsancarlos.org
AGENDA
This meeting will b e conducted both in -person at City Hall and virtually via Zoom. Members of the public will have the option to observe the meeting and address the City Council as outlined below.

In-Person Participation:
 Location. City Hall – 600 Elm Street, Council Chambers.

Masks are no longer required, but are still highly recommended in accordance with California Dept of Health Guidelines. To maintain public health and safety, please do not attend in person if you are experiencing symptoms associated with COVID-19.

 Provide Public Comment. To address the City Council on any item on the posted agenda, fill out a Request to Speak Form located in the back of the Council Chambers and submit it to the City Clerk; or, you may raise your hand when the Mayor calls for public comments.

Remote Participation:
 Observe via:
- Zoom. https://us02web.zoom.us/j/88256140939; or call 1-669-900-9128 and enter the Meeting ID #: 882 5614 0939
- Meeting Webportal. www.cityofsancarlos.org/agenda
- Local TV. Comcast Channel 27 and AT&T Uverse Channel 99

 Provide Public Comment. If you plan to make a public comment on any item on the posted agenda, please observe the meeting via Zoom (see above access inf ormation), and during the public comment period for the agenda item you wish to address, use the “raise hand” feature. If joining Zoom by phone, press *9 to “raise hand”.

Councilmembers may participate in this meeting remotely as authorized by AB 361.

MAYOR: Sara McDowell
COUNCIL: Ronald Collins, John Dugan, Laura Parmer-Lohan, Adam Rak

2 1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. CHANGES TO THE ORDER OF THE AGENDA

4. COUNCIL COMMUNICATIONS AND ANNOUNCEMENTS
Council Communications and Announcements are brief items from members of the City Council regarding upcoming events in the community and correspondence that they have received. They are informational in nature and no action will be taken on these items at this meeting.

5. PUBLIC COMMENT
Persons wishing to address the City Council on matters NOT on the posted agenda may do so.

Each speaker is limited to two minutes. If there are more than five individuals wishing to speak during public comment, the M ayor may choose to allow the first five speakers to speak during this time, and the balance of the Public Comment speakers will be called upon at the end of the Council Meeting.

If the item you are speaking on is not listed on the agenda, please be advise d that the City Council may briefly respond to statements made or questions posed as allowed under the Brown Act (Government Code Section 54954.2). The City Council's general policy is to refer items to staff for attention, or have a matter placed on a fut ure City Council agenda for a more comprehensive action or report and formal public discussion and input at that time.

6. CONSENT CALENDAR
a. Motion to Waive Reading of All Ordinances.
b. Approve Minutes of June 27, 2022 City Council Regular Meeting. c. Approve Minutes of July 8, 2022 City Council Special Meeting. d. Adopt a Resolution Rejecting the Bids from the Prequalified Bidders and Authorizing Staff to Re-Bid the Fire Station No. 16 Replacement Project C9823. e. Adopt a Resolution Appropriating $3 71,000 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C1807 in Fiscal Year 2022 -23; Awarding the 2022 Traffic Calming Improvement Project C1807 (Kenton Avenue at San Carlos Avenue and San Carlos Avenue at Prospect Street); Authorizi ng the City Manager to Execute a Public Projects Agreement with GradeTech, Inc. of San Ramon, CA in the Amount of $592,206.50; and Authorizing an Expenditure of Contingency in the Amount of $119,442.
f. Adopt a Resolution Appropriating $181,980 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C2203 in Fiscal Year 2022 -23; Awarding the 447 Hillcrest Road Wall Replacement Project C2203; Authorizing the City Manager to Execute a Public Projects Agreement with Brannon Corporation of 3 Morgan Hill, CA in an Amount of $525,980; and Authorizing an Expenditure of Contingency in the Amount of $106,000.
g. Adopt a Resolution Accepting and Approving the Annual Investment Policy for Fiscal Year 2022-23.
h. Accept Fiscal Year 2021 -22 Fourth Quar ter Investment Report Ending June 30, 2022.
i. Deny Claim of Premia Capital LLC and 1091 Industrial Owner LLC. j. Adopt a Resolution Awarding the Second Floor Library Tenant Improvement Project C2202; and Authorizing the City Manager to Execute a Publi c Projects Agreement with Rodan Builders of Hayward, CA in an Amount of $667,000; and Authorizing an Expenditure of Contingency in the Amount of $233,450. k. Adopt a Resolution Authorizing the City Manager to Execute an Amendment to the Public Projects A greement with C2R Engineering, Inc. in the Amount of $300,000 for the 2022 On -Call Sewer Replacement Project C1702; Rolling Forward $300,000 from the Remaining Project Budget from Fiscal Year ("FY") 2021-22 to FY 2022 -23, and Authorizing the Expenditure o f a Contingency Not - To-Exceed the Project Budget.
l. Adopt Ordinance 1585 Adding Chapter 8.52 to the San Carlos Municipal Code Establishing a Child Care Development Impact Fee for New Nonresidential Developments in the City of San Carlos.
m. Adopt Ordi nance 1586 Amending San Carlos Municipal Code Chapter 9.30 Noise Control - Section 9.30.070 Exempt Activities, (B) Construction Activities. n. Adopt Ordinance 1587 Amending San Carlos Municipal Code Chapter 2.24 Commissions by Repealing Section 2.24.300 Transportation and Circulation Commission, Removing References to the Commission, and Amending Section

2.24.140 Planning Commission – Powers and Duties; and Amending Sections to Update the Planning Commission Name to the Planning and Transportation Commission.

7. REPORTS TO COUNCIL
Reports to Council are updates on key City projects by City staff and City Council Subcommittees. They are informational in nature, and no action will be taken on these items at this meeting.
a. Receive an Update on Wildfire Mitigation.

8. PUBLIC HEARING
a. Consideration of Introducing an Ordinance Amending Ordinance 1240 for the Planned Development (PD) Zoning District for the Property Located at 1087 Old County Road (APN 046-184-270).

4 9. NEW BUSINESS
a. Consideration of Appointing Four Youth Advisory Council (YAC) Voting Members for the 2022 – 2023 Term, Five YAC Voting Members for the 2022 -2024 Term, Two Alternate YAC Members for the 2022 – 2023 Term, and Recognizing Four Retiring YAC Voting Members.

10. AGENDA SETTING
Items discussed in this Agenda Setting Section will be considered by the Council for placing on a future agenda. No action will be taken on these items at this meeting.

11. ADJOURNMENT

Any writings or documents provided to a majority of the City Counci l regarding any item on this agenda will be made available for public inspection upon request.

In compliance with the Americans with Disabilities Act and Title VI, if you need special assistance or translation services to participate in this meeting, pleas e contact the City Clerk’s Office at (650) 802 -4222 or via email at [email protected]. Notification in advance of the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.

June 27, 2022 1

San Carlos City Council/Successor Agency to the
Redevelopment Agency/Housing Authority Regular Meeting
Council Chambers, City Hall – 600 Elm Street, San Carlos June 27, 2022, 7:00 PM

MINUTES

ROLL CALL
City Council Present: Sara McDowell, Mayor
Ronald Collins, Councilmember
John Dugan, Councilmember
Laura Parmer-Lohan, Councilmember (participated remotely) Adam Rak, Vice Mayor

Staff Present: Adam Aronson, Economic Development and Housing Manager Kristina Bell, Police Captain
Nil Blackburn, Assistant City Manager
Sajuti Haque, Senior Management Analyst
Steven Machida, Public Works Director
Jeff Maltbie, City Manager
Andrea Mardesich, Principal Planner
Rebecca Mendenhall, Administrative Services Director
Crystal Mui, City Clerk
Amy Newby, Parks & Recreation Director
Gregory Rubens, City Attorney
Chris Valley, Building Official

1. CALL TO ORDER
The meeting was called to order at 7:00 PM by Mayor for the Day Eason Tsang.

2. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Mayor for the Day Eason Tsang.

3. CHANGES TO THE ORDER OF THE AGENDA
None.

4. PRESENTATIONS
a. Present a Proclamation Recognizing July 2022 as Parks and Recreation Month.

Mayor McDowell presented a proclamation to Parks and Recreation Director Amy Newby recognizing Parks and Recreation Month.

Ms. Newby thanked the Council for the recognition and invited the community to partake in their many events this summer.

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 2
b. Present Proclamations to Outgoing Economic Development and Advisory Commissioner Mark Berger; Planning Commis sioner Donald W. Bradley; and Transportation and Circulation Commissioners Nishant Garg and Sandra Nierenberg in Recognition of Their Years of Service.

Mayor McDowell noted that Mark Berger, Nishant Garg and Sandra Nierenberg were unable to attend the Council meeting this evening, but she recognized them for their years of Commission service. Planning Commissioner Don Bradley was present in the Council Chambers and received a proclamation presented by Mayor McDowell.

Mr. Bradley thanked Council and staf f for t he recognition and spoke on the importance of citizen engagement.

5. COUNCIL COMMUNICATIONS AND ANNOUNCEMENTS
Councilmember Collins provided an update from a recent Local Policy Makers Group meeting he had attended and announced the passing of his Mother-in-law and long-time San Carlos resident – Velma Harding Kuhlman.

Councilmember Dugan commented that he attended Friday’s Concert in the Park and encouraged the community to partake in the City’s festivities. He also provided a report from a rece nt Association of Bay Area Governments’ General Assembly and thanked Don Bradley for his service on the Planning Commission and for his services to the Country in the U.S. Air Force.

Vice Mayor Rak thanked all the commissioners for their service and repo rted on attending the June Council of Cities meeting and the recent 2+2 meeting.

Mayor McDowell reported that she had the opportunity to take Mayor for the Day Eason on a tour of City Hall. She also reported on a presentation she gave at a recent 2+2 meeting and, as part of the Safe Routes to School Program, encouraged the public to visit the City’s interactive webpage to provide feedback on suggested safety improvements.
a. Announce Appointed Downtown Advisory Committee Members.

Mayor McDowell announced the 17 newly appointed Downtown Advisory Committee Members.

6. PUBLIC COMMENT
Laura Deck, resident, expressed concern with Sheriff s carrying assault rifles at the Hometown Days Parade and requested Council ban rifles at next year's parade.

Mayor McDowell directed staff to follow-up with this public comment.

Daniel Villasenor, resident, announced that he’ll be hosting a music festival at Burton Park and invited the community to attend.

7. CONSENT CALENDAR
Councilmember Rak recused himself from the second Resolution in Item K a pproving installation of new sports field lighting at Flanagan Field.

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 3
RESULT: Adopted [Unanimous] Consent Calendar Items ‘a’ – ‘u’; and Item v – Ordinance 1583 Amending Municipal Code Chapter 18 to Adjust the City Density Bonus, I nclusionary Housing Requirements, Affordability Periods, Parking for Affordable Units, and Mak ing Other Conforming Amendments; and
Item w - Ordinance 1584 Amending San Carlos Municipal Code Title 18 - Zoning, Consisting of Modifications to Chapter 18.23 .210 - Accessory Dwelling Units/Junior Accessory Dwelling Units.

MOVER: John Dugan
SECONDER: Ronald Collins
AYES: Collins, Dugan, Parmer-Lohan, Rak, McDowell
a. Motion to Waive Reading of All Ordinances.
b. Approve Minutes of May 9, 2022 City Council Regular Meeting. c. Adopt a Resolution Appropriating/Transferring $1,850,000 from the General Capital Fund (Fund 25) to the Gas Tax Fund (Fund 16) to Supplement Project C9416 in Fiscal Year 2021 -22; Awarding the 2022 Pavement Rehabilitation Project C9416 -22; A uthorizing the City Manager to Execute a Public Projects Agreement with G. Bortolotto & Co., Inc. of San Carlos, CA in the Amount of $5,444,743.90; and Authorizing the Expenditure of Contingency Up to the Project Budget. Resolution 2022-060
d. Adopt a Resolution Appropriating $100,000 from the General Capital Fund (Fund 25) to C1904 in Fiscal Year 2022 -23; Awarding the Wheeler Plaza Garage Painting Project C1904; Authorizing the City Manager to Execute a Public Projects Agreement with JPB Designs, Inc. of O rangevale, CA in the Amount of $211,380; and Authorizing the Expenditure of a Contingency in the Amount of $42,276. Resolution 2022-061
e. Adopt a Resolution Calling and Giving Notice of a General Municipal Election to be Held on Tuesday, November 8, 2022 for the Election of Certain Officers (As Required by the Provisions of the Laws of the State of California Relating to General Law Cities) and Authorizing the Execution of a Services Agreement with the County of San Mateo for Specified Services Relating to the Conducting of a General Municipal Election. Resolution 2022-062
f. Receive an Update on the Status of Objectives and Tasks in the City's 2022 Strategic Plan and Approve the June 2022 Strategic Work Plan Update. g. Adopt a Resolution Approving the Pla ns and Specifications and Authorizing a Call for Bids for the Installation of Rectangular Rapid Flashing Beacons (RRFB) System at Kenton Avenue and Prospect Street on San Carlos Avenue as Part of the 2022 Traffic Calming Improvement Project C1807. Resolution 2022-063 h. Adopt a Resolution Approving the Plans and Specifications and Authorizing a Call for Bids for the 447 Hillcrest Wall Replacement Project C2203. Resolution 2022-064
i. Adopt a Resolution Approving and Adopting a Comprehensive Master Salary Schedule for Fiscal Year 2022 -23 in Accordance with Title 2 of the California

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

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Code of Regulations Section 570.5 and the California Employees Retirement System ("CalPERS"). Resolution 2022-065
j. Adopt a Resolution Approving the Plans and Specifications and A uthorizing a Call for Bids from Qualified Bidders for the Second Floor Library Tenant Improvement Project C2202. Resolution 2022-066
k. Adopt Resolutions Appropriating $137,565 from the General Capital Fund (Fund 25) to C1818 in Fiscal Year 2022 -23; Awarding the Installation of New Sports Field Lighting at Flanagan and Stadium Fields Project C1818; Authorizing the City Manager to Execute a Public Projects Agreement with Capitol Valley Electric, Inc. of Sacramento, CA in the Amount of $1,769,888; and Authorizing an Expenditure of Contingency in the Amount of $353,977. Resolution 2022-067 for Stadium Field
RESULT: Adopted [ 4 – 0 – 1] Resolution 2022 -068 Appropriating $137,565 from the General Capital Fund (Fund 25) to C1818 in Fiscal Year 2022 -23; Awarding the Installation of New Sports Field Lighting at Flanagan and Stadium Fields Project C1818; Authorizing the City Manager to Execute a Public Projects Agreement with Capitol Valley Electric, Inc. of Sacramento, CA in the Amount of $1,769,888; and
Authorizing an Expenditure of Contingency in the Amount of $353,977 for Flanagan Field.

MOVER: John Dugan
SECONDER: Ronald Collins
AYES: Collins, Dugan, Parmer-Lohan, McDowell
NAYS: None
RECUSE: Rak
l. Adopt a Resolution Appropriating $100,000 from the General Capital Fund (Fund 25) to Create a Website and Intranet Refresh Project in Fiscal Year 2022 -23.

Resolution 2022-069
m. Deny Claim of Mosgrove.
n. Adopt a Resolution Approving the Submittal of Annual Property Assessments to San Mateo County for National Pollutant Discharge Elimination System Stormwater Fees; Pulgas Creek Levee Assessment Fees; and Sewer Service Charges for Fiscal Year 2022-2023. Resolution 2022-070
o. Adopt a Resolution Approving and Authorizing the City Manager to Execute the Third Amendment to th e Lease Agreement with San Carlos Properties, LLC, Pertaining to the Property at 505 Skyway Road (APN 046 -250-020). Resolution 2022-071
p. Adopt a Resolution Authorizing the City Manager to Execute an Amendment to the Professional Services Agreement with C alifornia CAD Solutions, Inc. for Additional On -Call Geographic Information System Services During the Three - Year Term in an Amount Not -To-Exceed $96,000 Per Contract Calendar Year.

Resolution 2022-072

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 5
q. Adopt a Resolution Appropriating $13,100 from the G eneral Fund Unassigned Fund Balance and Agreeing to Fully Fund the San Carlos School District Crossing Guard Program for a Total Cost of $252,500 for Fiscal Year 2022 -23.

Resolution 2022-073
r. Adopt a Resolution Approving the Final Map for the 560 El Cami no Real Development, Assessor’s Parcel Numbers (APN) 050 -074-080, 090 and 100.

Resolution 2022-074
s. Adopt a Resolution Authorizing the City Manager to Execute an Amendment to the Agreement with Robert Half International, Inc. for Temporary Accounting Services in an Amount Not to Exceed $70,000. Resolution 2022-075 t. Authorize the Mayor to Sign a Letter on Behalf of the City Council to PG&E to Address Illegal Dumping and Blight at the PG&E Substation at 1500 Industrial Road.
u. Adopt a Resolution Approvi ng a 5% Increase in the Community Development Director’s Monthly Salary. Resolution 2022-076
v. Adopt Ordinance 1583 Amending Municipal Code Chapter 18 to Adjust the City Density Bonus, Inclusionary Housing Requirements, Affordability Periods, Parking for Affordable Units, and Making Other Conforming Amendments. w. Adopt Ordinance 1584 Amending San Carlos Municipal Code Title 18 - Zoning, Consisting of Modifications to Chapter 18.23.210 - Accessory Dwelling Units/Junior Accessory Dwelling Units.

8. REPORTS TO COUNCIL
a. Receive a Presentation from Cal Water on Drought Updates.

Public Works Director Steven Machida introduced CalWater Baysho re District Manager Ross Molian. Mr. Molian provided an update on the statewide drought emergency and then turned the presentation over to Anthony Meyer, CalWater Conservation Coordinator, to speak on water -use restrictions and conservation programs. Mr. Molian, Mr. Meyer, and CalWater Regional Community Affairs Specialist Robert Seeley responded to Council questions.

Councilmember Dugan directed staff to include the Smart Landscape T une-Up Program and Irrigation Day restriction in the city newsletter.

9. NEW BUSINESS
a. Consideration of Adopting a Resolution Approving and Adopting the Child Care Impact Fee Nexus Study Prepared by Economic & Planning Systems Inc. for the City of San Carlos Dated July 14, 2021.

Sajuti Haque, Senior Management Analyst, presented on the Nexus Study for Child Care and, along with Consultant Ashleigh Kanat, responded to Council questions.

RESULT: Adopted [Unanimous] Resolution 2022 -077 Approving and Adopting the Child Care Impact Fee Nexus Study Prepared by

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 6
Economic & Planning Systems Inc. for the City of San Carlos Dated July 14, 2021.

MOVER: Adam Rak
SECONDER: Ronald Collins
AYES: Rak, Dugan, Collins, Parmer-Lohan, McDowell

10. PUBLIC HEARING
a. Consideration of Introducing an Ordinance Adding Chapter 8.52 to the San Carlos Municipal Code Establishing a Child Care Development Impact Fee for New Nonresidential Developments in the City of San Carlos.

Sajuti Haque, Senior Management Analyst, outlined regulatory achievements and Ordinance goals and recommendations. Consultant Ashleigh Kanat presented on Development Impact Fee Program ’s parameters and potential use of revenues. Ms. Haque, Ms. Kan at, Al Savay Community Development Director and City Attorney Greg Rubens responded to Council questions.

Public Comment
Sarah Kinahan, resident and Coordinator for the San Mateo County Child Care Partnership Council, expressed support of the proposed Or dinance, provided preliminary data on the need for childcare in the city and addressed some of Council’s questions.

RESULT: Approved [Unanimous] to Close the Public Hearing.

MOVER: Ronald Collins
SECONDER: John Dugan
AYES: Parmer-Lohan, Rak, Dugan, Collins, McDowell

Council provided the following feedback:

- engage and encourage the direct built option
- be creative with ways to quickly put to use received fees , such as offering loans or grants to childcare operators in town - provide Council with an update/check-in
RESULT: Introduced as Amended [Unanimous] Ordinance 1585 Adding Chapter 8.52 to the San Carlos Municipal Code Establishing a Child Care Development Impact Fee for New Nonresidential Developments in the City of San Carlos that articulates the City Council’s interest to have child care built out and that the dimensions provided for minimum sized day cares being built onsite only be used as an example to inform the Memorandum of Understanding.

MOVER: Laura Parmer-Lohan
SECONDER: Ronald Collins
AYES: Collins, Parmer-Lohan, Rak, Dugan, McDowell

Council recessed at 9:19 PM and reconvened at 9:31 PM.
b. Consideration of Adopting a Resolution Authorizing Adjustments to the Park Facility Development Fee, Sewer Capacity Charge and Traffic Impact Fee for Fiscal Year 2022-23.

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 7
Administrative Services Director Rebecca Mendenhall presented on the recommended changes to the impact fee and responded to Council questions.

Public Comment
None.

RESULT: Approved [Unanimous] to Close the Public Hearing.

MOVER: Adam Rak
SECONDER: Ronald Collins
AYES: Dugan, Collins, Parmer-Lohan, Rak, McDowell

RESULT: Adopted [Unanimous] Resolution 2022 -078 Authorizing Adjustments to the Park Facility Development Fee, Sewer Capacity Charge and Traffic Impact Fee for FY 2022-23.

MOVER: Adam Rak
SECONDER: John Dugan
AYES: Rak, Dugan, Collins, Parmer-Lohan, McDowell
c. Consideration of Adopting a Resolution Authorizing Adjustments to the Cost of Services Schedule (User Fees) and the Approval of an Additional Budget Appropriation in the Am ount of $10,000 from the General Fund Unassigned Balance to Establish a Field Use Fee Scholarship Program for Fiscal Year 2022 - 23 and to Adopt Guidelines for Future Fee Increases.

Administrative Services Director Rebecca Mendenhall presented on the recommended changes to the Cost of Services Schedule and, along with Parks and Recreation Director Amy Newby and Principal Planner Andrea Mardesich responded to Council questions.

Public Comment
None.

RESULT: Approved [Unanimous] to Close the Public Hearing.

MOVER: Ronald Collins
SECONDER: Adam Rak
AYES: Parmer-Lohan, Rak, Dugan, Collins, McDowell

Council requested that staff stay ahead of fees to avoid steep increases in the future and invited staff to make a request if additional funds for the sports scholarship program is needed.

RESULT: Adopted [ 4 to 1 ] Resolution 2022 -079 Authorizing Adjustments to the Cost of Services Schedule (User Fees) and the Approval of an Additional Budget Appropriation in the Amount of $10,000 from the General Fund Unassigned Fund Balance to Establish a Field Use Fee Scholarship Program for Fiscal Year 2022 -23 and to Adopt Guidelines for Future Fee Increases.

MOVER: Ronald Collins
SECONDER: Laura Parmer-Lohan
AYES: Collins, Dugan, Parmer-Lohan, McDowell
NAYS: Rak

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

June 27, 2022 8

11. AGENDA SETTING
a. Consideration of Agendizing an Item to Consider Calling on Sutter Health to Reopen the Mack E. Mickelson Arthritis and Rehabilitation Center Therapy Pool in San Mateo.

Mayor McDowell suggested Council support the measure to reopen the Mack E.

Mickelson Arthritis and Rehabilitation Center Therapy Pool in San Mateo. Council approved this for a future meeting.

Mayor McDowell announced that Council will recess for the month of July.

12. ADJOURNMENT
The meeting adjourned at 9:59 PM.

Crystal Mui,
City Clerk

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Minutes Acceptance: Minutes of Jun 27, 2022 7:00 PM (CONSENT CALENDAR)

July 8, 2022 1

San Carlos City Council/Successor Agency to the
Redevelopment Agency/Housing Authority Special Meeting
Conducted Remotely in Accordance with Assembly Bill 361 July 8, 2022, 11:30 AM

MINUTES

ROLL CALL
City Council Present:

City Council Absent:

Adam Rak, Vice Mayor
Ronald Collins, Councilmember
John Dugan, Councilmember
Laura Parmer-Lohan, Councilmember

Sara McDowell, Mayor

Staff Present: Jeff Maltbie, City Manager
Crystal Mui, City Clerk
Gregory Rubens, City Attorney

1. CALL TO ORDER
The meeting was called to order at 11:30 AM by Vice Mayor Adam Rak.

2. PUBLIC COMMENT
Sofia McConn spoke in support of Vecino Lemonade concerts.

Daniel spoke about the need for his Vecino Lemonade concerts in the community.

Vice Mayor Rak requested City Atto rney Greg Rubens follow -up with Daniel on his comment.

Karla Aguilar spoke in support of Vecino Lemonade concerts.

Melina Dimick spoke in support of Vecino Lemonade concerts.

Jackson Gravagno spoke in support of Vecino Lemonade concerts.

Janel spoke in support of Vecino Lemonade concerts.

Elise Dimick spoke in support of Vecino Lemonade concerts.

Yasmine spoke in support of Vecino Lemonade concerts.

3. CONSENT CALENDAR
Vice Mayor Rak noted that he received a message from Mayor McDowell indicating her support of the letter to SamTrans (Item 3c)

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Minutes Acceptance: Minutes of Jul 8, 2022 11:30 AM (CONSENT CALENDAR)

July 8, 2022 2
RESULT: Adopted [Unanimous] Consent Calendar Items ‘a’ – ‘c’.

MOVER: Ronald Collins
SECONDER: John Dugan
AYES: Rak, Dugan, Collins, Parmer-Lohan
ABSENT: McDowell
a. Motion to Waive Reading of All Ordinances.
b. Adopt a Resolution Making Findings and Authorizing Remote Teleconference Meetings of the City Council and Commissions Pursuant to Assembly Bill 361.

Resolution 2022-080
c. Authorize the Mayor to Sign a Letter on Behalf of the City Council to San Mate o County Transit District (SamTrans) Regarding the Council's Desire for Housing to be Included as a Component of SamTrans' Redevelopment of Their Headquarters at 1250 San Carlos Avenue.

4. ADJOURNMENT
The meeting adjourned at 11:45 AM.

Crystal Mui,
City Clerk

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Minutes Acceptance: Minutes of Jul 8, 2022 11:30 AM (CONSENT CALENDAR)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Rejecting the Bids from the Prequalified Bidders and Authorizing Staff to Re -Bid the Fire Station No. 16 Replacement Project C9823.

RECOMMENDATION:

Staff recomme nds that the City Council adopt a resolution rejecting the bids from the prequalified bidders and authorizing staff to re -bid the Fire Station No. 16 Replacement Project (“Project”) C9823.

FISCAL IMPLICATIONS:

There is no fiscal impact and no additional funding is needed at this time.

Funding for the Project comes from C9823 which has approximately $11,668,734 available.

Should additional funding be required, staff will request it at the time of award.

BACKGROUND:

In May 2019, staff sought the City Council’s direction on the replacement of Fire Station No. 16 in lieu of renovation and modernization due to the significant costs of bringing the outdated station up to current seismic and building codes.

In August 2019, the Council approved the award of a Professional Services Agreement with Shah Kawasaki Architects (“SKA”). SKA was engaged to investigate existing building conditions, establish the needs of the Fire Department, develop a cost proposal to prepare plans, specifications, and an engineer’s estimate for the replacement of the existing fire station, and provide construction management services.

In March 2022, staff posted the prequalification for the Project and received eight prequalification packages from potential bidders. Staff, with the assistance of the construction management consultant, Consolidated CM, reviewed the prequalification packages and selected six qualified bidders.

The City Engineer signed the final bid set on May 12, 2022 , and the plans and specifications were approved by the City Council at its May 23, 2022 meeting.

ANALYSIS:

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2 The City advertised for bids for construction of the Project on June 8, 2022. Staff contacted the prequalified bidders directly to solicit bid proposals to construct the Project in accordance wi th the construction documents. Five bids were received on July 26, 2022.

During the bidding of the Project, six addendums were issued, including a revision to an addendum. The revised addendum was not provided to the plan distributor, resulting in some o f the prequalified bidders not receiving the information.

Because the revised addendum wasn’t provided to all the prequalified bidders and there was pertinent information that could have resulted in a change in the bid amounts, staff recommends rejecting all bids and re -bidding the Project to ensure receipt of responsible, responsive, and competitive bids.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt a resolution rejecting the bids from the prequalified bidders and authorizing staff to re-bid the Fire Station No. 16 Replacement Project C9823;

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Grace Le,
City Engineer

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution

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RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS

REJECTING THE BIDS FROM THE PREQUALIFIED BIDDERS AND AUTHORISING STAFF TO RE-BID THE FIRE STATION NO. 16 REPLACEMENT PROJECT (“PROJECT”) C9823.

WHEREAS, in May 2019, staff sought the City Council’s direction on the replacement of Fire Station No. 16 in lieu of renovation and modernization due to the significant costs of bringing the outdated station up to current seismic and building codes; and

WHEREAS, in August 2019, the Council approved the award of a professional services agreement with Shah Kawasaki Architects; and

WHEREAS, in March 2022, staff posted the prequalification for the Project and received eight prequalification packages from potential bidders; and

WHEREAS, staff, with the assistance of the construction management consultant, Consolidated CM, reviewed the prequalification packages and selected six qualified bidders; and

WHEREAS, the City advertised for bids for construction of the Project on June 8, 2022; and

WHEREAS, staff contacted the prequalified bidders directly to solicit bid proposals to construct the Project in accordance with the construction documents; and

WHEREAS, five bids were received on July 26, 2022; and

WHEREAS, during the bidding of the Project, six addendums were issued, including a revision to an addendum. The revised addendum was not provided to the plan distributor, resulting in some of the prequalified bidders not receiving the information; and

WHEREAS, since the revised addendum wasn’t provided to all the prequalified bidders and there was pertinent information that could have resulted in a change in the bid amounts, staff recommends rejecting all bids and re-bidding the Project to ensure receipt of responsible, responsive, and competitive bids.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council rejects the bids from the prequalified bidders and authorizes staff to re-bid the Fire Station No. 16 Replacement Project C9823.

* * * * *

I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 22nd day of August 2022, by the following vote:

AYES, COUNCILMEMBERS: ___________________________________________ NOES, COUNCILMEMBERS: ___________________________________________

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Attachment: Resolution (Reject Fire Station No. 16 Replacement Project) ABSENT, COUNCILMEMBERS: ___________________________________________

________________________________
CITY CLERK of the City of San Carlos
APPROVED:

___________________________
MAYOR of the City of San Carlos

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Attachment: Resolution (Reject Fire Station No. 16 Replacement Project)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Appropriating $371,000 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C1807 in Fiscal Year 2022 - 23; Awarding the 2022 Traffic Calming Improv ement Project C1807 (Kenton Avenue at San Carlos Avenue and San Carlos Avenue at Prospect Street); Authorizing the City Manager to Execute a Public Projects Agreement with GradeTech, Inc. of San Ramon, CA in the Amount of $592,206.50; and Authorizing an Expenditure of Contingency in the Amount of $119,442.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution appropriating $371,000 from the General Capital Projects Fund Unassigned Balance (“Fund 25”) to C1807 in Fiscal Year (“FY”) 2022-23; awarding the 2022 Traffic Calming Improvement Project C1807 (Kenton Avenue at San Carlos Avenue and San Carlos Avenue at Prospect Street) (“Project”); authorizing the City Manager to execute a public projects agreement with GradeTech, Inc. of San Ramon, CA in the amount of $592,206.50; and authorizing an expenditure of contingency in the amount of $119,442.

FISCAL IMPLICATIONS:

The Project is funded from Traffic Calming Improvements C1807, which has an available budget of approximately $982,400 in FY 2022-23.

The lowest responsible and responsive bid received for the Project was $592,206.50. Including a 20% contingency of $119,442, the total cost of the Project is approximately $711,648.50.

Although there are sufficient funds to award the Project with the available budget, there are additional traffic calming improvements being completed under the same Project budget which have not been fully paid.

Staff recently issued a task order for engineering design and construction services with Bellecci & Associates, Inc. in the amount of $85,416. The City Council also recently awarded the Installation of the hybrid actuated crosswalk under the Belmont Ave nue and El Camino Real Project. The construction and contingency costs total $414,782.

In addition, staff is working with the City’s traffic signal and streetlight maintenance contractor, Cal-West Lighting and Signal Maintenance, Inc., for the installation of speed feedback radar

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2 signs along Alameda de las Pulgas, Brittan Avenue, Crestview Drive, and Sa n Carlos Avenue.

The installation cost for these signs is $140,800.

Based on the projects already scheduled, the actual remaining budget for this Project is approximately $341,402 for FY 2022 -23, which is not sufficient to complete the Project.

Therefore, an additional appropriation of $371,000 is needed from the Fund 25 Unassigned Balance to C1807 in FY 2022-23. There are sufficient funds to cover this request.

With the available Project budget and the additional appropriation, the Project can be award ed to GradeTech, Inc. in the amount of $711,648.50 which includes the bid amount of $592,206.50 plus a contingency of $119,442.

BACKGROUND:

In 2018, the City Council approved a Neighborhood Traffic Management Program (“NTMP”).

The objective of the NTMP is to balance the needs of all users by providing an efficient and safe multi-modal street network. The NTMP recommended traffic controls in accordance with guidance provided by the City’s General Plan, City policies, lessons learned from other jurisdictions, practices published by the transportation industry, and community input regarding traffic concerns.

In the NTMP, traffic calming measures are categorized as Level 1 or Level 2 depending on the complexity of the improvement. Level 1 measures focus on easily implementable and relatively low cost features such as enhancing the visibility of crosswalks, striping narrow lanes, providing speed limit signs, installing high visibility crosswalks, providing additional informational signs, and installing new re gulatory signs. Level 2 measures represent a combination of Level 1 as well as vertical or horizontal deflections such as speed humps, speed bumps, speed cushions, speed tables, pedestrian refuges or islands, median diverters, chicanes, or barriers.

Staff has identified two existing crosswalk locations for Level 2 improvements: the intersection of San Carlos Avenue and Prospect Street and the intersection of San Carlos Avenue and Kenton Avenue.

Improvements at the existing crossings on San Carlos Avenue at Prospect Street would include:

 Installation of new overhang rectangular rapid flashing beacons at the existing crossings;  Curb extensions and bulb-outs;
 Reconstruction of existing curb ramps;
 Removal and replacement of traffic striping and pavement;  Painting the existing curb red; and
 Advanced warning signage for the new crossing.

Improvements at the intersection of Kenton Avenue at San Carlos Avenue would include:

 A new mid-block crossing on San Carlos Avenue at Kenton Avenue;  Rectangular rapid flashing beacons at the new crossing;  Construction or reconstruction of curb ramps;
 Removal and replacement of traffic striping and pavement;  Painting the existing curb red; and
 Advanced warning signage for the new crossing.

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3 Staff issued a task order for engineering and design services to Bellecci & Associates, Inc. in May 2021. The City Engineer signed the final bid set construction documents on June 14, 2022 and the City Council approved the construction documents at its June 27, 2022 meeting.

ANALYSIS:

The Project was advertised on July 1, 2022 and bids were opened on July 22, 2022. The following table shows the engineer’s estimate along with the results of the bid in order of lowest to highest:

Contractor Total Bid Amount
Engineer’s Estimate $562,645.00
GradeTech, Inc. $592,206.50
Redgwick Construction Co. $631,017.05
Sposeto Engineering, Inc. $657,584.50
Golden Bay Construction, Inc. $695,392.00
Ray’s Electric $697,886.50
JJR Construction, Inc. $710,313.75
FBD Vanguard Construction, Inc. $726,262.90
OBS Engineering, Inc. $931,567.00

The lowest responsible and responsive bid was submitted by GradeTech, Inc. with a total bid amount of $592,206.50.

The variance between the total bid amounts and the engineer’s estimate can be attributed to the current economy, material and labor shortages, the bidder’s workload and other obligations.

Therefore, staff recommends appropriating $371,000 from Fund 25 Unassignedd Balance to C1807 in FY 2022-23, awarding the Project to GradeTech, Inc. in the amount of $592,206.50, authorizing the City Manager to execute a Public Projects Agreement with GradeTech, Inc., and authorizing the expenditure of contingency in the amount of $119,442.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt a resolution appropriating $371,000 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C1807 in FY 2022-23; awarding the 2022 Traffic Calming Improvement Project C1807 (Kenton Avenue at San Carlos Avenue and San Carlos Avenue at Prosp ect Street); authorizing the City Manager to execute a public projects agreement with GradeT ech, Inc. of San Ramon, CA in the amount of $592,206.50; and authorizing an expenditure of contingency in the amount of $119,442.

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

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4 Respectfully submitted by:

Grace Le,
City Engineer

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution

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RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS APPROPRIATING $371,000 FROM THE GENERAL CAPITAL PROJECTS FUND UNASSIGNED BALANCE (FUND 25) TO C1807 IN FISCAL YEAR 2022-23; AWARDING THE 2022 TRAFFIC CALMING IMPROVEMENT PROJECT C1807 (KENTON AVENUE AT SAN CARLOS AVENUE AND SAN CARLOS AVENUE AT PROSPECT STREET); AUTHORIZING

THE CITY MANAGER TO EXECUTE A PUBLIC PROJECTS AGREEMENT WITH GRADETECH, INC. OF SAN RAMON, CA IN THE AMOUNT OF $592,206.50; AND AUTHORIZING AN EXPENDITURE OF CONTINGENCY IN THE AMOUNT OF $119,442.

WHEREAS, in 2018, the City Council approved a Neighborhood Traffic Management Program (“NTMP”) with the objective of balancing the needs of all users by providing an efficient and safe multi-modal street network; and

WHEREAS, the NTMP recommended traffic controls in accordance with guidance provided by the City’s General Plan, City policies, lessons learned from other jurisdictions, practices published by the transportation industry, and community input regarding traffic concerns; and

WHEREAS, in the NTMP, traffic calming measures are categorized as Level 1 or Level 2 depending on the complexity of the improvement; and

WHEREAS, Level 1 measures focus on easily implementable and relatively low cost features such as enhancing the visibility of crosswalks, striping narrow lanes, providing speed limit signs, installing high visibility crosswalks, providing additional informational signs , and installing new regulatory signs; and

WHEREAS, Level 2 measures represent a combination of Level 1 as well as vertical or horizontal deflections such as speed humps, speed bumps, speed cushions, speed tables, pedestrian refuges or islands, median diverters, chicanes, or barriers; and

WHEREAS, staff has identified two existing crosswalk locations for Level 2 improvements: the intersection of San Carlos Avenue and Prospect Street and the intersection of San Carlos Avenue and Kenton Avenue for the 2022 Traffic Calming Improvement Project (“Project”); and

WHEREAS, staff issued a task order for engineering and design services to Bellecci & Associates, Inc. in May 2021; and

WHEREAS, the City Engineer signed the final bid set construction documents on June 14, 2022; and

WHEREAS, the City Council approved the construction documents at the June 27, 2022 meeting; and

WHEREAS, the Project was advertised on July 1, 2022 and bids were opened on July 22, 2022; and

WHEREAS, the lowest responsible and responsive bid was submitted by GradeTech, Inc. with a total bid amount of $592,206.50; and

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Attachment: Resolution (Award Traffic Calming Improvements Project)

WHEREAS, although there are sufficient funds to award the Project with the available budget, there are additional traffic calming related projects being completed under the same Project budget, which have not been fully paid; and

WHEREAS, based on the projects already scheduled, the actual remaining budget for this Project is approximately $341,402 for FY 2022-23, which is not sufficient to complete the Project; and

WHEREAS, an additional appropriation of $371,000 is needed from the General Capital Projects Fund Unassigned Balance (Fund 25) to C1807 in FY 2022-23 to fully award the Project with contingency.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby adopts a Resolution appropriating $371,000 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C1807 in Fiscal Year 2022 -23, awarding the 2022 Traffic Calming Improvement Project C1807 (Kenton Avenue at San Carlos Avenue and San Carlos Avenue at Prospect Street), authorizing the City Manager to execute a public projects agreement with GradeTech, Inc. of San Ramon, CA in an amount of $592,206.50 , and authorizing an expenditure of contingency in the amount of $119,442.

* * * * *

AYES, COUNCILMEMBERS: _______________________________________________ NOES, COUNCILMEMBERS: _______________________________________________ ABSENT, COUNCILMEMBERS: _______________________________________________

________________________________
CITY CLERK of the City of San Carlos
APPROVED:

___________________________
MAYOR of the City of San Carlos

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Attachment: Resolution (Award Traffic Calming Improvements Project)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Appropriating $181,980 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C2203 in Fiscal Year 2022 - 23; Awarding the 447 Hillcrest Road Wall Rep lacement Project C2203; Authorizing the City Manager to Execute a Public Projects Agreement with Brannon Corporation of Morgan Hill, CA in an Amount of $525,980; and Authorizing an Expenditure of Contingency in the Amount of $106,000.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution appropriating $181,980 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C2203 in Fiscal Year (“FY”) 2022-23, awarding the 447 Hillcrest R oad Wall Replacement Project (“Project”) C2203, authorizing the City Manager to execute a Public Projects Agreement with Brannon Corporation of Morgan Hill, CA in an amount of $525,980, and authorizing the expenditure of contingency in the amount of $106,000.

FISCAL IMPLICATIONS:

Funding for the Project comes from C2203, which has an available budget of $450,000 that was approved as part of the FY 2022-23 Mid-Cycle Budget Review.

The lowest responsible and responsive bid received for this Project was $525,980. Including a 20% contingency of $106,000, the total cost of the Project is approximately $631,980.

To award the Project and contingency, an additional appropriation of $181,980 is needed from the unassigned balance in Fund 25 to C1807 in FY 2022 -23. There is sufficient fund balance t o cover this request.

BACKGROUND:

The existing decorative wall along the property of 447 Hillcrest Road partially failed due to heavy rains in early 2020. Since then, maintenance staff has been securing the wall each winter to prevent complete failure an d hillside slough off onto Hillcrest Road. However, the cost of securing the site every winter continues to escalate and a permanent solution is needed to secure the wall.

Staff retained Bellecci & Associates, Inc. (“Bellecci”) to provide recommendations and design for a permanent solution. Bellecci engaged a sub -consultant, Miller Pacific Engineering Group (“Miller Pacific”), to perform a site evaluation of the existing decorative wall and prepare a

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2 geotechnical engineering report with recommendations. Miller Pacific provided four options based on their site evaluation: a soldier pile and timber lagging retaining wall; a reinforced concrete retaining wall; a soil nail and shotcrete retaining wall; or, grade the slope and omit or shorten the wall. Miller Pacific recommended the soil nail and shotcrete retaining wall option because it is cost-effective and would maintain the existing wall height.

Staff concurred with the recommendation and requested that Bellecci move forward to prepare the final bid set construction documents for a soil nail and shotcrete retaining wall.

The City Engineer signed the final bid set of the specifications on June 13, 2022 and City Council approved the plans and specifications and authorized a call for bids at its June 27, 2022 meeting.

ANALYSIS:

The City advertised for bids for construction of the Project on July 1, 2022 . One bid was received and opened on July 26, 2022. The following table shows the engineer’s estimate a nd the bid:

Contractor Total Bid Amount
Engineer’s Estimate $342,520
Brannon Corporation $525,980

The responsible and responsive bid was submitted by Brannon Corporation with a total bid amount of $525,980. The variance between the bid amount and the engineer’s estimate can be attributed to the uniq ue scope of work, the current economy, material and labor shortage s, the bidder’s workload, and other obligations.

Therefore, staff recommends appropriating $181,980 from the unassigned fund balance Fund 25 to C2203 in FY 2022 -23, awarding the Project, a uthorizing the City Manager to execute a public projects agreement with Brannon Corporation in an amount of $525,980, and authorizing the expenditure of contingency in the amount of $106,000.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt a resolution appropriating $181,980 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C2203 in FY 2022-23, awarding the 447 Hillcrest Road Wall Replacement Project C2203, authorizing the City Manager to execute a public projects agreement with Brannon Corporation of Morgan Hill, CA in the amount of $525,980, and authorizing the expenditure of contingency in the amount of $106,000; or

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

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3 Respectfully submitted by:

Grace Le,
City Engineer

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution

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RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS APPROPRIATING $181,980 FROM THE GENERAL CAPITAL PROJECTS FUND UNASSIGNED BALANCE (FUND 25) TO C2203 IN FISCAL YEAR 2022-23; AWARDING THE 447 HILLCREST ROAD WALL REPLACEMENT PROJECT (“PROJECT”) C2203;

AUTHORIZING THE CITY MANAGER TO EXECUTE A PUBLIC PROJECTS AGREEMENT WITH BRANNON CORPORTATION OF MORGAN HILL, CA IN AN AMOUNT OF $525,980; AND AUTHORIZING AN EXPENDITURE OF CONTINGENCY IN THE AMOUNT OF $106,000.

WHEREAS, the existing decorative wall along the property of 447 Hillcrest Road partially failed due to heavy rains in early 2020; and

WHEREAS, maintenance staff has been securing the wall each winter to prevent complete failure and hillside slough off onto Hillcrest Road; and

WHEREAS, the cost of securing the site every winter continues to escalate and a permanent solution is needed to secure the wall; and

WHEREAS, staff retained Bellecci & Associates, Inc. (“Bellecci”) to provide recommendations and design for a permanent solution; and

WHEREAS, Bellecci engaged a sub-consultant, Miller Pacific Engineering Group (“Miller Pacific”), to perform a site evaluation of the existing decorative wall and prepare a geotechnical engineering report with recommendations; and

WHEREAS, staff concurred with Miller Pacific’s proposed recommendation and requested that Bellecci move forward to prepare the final bid set construction documents for a soil nail and shotcrete retaining wall; and

WHEREAS, the City Engineer signed the final bid set of the specifications on June 13, 2022 and the City Council approved the plans and specifications and authorized a call for bids at its June 27, 2022 meeting; and

WHEREAS, the City advertised for bids for construction of the Project on July 1, 2022, and bids were opened on July 26, 2022; and

WHEREAS, the lowest responsible and responsive bid was submitted by Brannon Corporation with a total bid amount of $525,980; and

WHEREAS, staff recommends appropriating $181,980 from the unassigned balance in Fund 25 to C2203 in FY 2022-23, awarding the Project, authorizing the City Manager to execute a public projects agreement with Brannon Corporation in an amount of $525,980, and authorizing the expenditure of contingency in the amount of $106,000.

NOW, THEREFORE BE IT RESOLVED , that the San Carlos City Council appropriates $181,980 from the General Capital Projects Fund Unassigned Balance (Fund 25) to C2203 in Fiscal Year 2022-23, awards the 447 Hillcrest Road Wall Replacement Project C2203, authorizes the City Manager to execute a public projects agreement with Brannon Corporation of Morgan

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Attachment: Resolution (Award 447 Hillcrest Rd Wall Replacement Project) Hill, CA in an amount of $525,980, and authorizes the expenditure of contingency in the amount of $106,000.

* * * * *

AYES, COUNCILMEMBERS: ___________________________________________ NOES, COUNCILMEMBERS: ___________________________________________ ABSENT, COUNCILMEMBERS: ___________________________________________

________________________________
CITY CLERK of the City of San Carlos
APPROVED:

___________________________
MAYOR of the City of San Carlos

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Attachment: Resolution (Award 447 Hillcrest Rd Wall Replacement Project)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Accepting and Approving the Annual Investment Policy for Fiscal Year 2022-23.

RECOMMENDATION:

Staff recommends that the City Council complete the annual review o f the City’s Investment Policy and adopt a resolution accepting and approving the Investment Policy for Fiscal Year (“FY”) 2022-23.

FISCAL IMPLICATIONS:

None.

BACKGROUND:

California Government Code Section 53646(a)(2) requires annual review and approva l of the Investment Policy by the City Council. The City’s Investment Policy was last adopted by the City Council on August 23, 2021 via Resolution 2021-073.

The Investment Policy applies to all financial assets of the City as accounted for in the Comprehensive Annual Financial Report (“ Annual Report ”). Statements outlined in the Investment Policy focus on the City’s pooled funds, but will also apply to all other funds under the Administrative Services Director’s span of control, unless specifically exempted by statute or ordinance. This policy is applicable, but not limited to, the following funds: General Fund; Sewer Fund; Capital Funds; Other Special Revenue Funds; Debt Service Funds; Internal Service Funds; Trust and Agency Funds; City and County Ass ociation of Governments (C/CAG); Peninsula Traffic Congestion Relief Alliance (Commute.org); and any new fund created by the City Council, unless specifically exempted.

The City’s investment portfolio has had an average quarter end balance of approximately $125 million over the past two years. These funds are drawn on throughout the calendar year for normal operating activity, with more significant levels of draw occurring in the third quarter (January through March) and the first quarter (July through December). The City’s cash position improves in late December and April due to the receipt of property tax collections from San Mateo County.

The City’s policy and selections have always been more conservative than permitted by State Code, with idle cash invested primarily in the San Mateo County Investment Pool and the

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2 State’s Local Agency Investment Fund (“LAIF”). Although these investment pools do not earn high yields, they satisfy the primary objective of Safety of Principal.

ANALYSIS:

There are no recommended changes at this time. The City’s current policy is in alignment with the California Debt and Investment Advisory Commission (CDIAC) Local Agency Investment Guidelines.

The City’s Investment Committee, consisting of Jeff Maltbie, City Manager; Inge Tiegel , City Treasurer; and Rebecca Mendenhall, Administrative Services Director, has reviewed and approved the revisions recommended to the Investment Policy.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Adopt a resolution accepting and approving the Annual Investment Policy for FY 2022- 23; or

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Rebecca Mendenhall,
Administrative Services Director

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution

2. Proposed FY23 Investment Policy

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RESOLUTION NO. 2022 - ________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS

ACCEPTING AND APPROVING THE ANNUAL INVESTMENT POLICY
FOR FISCAL YEAR 2022-23.
____________________________________________________________________________

WHEREAS, California Code Section 53646(a)(2) requires annual review and approval of the Investment Policy by the City Council; and

WHEREAS, the City’s Investment Policy was last adopted by the City Council on August 23, 2021 via Resolution 2021-073; and

WHEREAS, staff is not recommending any changes to the Investment Policy at this time as the current policy is in alignment with the California Debt and Investment Advisory Commission (CDIAC) Local Agency Investment Guidelines.

NOW, THEREFORE BE IT RESOLVED, by the City Council of the City of San Carlos that the Fiscal Year 2022-23 Investment Policy is hereby approved and adopted.

*****

I, City Clerk Crystal Mui, hereby certify that this Resolution was passed and adopted by the City Council of the City of San Carlos at a regular meeting held on the 22nd of August 2022, by the following vote:

AYES, COUNCILMEMBERS: _________ _____ _____

NOES, COUNCILMEMBERS: __________ ___________

ABSENT, COUNCILMEMBERS: _________________

____
CITY CLERK of the City of San Carlos
APPROVED:

__
MAYOR of the City of San Carlos

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Attachment: Resolution (Adopt Annual Investment Policy FY 22-23)

CITY OF SAN CARLOS

INVESTMENT POLICY

Last Adopted by Council: August 22, 2022
Resolution No. 2022-

POLICY
In accordance with the Municipal Code of the City of San Carlos and under authority granted by the City Council, the City Administrative Services Director is responsible for investing the unexpended cash in the City Treasury.

The investment of the funds of the City of San Carlos is directed to the goals of safety, liquidity and yield. The authority governing investments for municipal governments is set forth in the California Government Code, Sections 53601 through 53686.

The primary objective of the investment policy of the City of San Carlos is Safety of Principal .

Investments shall be placed in those securities as outlined by type and maturity sector in this document. Effective cash flow management and resulting cash investment practices are recognized as essential to good fiscal management and control. The City's portfolio shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. Portfolio management requires continual analysis and as a result the balance between the various investments and maturities may change in order to give the City of San Carlos the optimum combination of necessary liquidity and optimal yield based on cash flow projections.

SCOPE
The investment policy applies to all financial assets of the City of San Carlos as accounted for in the Comprehensive Annual Financial Report (CAFR). Policy statements outlined in this document focus on the City of San Carlos' pooled funds, but will also apply to all ot her funds under the City Administrative Services Director's span of control unless specifically exempted by statue or ordinance. This policy is applicable, but not limited to all funds listed below:

•General Fund •Sewer Fund •Capital Fund s •Other Special Revenue Funds, Debt Service Funds, Internal Service Funds •Trust and Agency Funds • Peninsula Traffic Congestion Relief Alliance (Commute.org) •City and County Association of Governments of San Mateo County (C/CAG) •Any new fund created by the City Council unless specifically exempted.

PRUDENCE
The standard to be used by investment officials shall be that of a "prudent investor" and shall be applied in the context of managing all aspects of the overall portfolio. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic co nditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like

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Attachment: Proposed FY23 Investment Policy (Adopt Annual Investment Policy FY 22-23) City of San Carlos
Investment Policy Page 1

character and with like aims, to safeguard the principal and maintain the liqui dity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.

It is the City's full intent, at the time of purchase, to hold all investments until maturity to ensure the return of all invested principal dollars. However, it is realized that market prices of securities will vary depending on economic and interest rate conditions at any point in time. It is further recognized that in a well-diversified investment portfolio, occasional measured losses are inevitable due to economic, bond market or individual security credit analysis. These occasional losses must be considered within the context of the overall investment program objective s and the resultant long - term rate of return.

The City Administrative Services Director and other individuals assigned to manage the investment portfolio, acting within the intent and scope of the investment policy and other written procedures and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.

OBJECTIVES
Safety of Principal
Safety of Principal is the foremost objective of the City of San Carlos. Each investment transaction shall seek to ensure that capital losses are avoided, whether from securities default, broker -dealer default or erosion of market value. The City shall seek to preserve principal by mitigating the two types of risk: credit risk and market risk.

Credit risk, defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing in investment grade securities and by diversifying the investment portf olio so that the failure of any one issuer does not unduly harm the City's capital base and cash flow.

Market risk, defined as market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by limiting the average maturity of the City's investment portfolio to two years, the maximum maturity of any one security to five years, structuring the portfolio based on historic and current cash flow analysis eliminating the need to sell securities prior to maturity and avoiding the purchase of long term securities for the sole purpose of short term speculation.

Liquidity
Historical cash flow trends are compared to current cash flow requirements on an ongoing basis in an effort to ensure that the City's investment portfolio will remain sufficiently liquid to enable the City to meet all reasonably anticipated operating requirements.

Maturity Matrix
Maturities of investments will be selected based on liquidity requirements to minimize interest rate risk and maximize earnings. Current and expected yield curve analysis will be monitored and the portfolio will be invested accordingly. The weighted average maturity of the pooled portfolio should not exceed two years and the following percentages of the portfolio should be invested in the following maturity sectors:

Maturity Range Suggested Percentage
1 day to 7 days 10 to 50%
7 days to 180 10 to 30%
180 days to 360 days 10 to 30%
1 year to 2 years 10 to 20%
2 years to 3 years 0 to 20%

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Attachment: Proposed FY23 Investment Policy (Adopt Annual Investment Policy FY 22-23) City of San Carlos
Investment Policy Page 2

3 years to 4 years 0 to 20%
4 years to 5 years 0 to 20%
Over 5 years Council Authorization Required *

* One exception does exist regarding the investment of bond reserve funds. If in the opinion of the City Administrative Services Director, matching the segregated investment p ortfolio of the bond reserve fund with the maturity schedule of an individual bond issue is prudent given current economic analysis, the investment policy authorizes extending beyond the five-year maturity limitation as outlined in this document.

PERFORMANCE EVALUATION
Investment performance is monitored and evaluated by the City Investment Advisory Committee.

Investment performance statistics and activity reports are generated on a quarterly basis for presentation to the City Investment Advisory Committee and to the City Council. Annually, a statement of investment policy, and any proposed changes to the policy, will be rendered to the Investment Advisory Committee and then to the City Council for consideration at a public meeting.

The City’s investment portfolio is designed to at least attain a market average rate of return through economic cycles. The market average rate of return is defined as average return on the Local Agency Investment Fund (assuming the State does not adversely affect LAIF’s returns due to budget constraints).

DELEGATION OF AUTHORITY
The Municipal Code of the City of San Carlos and the authority granted by City Council assign the responsibility of investing unexpended cash to the City ’s Administrative Services Director. Daily management responsibility of the investment program may be delegated to the Financial Services Manager, who shall establish procedures for the operation consistent with this investment policy.

INVESTMENT COMMITTEE
An investment committee consisting of the City Treasurer, City Manager, and Administrative Services Director shall be established to provide general oversight and direction concerning the policy related to management of the City's investment pool. The Financial Services Manager shall not be a member of the committee but shall serve in a staff and advisory capacity. The committee shall review and approve quarterly investment reports prepared by the Finance Department and reviewed by the Financial Services Manager or meet as necessary to discuss changes to the report or the investment strategy . The Investment Committee serving as the legislative body of the Investment Policy will have the quarterly reports for review within thirty (30) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code.

ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program, or impairs their ability to make impartial investment decisions. Additionally the Administrative Services Director and the Financial Services Manager are required to annually file applicable financial disclosures as required by the Fair Political Practices Commission (FPPC).

SAFEKEEPING OF SECURITIES
To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a third party bank trust department, acting as agent for the City under the terms of a custody agreement. All trades executed by a dealer will settle delivery versus payment (DVP) through the City's safekeeping agent.

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Securities held custody for the City shall be monitored by the Administrative Services Director to verify investment holdings.

All exceptions to this safekeeping policy must be approved by the City ’s Administrative Services Director in written form and included in the quarterly reports to the Investment Committee and the City Council.

INTERNAL CONTROL
Separation of functions between the City ’s Administrative Services Director or Financial Services Manager and/or the City Senior Accountant is designed to provide an ongoing internal review to prevent the potential for converting assets or concealing transactions.

Investment decisions are made by the Administrative Services Director, executed by the Administrative Services Director or Financial Services Manager and confirmed by the Senior Accountant. All wire transfers initiated by the Administrative Services Director or Financial Services Manager must be reconfirmed by the appropriate financial institution to the Senior Acc ountant.

Proper documentation obtained from confirmation and cash disbursement wire transfers is required for each investment transaction. Timely bank reconciliation is conducted to ensure proper handling of all transactions.

The investment portfolio and all related transactions are reviewed and balanced to appropriate general ledger accounts by the Senior Accountant on a monthly basis. An independent analysis by an external auditor shall be conducted annually to review and perform procedure testing on the City’s cash and investments that have a material impact on the financial statements. The Administrative Services Director and/or Investment Committee shall review and assure compliance with investment process and procedures.

REPORTING
The City Administrative Services Director shall review and render quarterly reports to the City Investment Advisory Committee and to the City Council that include the face amount of the cash investment, the classification of the investment, the name of the institution o r entity, the rate of interest, the maturity date, the current market value and accrued interest due for all securities. The quarterly reports will be submitted to the Investment Committee within thirty (30) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code. Once approved by the Investment Committee, the quarterly reports shall be placed on the City Council’s meeting agenda for its review and approval no later than 60 days after the qua rter ends. If there are no Council meetings within the 60 -day period, the quarterly report shall be presented to the Council at the soonest possible meeting thereafter.

QUALIFIED BROKER/DEALERS
The City shall transact business only with banks, savings and loans, and with broker/dealers. The broker/dealers should be primary or regional dealers. The City ’s Administrative Services Director will make exceptions only upon written authorization. The City currently does not maintain a list of broker/dealers approved to do business with the City. When necessary, the City shall go through the Request for Proposal processes to select the broker/dealers. S taff shall investigate dealers wishing to do business with the City to determine if they are adequately capitalized, have pending legal action against the firm or the individual broker and make markets in the securities appropriate to the City's needs. The City’s investment policy shall be made availabl e on the City’s website for broker/dealers’ review.

COLLATERAL REQUIREMENTS
Collateral is required for investments in certificates of deposit. To reduce market risk, the collateral level will be at least 110% of market value of principal and accrued interest.

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AUTHORIZED INVESTMENTS
Investment of City funds is governed by the California Government Code Sections 53600 et seq.

Within the context of the limitations, the following investments are authorized, as further limited herein:

1. United States Treasury Bills, Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no percentage limitation of the portfolio that can be invested in this category, although a five -year maturity limitation is applicable.

2. Local Agency Investment Fund (LAIF) , which is a State of California managed investment pool, and San Mateo County Investment pool, may be used up to the maximum permitted by California State Law. A review of the poo l/fund is required when part of the list of authorized investments, with the knowledge that the pool/fund may include some investments allowed by statute but not explicitly identified in this investment policy.

3. Most mortgage -backed securities are o bligations issued by the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA), and the Federal Home Loan Mortgage Corporation (FHLMC). A mortgage passthrough security, collateralized mortgage obligation, mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable passthrough certificate, or co nsumer receivable-backed bond has a maximum five years’ maturity. Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by a nationally recognized statistical rating organization (NRSRO) and have a maximum remaining maturity of five years or less. Purchase of securities authorized by this subdivision shall not exceed 20 percent of the agency’s surplus moneys that may be invested pursuant to this section.

4. Bills of exchange or time drafts drawn on and accepted by commercial banks, otherwise known as bankers ’ acceptances. Bankers’ acceptances purchased may not exceed 180 days to maturity or 40% of the cost value of the portfolio. Also, no more than 30% of the agency’s money may be in bankers’ acceptances of any one commercial bank.

5. Commercial paper ranked the highest letter and number rating by a nationally recognized statistical rating organization (NRSRO), such as Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services , and issued by domestic corporations having assets in excess of $500,000,000 and having an “A” or better rating on its long term debentures as provided by NRSRO. Purchases of eligible commercial paper may not exceed 270 days to maturity nor represent more than 10% of the outstanding paper of the issuing corporation. Purchases of commercial paper may not exceed 25% of the value of the portfolio.

6. Negotiable Certificates of Deposit issued by nationally or state chartered banks (FDIC insured institutions) or sta te or federal savings institutions. Purchases of negotiable certificates of deposit may not exceed 30% of total portfolio. A maturity limitation of five years is applicable.

7. Time deposits or placement service deposits , non -negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations. Since time deposits are not liquid, no more than 50% of the investment portfolio may be invested in this investment type. A maturity limitation of five years is applicable. Effective January 1, 2020, no more than 50 percent of the agency’s

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money may be invested in deposits, including certificates of deposit, through a placement service as authorized under 53601.8 (excludes negotiable certificates of deposit authorized under Section 53601(i)). On January 1, 2026, the maximum percentage of the portfolio reverts back to 30 percent. Investments made pursuant to 53635.8 remain subject to a maximum of 30 percent of the portfolio.

8. Medium Term Corporate Notes, with a maximum maturity of five years, may be purchased.

Securities eligible for investment shall be rated “A” or better by an NRSRO. Purchase of medium term notes may not exceed 30% of the market value of the portfolio.

9. Ineligible investments are those that are not described herein, including but not limited to, common stocks and long term (over five years in maturity) notes and bonds are prohibited from use in this portfolio. It is noted that special circumstances arise that necessitate the purchase of securities beyond the five-year limitation. On such occasions, requests must be approved by City Council prior to purchase.

10. Various daily money market funds administered for or by trustees, paying agents and custodian banks contracted by the City of San Carlos may be purchased as allowed under the State of California Government Code. Only funds holding U.S. Treasury or Government agency obligations can be used.

The following summary of maximum percentage limits, by instrument, are established for the City's total pooled funds portfolio:

Authorized Investment
Type
Government
Code
Maximum
Maturity
Minimum
Credit
Quality
Maximum in
Portfolio
Maximum
Investment in
One Issuer
Local Agency
Investment Fund
(LAIF)
16429.1 Upon
Demand N/A
As permitted by
LAIF (currently $75
million per account)
N/A
San Mateo County
Investment Pool 53684 Upon
Demand N/A
As permitted by
County Treasurer
(currently no limit)
N/A
Treasury Obligations
(bills, notes & bonds) 53601(b) 5 Years N/A 100% N/A
US Government
Agency and Federal
Agency Securities
53601(f) 5 Years N/A 100% N/A
Mortgage Pass-
Through Securities or
Mortgage-Backed
Securities
53601(o) 5 years (C) 20% N/A
Bankers’ Acceptances 53601(g) 180 Days N/A 40% (B)
Commercial Paper 53601(h) 270 Days
Highest
letter and
number
rating by
an
NRSRO
25% (A)
Negotiable Certificates
of Deposit 53601(i) 5 Years N/A 30% N/A
Placement Service
Deposits – Deposits or
53601.8 and
53635.8 5 Years N/A 50% N/A

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Certificates of
Deposits
Medium Term
Corporate Notes 53601(k) 5 Years A 30% N/A

(A) 10% of outstanding paper of issuing corporation
(B) No more than 30% of the agency’s money may be in bankers’ acceptances of any one commercial bank.
(C) Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO.

DERIVATIVE INVESTMENTS
Derivatives are investments whose value is "derived" from a benchmark or index. That benchmark can be almost any financial measure from interest rates to commodity and stock prices. The use of derivatives is prohibited under this policy.

LEGISLATIVE CHANGES
Any State of California legislative action that further restricts allowable maturities, investment type, or percentage allocations will be incorporated into the City of San Carlos' Investment Policy and supersede any and all previous applicable language.

INTEREST EARNINGS
All moneys earned and collected from investments authorized in this policy shall be allocated quarterly to various fund accounts based on the cash balance in each fund at quarter end as a percentage of the entire pooled portfolio.

LIMITING MARKET VALUE EROSION
The longer the maturity of securities, the greater their market price volatility. Therefore, it is the general policy of the City to limit the potential effects from erosion in market values by adhering to the following guidelines:

All immediate and anticipated liquidity requirements will be addressed prior to purchasing all investments.

Maturity dates for long-term investments will coincide with significant cash flow requirements where possible, to assist with short term cash requirements at maturity.

All long-term securities will be purchased with the intent to hold all investments to maturity under then prevailing economic conditions. However, economic or market conditions may change, making it in the City's best interest to sell or trade a security prior to maturity.

PORTFOLIO MANAGEMENT ACTIVITY
The investment program shall seek to augment returns consistent with the intent of this policy, identified risk limitations and prudent investment principals. These objectives will be achieved by use of the following strategies:

Active Portfolio Management. Through active fund and cash flow management, taking advantage of current economic and interest rate trends, the portfolio yield may be enhanced with limited and measurable increases in risk by extending the weighted maturity of the total portfolio.

Portfolio Maturity Management. When structuring the maturity composition of the portfolio, the City shall evaluate current and expected interest rate yields and necessary cash flow requirements. It is recognized that in normal market conditions longer maturities produce higher yields. However, the

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securities with longer maturities also experience greater price fluctuations when the level of interest rates change.

Security Swaps. The City may take advantage of security swap opportunities to improve the overall portfolio yield. A swap, which improves the portfolio yield, may be selected even if the transactions result in an accounting loss. Documentation for swaps will be included in t he City's permanent investment file documents.

Competitive Bidding . It is the policy of the City to require competitive bidding for investment transactions that are not classified as "new issue" securities. For the purchase of non -"new issue" securities and the sale of all securities at least three bidders must be contacted. Competitive bidding for security swaps is also suggested, however, it is understood that certain time constraints and broker portfolio limitations exist that would not accommodate the competitive bidding process. If a time or portfolio constraining co ndition exists, the pricing of the swap should be verified to current market conditions and documented for auditing purposes.

POLICY REVIEW
The City of San Carlos' investment policy shall be adopted by resolution of the City Council on an annual basis. This investment policy shall be reviewed at least annually to ensure its consistency with the overall objectives of preservation of principal, liquidity and yield, and its relevance to current law and financial and economic trends. Any amendments to the poli cy shall be forwarded to City Council for approval.

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Glossary of Terms

Accrued Interest: Interest earned but not yet received.

Active Deposits: Funds that are immediately required for disbursement.

Amortization: An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period of time.

Asked Price: The price a broker dealer offers to sell securities.

Basis Point: One basis point is one hundredth of one percent (.01).

Bid Price: The price a broker / dealer offers to purchase securities.

Bond: A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.

Bond Swap: Selling one bond issue and buying another at the same time in order to create an advantage for the investor. Some benefits of swapping may include tax-deductible losses, increased yields, and an improved quality portfolio.

Book Entry Securities : Securities, such stocks held in “street name,” that are recorded in a customer’s account, but are not accompanied by a certificate. The trend is toward a certificate-free society to cut down on paperwork and to diminish investors’ concerns about the certi ficates themselves. All the large New York City banks, including those that handle the bulk of the transactions of the major government securities dealers, now clear most of their transactions with each other and with the Federal Reserve through the use of automated telecommunications and the “book-entry” custody system maintained by the Federal Reserve Bank of New York. These banks have deposited with the Federal Reserve Bank a major portion of their government and agency securities holdings, including sec urities held for the accounts of their customers or in a fiduciary capacity. Virtually all transfers for the account of the banks, as well as for the government securities dealers who are their clients, are now effected solely by bookkeeping entries. The system reduces the costs and risks of physical handling and speeds the completion of transactions.

Bearer and Registered Bonds: In the past, bearer and registered bonds were issued in paper form.

Those still outstanding may be exchanged at any Federal Res erve Bank or branch for an equal amount of any authorized denomination of the same issue. Outstanding bearer bonds are interchangeable with registered bonds and bonds in “book -entry” form. That is, the latter exist as computer entries only and no paper securities are issued. New bearer and registered bonds are no longer being issued. Since August 1986, the Treasury’s new issues of marketable notes and bonds are available in book-entry form only. All Treasury bills and more than 90% of all other marketable securities are now in book -entry form. Book -entry obligations are transferable only pursuant to regulations prescribed by the Secretary of the Treasury.

Book Value: The value at which a debt security is shown on the holder's balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount.

Broker: In securities, the intermediary between a buyer and a seller of securities. The broke r, who usually charges a commission, must be registered with the exchange in which he or she is trading, accounting for the name registered representative.

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Certificate of Deposit : A deposit insured up to $ 250,000 by the Federal Deposit Insurance Corporation (FDIC) at a set rate for a specified period of time.

Collateral: Securities, evidence of deposit or pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposit of public moneys.

Comprehensive Annual Financial Report (CAFR): The official annual financial report for the City. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).

Constant Maturity Treasury (CMT) : An average yield of a specific Treasury maturity sector for a specific time frame. This is a market index for reference of past direction of interest rates for the given Treasury maturity range.

Coupon: The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value.

Credit Analysis: A critical review and appraisal of the economic and financial conditions or of the ability to meet debt obligations.

Current Yield: The interest paid on an investment expressed as a percentage of the current price of the security.

Custody: A banking service that provides safekeeping for the individual securities in a customer's investment portfolio under a written agreement that also calls for the ban k to collect and pay out income, to buy, sell, receive and deliver securities when ordered to do so by the principal.

Delivery vs. Payment (DVP): Delivery of securities with a simultaneous exchange of money for the securities.

Discount: The difference between the cost of a security and its value at maturity when quoted at lower than face value.

Diversification: Dividing investment funds among a variety of securities offering independent returns and risk profiles.

Duration: The weighted average maturity of a bond's cash flow stream, where the present value of the cash flows serve as the weights; the future point in time at which on average, an investor has received exactly half of the original investment, in present value terms; a bond's zero-coupon equivalent; the fulcrum of a bond's present value cash flow time line.

Fannie Mae: Trade name for the Federal National Mortgage Association (FNMA), a U.S. sponsored corporation.

Federal Reserve System: The central bank of the U.S. that consists of a seven member Board of Governors, 12 regional banks and approximately 8,000 commercial banks that are members.

Federal Deposit Insurance Corporation (FDIC) : Insurance provided to customers of a subscribing bank that guarantees deposits to a set limit (currently $250,000) per account.

Fed Wire: A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system.

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Freddie Mac: Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. sponsored corporation.

Ginnie Mae: Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government.

Inactive Deposits: Funds not immediately needed for disbursement.

Interest Rate: The annual yield earned on an investment, expressed as a percentage.

Investment Agreements: An agreement with a financial institution to borrow public funds subject to certain negotiated terms and conditions concerning collateral, liquidity and interest rates.

Liquidity: Refers to the ability to rapidly convert an investment into cash.

Market Value: The price at which a security is trading and could presumably be purchased or sold.

Maturity: The date upon which the principal or stated value of an investment becomes due and payable.

Nationally Recognized Statistical Rating Organizations (NRSRO): A U.S. Securities & Exchange Commission registered agency that assesses the creditworthiness of an entity or specific security.

NRSRO typically refers to Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services.

New Issue: Term used when a security is originally "brought" to market.

Perfected Delivery: Refers to an investment where the actual security or collateral is held by an independent third party representing the purchasing entity.

Portfolio: Collection of securities held by an investor.

Primary Dealer: A group of government securities dealers that submit daily reports of market activity and security positions held to the Federal Reserve Bank of New York and are subject to its informal oversight.

Purchase Date: The date in which a security is purchased for settlement on that or a later date.

Rate of Return: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.

Repurchase Agreement (REPO): A transaction where the seller (bank) agrees to buy back from the buyer (City) the securities at an agreed upon price after a stated period of time.

Reverse Repurchase Agreement (REVERSE REPO): A transaction where the seller (City) agrees to buy back from the buyer (bank) the securities at an agreed upon price after a stated period of time.

Risk: Degree of uncertainty of return on an asset.

Safekeeping: See Custody.

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Sallie Mae: Trade name for the Student Loan Marketing Association (SLMA), a U.S. sponsored corporation.

Secondary Market: A market made for the purchase and sale of outstanding issues following the initial distribution.

Settlement Date: The date on which a trade is cleared by delivery of securities against funds.

Time Deposit: A deposit in an interest-paying account that requires the money to remain on account for a specific length of time. While withdrawals can generally be made from a passbook account at any time, other time deposits, such as certificates of deposit, are penalized for early withdrawal.

Treasury Obligations: Debt obligations of the U.S. Government that are sold by the Treasury Department in the forms of bills, notes, and bonds. Bills are short -term obligations that mature in one year or less. Notes are obligations that mature between one year and ten years. Bonds are long-term obligations that generally mature in ten years or more.

U.S. Government Agencies: Instruments issued by various US Government Agencies most of which are secured only by the credit worthiness of the particular agency.

Yield: The rate of annual income return on an investment, expressed as a percentage. It is obtained by dividing the current dollar income by the current market price of the security.

Yield to Maturity : The rate of income return on an investment, minus any premi um or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.

Yield Curve: The yield on bonds, notes or bills of the same type and credit risk at a specific date for maturities up to thirty years.

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Attachment: Proposed FY23 Investment Policy (Adopt Annual Investment Policy FY 22-23)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Accept Fiscal Year 2021-22 Fourth Quarter Investment Report Ending June 30, 2022.

RECOMMENDATION:

Staff recommends that the City Council review and accept the Quarterly Investment Report (“Report”) for the fourth quarter of Fiscal Year (“FY”) 2021-22 ending June 30, 2022.

FISCAL IMPLICATIONS:

There is no fiscal impact to accepting the Report.

BACKGROUND:

On August 23, 2021, the City Council approved the Annual Investment Policy (“Policy”) per Resolution No. 2021 -073. In accordance with the Policy, the City Administrative Services Director is responsible for investing the unexpended cash used for funding operations of the City of San Carlos (“City”).

The investment of funds for the City is directed by the goals of safety, liquidity, and yield. The authority governing investments for municipal governments is set forth in the California Government Code, sections 53601 through 53686 (“Code”). Per section 53646 (b)(1) of the Code, the Investment Committee serving as the legislative body will have the quarterly reports for its review within thirty (30) days following the end of the quarter. Thus, this Report and its attachments are furnished for review and information.

Beginning in FY 2016-17, the City included the checking account balance as part of this Report.

Although a checking account is not a typical investment account, including this balance shows the total cash on hand for the quarter. The City typically maintains an average of $1 million to $2.6 million, and a larger balance at the end of the calendar year, in the checking account to meet cash disbursement needs. Transfers are usually made into the investment accounts during the quarter to account for receipts that exceed disbursements.

Investment Strategy

The City’s investment priorities, in order, are “safety, liquidity, and yield,” while meeting the cash flow needs of the City through prudent investment of unexpended cash.

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2 Compliance with Policy

Historical cash flow trends are compared to current cash flow requirements on an ongoing basis to ensure the City’s investment portfolio will remain sufficiently liquid to enable the City to meet all reasonably anticipated operating requirements. As of June 30, 2022, the port folio contains sufficient liquidity to meet the next six months of expected expenditures by the City.

As of June 30, 2022, the City has no investment instruments with a maturity date longer than one year. All investments are in highly liquid accounts, us ing the State of California and County of San Mateo investment pools, and are in compliance with the Policy.

The primary objective of the Policy of the City of San Carlos is “safety of principal”. The permitted investments section of the Policy also states:

Local Agency Investment Fund (LAIF), which is a State of California managed investment pool, and San Mateo County Investment pool, may be used up to the maximum permitted by California State Law. A review of the pool/fund is required when they are part of the list of authorized investments, with the knowledge that the pool/fund may include some investments allowed by statute but not explicitly identified in this investment policy.

The City’s Investment Committee, consisting of Jeff Maltbie, City Manag er; Inge Tiegel, City Treasurer; and Rebecca Mendenhall, Administrative Services Director, has reviewed and approved this Report.

ANALYSIS:

The Investment Portfolio (Attachment 1) indicates that on June 30, 2022, City funds in the amount of $162,917,094 were invested, producing a weighted average yield of 0.95% for this quarter. The amount in the checking account was $2,166,789. The Local Agency Investment Fund (“LAIF”), the City’s benchmark for comparison of investment yield, was 0.75% for the quarter. The investment yield, net of administrative fees, for the County Pool was 1.08%. The allocation of the investment portfolio balance to various City funds is included in Attachment 3 of the Report.

Below is a summary of the changes from the last quarter.

Quarter Ended
6/30/22
% of
Total
Quarter Ended
3/31/22
% of
Total
Increase
(Decrease)
City-Checking 2,166,789$ 1% 5,993,674$ 4% (3,826,885)$ City-SM County Pool 96,365,828 59% 84,355,059 60% 12,010,769 City-LAIF 66,551,266 40% 51,260,708 36% 15,290,558 Total 165,083,883$ 100% 141,609,441$ 100% 23,474,442$

The portfolio balance at the end of the fourth quarter is $165,083,883, an increase of approximately $23.5 million. The large increase in the portfolio balance was due to the timing of the cash receipts and cash payments.

Notable cash receipts received during the quarter include:

 Property tax payments in the amount of $10 million in April and $2.8 million in May;

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3  Large development permit payments totaling $11.2 million related to projects at 1030 Brittan, 777 Industrial Road, and 987 Commercial Way; and  Sales tax payments in the amount of $3.2 million.

The increase in cash during the quarter driven by the above revenues was partially offset by several major distributions:

 The payment to San Mateo County for law enforcement services for the fourth quarter in the amount of $1.9 million;
 Operating expenditure contributions to Silicon Valley Clean Water in the amount of $0.9 million; and
 The annual Other Post-Employment Benefits payments of $0.9 million.

The City draws on the i nvestment portfolio throughout the year for normal operating activity typically with the more significant levels of draw occurring in the first quarter (July through September) and fourth quarter (April through June). The City’s cash position typically imp roves in late December and April due to the receipt of property tax collections from San Mateo County.

Below is a comparison of quarterly cash position for the past three years.

$100
$120
$140
$160
$180
Sep 30 Dec 31 Mar 31 June 30
($ in millions)
Cash Position of Investments
FY2022
FY2021
FY2020

Below is a summary of the changes in the total investment interest earnings from the prior quarter.

Qtr Ended
6/30/22
Qtr Ended
3/31/22
Increase
(Decrease)
Investment Portfolio 162,917,094$ 135,615,767$ 27,301,327$ Weighted Avg Yield 0.95% 0.66% 0.29%
Accured Interest Earnings 355,677$ 221,468$ 134,209$

The increase in interest earnings this quarter occurred due to the higher interest rates and portfolio balance compared to the prior quarter. Interest for the investment account s was $355,677 and $3,366 for the checking account.

ALTERNATIVES:

The alternatives available to the City Council include:

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4 1. Accept the Quarterly Investment Report for the fourth quarter of FY 2021-22 as of June 30, 2022; or

2. Do not accept the Report; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Rebecca Mendenhall,
Administrative Services Director

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Portfolio Summary Q4 FY22

2. Portfolio Chart Q4 FY22

3. Historical Chart Q4 FY22

4. Rate of Return Chart Q4 FY22

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CITY OF SAN CARLOS Historical GASB 31
Date Purchase Boo k % of Market Quarterly
Investment Type Account/CUSIP # Purchased Price ($) Qtr. Year-to-date Value ($) Portfolio Value ($)* Income

LIQUID ACCOUNTS
Checking Account 2,166,789$ 0.36% 0.10% 2,166,789 $ 1% 2,166,789 $ 3,366 $ Investment Accounts
San Mateo County Pool-City of San Carlos 96,365,828 1.08% 0.91% 96,365,828 59% 93,359,214 245,078 State of California LAIF-City of San Carlos 66,551,266 0.75% 0.38% 66,551,266 40% 65,694,446 110,599 Total Liquid Accounts 162,917,094 $ 0.95% 0.70% 162,917,094 $ 99% 159,053,661 $ 355,677 $ Total for City of San Carlos 165,083,883 $ 0.94% 0.69% 165,083,883 $ 100% 161,220,449 $ 359,043 $

* Note: Difference in value between Historical Value and Market Value may be due to timing of purchase. Investments in the investment pools may have been purchased when interest rates were lower or higher than the end date of this report. As interest rates increase or decrease, the value of the investment pools will decrease or increase accordingly. However, the interest rate fluctuations does not have impact to the City's balance in the investment pools. The market values are presented as a reference only.

Yield
%

INVESTMENT PORTFOLIO

CITY OF SAN CARLOS
June 30, 2022

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Attachment: Portfolio Summary Q4 FY22 (Q4 Investment Report FY 21-22) Investment Portfolio Diversification
City of San Carlos Checking Account 2,166,789 $ 1% City of San Carlos SM County Pool 96,365,828 59% City of San Carlos LAIF-General 66,551,266 40% Total 165,083,883 $ 100%
City ‐ Checking
1%
City ‐ SMC Pool
59%
City ‐ LAIF
40%
City ‐ Checking City ‐ SMC Pool City ‐ LAIF
City of San Carlos
Investment Portfolio
as of June 30, 2022

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Attachment: Portfolio Chart Q4 FY22 (Q4 Investment Report FY 21-22) City of San Carlos Investment Portfolio
Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 City - Checking 1,800,227 2,108,111 3,342,715 2,500,327 2,321,355 2,329,948 3,214,823 5,993,674 2,166,789 City - SM County Pool 45,007,248 37,566,007 56,533,997 62,891,172 74,665,430 74,839,584 81,871,382 84,355,059 96,365,828 City - LAIF 70,229,328 66,981,730 62,775,035 61,327,279 60,644,252 58,692,480 51,978,289 51,260,708 66,551,266 Total 117,036,803$ 106,655,848 $ 122,651,747 $ 126,718,778 $ 137,631,036 $ 135,862,013 $ 137,064,495 $ 141,609,441 $ 165,083,883 $ 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jun‐20 Sep ‐20 Dec ‐20 Mar ‐21 Jun ‐21 Sep ‐21 Dec ‐21 Mar ‐22 Jun ‐22 City of San Carlos Historical Summary of Investment Portfolio City ‐ Checking
City ‐ LAIF
City ‐ SM County
Pool

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Attachment: Historical Chart Q4 FY22 (Q4 Investment Report FY 21-22) Investment Accounts Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 San Mateo County Pool-City of San Carlos 1.92% 1.56% 1.17% 1.11% 1.07% 0.99% 0.88% 0.87% 0.91% State of California LAIF-City of San Carlos 1.96% 0.84% 0.76% 0.65% 0.57% 0.24% 0.25% 0.27% 0.38% Annualized Rate of Return

CITY OF SAN CARLOS

INVESTMENT ANNUALIZED RATE OF RETURN
June 30, 2022

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%
Jun‐20 Sep ‐20 Dec ‐20 Mar ‐21 Jun ‐21 Sep ‐21 Dec ‐21 Mar ‐22 Jun ‐22 Investment Annualized Rate of Return
San Mateo County Pool‐City of San Carlos State of California LAIF‐City of San Carlos

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Attachment: Rate of Return Chart Q4 FY22 (Q4 Investment Report FY 21-22)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Deny Claim of Premia Capital LLC and 1091 Industrial Owner LLC.

RECOMMENDATION:

Staff recommends that the City Council d eny the claim of Premia Capital LLC and 1091 Industrial Owner LLC as recommended by the City’s outside counsel.

FISCAL IMPLICATIONS:

None for this action.

BACKGROUND:

This item is coming before the Council to act on the claim submitted by Premia Capital LLC and 1091 Industrial Owner LLC . Staff recommends that t he Council deny the claim based on the guidance from the City’s outside counsel.

The Tort Claims Act. California Government Code Sections 900, seq., mandates that all claims for money or damages against a public entity must be presented in writing to the public entity prior to filing suit. Generally, claims concerning personal injury, wrongful death, damage to personal property, or damage to crops must be presented to the public within six (6) months of the accrual of the claim. All other claims, principa lly claims on contracts and damage to real property, are subject to a one-year statute of limitations for presentation of the tort claim. Once a tort claim is received by the public entity, the entity has forty-five (45) days to act on the claim. A claim c an be settled or rejected. If no action is taken within 45 days, the claim is deemed rejected by operation of law on the last day.

Claims Processing in San Carlos . When the City receives a claim, the claim is immediately forwarded to claims examiners at Sedgwick for investigation. After Sedgwick investigates the claim, Sedgwick provides a recommendation to the City on the handling of the claim. In certain circumstances, depending on the nature of the claim, Sedgwick’s claims examiner may refer the claim to outside counsel, as is the case here. The same outside counsel is defending the City on the underlying trip and fall case between the City and Robert Koenigsberg.

About Sedgwick. Sedgwick is a leading global provider of technology -enabled risk, benef its and integrated business solutions. In July 2019, Sedgwick acquired York Risk Services Group (“York”). York was originally hired through the Pooled Liability Assurance Network Joint Powers Authority (“PLAN JPA”), and Sedgwick will continue claims admini stration services to provide

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2 claims administration services to the City. The City Council approved the City’s participation in the PLAN JPA (previously known as the Association of Bay Area Government Pooled Liability Assurance Network or “ABAG PLAN”) on No vember 27, 2017 and designated the Administrative Services Director and Senior Management Analyst as primary and alternate PLAN JPA Board members.

ANALYSIS:

On behalf of Premia Capital LLC and 1091 Industrial Owner LLC (“Claimant”), the Law Office of John Biard filed a claim for equity indemnity against the City. Robert Koenigsberg (“Plaintiff”) filed a lawsuit against claimants on January 27, 2022 at the San Mateo County Superior Court after Robert Koenigsberg slipped and fell over seed pods on a City sidewalk. Plaintiff also filed a lawsuit against the City alleging dangerous condition of public property over the incident.

Plaintiff failed to comply with the Tort Claims Act , and a demurrer has been filed which is set to be heard on August 26, 2022. If this demurrer is sustained without leave to amend, Plaintiff will be left without a claim against the City.

The claimants have now timely filed a claim for indemnity against the City. This does not appear to be a case of liability against the City of San Carlos, as San Carlos Municipal Code 12.04.020 states that adjacent property owners are not only responsible for the maintenance and repair of the sidewalk, but also responsible for bodily injury or property damage resulting from failing to keep the sidewalk in a non -dangerous condition. In addition, the trees are not City trees; therefore, liability, if any, would not be properly placed with the City. Staff is also unable to locate any agreements that would shift the responsibility for maintaining the private trees or the sidewalk back to the City. For those reasons, the City’s outside counsel has recommended formal rejection of Premia Capital LLC and 1091 Industrial Owner LLC’s claim.

Council’s rejection of this claim does not prohibit staff or the staff of Sedgwick from continuing to work with the claimant to resolve the dispute.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Deny claim of Premia Capital LLC and 1091 Industrial Owner LLC; or

2. Do not deny claim of Premia Capital LLC and 1091 Industrial Owner LLC; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Rebecca Mendenhall,
Administrative Services Director

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3 Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Claim - Premia Capital, LLC and 1091 Industrial Owner

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

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Attachment: Claim - Premia Capital, LLC and 1091 Industrial Owner (Deny Claim of Premia Capital)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Awarding the Second Floor Library Tenant Improvement Project C2202; and Authorizing the City Manager to Execute a Public Projects Agreement with Rodan Builders of H ayward, CA in an Amount of $667,000; and Authorizing an Expenditure of Contingency in the Amount of $233,450.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution awarding the Second Floor Library Tenant Improvement Project C2202; authorizing the City Manager to execute a public projects agreement with Rodan Builders of Hayward, CA in the amount of $667,000; and authorizing an expenditure of contingency in the amount of $233,450.

FISCAL IMPLICATIONS:

Funding for the Second Floor Li brary Tenant Improvement Project (“Project”) comes from C2202, which has an available budget of $1,350,000 that was approved as part of the F iscal Year (“FY”) 2022-23 budget.

The lowest responsible and responsive bid received for the Project was $667,000. Including a 35% contingency of $233,450, the total cost of the construction work is approximately $900,450.

The estimated cost for cubicles and other office furniture is approximately $150,000 and is outside the scope of work for this Project.

BACKGROUND:

The Project consists of remodeling and updating Suite 206 on the second floor of the City of San Carlos L ibrary (“Library”), where the Chamber of Commerce was previously located , to provide additional office space for City staff.

The office space , as currently configured, is not adequate and requires cabling, electrical, lighting, and other updates. The Project budget includes costs for an additional network switch to accommodate the added connections.

The increase in development and capital projec ts in the city created the demand for additional personnel and consulting resources. City Hall has limited space and/or capacity for growth . As such, it has become necessary to expand into th e recently vacated space at the Library . This

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2 space will require remodeling as well as furniture, cabling, and electrical upgrades to meet the growing needs of the City. The goal is to also maximize the space for future growth and use.

Staff retained Viotti Architects to provide architectural plan services and prepare the construction documents for the Project.

ANALYSIS:

The City advertised its request for construction bids on July 1, 2022 and bids were opened on July 26, 2022. The following table shows the architect’s estimate along with the results of the bids in order from lowest to highest:

Contractor Total Bid Amount
Architect’s Estimate $801,576
Rodan Builders $667,000
Southwest Construction $799,000

The lowest and responsible bid was submitted by Rodan Builders with a total bid amount of $667,000. The v ariance between the total bid amounts and the architect’s estimate can be attributed to current economy, material and labor availability, and other obligations.

Staff recommends awarding the Second Floor Library Tenant Improvement Project C2202; authorizing the City Manager to execute a public projects agreement with Rodan Builders of Hayward, CA in an amount of $667,000; and authoriz ing an expenditure of contingency in the amount of $233,450.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Adopt a resolution awarding the Second Floor Library Tenant Improvement Project C2202; authorizing the City Manager to execute a public projects agreement with Rodan Builders of Hayward, CA in an amount of $667,000; and authoriz ing an expenditure of contingency in the amount of $233,450; or

2. Do not adopt the Resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Al Savay, AICP
Community Development Director

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3 Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution - Library Remodel Project

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RESOLUTION NO. 2022 – ____

ADOPT A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AWARDING THE SECOND FLOOR LIBRARY TENANT IMPROVEMENT PROJECT C2202;

AUTHORIZING THE CITY MANAGER TO EXECUTE A PUBLIC PROJECTS AGREEMENT WITH RODAN BUILDERS OF HAYWARD, CA IN AN AMOUNT OF $667,000; AND AUTHORIZING AN EXPENDITURE OF CONTINGENCY IN THE AMOUNT OF $233,450.

WHEREAS, City Hall has limited space and/or capacity for growth and therefore it has become necessary to expand into the recently vacated library space; and

WHEREAS, with the increase in development and capital projects, there is an additional demand for personnel and consulting services office space and work areas; and

WHEREAS, the goal is to maximize the space for future growth and use; and

WHEREAS, staff retained Viotti Architects to provide architectural plan services and prepare the construction documents; and

WHEREAS, the final bid set of the construction documents were prepared on June 14, 2022; and

WHEREAS, the City advertised for bids for construction of the project on July 1, 2022, and bids were opened July 26, 2022; and

WHEREAS, the lowest and responsible bid was submitted by Rodan Builders with a total bid amount of $667,000; and

WHEREAS, staff recommends awarding the Second Floor Library Tenant Improvement Project C2202; authorizing the City Manager to execute a public projects agreement with Rodan Builders of Hayward, CA in an Amount of $667,000; and authorizing an expenditure of contingency in the amount of $233,450.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby awards the 2nd Floor Library Tenant Improvement Project C2202; and authorizes the City Manager to execute a public projects a greement with Rodan Builders of Hayward, CA in an Amount of $667,000; and authorizes an expenditure of contingency in the amount of $233,450.

* * * * *

AYES, COUNCILMEMBERS: ___________________________________________ NOES, COUNCILMEMBERS: ___________________________________________ ABSENT, COUNCILMEMBERS: ___________________________________________

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Attachment: Resolution - Library Remodel Project (Award Library Tenant Improvement Project)

________________________________
CITY CLERK of the City of San Carlos
APPROVED:

___________________________
MAYOR of the City of San Carlos

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Attachment: Resolution - Library Remodel Project (Award Library Tenant Improvement Project)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt a Resolution Authorizing the City Manager to Execute an Amendment to the Public Projects Agreement with C2R Engineering, Inc. in the Amount of $300,000 for the 2022 On -Call Sewe r Replacement Project C1702; Rolling Forward $300,000 from the Remaining Project Budget from Fiscal Year ("FY") 2021-22 to FY 2022 -23, and Authorizing the Expenditure of a Contingency Not-To-Exceed the Project Budget.

RECOMMENDATION:

Staff recommends t hat the City Council adopt a resolution authorizing the City Manager to execute an amendment to the public projects agreement with C2R Engineering, Inc. in the amount of $300,000 for the 2022 On -Call Sewer Replacement Project (“Project”) C1702; rolling forward $300,000 from the remaining project budget from F iscal Year (“F Y”) 2021-22 to FY 2022-23, and authorizing the expenditure of a contingency not-to-exceed the Project budget.

FISCAL IMPLICATIONS:

Funding for the Project comes from the On -Call Sewer Co ntracts C1702, which had a total approved budget of $900,000 for FY 2021-22.

The City Council previously awarded the Project to C2R Engineering, Inc. (“Contractor”) in the amount of $418,700 and authorized an expenditure of contingency in the amount of $147,000 at the October 25, 2021 meeting, which leaves a remaining budget of approximately $334,300.

There is sufficient funding in the FY 2021 -22 Project budget to cover the additional $300,000 requested. Staff recommends rolling over $300,000 from the F Y 2021 -22 remaining Project budget into the FY 2022 -23 Project budget and amending the public projects agreement to complete the additional work for the Project.

The revised total Project cost will be $865,700.

BACKGROUND:

Staff is bringing this item to City Council to amend the public projects agreement with the Contractor to increase the budget and complete additional emergency repairs to the sanitary sewer main.

The Project was established to address emergency repairs needed outside of the basin

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2 scheduled for the current year Annual Sewer Rehabilitation Project. Through the Project, over 1200 linear feet of sanitary sewer main segments will be replaced or rehabilitated at various locations citywide.

ANALYSIS:

With the awarded amount, the Contractor was able to complete the first task order consisting of emergency point repairs to avoid sanitary sewer overflows, a lower lateral replacement, and a sanitary sewer manhole relocation.

However, staff would like to address more sewer main segments in n eed of immediate repair due to several defects such as cracking, flexure, soil collapse, and large voids within the segment along streets that are scheduled for upcoming pavement rehabilitation in FY 2022-23.

The list of repairs were identified by reviewi ng the existing condition of the pipe and recommendations provided by the City’s consultant. Addressing these repairs as part of the Project expedites the repairs prior to the planned pavement rehabilitation schedule and avoids trenching into new pavement.

Therefore, staff recommends amending the public projects agreement with the Contractor to complete repairs for the additional task orders and authorizing contingency up to the Project budget.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt a resolution authorizing the City Manager to execute an amendment to the public projects agreement with C2R Engineering, Inc. in the amount of $300,000 for the 2022 On-Call Sewer Replacement Project C1702, rolling forward $300,000 from the remaining project budget from FY 2021 -22 to FY 2022 -23 and authorizing the expenditure of a contingency not-to-exceed the Project budget; or

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Grace Le,
City Engineer

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3 Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Resolution

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RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS

AUTHORIZING THE CITY MANAGER TO EXECUTE AN AMENDMENT TO THE PUBLIC PROJECTS AGREEMENT WITH C2R ENGINEERING, INC. IN THE AMOUNT OF $300,000 FOR THE 2022 ON-CALL SEWER REPLACEMENT PROJECT C1702; ROLLING FORWARD $300,000 FROM THE REMAINING PROJECT BUDGET FROM FISCAL YEAR (“FY”) 2021-22 TO FY 2022-23, AND AUTHORIZING THE EXPENDITURE OF A CONTINGENCY NOT-TO- EXCEED THE PROJECT BUDGET.

WHEREAS, the 2022 On-Call Sewer Replacement Project (“Project”) was established to address emergency repairs needed outside of the basin scheduled for the current year Annual Sewer Rehabilitation Project; and

WHEREAS, funding for the Project comes from the On -Call Sewer Contracts C1702, which had a total approved budget of $900,000 for Fiscal Year (“FY”) 2021-22; and

WHEREAS, the City Council previously awarded the Project to C2R Engineering, Inc. (“Contractor”) in the amount of $418,700 and authorized an expenditure of contingency i n the amount of $147,000 at the October 25, 2021 City Council meeting , which leaves a remaining budget of approximately $334,300; and

WHEREAS, there is sufficient funding in the FY 2021-22 Project budget to cover the additional $300,000 requested; and

WHEREAS, staff recommends rolling over the $300,000 from the FY 2021-22 Project budget into the FY 2022-23 Project budget and amending the public projects agreement to complete the additional Project work; and

WHEREAS, staff is bringing this item to City Council to amend the public projects agreement with the Contractor to increase the budget and complete additional emergency repairs to the sanitary sewer main; and

WHEREAS, through the Project, over 1200 linear feet of sanitary sewer main segments will be replaced or rehabilitated at various locations citywide; and

WHEREAS, with the awarded amount, the Contractor was able to complete the first task order consisting of emergency point repairs to avoid sanitary sewer overflows, a lower lateral replacement, and a sanitary sewer manhole relocation; and

WHEREAS, staff would like to address sewer main segments in need of immediate repair due to several defects such as cracking, flexure, soil collapse, and large voids within the segment along streets that are scheduled for upcoming pavement rehabilitation in FY 2022-23; and

WHEREAS, addressing these repairs as part of the Project expedites the repairs prior to the planned pavement rehabilitation schedule and avoids trenching into new pavement; and

WHEREAS, staff recommends amending the public projects agreement with the Contractor to complete repairs for the additional task orders and authorizing contingency up to the Project budget.

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Attachment: Resolution (On-Call Sewer Contract Budget Increase)

NOW, THEREFORE BE IT RESOLVED , that the San Carlos City Council hereby approves executing an amendment to the public projects agreement with C2R Engineering, Inc. in the amount of $300,000 for the 2022 On -Call Sewer Replacement Project C1702 , rolling forward $300,000 from the remaining project budget from FY 2021 -22 to FY 2022 -23 and authorizing the expenditure of a contingency not-to-exceed the Project budget.

* * * * *

AYES, COUNCILMEMBERS: ___________________________________________ NOES, COUNCILMEMBERS: ___________________________________________ ABSENT, COUNCILMEMBERS: ___________________________________________

________________________________
CITY CLERK of the City of San Carlos
APPROVED:

___________________________
MAYOR of the City of San Carlos

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Attachment: Resolution (On-Call Sewer Contract Budget Increase)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt Ordinance 1585 Adding Chapter 8.52 to the San Carlos Municipal Code Establishing a Child Care Development Impact Fee for New Nonresidential Developments in the City of San Carlos.

RECOMMENDATION:

Staff recommends that the City Council adopt Ordinance 1585 adding Chapter 8.52 to the San Carlos Municipal Code establishing a child care development impact fee for new nonresidential developments in the city.

FISCAL IMPACT:

As a per square foot fee derived from new nonresidential developments, potential revenues will vary depending on the sizes of future projects.

BACKGROUND:

One of the City Council’s (“Council”) ongoing strategic goals is to increase access to child care by reducing regulatory and financial barriers to the creation and expansion of child care facilities in the city. In October 2017, the Council received an informational presentation from staff describing potential strategies to address the shortage of child care facilities serving the San Carlos community. This presentation was a response to information provided by San Mateo County’s Early Learning Support Services which highlighted the need for additional child care.

At that time, there was a shortage of m ore than 650 spaces for infant and preschool -aged children in San Carlos.

At the Council’s direction, staff initiated efforts to study the issue. Economic & Planning Systems, Inc. (“EPS”) was retained to conduct an initial study of regulatory and financi ng options to increase the supply of child care facilities and develop strategies to mitigate future demand based on the expected increase in residents and employers in San Carlos. In 2021, the Council approved the following changes to the Municipal Code t o remove regulatory barriers:

 Updated Municipal Code Sections 18.04 and 18.05 to remove the minor use permit requirement for commercial child care centers in specific zoning districts.  Updated Municipal Code Section 18.23.090, Standards for Specific Uses and Activities, to (1) remove the outdoor space requirement; (2) allow staff level review for pick -up and

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2 drop-off plans and require a minor use permit for parking non -compliance; and (3) update hours of operation.
 Updated Municipal Code Sections 18.23. 090, 18.23.040, and 5.04.020 to ensure compliance with State law for small and large family in-home day care.

Beyond the changes to San Carlos’ local regulations summarized above, staff and consultants were asked to evaluate different approaches to creatin g new child care spaces, specifically focusing on child care development impact fees. In July 2020, EPS presented the Council with information on child care development impact fees. Following the presentation, the Council requested further evaluation of fu nding options. Since then, staff held two collaborative working sessions with the City Council Child Care Subcommittee (“Subcommittee”) in June 2021 and November 2021 to review findings and develop preliminary recommendations for the Council to discuss and provide feedback.

During these working sessions, the Subcommittee evaluated a range of funding strategies and considered options for potential partnerships with the Child Care Coordinating Council (4Cs) of San Mateo County. Because development of onsite child care may not always be appropriate from a land use compatibility perspective and/or may not be feasible for smaller projects, the Subcommittee indicated that an onsite requirement (with an associated in -lieu fee option) may not be viable at this time.

On March 14, 2022, the Council held a study session to discuss the parameters of a proposed child care development impact fee program. Staff received direction to move forward with crafting a fee program that only applied to nonresidential developments with a provision to allow a build onsite option.

On June 27, 2022, the Council introduced Ordinance 1585 adding Chapter 8.52 to the San Carlos Municipal Code, establishing a child care development impact fee for new nonresidential developments in the C ity. The Council approved the Ordinance with minor changes to Section

8.52.060, Alternative Means of Satisfying Fee Obligation, as summarized below:

 Specify that the child care impact fee obligation may be met by building appropriately sized and feasible child care space onsite and contracting with a licensed child care provider; and

 Use an example showing the dimensions of an onsite c hild care facility to inform a memorandum of u nderstanding or similar agreement between the d eveloper and the City. For example, a new nonresidential development of 50,000 square feet may meet its fee obligation by building a child c are space onsite at a ratio of ten percent, such that development provides at least 5,000 square feet of child care space onsite; and

 Specify th at other sized onsite child care facilities may be approved if economic and operational feasibility is demonstrated by the developer, consistent with the demand ratios articulated in the Child Care Impact Fee Nexus Study (“Nexus Study”).

Specifically, the redlined sections below show the exact minor edits requested by the Council in Section 8.52.060, Alternative Means of Satisfying Fee Obligation:

New nNonresidential projects of 50,000 sq.ft. or larger may meet the child care impact fee obligation by building appropriately sized and feasible child care space onsite, at a ratio of 10%

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3 of total square footage, and contracting with a licensed child care provider. For example, a new nonresidential development of 50,000 square feet may meet its fee obligation by building child care space onsite at a ratio of 10 percent, such that the development provides at least 5,000 square feet of child care space onsite. The dimensions provided in this example are meant to inform a Memorandum of Understanding or similar agreement between the Developer and the City. Other sized onsite child care facilities may be approved if economic and operational feasibility is demonstrated by the developer, consistent with the demand ratios articulated in the Nexus Study. Any onsite child care provided through this option would need to meet state licensing requirements and local regulatory requirements (as specified in Section 18.23.090 of the Municipal Code) and would need to be mutually agreed upon by the Developer and the City.

If mutually agreed upon by the Developer and the City, alternative means of satisfying the fee obligation may be identified and articulated in a Development Agreement, or similar mutually agreed upon Agreement.

ANALYSIS:

Nexus-Based Fees.

Development impact fee s authorized under the Mitigation Fee Act require the preparation of a nexus study to evaluate the impact of new development on the need for the identified facilities.

The study must ensure that the fee levels are proportionate to their impact. EPS prepare d the Nexus Study in January 2020 and updated it in July 2021 (see Attachment 3). The Nexus Study was adopted by the Council via Resolution 2022 -077 on June 27, 2022. The Nexus Study evaluates the im pact of new residential and non residential develop ment; h owever, the Subcommittee and the Council previously provided direction not to apply the fee to new residential development. The nexus -based fees are the maximum fees that can be justified given the current cost of developing new child care spaces. The Coun cil indicated their interest in adopting the reduced fees (lower than the nexus-justified fees) as a policy decision, based on feasibility and/or other considerations.

This fee is a one -time charge on new development set according to “nexus logic.” The f unds collected can only be used to fund capital projects (not maintena nce or operations). For example, the City could potentially use the funds to contribute to the construction of new child care facilities, land acquisition costs, or loans and/or grants t o providers seeking to create or expand capacity. It is important to note that these funds cannot be used to subsidize operations or direct assistance with child care costs.

The amount of the proposed fee established by the Nexus Study or subsequent nexu s studies will be adjusted annually based on the Construction Cost Index published by the “Engineering News Record” or a reasonable replacement index. The information below focuses on the potential maximum fee amount that the City can adopt and the methodology.

Nexus Methodology.

Based on data reported in the 2017 San Mateo County Early Learning Facilities Study, the demand for child care spaces resulting from new nonresidential development is approximately four spaces per 100 employees. At an estimated c ost of $80,391 per space (including land), the cost per employee is $3,352. Based on employment density assumptions, the cost per employee can be expressed as a cost per square foot as seen in the table below:

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4 Maximum Fees for Nonresidential Development
Office/Research &
Development (R&D)
$10.07 per sq.ft.

Retail $5.03 per sq.ft.

Hotel $3.35 per sq.ft.

Industrial $3.35 per sq.ft.

Feasibility Considerations.

In considering a potential new child care development impact fee and appropriate fee levels, it is helpful to understand how similar fees and programs are being implemented in comparable jurisdictions. The table below compares child care policies and fee programs in three Bay Area jurisdictions.

Overview of Comparable Jurisdictions
Redwood
City
 Robust city-led child care program housed in the Parks and Recreation and Community Services Department
 Employs a full-time Child Care Coordinator who works with other departments and the community to implement programs to increase the quantity and quality of child care and early education
 Waives the planning fees associated with large family child care facilities  Does not charge child care impact fees
South
San
Francisco
 Child care program housed in the Parks Division  Program includes three preschools for children ages 2.5 to 5 years  Child care impact fee program for nonresidential development San
Mateo
 The City partners with the Child Care Coordinating Council (4Cs) to support parents, providers, and local communities in finding, planning for, paying for, and accessing affordable, quality child care
 San Mateo has a child care impact fee program for nonresidential development

Other Bay Area cities that charge child care impact fees include San Francisco, Berkeley, Livermore, San Ramon, and Clayton. In Southern California, Santa Monica has a robust child care impact fee program. T he table below highlights the fee ranges from a few cities, while Attachment 4 provides a more comprehensive overview.

City Fees per Square Feet of Nonresidential Development South San Francisco $0.18 to $0.68
San Mateo $1.08
San Francisco $1.95
Berkeley $0.75 to $1.50
Livermore $5.00 to $7.00 (broader “Social and Human Services Fee”) Santa Monica $3.00 to $7.00

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5 Fee Burden Analysis.

In addition to reviewing what other cities are doing, the Subcommittee also requested an analysis of how adding a new child care development impact fee changes the total existing fee burden. Currently, th e fee burd en for all office/R&D, retail, hotel, and industrial d evelopments includes the sewer capacity fee, commercial linkage fee, and the traffic impact fee. The table below shows the impact on the existing aggregate fee levels for nonresidential development if a new child care development impact fee were to be implemented, both at the maximum -allowed and 50 percent reduced fee levels.

For example, new office development is currently required to pay, in aggregate, approximately $30.00 per square foot. At a maximum-allowed fee of $10.07 per square foot, the child care impact fee would increase the existing fee burden by 34%. At a reduced fee of $5.00 per square foot, the child care impact fee would increase the existing fee burden by 17%. At the reduced fee levels, the child care fee represents 14% of the aggregate fee burden for office development, 16% of the aggregate fee burden for R&D development, 7% of the aggregate fee burden for retail and hotel development, and 19% of the aggregate fee burden for industrial development.

Land Use Current Fee
Obligation
Total Fee Obligation
with Max-Allowed
Child Care Fee
%
Increase
at Max
Total Fee
Obligation with
50% Reduced
Child Care Fee
(Recommended)
%
Increase
at
Reduced
Office/R&D $29.89 per sq.ft. $39.96 per sq.ft. 34% $34.89 per sq.ft. 17% Retail $31.79 per sq.ft. $36.82 per sq.ft. 16% $34.29 per sq.ft. 8% Hotel $20.21 per sq.ft. $23.56 per sq.ft. 17% $21.81 per sq.ft. 8% Industrial $6.84 per sq.ft. $10.19 per sq.ft. 49% $8.44 per sq.ft. 23%

At the M arch Study Session, the Council asked staff to assess the aggregate fee burden (per sq.ft.) through a comparative analysis with other cities that implement child care fees. The purpose behind this analysis is to understand how San Carlos’ aggregate fees (with and without child care fees) compare to other cities to assess where San Carlos falls on the fee spectrum.

For most of the nonresidential land use categories, the aggregate fees (including child care fees) for San Carlos align well with other cities. See Attachment 5 for the full analysis chart.

At the March Study Session, the City Council also directed staff to develop a resolution adopting the reduced child care impact fee levels (highlighted in blue in the table above). This is because adopting the maximum-justified child care development impact fees may adversely affect the interest of some developers considering building in the c ity if the fees are considered too high.

Higher fees will also impact the amount of community benefit dollars that would otherwise be available for the City Council ’s other community priorities such as the Downtown, housing, parks, and open space amenities. Thus, staff recommends adopting the reduc ed fee levels under a separate r esolution to address the issue of child care shortage without impacting the aggregate fees dramatically. Adopting the reduced fee levels is consistent with other jurisdictions and justified within the Nexus Study.

Fee Program Recommendations

Child Care Development Impact Fee Parameters.

Based on the City Council’s direction, feedback from the Child Care Subcommittee, and the preceding feasibility evaluation, the following fee program parameters are recommended:

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6  Apply the child care development impact fee only to new nonresidential development.  Adopt the following reduced fee levels (50% reduced from the maximum fee levels) under a separate resolution at an upcoming Council meeting.

Office/R&D $5.00 per sq.ft.

Retail $2.50 per sq.ft.

Hotel $1.60 per sq.ft.

Industrial $1.60 per sq.ft.

Child Care Build Onsite Option.

Staff also recommends that a build onsite option is included so that developers will have the option to build the child care facility onsite as an alternative to paying the child care development impact fee. The build onsite option summarized below includes the minor edits requested by the Council at its June 27, 2022 meeting.

Any new nonresidential development may meet the child care impact fee obligation by building appropriately sized and feasible child care onsite and contracting with a licensed child care provider. For example, a new nonresidential development of 50,000 square feet may meet its fee obligation by building child care space onsite at a ratio of ten percent, providing at least 5,000 square feet of child care space onsite. The dimensions provided in this example are meant to inform a memorandum of understanding or similar agreement between the developer and the City. Other sized onsite child care facilities may be approved if economic and operational feasibility is demonstrated by the developer, consistent with the demand ratios articulated in the Nexus Study. Any onsite child care provided through this option would need to meet State licensing requirements, local regulatory requirements, and would need to be mutually agreed upon by the developer and the City. Also, alternative means of satisfying the fee obligation may be identified and articulated in a development agreement, or similar mutually agreed upon agreement between the developer and the City.

Potential Use of Fee Revenue.

A development impact fee program will generate revenue for the creation of new child care spaces at existing or new facilities. As stated above, fee revenue can be applied to the construction of new child care facilities, land acquisition for child care facilities, or a revolving loan or grant program for home daycare providers who need funding assistance for capital improvements that result in increased capacity. The Mitigation Fee Act is clear that impact fee revenue cannot be used to su bsidize operations or provide direct assistance with child care costs.

Summary of Recommendations

Child Care Development Impact Fee Parameters.

Staff recommends adopting Ordinance 1585 , adding Chapter 8.52 to the Municipal Code establishing a Child Care Development Impact Fee that only applies to new nonresidential developments.

Build Onsite Option.

Staff recommends including an option within Ordinance 1585 for new nonresidential developments to meet the child care impact fee obligation by building app ropriately sized and feasible child care onsite and contracting with a licensed child care provider. Any onsite child

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7 care provided through this option would need to meet S tate licensing requirements , local regulatory requirements, and would need to be mutually agreed upon by the d eveloper and the City.

Next Steps.

If the second reading of proposed Ordinance 1585 is approved at the August 22, 2022 City Council meeting, the Ordinance would become effective on September 22, 2022. The associated fees would t ake effect 60 days after a separate resolution to set the fee levels is adopted.

ALTERNATIVES:

The options available to the City Council include:

1. Adopt Ordinance 1585 a dding Chapter 8.52 to the San Carlos Municipal Code establishing a Child Care Development Impact Fee for new nonresidential developments in the city; or

2. Do not adopt Ordinance 1585; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Al Savay, AICP
Community Development Director

Sajuti Haque, Senior Management
Analyst

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Ordinance 1585- CLEAN Child Care Dev Impact Fee

2. Ordinance 1585 - REDLINED Child Care Dev Impact Fee

3. Child Care Impact Fee Nexus Study Draft Report

4. Appendix A-1 - Model Update

5. Aggregate Fee Burden

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1 ORDINANCE NO. 1585

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS ADDING CHAPTER 8.52 TO THE SAN CARLOS MUNICIPAL CODE

ESTABLISHING A CHILD CARE DEVELOPMENT IMPACT FEE FOR NEW NONRESIDENTIAL DEVELOPMENTS IN THE CITY OF SAN CARLOS.

RECITALS
WHEREAS, as part of the 2022 City Council Strategic Goals, the City Council expressed interest in adopting a Child Care Development Impact Fee (“Fee”) under the authority of Sections 66000 et seq. of the California Government Code (“Mitigation Fe e Act”) that applies to nonresidential development projects in the City to address the shortage of child care facilities in San Carlos; and
WHEREAS, the San Mateo County Child Care Needs Assessment prepared by the San Mateo County Child Care Partnership C ouncil in 2017 states that there is a shortage of more than 650 spaces for infant and preschool-aged children; and WHEREAS, in 2019, staff retained Economic & Planning Systems Inc. (“EPS”) to conduct an initial study of regulatory and financing options to increase the supply of child care facilities and develop strategies to mitigate the future demands based on an expected increase of residents and employers in San Carlos; and
WHEREAS, in January 2020 and July 2021 a study was prepared and then updated for the City by EPS entitled Child Care Impact Fee Nexus Study (“Nexus Study”) which established the maximum child care development impact fees justifiable under the Mitigation Fee Act that could be required of new development in the City of San Carlos; and WHEREAS, on March 14, 2022, a City Council Study Session was held to discuss and evaluate the feasibility of implementing a child care development impact fee; and WHEREAS, the City Council has duly considered all evidence, including testimony and the evaluation and recommendations by staff, presented at said study session; and WHEREAS, on June 27, 2022, the City Council held a duly noticed public hearing to consider Ordinance 1585 adding Chapter 8.52 to the San Carlos Municipal Code establishing a child care development impact fee for new nonresidential developments and approved the Ordinance with minor changes to Section 8.52.060; and
WHEREAS, ten (10) days advance notice of the public hearing at which this Ordinance was introduced was given by publication in accordance with Government Code Section 6062a; and
WHEREAS, pursuant to Public Resources Code Section 21065 and CEQA Guidelines Section 15378, the proposed project does not constitute a “project” within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. The proposed Ordinance also is exempt from environmental review pursuant to CEQA Guidelines Section 15061(b)(3) since there would be no possibility of

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 2 a significant effect on the environment, in that its provisions requiring the provision of affordable housing would not have any effect on the physical environment.

NOW, THEREFORE BE IT ORDAINED by the City Council of the City of San Carlos as follows:

SECTION 1: The City Council of the City of San Carlos hereby finds and declares that the forgoing recitals are true and correct and are incorporated into this Ordinance as though fully set forth herein. The City Council further finds as follows:

1) The City Council established priorities that acknowledge the critical role that child care plays in facilitating the lives of working parents and guardians in the City and directed City staff to evaluate options to encourage an adequate and diverse supply of child care facilities citywide and to implement a child care impact fee on new nonresidential development due to its impacts on child care needs; and
2) New, nonresidential development can reasonably be anticipated to increase the capacity for new businesses and new job growth in the City, and some new employees occupying the new development may require child care services so that their children may be well-cared for while they work; and
3) An Early Learning Facilities Needs Assessment conducted by San Mateo County Human Services Agency, First 5 San Mateo County, and the Child Care Partnership Council established that there is already a shortage of quality child care options in San Carlos, and, if unmitigated, new development will place additional, and cumulatively overwhelming, burdens on the child care system; and
4) As a condition of project approval, new nonresidential development must mitigate its adverse impact of increased demand for child care generated by the development. Child care impact fees are a necessary financing tool to generate revenue that can be used to expand the capacity of the child care system so that new development does not exacerbate the existing child care shortage. A child care impact fee program further enables developers of new development to pay their fair share of the costs needed to build more child care to mitigate the impact of new development; and
5) As established by the Nexus Study, adopted by the City Council on June 27, 2022, there is a reasonable relationship between the type and amount of new development and the number of new child care spaces required; and between the number of new child care spaces required and the use of the fee; and
6) The fee established by the Nexus Study and under this Ordinance is proportional to the impacts created by voluntary development in the City; and 7) The amount of the proposed fee shall be established by City Council resolution and not exceed the fee established by the adopted Impact Fee Nexus Study dated July 14, 2021 or

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 3 subsequent nexus studies, which shall be adjusted annually based on the Construction Cost Index published by the Engineering News Record or a reasonable replacement index.

The purpose of this chapter, therefore, is to provide funding to expand the number of quality child care spaces available to residents and employees in San Carlos through the use of development fees consistent with state law, in order to implement the child care policies prioritized in the 2022 City Council Strategic Goals. The intent of this chapter is not to raise general revenues. Instead, the intent is to provide for the capital improvements and augmentation to the child care system to help satisfy the child care needs generated by growth from new development, in a balanced and efficient manner which will mitigate the adverse impacts on the child care system and promote the public health, safety, and general welfare.

SECTION 2: Chapter 8.52: CHILD CARE DEVELOPMENT IMPACT FEES is added to the municipal code as follows:

Chapter 8.52

CHILD CARE DEVELOPMENT IMPACT FEES

8.52.010 Authority.

8.52.020 Purpose.

8.52.030 Definitions.

8.52.040 Application and Payment of Fee

8.52.050 Fee payment.

8.52.060 Alternative Means of Satisfying Fee Obligation.

8.52.070 Exemptions.

8.52.080 Credits and fee adjustments and appeals.

8.52.090 Use of fee.

8.52.100 Refund of fee.

8.52.110 Annual review.

8.52.010 Authority.

This chapter is enacted pursuant to the Mitigation Fee Act contained in Government Code Sections 66000 et seq.

8.52.020 Purpose.

The purpose of this chapter is to provide funding to expand the number of quality child care spaces available to residents and employees in San Carlos through the use of development fees consistent with state law, in order to implement the child care policies prioritized in the 2022 City Council Strategic Goals. The intent of this chapter is not to raise general revenues.

Instead, the intent is to provide for the capital improvements and augmentation to the child care system to help satisfy the child care needs generated by growth from new development, in a balanced and efficient manner which will mitigate the adverse impacts on the child care system and promote the public health, safety, and general welfare.

8.52.030 Definitions.

As used in this chapter, the following terms shall have the following meanings:

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 4 A. “Building permit” includes full structural building permits as well as partial permits such as foundation-only permits.

B. “Child care development impact fee” means the fee charged to new nonresidential development in the City of San Carlos on a per square foot of floor area basis.

C. “Development Agreement” means a written agreement with applicants for development projects as provided by Municipal Code Chapter 18.37.

D. “Floor area measurement” includes exterior façade of building wall planes or from the center line of party walls; parking areas and exterior walkways are not included.

E. “Mitigation Fee Act” authorizes a local government agency to impose development impact fees on specific development projects to defray the cost of new or additional public facilities that are needed to serve those developments.

F. “Nonresidential development” includes land uses categories identified in the City’s Zoning Code, Title 18 of the Municipal Code, including office/R&D, retail, hotel and industrial.

G. “Nexus Study” is the study prepared by Economic & Planning Systems (EPS) on July 14, 2021 that established the maximum child care development impact fees justifiable under the Mitigation Fee Act that could be required of new development in the City of San Carlos. “Zoning administrator” means the Zoning Administrator of the City of San Carlos, or his or her designee. (Ord. 1533 § 1 (Exh. A (part)), 2018: Ord. 1525 § 2(3) (Exh. C (part)), 2017)
H. “Use Permit” means a discretionary permit, such as a minor use or conditional use permit, which may be granted by the appropriate City of San Carlos authority to provide for the accommodation of land uses with special site or design requirements, operating characteristics, or potential adverse effects on surroundings, which are not permitted as of right but which may be approved upon completion of a review process and, where necessary, the imposition of special conditions of approval by the permit granting authority.

8.52.040 Application and Payment of Fee.

The child care development impact fee enabled in this chapter is charged to new nonresidential development in the City of San Carlos on a per square foot of floor area basis. Floor area measurement shall be to the exterior facade of building wall planes or from the center line of party walls. Parking areas and exterior walkways are not included in the child care impact fee calculation.

This chapter does not replace normal subdivision map exactions or other measures required to mitigate site specific impacts of a development project including, but not limited to, mitigations pursuant to the California Environmental Quality Act; regulatory and processing fees; fees required pursuant to a development agreement; funds collected pursuant to a reimbursement agreement that exceed the developer’s share of public improvement costs; or assessment district proceedings, benefit assessments, or taxes.

A. General. The amount of the proposed fee shall be established by City Council resolution and not exceed the fee established by the adopted Impact Fee Nexus Study

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 5 dated July 14, 2021 or subsequent nexus studies, which shall be adjusted annually based on the Construction Cost Index published by the Engineering News Record or a reasonable replacement index. The fee imposed under this chapter is based on the consideration that new development contributes to expanding the need for additional quality child care spaces in the City, based on employment generation and employee demand for child care.

B. Types of Development Subject to the Fee. The fee shall be applicable to new development and redevelopment projects which require a planning application, expansion of floor area of existing uses which require a planning application, and changes of use requiring a use permit as follows:

1. Nonresidential Construction. Fees shall be charged based on employment generation and employee demand for child care, as established in the Child care Impact Fee Nexus Study. No fee is applicable for remodeling or restoration only, where the floor area is improved or replaced but not increased.

Floor area measurement shall be to the exterior facade of building wall planes or from the center line of party walls. Parking areas and exterior walkways are not included in the child care need generation calculation.

2. Changes of Use Requiring a Use Permit. Fees shall be charged upon the incremental difference between the fee calculated for the floor area of a prior legal use and the fee calculated for the floor area of the proposed new use.

C. Land Use Categories Subject to the Fee. All nonresidential land use categories identified in the City’s Zoning Code, Title 18 of the City’s Municipal Code, which generate employment are subject to the fee.

D. Authority of Zoning Administrator. The Zoning Administrator shall have authority to render final determinations regarding the appropriate classification of land use and the correct calculation of gross building floor area for a particular development project. (Ord. 1562 § 2 (part), 2020; Ord. 1400 § 1 (part), 2008)

8.52.050 Fee payment.

The child care impact fee shall be paid in full to the City of San Carlos before the first building permit is issued. If no building permit is required, the fee shall be paid before a conversion of use may take place. The fee shall not apply to any project submitted for a building permit or to any project application that was submitted and considered complete prior to the effective date of this Ordinance, except where otherwise subject to an existing development agreement. (Ord. 1400 § 1 (part), 2008)

8.52.060 Alternative Means of Satisfying Fee Obligation.

New nonresidential projects may meet the child care impact fee obligation by building appropriately sized and feasible child care space onsite and contracting with a licensed child care provider. For example, a new nonresidential development of 50,000 square feet may meet

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 6 its fee obligation by building child care space onsite at a ratio of 10 percent, such that the development provides at least 5,000 square feet of child care space onsite. The dimensions provided in this example are meant to inform a Memorandum of Understanding or similar agreement between the Developer and the City. Other sized onsite child care facilities may be approved if economic and operational feasibility is demonstrated by the developer, consistent with the demand ratios articulated in the Nexus Study. Any onsite child care provided through this option would need to meet state licensing requirements and local regulatory requirements (as specified in Section 18.23.090 of the Municipal Code) and would need to be mutually agreed upon by the Developer and the City.

8.52.070 Exemptions.

The following exemptions from the requirements for fees and exactions are imposed:

1. Any type of project determined by the city council to have a reduced or insignificant child care impact.

2. Residential uses. Residential uses including single family, multifamily, senior housing, affordable housing, accessory dwelling units and junior accessory dwelling units.

3. Repairs or Replacement. No fee is applicable for repairing, remodeling, modifying, reconstructing, replacing only, where the floor area is improved or replaced but not increased. This includes residential and nonresidential square footage being replaced due to natural disaster.

4. Public Project. Projects undertaken by a public agency except projects undertaken by a private developer on public property, and except property not used exclusively for a governmental purpose.

5. Project with Complete Application Prior to Effective Date of Ordinance. Project submitted for a building permit or any project application that was submitted and considered complete prior to the effective date of this Ordinance, except for any project which is required to comply with these measures pursuant to the provisions of a development agreement.

8.52.080 Credits and Fee Adjustments and Appeals.

A. Credits. If a project is changing its use and adding net new square footage, a credit in the amount offsetting the impact of its prior use shall be applied. For example, a development project converting existing industrial square footage into office/R&D will have the fee for the proposed office/R&D space (including any addition) calculated and the fee for the existing industrial space calculated, and the existing industrial space will be credited against the new office/R&D use. In the event that the credit exceeds the new fee, the fee shall be zero and no refunds are applicable. No credits or exemptions will be given to properties that have been vacant for more than three years by the time of applying for building permit.

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 7 B. Fee adjustments and appeals. The developer of a project subject to this chapter may appeal the imposition and/or calculation of the fee.

1. The appeal shall be processed in accordance with Chapter 1.25 of this code.

An appeal by a developer of a project not requiring a planning application shall be to the zoning administrator.

2. Notice of the appeal shall be provided in accordance with applicable provisions of this code.

3. The appellant shall state in detail the factual basis for the appeal and shall bear the burden of proof in presenting substantial evidence to support the appeal.

4. The appeal body shall uphold the fee and deny the appeal if it finds that there is a reasonable relationship between the development project’s impact on employee generation and the need for child care spaces and the amount of the fee. The appeal body shall consider the land use category determination, and the substance and nature of the evidence, including the fee calculation method, supporting technical documentation, and the appellant’s technical data. Based on the evidence, the appeal body may also modify the fee. (Ord. 1400 § 1 (part), 2008)

8.52.090 Use of Fee.

Upon receipt, child care impact fees shall be deposited, invested, accounted for, and expended as required per the Mitigation Fee Act, Government Code Section 66001, or successor statute.

Revenues, along with any interest earnings on the account, shall be used to fund contributions towards the expansion of new child care spaces in the City, including but not limited to:

1. Acquiring land on which a new child care facility may be developed

2. Funding child care facility development costs

3. Providing loans or grants to licensed in-home child care providers

4. And/or other capital expenditures related to expanding child care in the City otherwise consistent with the law.

8.52.100 Refund of fee.

Under certain circumstances, refund of the fees paid may be warranted.

A. If a building permit or use permit expires, is canceled, or is voided and any fees paid pursuant to this chapter have not been expended, no construction has taken place, and the use has never occupied the site, the Director of Community Development may, upon the written request of the applicant, order return of the fee and interest earned on it, less administrative costs.

B. The City Council shall make a finding with respect to any fee revenue not expended or committed five years or more after it was paid. If the City Council finds that the fee revenue is not committed, it shall authorize a refund to the then owner of the property for which the fee was paid, pursuant to Government Code Section 66001 or successor legislation. (Ord. 1400 § 1 (part), 2008)

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 8 8.52.110 Annual review.

The child care impact fee authorized by this chapter, implementing Council resolutions, and supporting documentation, shall be reviewed annually by the City Council in order to make any findings required by State law, and to make any adjustments in the amount of the fee. (Ord. 1400 § 1 (part), 2008)
SECTION 3: The City Council hereby declares that it would have passed this Ordinance sentence by sentence, paragraph by paragraph, and section by section, and does hereby declare that any p rovisions of this Ordinance are severable and if for any reason any sentence, paragraph or section of this Ordinance shall be held invalid, such decision shall not affect the validity of the remaining parts of this Ordinance.

SECTION 4: This Ordinance shall be published and posted according to law and shall take effect and be in force from and after 30 days after its passage and adoption.

*****

I, City Clerk Crystal Mui, hereby certify that the foregoing Ordinance was introduced on the 27th day of June, 2022 and adopted at a regular meeting of the City Council of the City of San Carlos held on the 22nd day of August, 2022 by the following vote:

________________________________
CITY CLERK of the City of San Carlos

APPROVED:

___________________________
MAYOR of the City of San Carlos

AYES, COUNCILMEMBERS:

NOES, COUNCILMEMBERS:

ABSENT, COUNCILMEMBERS:

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Attachment: Ordinance 1585- CLEAN Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 1 ORDINANCE NO. 1585

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS ADDING CHAPTER 8.52 TO THE SAN CARLOS MUNICIPAL CODE

ESTABLISHING A CHILD CARE DEVELOPMENT IMPACT FEE FOR NEW NONRESIDENTIAL DEVELOPMENTS IN THE CITY OF SAN CARLOS.

RECITALS

WHEREAS, as part of the 2022 City Council Strategic Goals, the City Council expressed interest in adopting a Child Care Development Impact Fee (“Fee”) under the authority of Sections 66000 et seq. of the California Government Code (“Mitigation Fee Act”) that applies to nonresidential development projects in the City to address the shortage of child care facilities in San Carlos; and

WHEREAS, the San Mateo County Child Care Needs Assessment prepared by the San Mateo County Child Care Partnership Council i n 2017 states that there is a shortage of more than 650 spaces for infant and preschool-aged children; and

WHEREAS, in 2019, staff retained Economic & Planning Systems Inc. (“EPS”) to conduct an initial study of regulatory and financing options to increas e the supply of child care facilities and develop strategies to mitigate the future demands based on an expected increase of residents and employers in San Carlos; and

WHEREAS, in January 2020 and July 2021 a study was prepared and then updated for the City by EPS entitled Child Care Impact Fee Nexus Study (“Nexus Study”) which established the maximum child care development impact fees justifiable under the Mitigation Fee Act that could be required of new development in the City of San Carlos; and

WHEREAS, on March 14, 2022, a City Council Study Session was held to discuss and evaluate the feasibility of implementing a child care development impact fee; and

WHEREAS, the City Council has duly considered all evidence, including testimony and the evaluation and recommendations by staff, presented at said study session; and

WHEREAS, on June 27, 2022, the City Council held a duly noticed public hearing to consider Ordinance 1585 adding Chapter 8.52 to the San Carlos Municipal Code establishing a child care development impact fee for new nonresidential developments and approved the Ordinance with minor changes to Section 8.52.060; and

WHEREAS, ten (10) days advance notice of the public hearing at which this Ordinance was introduced was given by publication in accordance with Government Code Section 6062a; and
WHEREAS, pursuant to Public Resources Code Section 21065 and CEQA Guidelines Section 15378, the proposed project does not constitute a “project” within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. The proposed Ordinance also is exempt from environmental review pursuant to CEQA Guidelines Section 15061(b)(3) since there would be no possibility of

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 2 a significant effect on the environment, in that its provisions requiring the provision of affordable housing would not have any effect on the physical environment.

NOW, THEREFORE BE IT ORDAINED by the City Council of the City of San Carlos as follows:

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 3 subsequent nexus studies, which shall be adjusted annually based on the Construction Cost Index published by the Engineering News Record or a reasonable replacement index.

SECTION 2: Chapter 8.52: CHILD CARE DEVELOPMENT IMPACT FEES is added to the municipal code as follows:

Chapter 8.52

CHILD CARE DEVELOPMENT IMPACT FEES

8.52.010 Authority.

8.52.020 Purpose.

8.52.030 Definitions.

8.52.040 Application and Payment of Fee

8.52.050 Fee payment.

8.52.060 Alternative Means of Satisfying Fee Obligation.

8.52.070 Exemptions.

8.52.080 Credits and fee adjustments and appeals.

8.52.090 Use of fee.

8.52.100 Refund of fee.

8.52.110 Annual review.

8.52.010 Authority.

This chapter is enacted pursuant to the Mitigation Fee Act contained in Government Code Sections 66000 et seq.

8.52.020 Purpose.

8.52.030 Definitions.

As used in this chapter, the following terms shall have the following meanings:

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 4 A. “Building permit” includes full structural building permits as well as partial permits such as foundation-only permits.

B. “Child care development impact fee” means the fee charged to new nonresidential development in the City of San Carlos on a per square foot of floor area basis.

C. “Development Agreement” means a written agreement with applicants for development projects as provided by Municipal Code Chapter 18.37.

D. “Floor area measurement” includes exterior façade of building wall planes or from the center line of party walls; parking areas and exterior walkways are not included.

F. “Nonresidential development” includes land uses categories identified in the City’s Zoning Code, Title 18 of the Municipal Code, including office/R&D, retail, hotel and industrial.

8.52.040 Application and Payment of Fee.

A. General. The amount of the proposed fee shall be established by City Council resolution and not exceed the fee established by the adopted Impact Fee Nexus Study

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 5 dated July 14, 2021 or subsequent nexus studies, which shall be adjusted annually based on the Construction Cost Index published by the Engineering News Record or a reasonable replacement index. The fee imposed under this chapter is based on the consideration that new development contributes to expanding the need for additional quality child care spaces in the City, based on employment generation and employee demand for child care.

8.52.050 Fee payment.

8.52.060 Alternative Means of Satisfying Fee Obligation.

New nNonresidential projects of 50,000 sq.ft. or larger may meet the child care impact fee obligation by building appropriately sized and feasible child care space onsite, at a ratio of 10% of total square footage, and contracting with a licensed child care provider. For example, a new

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 6 nonresidential development of 50,000 square feet may meet its fee obligation by building child care space onsite at a ratio of 10 percent, such that the development provides at least 5,000 square feet of child care space onsite. The dimensions provided in this example are meant to inform a Memorandum of Understanding or similar agreement between the Developer and the City. Other sized onsite child care facilities may be approved if economic and operational feasibility is demonstrated by the developer, consistent with the demand ratios articulated in the Nexus Study. Any onsite child care provided through this option would need to meet state licensing requirements and local regulatory requirements (as specified in Section 18.23.090 of the Municipal Code) and would need to be mutually agreed upon by the Developer and the City.

8.52.070 Exemptions.

The following exemptions from the requirements for fees and exactions are imposed:

1. Any type of project determined by the city council to have a reduced or insignificant child care impact.

2. Residential uses. Residential uses including single family, multifamily, senior housing, affordable housing, accessory dwelling units and junior accessory dwelling units.

4. Public Project. Projects undertaken by a public agency except projects undertaken by a private developer on public property, and except property not used exclusively for a governmental purpose.

8.52.080 Credits and Fee Adjustments and Appeals.

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 7 will be given to properties that have been vacant for more than three years by the time of applying for building permit.

B. Fee adjustments and appeals. The developer of a project subject to this chapter may appeal the imposition and/or calculation of the fee.

1. The appeal shall be processed in accordance with Chapter 1.25 of this code.

An appeal by a developer of a project not requiring a planning application shall be to the zoning administrator.

2. Notice of the appeal shall be provided in accordance with applicable provisions of this code.

3. The appellant shall state in detail the factual basis for the appeal and shall bear the burden of proof in presenting substantial evidence to support the appeal.

8.52.090 Use of Fee.

Upon receipt, child care impact fees shall be deposited, invested, accounted for, and expended as required per the Mitigation Fee Act, Government Code Section 66001, or successor statute.

Revenues, along with any interest earnings on the account, shall be used to fund contributions towards the expansion of new child care spaces in the City, including but not limited to:

1. Acquiring land on which a new child care facility may be developed

2. Funding child care facility development costs

3. Providing loans or grants to licensed in-home child care providers

4. And/or other capital expenditures related to expanding child care in the City otherwise consistent with the law.

8.52.100 Refund of fee.

Under certain circumstances, refund of the fees paid may be warranted.

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Attachment: Ordinance 1585 - REDLINED Child Care Dev Impact Fee (Adopt Ord Child Care Development Impact Fee) 8 was paid, pursuant to Government Code Section 66001 or successor legislation. (Ord. 1400 § 1 (part), 2008)

8.52.110 Annual review.

The child care impact fee authorized by this chapter, implementing Council resolutions, and supporting documentation, shall be reviewed annually by the City Council in order to make any findings required by State law, and to make any adjustments in the amount of the fee. (Ord. 1400 § 1 (part), 2008)
SECTION 3: The City Council hereby declares that it would have passed this Ordinance sentence by sentence, paragraph by paragraph, and section by section, and does hereby declare that any provisions of this Ordinance are severable and if for any reason any sentence, paragraph or section of this Ordinance shall be held invalid, such decision shall not affect the validity of the remaining parts of this Ordinance.

SECTION 4: This Ordinance shall be published and posted according to law and shall take effect and be in force from and after 30 days after its passage and adoption.

*****

________________________________
CITY CLERK of the City of San Carlos

APPROVED:

___________________________
MAYOR of the City of San Carlos

AYES, COUNCILMEMBERS:

NOES, COUNCILMEMBERS:

ABSENT, COUNCILMEMBERS:

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Draft Report
Child Care Impact Fee Nexus Study

Prepared for:

City of San Carlos

Prepared by:

Economic & Planning Systems, Inc.

July 14, 2021

EPS #211028

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Table of Contents

1. BACKGROUND AND SUMMARY OF FEES ......................................................................... 1 Summary of Maximum Fee Levels ............................................................................. 1 Report Background and Legal Context ........................................................................ 2

2. DEMOGRAPHIC, EMPLOYMENT, AND LAND USE ASSUMPTIONS .............................................. 4 Current Population and Households in San Carlos ........................................................ 4 Age Cohorts ........................................................................................................... 5 Labor Force Participation .......................................................................................... 5 Child Care Choice .................................................................................................... 6 Population Density .................................................................................................. 7 Employment Density ............................................................................................... 8

3. CHILD CARE FACILITY COST ESTIMATES ....................................................................... 9

4. CHILD CARE FEE CALCULATIONS .............................................................................. 10 Residential Fees .................................................................................................... 10 Nonresidential Fees ............................................................................................... 11

5. MITIGATION FEE ACT NEXUS FINDINGS ...................................................................... 13

6. FEE PROGRAM IMPLEMENTATION AND ADMINISTRATION ................................................... 14 Fee Collection and Amount ..................................................................................... 14 Annual Review and Five-Year Review ....................................................................... 15 Accounting, Reporting, and Updates ........................................................................ 16

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List of Tables
Table 1. Summary of Child Care Impact Fees by Land Use Category ................................... 2 Table 2. Population and Households ............................................................................... 4 Table 3. Age Cohorts in City and County ......................................................................... 5 Table 4. Labor Force Participation .................................................................................. 6 Table 5. Child Care Choice ............................................................................................ 7 Table 6. Population and Households by Number of Units in Structure .................................. 8 Table 7. Employment Density ........................................................................................ 8 Table 8. Average Cost per Child Care Space by Type of Facility .......................................... 9 Table 9. Child Care Fees for Residential Development ..................................................... 10 Table 10. Child Care Fees for Nonresidential Development ................................................ 11

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1. BACKGROUND AND SUMMARY OF FEES
This report establishes the maximum child care development impact fees justifiable under the Mitigation Fee Act that could be required of new development in the City of San Carlos. In October 2017, the City Council considered strategies to address the shortage of child care facilities serving the community. This was a response to a study initiated by the San Mateo County’s Office of Education, which identified significant shortages of child care spaces in the County, generally, and San Carlos, specifically. At Council’s direction, staff was directed to study the regulatory and financing options available to the City to increase the supply of child care facilities and develop strategies to mitigate the future demand based on the expected increase in residents and jobs in San Carlos.

The issues were studied, and the Council’s Child Care Subcommittee held collaborative working sessions with City staff to review findings and develop strategies. In the fall of 2019, the City Council affirmed that addressing the City’s child care needs is a priority, and one of the funding strategies identified was to explore various fees or charges on new development to mitigate the demand for child care from new residents and employees in the City. Economic & Planning Systems, Inc. (EPS) was retained to develop the technical analysis and prepare the required Nexus Study to support potential implementation of a child care development impact fee, as authorized by the Mitigation Fee Act (California Government Code 66000 et seq.).

While this Nexus Study supports the maximum-justifiable fee levels, the Council may choose to adopt fees below the maximum, charge only certain land use categories, or not adopt fees at all.

Summary of Maxi mum Fee Levels
At the Council’s discretion, a new child care development impact fee could be charged to all new residential and/or nonresidential development and at fee levels up to the maximum justifiable through this Nexus Study. The technical analysis included in this report presents the methodology and analysis to support the maximum-justifiable fee levels in the City of San Carlos, as shown below in Table 1.

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Report Background and Legal Context
This report is designed to provide the necessary technical analysis supporting a schedule of development impact fees intended to mitigate the demand for child care spaces in the City that results from new residential and commercial development. The City currently has several development impact fees, none of which is for child care. A new fee program for child care, if approved, will need to be enacted through the adoption of a new City Ordinance(s) supporting the addition of a new fee category for child care facilities. The new enabling Ordinance would allow the City to adopt, by Resolution, a fee schedule consistent with the supporting technical analysis and findings provided in this Report. The Resolution approach to setting the fee allows periodic adjustments of the fee amount without requiring amendments to the enabling Ordinance.

The key requirements of the Mitigation Fee Act that determine the structure, scope, and amount of the proposed Fee Program are as follows:
 Collected for Capital Facility, Equipment, and Infrastructure Improvements. Impact fee revenue can be collected and used to cover the cost of constructing capital facilities and infrastructure improvements required to serve new development and growth in the City.

However, impact fee revenue cannot be used to cover the operations and maintenance costs of these or any other facilities and infrastructure.
 Cannot Fund Existing Needs. Impact fee revenue cannot be collected or used to cover the cost of existing needs/deficiencies in City capital facilities or infrastructure. Thus, the cost of capital projects or facilities designed to meet the needs of the City’s existing population must be funded through other sources to meet overall funding requirements.

Land Use Category
Residential
Single Family $12,257 per unit
Multifamily $9,355 per unit
Non-Residential
Office/R&D $10.07 per sq.ft.

Retail $5.03 per sq.ft.

Hotel $3.35 per sq.ft.

Industrial $3.35 per sq.ft.

Source: Economic & Planning Systems, Inc.

Maximum Fee [1]
[1] The analysis assumes that 100 percent of preschool-aged children, regardless of their parents’ working status, require child care. This is in support of the County’s overall policy to promote Universal Preschool.

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2. DEMOGRAPHIC, EMPLOYMENT, AND LAND USE ASSUMPTIONS
This Chapter describes the demographic, employment, and land use assumptions utilized in this Study that are important drivers of the maximum development impact fee estimates. The estimates are used for the following primary purposes in the fee calculations:
 Population and household count data is used to relate the number of children in the City to the supply of housing units. This data is shown on Table 2.  Estimates of the number of children within certain age cohorts (e.g., infant, preschool, school-age) are used to estimate potential demand from each cohort and are shown on Table 3.
 Estimates of parental labor force participation by age cohort are used to understand the share of households needing child care and are shown on Table 4.  Estimates of the share of children whose parents/guardians need a child care arrangement and who will choose a child care center type of facility are provided in Table 5.  Estimates related to population density (e.g., persons per housing unit) are shown on Table 6 and are used to differentiate costs between residential land uses.  Estimates related to employment density (e.g., employees per square foot) are shown on Table 7 and are used to differentiate costs between non-residential land uses.

Current Population and Ho useholds in San Carlos
Population and household counts are shown in Table 2 and are used to relate the number of children in the City to the overall population as well as to the supply of housing units.

Table 2. Population and Households

Item Total
Population in Households 30,024
Total Households 11,689
Sources: U.S. Census Bureau, 2015-2019 American
Community Survey 5-Year Estimates; Economic &
Planning Systems, Inc.

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EPS developed a distribution of the number of children within certain age cohorts based on data from the California Department of Finance and the U.S. Census American Community Survey (5-year estimate, 2015-2019). Because parents/guardians make different child care decisions at different times in their children’s lives, this data is used to support estimates of child care demand for different age cohorts. The Census-based age breakdown of children at the City level is not as detailed as the Department of Finance’s estimates for San Mateo County. Accordingly, EPS used the County’s age cohort distribution and applied those shares to the City’s population under 18 years of age. These estimates are provided in Table 3.

Table 3. Age Cohorts in City and County

Labor Force Participation
The U.S. Census American Community Survey (5-year estimate, 2015-2019) reports the number of children whose parents are working. The data reports the number of children in single parent households in which that parent is working, as well as the number of children in two-parent households in which both parents are working. These estimates are provided in Table 4.

Item Number
Percent of
Total
San Mateo County
Total Population under 18 Years of Age 170,296
Infant (Birth to 24 Months) 17,183 10.1%
Preschool (2 to 5 Years) 31,932 18.8%
School Age (5 to 18 Years) 121,182 71.2%
San Carlos [1]
Total Population under 18 Years of Age 7,469
Infant (Birth to 24 Months) 754 10.1%
Preschool (2 to 5 Years) 1,400 18.8%
School Age (5 to 18 Years) 5,315 71.2%
[1] County age distribution among population under age 18 (DOF, 2019) is applied to City's total population under age 18 as reported by Census.

Source: CA Department of Finance: Total Estimated and Projected Population for California Counties: July 1, 2010 to July 1, 2060 in 1-year Increments; U.S.

Census Bureau, 2015-2019 American Communi ty Survey 5-Year Estimates; Economic & Planning Systems, Inc.

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Child Care Choice
There are a range of child care options potentially available to families requiring non-parental child care, including other relatives, nanny shares, live-in au pairs, child care centers, home- based day care, etc. As such, another adjustment to the data is needed to estimate the number of children whose parents/guardians need a child care arrangement and who will choose a child care center type of facility (i.e., the type of facility for which the impact fee revenue can be used). Table 5 draws upon data collected by the U.S. Department of Education’s National Center for Education Statistics, which reports the number of children participating in various early childhood programs.

Item Estimate
Total Children [1] 7,341
Under 6 Years 2,382
Living with Two Parents 2,238
Both Parents in Labor Force 1,587
Living with One Parent 144
Parent in Labor Force 137
All Parents in Labor Force 1,724
Labor Force Participation 72.4%
6 to 17 Years 4,959
Living with Two Parents 4,131
Both Parents in Labor Force 2,897
Living with One Parent 828
Parent in Labor Force 763
All Parents in Labor Force 3,660
Labor Force Participation 73.8%
Source: U.S. Census Bureau, 2015-2019 American
Community Survey 5-Year Estimates; Economic &
Planning Systems, Inc.
[1] Universe of data is "Own children under 18 years
in families and subfamilies."

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Population Density
EPS has developed persons per household estimates based on data from the California Department of Finance and the U.S. Census American Community Survey (5-year estimate, 2015-2019). This data has been used to develop estimates of the number of persons per occupied household specific to each residential development type. These estimates are provided in Table 6.

Age Cohort
Number of
Children in
Survey
Children in
Parental Care
Arrangements
Children in
Non-Parental Care
Arrangements
Number Percent
Total 21,362 8,609 12,753 7,742 60.7%
Infant
Under 1 Year Old 4,724 2,487 2,237 888 39.7%
1 to 2 Years Old 8,552 3,932 4,619 2,504 54.2%
Weighted Average 13,276 6,420 6,856 3,392 49.5%
Preschool [1]
3 to 5 Years Old 8,087 2,190 5,897 4,350 73.8%
[1] While the data suggests that 73.8% of preschoolers who need childcare will opt for center-based care or care in a non- relative's home, the analysis assumes that 100 percent of preschool-aged children require child care. This is in support of the County’s overall policy to promote Universal Preschool.

Source: U.S. Department of Education, National Center for Education Statistics, Early Childhood Program Participation Survey of the National Household Education Surveys Program (ECPP-NHES:2016).

Children in Center-Based
Care or Care in a Non-
relative’s Home
Note: Numbers are in thousands.

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Employment Density
The gross building square footage assumptions of workspace required on average to accommodate jobs in different land use categories are generally consistent with industry- standard employment densities and are reflected in Table 7. As shown, the average square feet required per job ranges from 333 square feet on average for office/R&D development to 1,000 square feet on average for industrial development. Stated in another way, office developments are assumed to have the highest employment density with about 3 jobs per 1,000 square feet relative to 1 job per 1,000 square feet of industrial development.

Table 7. Employment Density
Item
Single Family
1-Unit in Structure
Multifamily [1]
2 + Units in Structure Total
Total Households 8,590 3,099 11,689
Share 73.5% 26.5% 100.0%
Population in Households 23,542 6,482 30,024
People per HH 2.74 2.09 2.57
[1] Total includes mobile homes to account for the City's total population in households.

Sources: U.S. Census Bureau, 2015-2019 American Co mmunity Survey 5-Year Estimates; Economic & Planning Systems, Inc.

Item
Employment Density by Land Use Category
Square Feet per Job
Office/R&D 333 sq.ft. per job
Retail 667 sq.ft. per job
Hotel 1,000 sq.ft. per job
Industrial 1,000 sq.ft. per job
Jobs per Square Foot
Office/R&D 0.0030 jobs per sq.ft.

Retail 0.0015 jobs per sq.ft.

Hotel 0.0010 jobs per sq.ft.

Industrial 0.0010 jobs per sq.ft.

Assumption
Sources: City of San Carlos Linkage Fee Nexus Study, Vernazza Wolfe Associates, Inc. and Strategic Economics; Economic & Planning Systems, Inc.

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3. CHILD CARE FACILITY COST ESTIMATES
The high cost of real estate and limited availability of land are factors that greatly influence the supply of child care facilities in high-cost counties, such as San Mateo. Of course, the cost of providing new child care spaces will vary on a project-by-project basis, depending on the size of the facility and the overall development program. Typical costs associated with developing new child care spaces in San Mateo County, excluding land, are provided in the 2017 San Mateo Early Learning Needs Assessment and shown below in Table 8. Costs range from $27,500 to $58,000 per space in 2021 dollars depending on the type of facility and include the structure, site design, preparation, general site improvement, and installation—but not land. The average cost is $43,391 per space, which is considered a reasonable average planning-level cost estimate for the purposes of establishing this fee. With land costs included, the cost per space is higher, at $80,391 per space.

Table 8. Average Cost per Child Care Space by Type of Facility

Construction Type
Avg. Cost /
Space (2017)1
Avg. Cost /
Space (2021)2
Development Cost
New Building $43,183 $46,743
New / Existing Commercial Space $53,800 $58,235
Expansion of Existing Center $37,003 $40,053
Portable Building $25,412 $27,507
Employer-based Center $41,033 $44,415
Average, Development Cost $43,391
Land Cost (Rounded)
3 $37,000
Total, Land and Average Development Costs $80,391
[1] Average cost per early learning space for child care facilities in San Mateo County, according to the San Mateo Early Learning Needs Assessment (2017). [2] Average cost per early learning space has been adjusted for inflation at an annual rate of 2%.

Sources: San Mateo Early Learning Needs Assessment (2017); Economic & Planning Systems, Inc.
[3] Assumes 175 square feet of land area per child care space, reflecting the indoor, outdoor, administrative, public, and mechanical functions. The per acre land value assumption is $9 million based on current land values in San Carlos.

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4. CHILD CARE FEE CALCULATIONS
The Mitigation Fee Act maximum child care development impact fee calculations are driven by:
(1) demand for child care from residential and nonresidential development, (2) child care facility cost estimates, and (3) persons per household and employment density assumptions. The residential fees are shown in Table 9 and the nonresidential fees are shown in Table 10.

Residential Fees
Table 9. Child Care Fees for Residential Development

As shown in Table 9, the demand for child care spaces resulting from new residential development is approximately 6 spaces per 100 residents. At a cost of $80,391 per space, the Item Assumption Amount Notes
Total Population 30,024 See Table 2
Total Households 11,689 See Table 2
Population Under Age 18 7,469 See Table 3
Infant (Birth to 24 Months) 10.1% 754 See Table 3
Preschool (2 to 5 Years) 18.8% 1,400 See Table 3; Includes 1/2 of 5-year olds Population per Household
Infant (Birth to 24 Months) 0.06
Preschool (2 to 5 Years) 0.12
Population per Household, Needing Childcare
Infant (Birth to 24 Months) 72.4% 0.05 See Table 4
Preschool (2 to 5 Years) 72.4% 0.09 See Table 4
Population per Household, Choosing Center-based Care or Non-relative Care in Someone Else's Home Infant (Birth to 24 Months) 49.5% 0.02 Reflects weighted average of under 1 and 1-2 year olds cohorts; See Table 5
Preschool (2 to 5 Years) 100.0% 0.12 Reflects Countywide Universal Preschool Policy Objective
Childcare Spaces Needed in Licensed Centers 1,670 Spaces needed for every 11,689 households Childcare Spaces per Resident 0.0556
Cost per Childcare Space $80,391 See Table 8
Cost per Resident $4,472
Number of people per Single Family Household 2.74 See Table 6 Number of people per Multifamily Household 2.09 See Table 6 Cost per Single Family Household $12,257
Cost per Multifamily Household $9,355
Sources: CA Department of Finance: Total Estimated and Projected Population for California Counties: July 1, 2010 to July 1, 20 60 in 1- year Increments; U.S. Census Bureau, 2015-2019 American Community Survey 5-Year Estimates; U.S. Department of Education, National Center for Education Statistics, Early Childhood Program Participation Survey of the National Household Education Surv eys Program (ECPP-NHES:2016), Table was prepared December 2017; Economic & Planning Systems, Inc.

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Nonresidential Fees
As shown in Table 10 and based on data reported in the 2017 San Mateo County Early Learning Facilities Study, the demand for child care spaces resulting from new nonresidential development is approximately 4 spaces per 100 employees. At a cost of $80,391 per space, the cost per employee is $3,352. Based on the employment density assumptions, the cost per employee can be expressed as a cost per square foot.

Table 10. Child Care Fees for Nonresidential Development

As shown, the maximum development impact fees are:
 Single-Family. $12,257 per single family unit.
 Multifamily. $9,355 per multifamily/apartment unit.
 Accessory Dwelling Units. Note that Senate Bill 13 (effective 1/1/2020 – 12/31/2024) precludes jurisdictions from charging impact fees on ADUs under 750 square feet.  Office/R&D. $10.07 per office/R&D building square foot.  Retail. $5.03 per retail building square foot.
 Hotel. $3.35 per hotel building square foot.
 Industrial. $3.35 per industrial building square foot.

While these maximum child care development impact fees are driven by marginal demand and average costs (rather than the City’s capital improvement list), the City has provided some examples of how it may use the revenue to invest in child care facility expansion throughout San Item Notes
Cost per Childcare Space $80,391 See Table 8
Childcare Space Demand per Employee 0.0417 San Mateo County ELF Study, 2017 Cost per Employee $3,352
Jobs per Square Foot
Office/R&D 0.0030 jobs per sq.ft.

Retail 0.0015 jobs per sq.ft.

Hotel 0.0010 jobs per sq.ft.

Industrial 0.0010 jobs per sq.ft.

Fee by Land Use Category
Office/R&D $10.07 per sq.ft.

Retail $5.03 per sq.ft.

Hotel $3.35 per sq.ft.

Industrial $3.35 per sq.ft.

Sources: Brion Economics Team; City of San Carlos Linkage Fee Nexus Study, Vernazza Wolfe Associates, Inc. and Strategic Econom ics; Economic & Planning Systems, Inc.

Assumption

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Child Care Impact Fee Nexus Study
Draft Report 7/14/21

Economic & Planning Systems, Inc. 12 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx Carlos. More detailed plans will be developed as part of the City’s future planning efforts and/or through negotiations with prospective developers.
 City contribution to new child care facilities located within new or existing private developments.
 Loans or grants to providers operating Small or Large Family Child Care Homes, seeking to create/expand capacity.
 Loans or grants to providers operating Child Care Centers, seeking to create/expand capacity.

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee)

Economic & Planning Systems, Inc. 13 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx

5. MITIGATION FEE ACT NEXUS FINDINGS
Development impact fees can be charged to new development under the Mitigation Fee Act.

Nexus findings are provided below addressing: 1) the purpose of the fee, 2) the specific use of fee revenue, 3) the relationship between the facility improvements and the type of development, 4) the relationship between the need for the facility improvements and the type of development, and 5) the relationship between the amount of the fee and the proportionality of cost specifically attributable to development. The technical information and calculations provided support these nexus findings/requirements.

Purpose
The fee will support provision of adequate levels of child care facility spaces in the City as new development occurs and will help ensure that new development pays its fair share of child care facility costs.

Use of Fee
Fee revenue will contribute funding towards the creation or expansion of new child care spaces in the City.

Relationship
New residential and nonresidential development and the associated new residents and workers in San Carlos will increase demand for child care spaces. Fee revenue from this new development will be used to increase the number of child care spaces thereby increasing the availability of child care spaces and addressing demand from the new residents and workers.

Need
There is a demonstrated shortage of child care spaces in the City, and each new residential and nonresidential development project adds to the need for quality child care spaces. While this fee program cannot be used to address existing deficiencies, new child care spaces are necessary to avoid exacerbating the current shortage.

Proportionality
The marginal demand for child care spaces from new residents and employees in the City and the average cost of developing those spaces are used to ensure that new development funds a sufficient number of child care spaces to mitigate its own demand, but no more. In this way, the contribution of new development is proportional to its impact and is not expanded beyond its appropriate share.

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee)

Economic & Planning Systems, Inc. 14 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx

6. FEE PROGRAM IMPLEMENTATION AND ADMINISTRATION
The child care development impact fee will need to be adopted by City Resolution as enabled by a new Ordinance. The Ordinance will allow the City Council to adopt, by Resolution, a fee schedule consistent with supporting technical analysis and findings provided in this Report. The Resolution approach to setting the fee allows periodic adjustments of the fee amount that may be necessary over time, without amending the enabling Ordinance. It is anticipated that the City will develop a new Ordinance as part of this study process. This new Ordinance addresses the primary implementation and administrative issues and procedures associated with the fee program. A brief summary of the key implementation and administrative elements is provided below.

Fee Collection and Amount
Applicable Land Uses
All new development that occurs within the City of San Carlos, except as specifically exempted by the Ordinance, shall pay the child care development impact fee. While the maximum fee amount will be determined by the Mitigation Fee Act Nexus Study, the City may elect to charge less for a variety of reasons and under certain circumstances, as [will be] described in the Ordinance. In any case, the applicable fees will be published in a Fee Schedule made available by the City and updated periodically. The amount will vary by land use, as shown in Table 1.

It is possible that certain projects may not fit neatly into the identified categories. In cases where such ambiguity exists, the City’s Community Development Director will need to make a determination as to the applicable fees. The Fee Ordinance articulates guidelines for resolving discrepancies and/or disputes.

Exemptions
The City may also elect not to impose fees for certain categories of development, though alternative funding sources to offset a loss in fee revenue would need to be provided. For example, the City may elect to exempt developers from paying fees on any affordable housing units they build. Likewise, the City may enter into a Development Agreement that specifically exempts all or a portion of the City fees.

Alternative Means of Satisfying Fee Requirement
As [will be] described in the Ordinance, the City may specify alternative means of satisfying the child care fee requirement, when doing so accelerates or enhances the number of child care spaces available in the City. For example, new non-residential development greater than 50,000 square feet may meet its fee obligation by building child care space onsite at a ratio of 10 percent, such that a 50,000 sq.ft. development provides at least 5,000 sq.ft. of child care space) and contracting with a licensed child care provider to operate the child care facility. This threshold of 50,000 sq.ft. ensures that the size of the child care facility is sufficient to serve enough children (approx. 50) to support efficient operations. This option may only be exercised if a child care use onsite is consistent with the General Plan and zoning. In addition, the City will

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Child Care Impact Fee Nexus Study
Draft Report 7/14/21

Economic & Planning Systems, Inc. 15 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx need to coordinate with the applicant to ensure that the child care space will be able to meet state licensing requirements (for indoor and outdoor space).

The City also may be willing to consider the development of an off-site child care center in-lieu of paying the child care impact fees.

Timing of Establishing Effective Fees
Senate Bill 330, the “Housing Crisis Act of 2019,” requires jurisdictions to charge the fees in effect at the time an application for development is submitted, regardless of when the fees are to be paid. Jurisdictions may not increase fees during a project’s application period, unless the increase is related to an annual fee adjustment as described below.

Fee Escalation
The ordinance allows for an automatic adjustment of the fee to keep pace with inflationary increases in construction costs. This allows the fee level to keep pace with inflation without requiring an annual approval process. This adjustment is based on the Construction Cost Index (CCI) published by the Engineering News Record (ENR), a source widely used in the construction industry, and by many jurisdictions as a basis for making annual inflation adjustments to their development impact fees. ENR’s CCI has been published consistently every month since 1967. As such ENR is one of the most reliable and consistent indices that track trends in construction costs.

Senate Bill 330, the “Housing Crisis Act of 2019,” allows fee increases during a project’s application period if the fee increases are the result of an annual fee adjustment based on an independently published cost index and referenced within the relevant establishing ordinance or resolution.

Timing and Manner of Payment
The City’s Ordinance addresses issues related to the timing and manner of payment for the fee including the potential for fee deferrals, payment plans, credits and reimbursements, exemptions, and related adjustments.

Annual Review and Five-Year Review
Annual Review
This Report and the technical information contained herein should be maintained and reviewed periodically by the City as necessary to ensure alignment of facility needs and new development and to enable the adequate programming of funding sources. To the extent that improvement requirements, costs, or development potential changes over time, the Fee Program may need to be updated. Specifically, AB 1600 (at Gov. Code §§ 66001(c), 66006(b)(1)) stipulates that each local agency that requires payment of a fee make specific information available to the public annually within 180 days of the last day of the fiscal year. This information includes the following:
 A description of the type of fee in the account
 The amount of the fee
 The beginning and ending balance of the fund

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Child Care Impact Fee Nexus Study
Draft Report 7/14/21

Economic & Planning Systems, Inc. 16 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx  The amount of fees collected and interest earned
 Identification of the improvements constructed
 The total cost of the improvements constructed
 The fees expended to construct the improvement
 The percent of total costs funded by the fee
If sufficient fees have been collected to fund the construction of an improvement, the agency must specify the approximate date for construction of that improvement. Because of the dynamic nature of growth and infrastructure requirements, the City should monitor development activity, the need for improvements, and the adequacy of the fee revenues and other available funding. Formal annual review of the fee program should occur, at which time adjustments should be made.

Five-Year Review
Fees will be collected from new development within the City immediately; however, use of these funds may need to wait until a sufficient fund balance can be accrued. Per Government Code Section 66006, the City is required to deposit, invest, account for, and expend the fees in a prescribed manner. The fifth fiscal year following the first deposit into the Fee account or fund, and every five years thereafter, the City is required to make all of the following findings with respect to that portion of the account or fund remaining unexpended:
 Identify the purpose for which the fee is to be put;
 Demonstrate a reasonable relationship between the fee and the purpose for which it is charged;
 Identify all sources and amounts of funding anticipated to complete financing in incomplete improvements; and
 Designate the approximate dates on that the funding referred to in the above paragraph is expected to be deposited in the appropriate account or fund.

Once sufficient funds have been collected to complete the specified projects, the City must commence construction within 180 days. If they fail to do this, the City is required to refund the unexpended portion of the fee and any accrued interest to the then current owner.

Accounting, Reporting, and Updates
Accounting
Surplus Funds
AB 1600 also requires that if any portion of a fee remains unexpended or uncommitted in an account for five years or more after deposit of the fee, the City Council shall make findings once each year: (1) to identify the purpose to which the fee is to be put, (2) to demonstrate a reasonable relationship between the fee and the purpose for which it was charged, (3) to identify all sources and amounts of funding anticipated to complete financing of incomplete improvements, and (4) to designate the approximate dates on which the funding identified in (3) is expected to be deposited into the appropriate fund.

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Child Care Impact Fee Nexus Study
Draft Report 7/14/21

Economic & Planning Systems, Inc. 17 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx If adequate funding has been collected for a certain improvement, an approximate date must be specified as to when construction on the improvement will begin. If the findings show no need for the unspent funds, or if the conditions discussed above are not met, and the administrative costs of the refund do not exceed the refund itself, the local agency that has collected the funds must refund them.

Credits and Reimbursements
It is recommended that, under certain and limited circumstances as determined by the City, the Impact Fee Ordinance allow developers subject to the fee to obtain credits, reimbursements, or exemptions. Fee credits, reimbursements, or exemptions should not be allowed by right but rather should be subject to a case-by-case review by City staff and Council to ensure that such credits or reimbursements are warranted and appropriate.

A fee credit—as defined by an annual cost review or other recent evaluation of cost—may be allowed if a developer provides a particular off-site facility or improvement that is of citywide benefit. For example, the City may elect to offer a fee credit to developers who develop child care facilities off-site and of citywide benefit. In the event there is a discrepancy between the estimated and actual costs of construction for a project where a fee credit is being provided, if the actual construction costs are less than the estimate, the City will not reimburse the developer for any difference between the actual and estimated costs; and if the actual construction costs are more than the estimate, the City will not provide any additional funding to the developer.

Reimbursements should be considered for developers who contribute more funding and/or build and dedicate infrastructure items that exceed their proportional obligation if the project funded is of high priority. Such reimbursements should be provided as fee revenue becomes available and should include a reasonable factor for interest earned on the reimbursable amount. It should not compromise the implementation of other priority capital projects. A provision for including such interest payments as additional costs in subsequent fees can be included in the Ordinance.

Reimbursements would be granted on a discretionary basis only and not granted as a right.

Internal Loaning of Funds
Loans between the impact fee funds may be used from time to time to facilitate the construction of needed facilities and assure adequate cash flow. Any such loan shall be made in accordance with applicable law, as interpreted by the City Attorney of the City of San Carlos, and all funds shall be placed in separate accounts.

Reporting
AB 1483 (at Gov. Code §§ 65940.1(a)) requires all jurisdictions make available on their website the following:
 A current schedule of fees, exactions, and affordability requirements;  All zoning ordinances and development standards;
 The current and five previous annual fee reports or annual financial reports; and  An archive of impact fee nexus studies conducted on or after January 1, 2018.

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Child Care Impact Fee Nexus Study
Draft Report 7/14/21

Economic & Planning Systems, Inc. 18 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare Fe e Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Draft Report_2021July14.docx Updates
Additionally, it is common for cities to undertake a comprehensive update of nexus studies and associated development impact fee programs every five to eight years to account for changes in facility development costs among other factors.

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Attachment: Child Care Impact Fee Nexus Study Draft Report (Adopt Ord Child Care Development Impact Fee) Appendix A-1
Childcare Development Impact Fee Survey
San Carlos Childcare Fee Study, EPS #181090
Residential Commercial
San Francisco San Francisco Child Care Impact Fee 2016 (Residential) 1985 (Commercial) 2021 $1.18 - $2.35 per sq.ft. depending on project size $2.02 per sq.ft.

Replacement of use and plan area fees
are different. Some plan area fees have
a percentage going to child care.

Link
Santa Monica Los Angeles Child Care Linkage Fee 2006 2019 $154.69 per unit (multifamily) Hotel $3.68 per sq.ft.

Retail $5.25 per sq.ft.

Office $7.34
per sq.ft.

Link
Berkeley Alameda Child Care Mitigation Fee 1993 2012 N/A Hotel $1.50 per sq.ft
Retail/Restaurant $1.25 per sq.ft
Office $1.25 per sq.ft
Industrial/Manufacturing $0.75 per sq.ft
Warehouse/Storage $0.62 per sq.ft.

R&D $0.80
per sq.ft
Link (Fee Range)
Link (Fee by Usage)
San Mateo San Mateo Child Care Development Fee 2004 2021 N/A $1.09 per sq.ft. Link South San Francisco San Mateo Childcare Impact Fee 2001 2020 $1,851 - $1,979 per unit
depending on du/ac. Other is
$1.28 per sq.ft.

Hotel $0.18 per sq.ft.

Retail/Commercial $0.68 per sq.ft.

Office/R&D $0.57 per sq.ft.

Industrial $0.54 per sq.ft.

Link
Livermore Alameda Social and Human Services
Facility Fee 2008 2021
$1,298 per unit (multifamily);
$1,415 per unit (single family
attached); $1,677 per unit (single
family detached)
Service $5 per sq.ft.

Retail $5 per sq.ft.

Office $7 per sq.ft.

R&D/ Manufacturing $3 per sq.ft.

Fee revenues used for child care
facilities, senior facilities, and facilities
for the homeless.

Link
San Ramon Contra Costa School Age Child Care Fee 1988 2021 $959.18 per unit (single-family) $516.82 per unit (multifamily)
Hotel $0.17 per sq.ft.

Retail $0.28 per sq.ft.

Office $0.61 per sq.ft.

Industrial $0.19
per sq.ft.

Link
Clayton Contra Costa Childcare Fee 1988 2020 $205 per unit (single-family) $205 per unit (multifamily) $0.10 per sq. ft Fee was last updated in 2009 and remains the same in 2020. Link
Sources: Websites of individual jurisdictions; Economic & Planning Systems, Inc.

Description Link/SourceCity County Fee Name Date Implemented Latest Fee Year Available
Fee Levels

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Attachment: Appendix A-1 - Model Update (Adopt Ord Child Care Development Impact Fee)

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Attachment: Aggregate Fee Burden (Adopt Ord Child Care Development Impact Fee)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt Ordinance 1586 Amending San Carlos Municipal Code Chapter 9.30 Noise Control - Section 9.30.070 Exempt Activities, (B) Construction Activities.

RECOMMENDATION:

Staff recommends that the City Council adopt Ordinance 1586 amending San Carlos Municipal Code Chapter 9.30 Noise Control – Section 9.30.070 – Exempt activities , (B) Construction activities.

FISCAL IMPLICATIONS:

There will be no fiscal impact to the City of San Carlos.

BACKGROUND:

On August 8, 2022, the City Council introduced Ordinance 1586 amending San Carlos Municipal Code Chapter 9.30 Noise Control – Section 9.30.070 – Exempt activities, (B) Construction activities.

At the meeting, the Council requested that Juneteenth be added to the list of no construction noise-related federal holidays. This requested change has been incorporated into Ordinance 1586.

ANALYSIS:

The chart below is a comparison of the current San Carlos construction noise hours compared to the construction noise hours of other San Mateo County jurisdictions (NA = Not Allowed):

City Weekday Hours Saturday Hours Sunday Hours Holiday Hours Atherton 8 to 5 NA NA NA
Belmont 8 to 5 10 to 6 NA NA
Burlingame 8 to 7 9 to 6 NA NA
Daly City 8 to 5:30 NA NA NA
Hillsborough 8 to 5 10 to 5 NA NA
Menlo Park 8 to 6 NA NA NA
Redwood City 7 to 8 NA NA NA
Palo Alto 8 to 6 9 to 6 NA NA

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2 San Mateo 7 to 7 9 to 5 12 to 4 12 to 4
S. San Francisco 8 to 8 9 to 8 10 to 6 10 to 6
San Carlos 8 to 5 9 to 5 NA NA

As reflected in the table above, t he current construction noise hours for San Carlos are reasonable and consistent with the construction noise hours of neighboring jurisdictions in San Mateo County.

Since the adoption of the current hours under Resolut ion 2020 -026 (Attachment 2) , the community has grown accustomed to the allowable days and timeline(s) resulting in fewer construction noise complaints, and less time to complete projects with the Saturday work hours.

Therefore, staff is recommending no changes to the current construction noise hours.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Adopt Ordinance 1586 amending San Carlos Municipal Code Chapter 9.30 Noise Control – Section 9.30.070 – Exempt activities, (B) Construction activities; or

2. Do not adopt Ordinance 1586; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Al Savay, AICP
Community Development Director

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Ordinance 1586 - Construction Noise

2. City Council Resolution 2020-026

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ORDINANCE NO. 1586

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AMENDING SAN CARLOS MUNICIPAL CODE CHAPTER 9.30 NOISE CONTROL – SECTION 9.30.070 EXEMPT ACTIVITIES, (B) CONSTRUCTION ACTIVITIES.

The City Council of the City of San Carlos does ordain as follows:

SECTION 1:

WHEREAS, San Carlos Municipal Code Section 9.30 establishes reasonable levels of noise control in San Carlos; and

WHEREAS, Section 9.30.070 B. Construction activities, establishes noise hours and allowable days for residential and commercial construction activities; and

WHEREAS, the City Council has determined that San Carlos Municipal Code Section

9.30.070 B. Construction activities, needs to be updated to formally adopt the construction noise hours that were adopted under Resolution No. 2020-026 – Temporary Construction Hours in response to the Governor’s COVID-19 Executive Orders; and

WHEREAS, the Governor determined that the Covid-19 Declaration of Emergency is no longer necessary and thereby ended the Declaration of Emergency in San Carlos, thus rendering the temporary construction hours under Resolution 2020-026 ineffective; and

WHEREAS, the construction noise hours adopted under Resolution No. 2020 -026 have been deemed reasonable, that they do not unduly impact the orderly development of housing and construction activities and are consistent with the construction noise hours of neighboring jurisdictions in San Mateo County.

SECTION 2: The City Council hereby approves the Municipal Code Ordinance amendments to Chapter 9.30 – Noise Control , as follows (new language is shown with bold underline and removed language is shown in strikethrough):

9.30.070 Exempt activities:

B. Construction activities; such activities, however, shall be limited to the hours of eight a.m. to six five p.m. Monday through Friday, and nine a.m. to five p.m. on Saturdays and Sundays. No construction noise-related activities on Sundays and the following holidays:

New Year’s Day, Martin Luther King Jr. Day, President’s Day, Memorial Day, Juneteenth, 4th of July, Labor Day, Veteran’s Day, Thanksgiving Day and Christmas Day. All gasoline- powered construction equipment shall be equipped with an operating muffler or baffling system as originally provided by the manufacturer, and no modification to these systems is permitted (the Building Official shall have the authority to grant exceptions to construction noise-related activities);

SECTION 3: Severability. That the City Council hereby declares that it would have passed this Ordinance sentence by sentence, paragraph by paragraph, and section by section, and does hereby declare that the provisions of this Ordinance are severable, and, if for any reason any

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Attachment: Ordinance 1586 - Construction Noise (Construction Noise Hours) sentence, paragraph or section of this Ordinance shall be held invalid, such decision shall not affect the validity of the remaining parts of this Ordinance.

SECTION 4: Publication. This Ordinance shall be published and posted according to law and shall take effect and be in force from and after 30 days after its passage and adoption.

* * * *

I, City Clerk Crystal Mui, hereby certify that the foregoing Ordinance was i ntroduced on the 8th day of August, 2022, and passed and adopted as an Ordinance of the City Council of the City of San Carlos at a regular meeting ther eof held on the 22nd day of August, 2022, by the following vote:

AYES, COUNCIL MEMBERS: ________________________________________________

NOES, COUNCIL MEMBERS: ________________________________________________

ABSENT, COUNCIL MEMBERS: _______________________________________________

CITY CLERK of the City of San Carlos
APPROVED:

MAYOR of the City of San Carlos

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Attachment: Ordinance 1586 - Construction Noise (Construction Noise Hours)

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Attachment: City Council Resolution 2020-026 (Construction Noise Hours)

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Attachment: City Council Resolution 2020-026 (Construction Noise Hours)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Adopt Ordinance 1587 Amending San Carlos Municipal Code Chapter 2.24 Commissions by Repealing Section 2.24.300 Transportation and Circulation Commission, Removing References to the Co mmission, and Amending Section 2.24.140 Planning Commission – Powers and Duties; and Amending Sections to Update the Planning Commission Name to the Planning and Transportation Commission.

RECOMMENDATION:

Staff recommends that the City Council adopt Ordinance 1587 renaming the Planning Commission the “Planning and Transportation Commission ”, amending San Carlos Municipal Code Chapter 2.24 “Commissions” by repealing Section 2.24.300 “Transportation and Circulation Commission” (“T&CC”) and removing references to the Commission, and amending Section 2.24.140 “Planning Commission – Powers and Duties”.

FISCAL IMPLICATIONS:

There are no fiscal implications associated with adopting the Ordinance.

BACKGROUND:

The T&CC has been charged with serving as the ad visory body to the City Council, Planning Commission, and the Public Works and Community Development Departments as related to motorized and non-motorized transportation matters in the city. The T&CC has also been tasked with examining the need for bicycle and pedestrian transportation, serves as the City’s Bicycle and Pedestrian Advisory Commission, and promotes bicycle and pedestrian programs. T&CC also reviews and comments on all significant street, sidewalk, or street related capital improvement projects planned in the city.

While T&CC has provided helpful input on transportation and circulation issues, the T&CC has consistently struggled to hold regular meetings due to a lack of quorum. Some of this may be explained by commissioners moving out of the area or a change in their work or family statuses.

Recruiting for commissioners has been challenging. The time commitment to serve on the T&CC and the uncertainty of the COVID pandemic may have limited the number of applications from potential candidates.

On August 8, 2022 the City Council introduced Ordinance 1587 renaming the Planning

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2 Commission the “Planning and Transportation Commission ” and assigning the T&CC functions to the Planning and Transportation Commission.

ANALYSIS:

Section 2.24.300 in the San Carlos Municipal Code describes the five functions of the T&CC.

These functions relate to traffic, circulation, bicycle , and pedestrian improvements. An excerpt of Section 2.24.300 “Transportation and Circulation Commission” in the Municipal Code, Section A which describes the five functions follows.

2.24.300 Transportation and Circulation Commission.

A. The City of San Carlos establishes a Transportation and Circulation Commission to advise the City Council and other City agenci es on motorized and non -motorized transportation matters consistent with this section. The Transportation and Circulation Commission shall advise and act on the following:

1. Receive and evaluate complaints and other matters having to do with traffic and circulation, including pedestrian and bicycling matters.

2. Recommend to the City Council and staff ways and means for improving traffic and circulation conditions, including bicycle and pedestrian conditions, and encourage use of alternative modes of transportation in the City.

3. Periodically review and advise the City Council and Planning Commission and staff on matters related to the Circulation Element of the City’s General Plan.

4. Advise the City Council, Planning Commission and staff with respect to specific development projects which are referred to the Transportation and Circulation Commission for review, on traffic and circulation matters including bicycle and pedestrian conditions.

5. Review and comment on preliminary plans for all capital improvement progr ams related to any and all modes of transportation.

The five functions of the T&CC would be reassigned to the Planning and Transportation Commission under 2.24.140 (F) “Planning Commission – Powers and Duties ”. However, upon closer examination, fu nctions 3 and 4 are similar to the duties that the Planning Commission currently performs. Therefore, only functions 1, 2 , and 5 would be reassigned to the Planning and Transportation Commission.

Next Steps

Should the C ouncil adopt the ordinance the pr oposed amendments would become effective September 22, 2022.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt Ordinance 1587 renaming the Planning Commission the “Planning and

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3 Transportation Commission ”, amending San Carlos Municipal Code Chapter 2.24 “Commissions” by repealing Section 2.24.300 “ Transportation and Circulation Commission” (“T&CC”) and r emoving references to the Commission, and amending Section 2.24.140 “Planning Commission – Powers and Duties”; or

2. Do not adopt the Ordinance; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Grace Le,
City Engineer

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Ordinance

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ORDINANCE NO. 1587

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AMENDING SAN CARLOS MUNICIPAL CODE CHAPTER 2.24 COMMISSIONS BY REPEALING SECTION 2.24.300 TRANSPORTATION AND CIRCULATION COMMISSION, REMOVING REFERENCE TO THE COMMISSION, AMENDING SECTION 2.24.140 PLANNING COMMISSION – POWERS AND DUTIES; AND AMENDING SECTIONS TO

UPDATE THE PLANNING COMMISSION TO THE PLANNING AND
TRANSPORTATION COMMISSION.

SECTION 1: Findings. The City Council of the City of San Carlos hereby finds and declares as follows:

WHEREAS, San Carlos Municipal Code Chapter 2.24 establishes the Commissions and Boards in San Carlos; and

WHEREAS, the Transportation and Circulation Commission (“ T&CC”) has provided helpful input on transportation and circulation issues, but has consistently struggled to hold regular meetings due to a lack of quorum; and

WHEREAS, two of the five functions performed by the T&CC are also currently performed by the Planning Commission; and

WHEREAS, the City Council has determined that San Carlos Municipal Code Section

2.24.300 Transportation and Circulation Commission should be repealed and the duties of the T&CC transferred to the Planning Commission; and

NOW, THEREFORE, the City Council of the City of San Carlos does ordain as follows:

SECTION 2: The City Council hereby amends Chapter 2.24 – Commissions, by repealing Section

2.24.300 Transportation and Circulation Commission, removing references to the Commission in Sections 2.24.010 - Creation of Commissions and Section 2.24.020 - Membership, and approving the Municipal Code Ordinance amendments to Section 2.24.140 Planning & Transportation Commission - Powers and Duties ; amending Sections throughout Chapter 2.24 to update the Planning Commission to the “Planning and Transportation Commission” as follows (new language is shown with bold underline and removed language is shown in strikethrough):

2.24.300 Transportation and Circulation Commission.

A. The City of San Carlos establishes a Transportation and Circulation Commission to advise the City Council and other City agencies on motorized and non -motorized transportation matters consistent with this section. The Transpo rtation and Circulation Commission shall advise and act on the following:

1. Receive and evaluate complaints and other matters having to do with traffic and circulation, including pedestrian and bicycling matters.

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Attachment: Ordinance (Dissolve T&C)

3. Periodically review and advise the City Council and Plannin g Commission and staff on matters related to the Circulation Element of the City’s General Plan.

4. Advise the City Council, Planning Commission and staff with respect to specific development projects which are referred to the Transportation and Circul ation Commission for review, on traffic and circulation matters including bicycle and pedestrian conditions.

5. Review and comment on preliminary plans for all capital improvement programs related to any and all modes of transportation.

B. Commission Composition. The Transportation and Circulation Commission shall consist of five voting members approved by the City Council and may include an alternate member. At least one member of the Transportation and Circulation Commission shall be a bicyclist and at least one other member who understands the range of transportation needs of bicyclists and pedestrians. A majority of the members shall be San Carlos residents, preferably from varying San Carlos neighborhoods. All members have one vote.

The alternate member participates as a voting, participating member only in the event of an absence of a voting member or in the event that a member abstains from a matter due to a conflict of interest.

C. Organization and Terms of Office.

1. The members of the Transportation and Circulation Commission shall annually elect the Chairperson and Vice Chairperson. The Vice Chairperson shall perform the duties of the Chairperson when the Chairperson is absent. In the event of a vacancy in the Chairperson’s pos ition, the Vice Chairperson shall succeed as Chairperson for the balance of the Chairperson’s term and the Commission shall elect a successor to fill the vacancy of the Vice Chairperson.

2. The Transportation and Circulation Commission shall establish rules and regulations for its own procedures and shall meet when necessary as determined by the Commission.

The Transportation and Circulation Commission shall meet a minimum of four times per year. All meetings shall, except as provided by law, be open to the public.

3. The Transportation and Circulation Commission is subject to the California Brown Act.

All meetings of a quorum of the Commission must be held pursuant to the noticing provisions of the Brown Act, and are open to the public. A majority of the total members of the Commission shall constitute a quorum. Meeting minutes shall be taken at each meeting of the Commission.

4. The terms of each member of the Transportation and Circulation Commission shall be as set forth in Section 2.24.040. (Ord. 1555 § 2 (Exh. A (part)), 2019: Ord. 1454 § 2 (part), 2013: Ord. 1383 § 3, 2007)

2.24.010 Creation of commissions.

There are established the following commissions and boards in the City and outside agencies that the City has appointees on:

A. Planning and Transportation Commission;

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B. Parks, Recreation and Culture Commission;
C. Transportation and Circulation Commission;
D.C. Youth Advisory Council;
E.D. Residential Design Review Committee;
F.E. Economic Development Advisory Commission;
G.F. Museum of San Carlos History Board of Directors; H.G. San Mateo County Mosquito and Vector Control District Board of Trustees.

2.24.020 Membership.

Each commission or board established in Section 2.24.010 shall have five members, unless otherwise designated in this chapter or in the resolution, ordinance, or by-laws establishing the commission. The term “commission” shall include commissions, boards and committees. All commission members shall be residents living in the incorporated area of the City of San Carlos unless otherwise specified by the City Council in the ordinance or resolution establishing the commission.

The City Council may also designate an alternate member to the following commissions:

A. Economic Development and Advisory Commission;
B. Parks, Recreation and Culture Commission;
C. Transportation and Circulation Commission.

Alternates serve as a voting, participating member only in the event of an absence of a voting member or in the event that a member abstains from a matter due to a conflict of interest.

2.24.140 Planning & Transportation Commission — Powers and duties.

The Planning & Transportation Commission shall have the following powers and duties:

A. Prepare and recommend a comprehensive General Plan for the future development of the City, and, from time to time, review the provisions of such plan and make a report of its findings and recommendations to the City Council.

B. Initiate, from time to time, a review of the zoning ordinances codified in Title 18 and make a report of its findings and recommendations to the City Council.

C. Receive and act upon applications authorized and specified in Title 18.

D. Hear and decide appeals where it is alleged there is an error in any order, requirement, decision or determination made by any City official in the interpretation and enforcement of Title 18.

E. Appoint one member to serve on the Residential Design Review Committee.

F. Receive and evaluate complaints and other matters having to do with traffic and circulation, including pedestrian and bicycling matters.

G. Recommend to the City Council and staff ways and means for improving traffic and circulation conditions, including bicycle and pedestrian conditions, and

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encourage use of alternative modes of transportation in the city.

H. Review and comment on preliminary plans for all capital improvement programs related to any and all modes of transportation.

I. Perform such other duties as are now or may hereafter be designated by State statutes or this Code.

J. At the initial meeting of the Planning & Transportation Commission, and yearly thereafter, the members shall elect the Chairperson and Vice Chairperson. The Vice Chairperson shall perform the duties of the Chairperson when the Chairperson is absent.

In the event of a vacancy in the Chairperson’s position, the Vice Chairperson shall succeed as Chairperson for the balance of the Chairperson’s term and the Commission shall elect a successor to fill the vacancy of the Vic e Chairperson. The Commission shall also annually appoint one member of the Planning & Transportation Commission as a member of the Residential Design Review Committee, who shall serve as Chair of the Committee.

K. The Planning & Transportation Commission is subject to the California Brown Act (Government Code Section 56900 et seq.), and all meetings shall be open to the public, except as provided by law. All meetings of a quorum of the Commission must be held pursuant to the noticing provisions of the Brown Act, and are open to the public. A majority of the members shall constitute a quorum. Meeting minutes shall be taken of each official meeting of the Commission.

2.24.150 Planning & Transportation Commission—Delegation of authority.

Nothing in this chapter shall be construed as delegating to the Planning & Transportation Commission any function or authority not delegated or authorized by State law pursuant to Title 7 of Chapter 3 of the Government Code, beginning at Section 65100 as it may be amended.

2.24.155 Residential Design Review Committee—Powers and duties.

The Residential Design Review Committee (RDRC) shall have the following powers and duties:

A. The Residential Design Review Committee is established to conduct design review of proposed residential development pursuant to Title 18 and any adopted residential design review guidelines.

B. Nothing in this chapter shall be construed as restricting or curtailing any of the powers of the City Council, or as delegation to the Committee of any of the authority or discretionary powers vested and imposed by law in the City Council. The City Council declares that the public interest, convenience, welfare and necessity require the appointment of a Residential Design Review Committee to act in an advisory capacity to the Planning & Transportation Commission for the purposes enumerated in this section.

SECTION 3: CEQA. this Ordinance is exempt from additional environmental review pursuant to California Environmental Quality Act (“CEQA”) Guidelines Section 15061(b)(3); under the general

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rule that CEQA applies only to projects, which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.

SECTION 4: Severability. That the City Council hereby declares that it would have passed this Ordinance sentence by sentence, paragraph by par agraph, and section by section, and does hereby declare that any provisions of this Ordinance are severable, and, if for any reason any sentence, paragraph or section of this Ordinance shall be held invalid, such decision shall not affect the validity of the remaining parts of this Ordinance.

SECTION 5: Publication. This Ordinance shall be published and posted according to law and shall take effect and be in force from and after 30 days after its passage and adoption.

* * * *

I, City Clerk Crystal Mui, hereby certify that the foregoing Ordinance was i ntroduced on the 8th day of August, 2022 and passed and adopted as an Ordinance of the City Council of the City of San Carlos at a regular meeting ther eof held on the 22nd day of August, 2022 by the following vote:

AYES, COUNCIL MEMBERS: ________________________________________________

NOES, COUNCIL MEMBERS: ________________________________________________

ABSENT, COUNCIL MEMBERS: _______________________________________________

CITY CLERK of the City of San Carlos
APPROVED:

MAYOR of the City of San Carlos

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CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Receive an Update on Wildfire Mitigation.

RECOMMENDATION:

This is an update to the City Council on the current status of efforts to mitigate the threat of wildfire in our community and an update on local and statewide conditions. No action is necessary.

FISCAL IMPLICATIONS:

There is no fiscal impact associated with receiving this report.

BACKGROUND:

This report is being presented to the City Council in response to its request for information about wildfire preparedness in San Carlos.

Recent catastrophic fire events have occurred in many parts of our state. The fire behavior includes a much faster rate of spread that is very difficult to contain. The overall length of fire season is much longer with fires also occurring in November and December on a routine basis.

Fire season is now considered to be year round.

For several years, the Fire Department has worked with the Publi c Works and Parks & Recreation D epartments to mitiga te the threat of wildfire in our community. We are using several methods to reduce our overall risk . These methods include fuels management, public education, wildland urban interface inspections and code enforcement, and the placement of fire spotting cameras.

ANALYSIS:

Fuels Management

In 2018, the City of San Carlos received a Hazard Mitigation Grant from the Federal Emergency Management Agenc y (“FEMA”). The grant was applied toward a multi-year project that has since been completed. Now in maintenance phase, the City has entered into an agreement with Rustic Ranch to maintain the fuel breaks and identify new opportunities for fuel mitigation on City-owned lands. Th is type of work is completed using hand crews, heavy equipment , and

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2 goats in order to improve existing fuel breaks and to establish mitigation measures when new areas of concern are identified.

Neighboring agencies including the San Francisco PUC, Mid -Pen Open Space, and the City of Belmont are conducting fuel mitigation similar to San Ca rlos. Their collective mitigations efforts will also help protect the City of San Carlos.

Public Education

Public education has been a high priority over the last several years. A postcard containing instructions for creating defensible space will be ma iled to all of our residents who reside in the “high fire danger” area of San Carlos. This is done on an annual basis.

Our website has been completely updated and contains many resources for mitigating wildfire threats and provides instructions on what h omeowners can do to protect their homes and families.

Inspections and Code Enforcement

We have begun our annual wildland urban interface inspections (WUI). This involves sending fire companies to inspect all streets in the high fire severity zone and is suing correction notices to private properties that are in violation of the fire code. This process is intended to b e educational for our residents. However, enforcement is an option in cases of non-compliance.

We have also responded to several complaints from community members regarding private property that has not been properly maintained. All of these complaints have been investigated and appropriate enforcement actions have been taken.

Fire Activity

We recently experienced a 20 acre fire on the bo rder of San Carlos and Redwood City. The fire was burning in a south west direction and was threatening homes in Redwood City and Woodside. The fire started in San Mateo County ’s jurisdiction and San Mateo County Fire (CALFIRE) is the lead investigating agency. We had a unified command structure on scene and close coordination of the overall response.

Zonehaven has been fully implemented as the City’s evacuation platform. We have conducted drills as well as used the system during the Emerald Hills fire. T he system performed as designed and the San Mateo County Department of Emergency Management assisted us with notifications.

Residents in San Mateo County, Woodside, and Redwood City were alerted that they were placed in either mandatory evacuation or evacuation warning status. San Carlos residents were not notified since there was not an imminent threat to the San Carlos community. The San Carlos City Manager’s Office was kept informed during the incident and posted notices to all the City’s social media channels. Staff was on standby and prepared to notify r esidents if conditions changed.

The State of California has experie nced several significant fires recently. H owever, the season has been slower than anticipated. Over the next several months , we an ticipate a significant

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3 threat of wildfire in the state. S an Mateo County is predicted to have an above normal threat of wildfire due to long term drought.

Next Steps

On August 30, the City will host a virtual Wildfire Preparedness Community Meeting on h ow to be prepared for wildfires.

We will continue to look for opportunities to install fire confirmation cameras . Two cameras with a view of San Carlos are currently in operation . We are also testing a fire detection camera in Redwood City that utilizes artificial intelligence to detect smoke. This technology is in the testing phase in several areas of the state and work to improve its capability is ongoing.

The Fire Department is being very proactive in preparing for wildfire in our wildland urban interface. Now that California is under threat from wildfire year around, we feel it is important that we continuously work with our community to plan and prepare.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Provide feedback on our current efforts; or

2. Provide staff with alternative direction.

Respectfully submitted by:

Dave Pucci,
RWCFD Deputy Fire Chief

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

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CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Consideration of Introducing an Ordinance Amending Ordinance 1240 for the Planned Development (PD) Zoning District for the Property Located at 1087 Old County Road (APN 046-184-270).

RECOMMENDATION:

The Planning Commission recommends that the City Council introduce an ordinance amending Ordinance 1240 for the Planned Development (“PD”) Zoning District located at 1087 Old County Road to permit the division of space within an existing building.

FISCAL IMPACT:

The applicant has paid the appropriate application fees to pay for expenses related to the analysis of the proposed amendment.

BACKGROUND:

History of Subject Location.

Ordinance 1240 (“Ordinance”) was adopted in 1998 and provided a Plan of Development for the construction of one retail building at 1087 Old County Road (subject site). The Ordinance established development standards and compliance with the Planned Community Zoning Regulations. A conditional use permit and architectural review was required for the new 18,560 square foot building. The Planning Commission also approved a conditional use permit to permit a regional retail use for Pep Boys who ha s been the sole tenant since 1998. When the Ordinance was adopted in 1998, the City Council also approved an amendment to the East Side Specific Plan. The 1998 amendment allowed the construction of retail less than 25,000 s quare feet (which was prohibited at the time ) and also prohibited the division of space for use by multiple tenants. The retail building was approved in 1998 because the proposed use by Pep Boys was consistent with the 1991 East Side Specific Plan, and was thought to add an attractive addition to the regional retail area of the City. The East Side Specific Pla n was superseded by the General Plan adopted in 2009.

Michael Lockhart of Advance Auto Parts (“Applicant”) requests that the City amend the Planned Development Zoning-12 (PD-12) zoning Ordinance 1240 to permit internal building division of space in order to allow multiple tenants. The building is owned by Pep Boys Service, and the Applicant is a potential lessee. The Applicant desires to operate a retail space for the sale of automotive parts, which would be run separately from the automotive service and repair center operated by Pep Boys Service. Pep Boys Service is concentrating on automotive repair and

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2 electric vehicle service in California and has entered into an arrangement with the Applicant to lease retail space within Pep Boys Service’s 109 stores t hroughout California, including the 1087 Old County Road location.

The history of the approvals and associated ordinances is included as Attachment 2.

June 20, 2022 Planning Commission Meeting.

The developer requests an amendment to the Planned Developm ent Ordinance to divide the space to allow multiple smaller lessees. On June 20, 2020, the Planning Commission conducted a public hearing and held a discussion in which Commissioners supported the division of space and the allowance of additional uses. Aft erwards, the Planning Commission unanimously adopted a resolution recommending that the City Council amend the Ordinance and further include a restriction on office use.

Project Summary and Amendments.

The Applicant seeks to amend the PD -12 regulation to clarify that the division of space is permitted for use by multiple tenants. The Applicant would maintain the existing footprint and elevations, with the exception of signage and minor exterior changes , and construct interior partitions to include an additional commercial tenant.

ANALYSIS AND FINDINGS FOR APPROVAL:

When the Ordinance was originally adopted, the City sought to reduce any negative impacts to downtown businesses and to promote regional retail in the area on Old County Road between Brittan Avenue and Howard Avenue. Based on a review of all documents associated with the overall development of the site, staff has determined that the building was intended to be permitted for use by a single tenant.

The proposed amendment to the Planned Developm ent zoning regulation would only allow the building at 1087 Old County Road to be partitioned.

The Development Standards approved within the Ordinance do not specifically limit division of the building. However, at the time of approval, the Planning Commi ssion had adopted a resolution maintaining that the building located at 1087 Old County Road is approved for single use retail and prohibited the division of space for use by multiple tenants. Staff recommend s that PD-12 be updated to clarify that the division of space is permitted for use by multiple tenants.

The Development Standards approved within Ordinance 1240 are shown below , with the proposed addition indicated with underlined text.

1. Setbacks for the building shall be a minimum of 25’ from the top of the creek bank 50’ from Brittan Avenue and 100’ from Old County Road. Height shall be limited to no more than 50’ with lot coverage not to exceed 20% for buildings. Only parking as shown on the Plan of Development shall be permitted within the creek setback.

2. Compliance shall be maintained with the Planned Community Zoning Regulations specified in the San Carlos Municipal Code. A Conditional Use Permit and Architectural Review shall be completed prior to submittal of building permits.

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3 3. The proposed development shall secure and keep active a building permit no later than two (2) years from the effective adoption date of this Plan of Development. If the building permit is not secured and kept active this Ordinance shall expire.

4. The project construction front age improvements and site improvements shall comply with all requirements of the Building Department, Public Works Department, Fire Department and Police Department. Fire Department access to the site and building shall be maintained at all times.

5. The signage for the project shall not exceed 260 square feet. Proposed sign plans and the revised monument sign design and placement are approved.

6. Compliance shall be maintained with National Pollution Discharge Elimination System (NPDES) requirements both for construction and ongoing operations of the project.

7. A minimum of one parking space for each 300 square feet of building area shall be maintained for the retail development and one parking space shall be maintained for each 200 square feet for the service bays.

8. Improvements and dedications on Old County Road shall occur in accordance with specifications approved by the City Engineer and City Council. The traffic signal shall be moved at the expense of the applicant.

9. Construction of all frontage improvements inc luding curb gutter and sidewalk and driveway approaches shall be constructed or reconstructed to the satisfaction of the City of San Carlos Public Works Director.

10. Outdoor storage displays and sales shall be prohibited on the site. Compliance shall be maintained with the performance standards in the PM zoning, the Sign Ordinance, and other applicable Municipal Code requirements.

11. The applicant and contractor shall comply with all mitigation measures identified in the environmental review documents.

12. Division of space to allow multiple tenants is permitted.

Required Findings.

A. The proposed development is consistent with the General Plan and any applicable specific plan, including the density and intensity limitations that apply.

Basis for finding: The project is supported by the following General Plan goals and policies:
 Goal LU-3: promote connectivity and provide retail and services within walking distance of home and employment centers.
 Goal LU-5: support and maintain land uses that contribute to a vibrant and resilient local economy and support the fiscal well-being of the City.  Goal LU-6: strengthen the economic vitality of the East Side of the city by encouraging a diversity of commercial uses while protecting and preserving existing industrial uses.

B. The subject site is physically suitable for the type and intensity of the land use being proposed.

Basis for finding: There is adequate parking, circulation , and landscaping for the expanded land uses at the site. The building as designed is suitable for the proposed

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4 land uses at the site with minor interior modifications subject to compliance with adopted building codes. The intensity of use and square footage of the uses is not proposed to change.

C. Adequate transportation facilities and public services exist or will be provided in accord with the conditions of PD plan approval, to serve the proposed development; and the approval of the proposed development will not result in a reduction of traffic levels of service or public services so as to be a detriment t o public health, safety, or welfare.

Basis for finding: The site was designed to accommodate retail uses. Allowing more than one tenant within the existing square footage of the building would not expand the need for transportation facilities or public se rvices and the traffic levels would be similar. The building will be partitioned so that 10,244 square feet of the existing 18,560 feet building will be operated by a separate retail tenant. The sales area of the retail portion of the building open to the public will be 2,961 s quare feet. The remaining 8,316 square feet will remain as a separate automotive repair and service center.

D. The proposed development will not have a substantial adverse effect on surrounding land uses and will be compatible with the existing and planned land use character of the surrounding area.

Basis for finding: As noted above, the site was designed to accommodate retail uses and additional tenants would not have a substantial adverse effect on the surrounding land uses and would be compatible with the existing and planned land use character of the area.

E. The development generally complies with applicable adopted design guidelines.

Basis for finding: The site is governed by the Plan of Development plan. No exterior changes are proposed.

F. The proposed development is demonstratively superior to the development that could occur under the standards applicable to the underlying base district, and will achieve superior community design, environmental preservation and/or substantial public benefit. In making this determination, the following factors shall be considered:

1. Appropriateness of the use(s) at the proposed location.

2. The mix of uses, housing types, and housing price levels.

3. Provision of units affordable to persons and families of low and moderate income or to lower income households.

4. Provision of infrastructure improvements.

5. Provision of open space.

6. Compatibility of uses within the development area.

7. Creativity in design and use of land.

8. Quality of design, and adequacy of light and air to the interior spaces of the buildings.

9. Overall contribution to the enhancement of neighborhood character and the environment of San Carlos in the long term.

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5 Basis for finding: The ability to partition the building provides greater flexibility to hav e additional tenants use the site and enhance the economic vitality of the area. There is no change in use and the proposed use is consistent with the previously approved Planned Development Plan. No changes are proposed to the exterior of the building or the site.

Environmental Review.

This project is exempt from the provisions of the California Environmental Quality Act (CEQA) based on Section 15301 which exempts existing facilities. Specifically, Section 15301 (a) states that “interior or exterior alter ations involving such things as interior partitions, plumbing, and electrical conveyances.”

Public Outreach.

Notices were sent to property owners within 300 feet from the property and a legal notice was published in the newspaper on August 12, 2022. (Atta chment 3). Staff has not received any comments as of the writing of this report.

ALTERNATIVES:

The alternatives to this recommendation that are available to the City Council include:

1. Introduce an ordinance amending Ordinance 1240 for the Planned Develop ment Zoning District including offices as a conditional use; or

2. Do not introduce the ordinance; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Al Savay, AICP
Community Development Director

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

ATTACHMENT(S):

1. Proposed Ordinance

2. Ordinance 1240 - 1087 Old County Rd

3. 1087 Old County Road Notice

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ORDINANCE NO ______

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AMENDING ORDINANCE 1240 FOR THE PLANNED DEVELOPMENT (PD) ZONING DISTRICT FOR THE PROPERTY LOCATED AT 1087 OLD COUNTY ROAD (APN 046-184-270).

RECITALS

WHEREAS, by Ordinance 1240, adopted on February 9, 1998, the City Council amended the Zoning Map to designate 1087 Old County Road Planned Development (PD) – 12 Zoning District and adopted the associated Plan of Development; and

WHEREAS, Michael Lockhart filed an application for approval of an amendment to the Planned Development (PD) Zoning District; and

WHEREAS, the associated Plan of Development shall be maintained; and

WHEREAS, the amendment to the Planned Development permits the division of space for use by multiple tenants; and

WHEREAS, an analysis of the proposed revisions has been conducted and it has been determined that subsequent analysis is not required under California Environmental Quality Act (CEQA) Guidelines Section 15301(a); and

WHEREAS, the Planning Commission conducted a duly noticed public hearing to consider all evidence presented both orally and in writing on June 20, 2022 and recommended approval of the proposed amended by a 5:0 vote; and

WHEREAS, the City Council conducted a duly noticed public hearing on amendments to the San Carlos Zoning Ordinance to hear and consider all comments of all persons interested in or concerned with a proposed amendment to the Planned Development plan on August 22, 2022 in consideration of adoption of this Ordinance.

NOW, THEREFORE BE IT RESOLVED by the City Council of the City of San Carlos does ordain as follows:

SECTION 1. The Development Standards of Ordinance 1240 is amended by adding text as show in underline (example).

Development Standards

Only parking as shown on the Plan of Development shall be permitted within the creek setback.

2. Compliance shall be maintained with the Planned Community Zoning Regulations specified in the San Carlos Municipal Code. A Conditional Use

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Attachment: Proposed Ordinance (PD Amendment at 1087 Old County) Permit and Architectural Review shall be completed prior to submittal of building permits.

3. The proposed development shall secure and keep active a building permit no later than two (2) years from the effective adoption date of this Plan of Development. If the building permit is not secured and kept active this Ordinance shall expire.

4. The project construction frontage improvements and site improvements shall comply with all requirements of the Building Department, Public Works Department, Fire Department and Police Department. Fire Department access to the site and building shall be maintained at all times.

5. The signage for the project shall not exceed 260 square feet. Proposed sign plans and the revised monument sign design and placement are approved.

6. Compliance shall be maintained with National Pollution Discharge Elimination System (NPDES) requirements both for construction and ongoing operations of the project.

9. Construction of all frontage improvements including curb gutter and sidewalk and driveway approaches shall be constructed or reconstructed to the satisfaction of the City of San Carlos Public Works Director.

11. The applicant and contractor shall comply with all mitigation measures identified in the environmental review documents.

12. Division of space to allow multiple tenants is permitted.

SECTION 2. Severability. That the City Council hereby declares that it would have passed this Ordinance sentence by sentence , paragraph by paragraph, and section by section and does hereby declare that any provisions on this Ordinance are severable and if for any reason any sentence paragraph or section of this Ordinance shall be held invalid such decision shall not effect the validity of the remaining parts of this Ordinance.

SECTION 3. Publication. This Ordinance shall be published and posted according to law and shall take effect and be in force from and after thirty (30) days after its passage and adoption.

* * * *

I, City Clerk Crystal Mui, hereby certify that the foregoing Ordinance was introduced on the 22nd day of August, 2022 and passed and adopted as an Ordinance of the City Council of the City of San Carlos at a regular meeting thereof held on the ____day of ____________, 2022 by the following vote:

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Attachment: Proposed Ordinance (PD Amendment at 1087 Old County)

AYES, COUNCIL MEMBERS: ________________________________________________

NOES, COUNCIL MEMBERS: ________________________________________________

ABSENT, COUNCIL MEMBERS: _______________________________________________

CITY CLERK of the City of San Carlos
APPROVED:

MAYOR of the City of San Carlos

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Attachment: Ordinance 1240 - 1087 Old County Rd (PD Amendment at 1087 Old County)

NOTICE OF PUBLIC HEARING

NOTICE IS HEREBY GIVEN THAT the San Carlos City Council will hold a public hearing on Monday, August 22 , 2022 at 7:00 p.m. , for the purpose of hearing and considering all comments of all persons interested in or concerned with the application submitted by Michael Lockhart requesting to amend the Planned Development Plan (Ordinance 1240), for a commercial building located at 1087 Old County Road (APN 046-184-270).

The City Council, at its February 9, 1998 meeting adopted Ordinance 1240, approving an 18,560 square foot building with limited retail uses. The applicant requests an amendment to the Planned Development Zoning District and Planned Development Plan, to allow multiple tenants inside the building. There are no significant improvements proposed for the exterior of the building. This will allow the applicant to partition the building to allow the applicant to partition the building to allow additional tenants.

On June 20, 2022, the San Carlos Planning Commission held a public hearing on the applicants request and subsequently adopted a resolution recommending to City Council adoption of an ordinance amending Ordinance 1240 to allow partitioning of the building.

This project is exempt from the provisions of the California Environmental Quality ACT (CEQA) based on section 15301 which exempts existing facilities. Specifically, 15301(a) states that the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or f ormer use including (a) interior or exterior alterations involving such things as interior partitions, plumbing, and electrical conveyances.

The agenda and relevant materials for this item will be available for viewing online- www.cityofsancarlos.org/agenda; at the City Clerk’s Department in City Hall – 600 Elm Street; and at the San Carlos Library – 610 Elm Street, beginning Thursday, August 18, 2022. The public will have the options to observe the meeting and address the Council in– person in City Hall’s Council Chambers or remotely via Zoom. Details and instructions will be available on the agenda.

Questions regarding the project may be dir ected to Chris Dacumos, consultant Senior Planner, [email protected]. Comments may be sent via email to the City Clerk - [email protected] and the City Council – [email protected]; or mailed to the City Clerk at 600 Elm Street, San Carlos, CA 94070.

All persons interested in the above are hereby invited to participate in this Public Hearing and be heard. If you challenge this proposal in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the City Clerk prior to the public hearing.

Crystal Mui,
City Clerk
Mailing Date: August 11, 2022
Publication Date: August 12, 2022

If you require translation for this notice, please contact the City Clerk’s Office at 650-802-4222.

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Attachment: 1087 Old County Road Notice (PD Amendment at 1087 Old County)

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To the right is a copy of the notice you sent to us for publication in the ENQUIRER-BULLETIN. Please read this notice carefully and call us with any corrections. The Proof of Publication will be filed with the County Clerk, if required, and mailed to you after the last date below. Publication date(s) for this notice is (are):

Mailing Address : 915 E FIRST ST, LOS ANGELES, CA 90012 Telephone (800) 788-7840 / Fax (800) 464-2839
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CRYSTAL MUI

CITY OF SAN CARLOS/CITY CLERK
600 ELM ST
SAN CARLOS, CA 94070

HRG NOTICE OF HEARING
PD Updates to 1087 Old County Road 8.22.22
08/12/2022
Publication
Total
$107.80
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Ad Description

COPY OF NOTICE
3614021
!A000006087908!
The charge(s) for this order is as follows. An invoice will be sent after the last date of publication. If you prepaid this order in full, you will not receive an invoice.

NOTICE OF PUBLIC

HEARING NOTICE IS
HEREBY GIVEN THAT the
San Carlos City Council will
hold a public hearing on
Monday, August 22, 2022 at
7:00 p.m. , for the purpose of
hearing and considering all
comments of all persons
interested in or concerned
with the application submi t-
ted by Michael Lockhart
requesting to amend the
Planned Development Plan
(Ordinance 1240), for a
commercial building located
at 1087 Old County Road
(APN 046 -184 -270). The City
Council, at its February 9,
1998 meeting adopted
Ordinance 1 240, approving
an 18,560 square foot
building with limited retail
uses. The applicant requests
an amendment to the
Planned Development
Zoning District and Planned
Development Plan, to allow
multiple tenants inside the
building. There are no
significant imp rovements
proposed for the exterior of
the building. This will allow
the applicant to partition the
building to allow the
applicant to partition the
building to allow additional
tenants. On June 20, 2022,
the San Carlos Planning
Commission held a public
he aring on the applicants
request and subsequently
adopted a resolution
recommending to City
Council adoption of an
ordinance amending
Ordinance 1240 to allow
partitioning of the building.

This project is exempt from
the provisions of the
California Environm ental
Quality ACT (CEQA) based
on section 15301 which
exempts existing facilities.

Specifically, 15301(a) states
that the operation, repair,
maintenance, permitting,
leasing, licensing, or minor
alteration of existing public or
private structures, faciliti es,
mechanical equipment, or
topographical features,
involving negligible or no
expansion of existing or
former use including (a)
interior or exterior alterations
involving such things as
interior partitions, plumbing,
and electrical conveyances.

The agend a and relevant
materials for this item will be
available for viewing online -
www.cityofsancarlos.org/age
nda; at the City Clerk's
Department in City Hall –
600 Elm Street; and at the
San Carlos Library – 610
Elm Street, beginning
Thursday, August 18, 2022.

The public will have the
options to observethe
meetingand address the
Council in –person in City
Hall's Council Chambers or
remotely via Zoom. Details
and instructionswill be
available on the agenda.

Questions regarding the
projectmay be directedt o-
Chris Dac umos, consultant
Senior Planner, cdac u-
[email protected].

Commentsmay be sent via
email to the City Clerk -
Cit y-
[email protected]
d the City Council –
CityCou n-
[email protected]; or
mailed to the City Clerk at
600 Elm Street, San Carlos,
CA 94 070. All persons
interested in the above are
hereby invited to participate
in this Public Hearing and be
heard. If you challenge this
proposal in court, you may
be limited to raising only
those issues you or
someone else raised at the
public hearing descri bed in
this notice, or in written
correspondence delivered to
the City Clerk prior to the
public hearing. Crystal Mui,
City Clerk Mailing Date:
8/11/22 Publication Date:
8/12/22
SPEN -3614021#

EXAMINER - ENQUIRER -

BULLETIN

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Attachment: 1087 Old County Road Notice (PD Amendment at 1087 Old County) 051348280
Gangstad Heidi M
4324 Loma Del Norte
El Paso, TX 79934

051348270
Lee Kai Man Tr
877 Darien Way
San Francisco, CA 94127-2501

046184070
Alemany Plaza Llc
2 Terra Linda Court
Millbrae, CA 94030-2915

051348150
Shannon Rosemarie A Tr
608 Atherton Ct
Modesto, CA 95356-9587

046184270
Arton Investment Inc
570 El Camino Real #220
Redwood City, CA 94063

051348230
Au Energy Llc
123 Linden Ave
So San Francisco, CA 94080

046171180
Hd Development Of Maryland Inc
2455 Paces Ferry Road
Atlanta, GA 30339

046184290
San Carlos Partners Llc
Po Box 847
Carlsbad, CA 92018

046184300
Kellymoore Paint Co Inc
1390 El Camino Real Ste 300
San Carlos, CA 94070

046184280
San Carlos Partners Llc
Po Box 847
Carlsbad, CA 92018

051349010
San Mateo Co Transit District
1250 San Carlos Ave
San Carlos, CA 94070

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Attachment: 1087 Old County Road Notice (PD Amendment at 1087 Old County) 051348280
The Occupant
1030 El Camino Real
Colma, CA 94014
051348280
The Occupant
1030 El Camino Real
San Carlos, CA 94070
051348270
The Occupant
1050 El Camino Real
San Carlos, CA, 94070
046184070
The Occupant
1060 Brittan Ave
San Carlos, CA 94070
051348150
The Occupant
1060 El Camino Real
Redwood City, CA 94063
051348150
The Occupant
1060 El Camino Real
San Carlos, CA 94070
046184270
The Occupant
1090 Brittan Ave
San Carlos, CA
051348230
The Occupant
1098 El Camino Real
San Carlos, CA 94070
046171180
The Occupant
1125 Old County Rd
San Carlos, CA 94070
046184290
The Occupant
915 Old County Rd
San Carlos, CA

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Attachment: 1087 Old County Road Notice (PD Amendment at 1087 Old County) © Latitude Geographics Group Ltd.

0.07 THIS MAP IS NOT TO BE USED FOR NAVIGATION
WGS_1984_Web_Mercator_Auxiliary_Sphere
Miles0.07 This map is a user generated static output from an Internet mapping site and is for reference only. Data layers that appear on this map may or may not be accurate, current, or otherwise reliable.

0.040
2,257
San Mateo map
1:

San Mateo County

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Attachment: 1087 Old County Road Notice (PD Amendment at 1087 Old County)

CITY COUNCIL

STAFF REPORT

MEETING DATE: August 22, 2022

ITEM TITLE: Consideration of Appointing Four Youth Advisory Council (YAC) Voting Members for the 2022 – 2023 Term, Five YAC Voting Members for the 2022 - 2024 Term, Two Alternate YAC Members for t he 2022 – 2023 Term, and Recognizing Four Retiring YAC Voting Members.

RECOMMENDATION:

Staff recommends that the City Council appoint four Youth Advisory Council ( “YAC”) voting members for the 2022 -23 term, five YAC voting membe rs for the 2022 -24 term, two alternate YAC members for the 2022-23 term, and recognize four retiring YAC voting members.

FISCAL IMPLICATIONS:

There are no fiscal implications associated with taking these actions.

BACKGROUND:

The City Council has traditionally appointed qualifi ed youth in the S an Carlos community to the YAC. These youth have been through a written application process and an oral board interview process.

ANALYSIS:

Following the written application and oral board interview process, the following eleven San Carlos youth are being recommended for appointment to the YAC – four as voting members for the 2022-23 term, five as voting members for the 2022 -24 term, and two as alternate members for the 2022-23 term:

Calista Savay (2022-23 term) – Carlmont High School, Senior - Voting Member Calista is a senior at Carlmont High School seeking appointment of a one-year term on the YAC as a voting member. Calista loves working with other people to come up with solutions for our town and works to make our community better.

Vikram Kacholiya (2022-23 term) – Carlmont High School, Senior - Voting Member Vikram is a senior at Carlmont High School seeking his second appointment on the YAC as a voting member. Vikram has really enjoyed his time on the council and is looking to ch allenge himself this year to take on more of a leadership role on the YAC.

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2 Sufiya Kaul (2022-23 term) – Saint Francis High School, Sophomore - Alternate Sufiya is a sophomore at Saint Francis High School seeking a one-year term as an alternate on the YAC. Sufiya enjoys being on the YAC and looks forward to the skills and lessons she will learn with continued participation.

Maya Nayberg (2022-23 term) – Carlmont High School, Senior - Voting Member Maya is a senior at Carlmont High School seeking a one -year appointment on the YAC as a voting member. Maya has already been on the YAC for 5 years and loves being a part of the council. Maya has connected with many fellow YAC members on a personal level, and she hopes to maintain these friends for a long time. Maya wants others to be able to have the same experiences she has had and hopes to contribute more ideas to the YAC this year.

Diya Patel (2022-23 term) – Sequoia High School Junior - Alternate Diya is a junior at Sequoia High School seeking a one -year appointment on the YAC as an alternate. Diya would like to be a member of the YAC because helping the community and making a difference that will benefit teens is extremely important. Diya also wants to be a member to learn new skills that can be valuable in the future.

Ivy Zhou (2022-23 term) – Carlmont High School, Senior - Voting Member Ivy is a senior at Carlmont High School seeking a one-year appointment on the YAC as a voting member. Ivy has lived in San Carlos since elementary school and really en joys living here. Ivy looks forward to being a member of the YAC and representing the youth population in San Carlos as it is a great way to understand the issues we are facing, make the youth voice heard, and contribute to events/activities that can make the city a better home for everyone in our community.

Hannah Delizo (2022-24 term) – Sequoia High School, Junior - Voting Member Hannah is a junior at Sequoia High School seeking a two -year appointment on the YAC as a voting member. Hanna wants to join the YAC to be a voice for young people in the community, especially for youth of color. Hanna also looks forward to the opportunity to develop more leadership skills.

Anika Gupta (2022-24 term) – Sequoia High School, Junior - Voting Member Anika is a juni or at Sequoia High School seeking a two-year appointment on the YAC as a voting member. Anika would like to be a member of the YAC because she loves living in San Carlos and enjoys the community here. Anika has also been a part of the YAC the past year and enjoyed every part of it.

Eva McLinden (2022-24 term) – Tierra Linda Middle School, 8th Grade - Voting Member Eva is an 8 th grader at Tierra Linda Middle School seeking a two -year appointment on the YAC as a voting member. Eva was a member last year and had an amazing experience. Eva is looking forward to all the events and activities that YAC participates in throughout the year.

Ellora Mehta (2022-24 term) – Carlmont High School, Freshman - Voting Member Ellora is a freshman at Carlmont High School seeking a two-year appointment on the YAC as a voting member. Eva is looking forward to joining the YAC as a way to help the comm unity and be able to give back.

Ava Stathacopoulos (2022-24 term) – St. Francis, Junior - Voting Member

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3 Ava is a junior at St. Francis High School seeking a two -year appointment on the YAC as a voting member. Ava hopes to use her platform on the YAC to promote mental health initiatives for San Carlos youth.

Recognition of Outgoing Youth Advisory Council Voting Members:

The following YAC members completed their terms of office as of June 30, 2022:

 Lucas Eden – two, two-year terms. Offices held: Chair, Public Relations.  Isabela Sugden – two, two-year terms. Office held: Vice Chair.  Ezra Bergson-Michelson – three, two-year terms and one, one-year term.  Liam Tierney – two, one-year terms.

ALTERNATIVES:

The options available to the City Council include:

1. Appoint the recommended Youth Advisory Council voting members for the 2022 -23 and 2022-24 terms and recognize retiring Youth Advisory Council voting members; or

2. Do not appoint recommended Youth Advisory Council voting member s for the 2022 -23 and 2022-24 terms; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Tyler Muela,
Recreation Supervisor

Approved for submission by:

_________________________
Jeff Maltbie, City Manager

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San Carlos City CouncilAugust 22, 2022

San Carlos City Council
August 22, 2022