Agenda packet — San Carlos City Council, September 26, 2022 (part 1 of 2)

CITY OF SAN CARLOS
City Council/Successor Agency to the
Redevelopment Agency/Housing Authority
Regular Meeting
September 26, 2022 7:00 PM
Council Chambers, City Hall
600 Elm Street, San Carlos, CA 94070
www.cityofsancarlos.org
AGENDA
This meeting will be conducted both inperson 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.

InPerson 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 COVID19.

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 16699009128 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 information), 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 ParmerLohan, Adam Rak

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. CHANGES TO THE ORDER OF THE AGENDA

4. PRESENTATIONS
a. Receive an Annual Update from the Community Foundation of San Carlos.

5. 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.

6. 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 Mayor 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 advised 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 future City Council agenda for a more comprehensive action or report and formal public discussion and input at that time.

7. CONSENT CALENDAR
a. Motion to Waive Reading of All Ordinances.
b. Approve Minutes of August 22, 2022 City Council Regular Meeting. c. Adopt a Resolution Amending the City of San Carlos' Conflict of Interest Code. d. Adopt a Resolution Accepting the 2022 Sewer System CCTV Inspection Project C1736; and Authorizing the Public Works Director to Issue and Record a Notice of Completion.
e. Adopt a Resolution Awarding the Fire Station No. 16 Replacement Project C9823; Authorizing the City Manager to Execute a Public Projects Agreement with Beals Martin & Associates, Inc. of Redwood City, CA in the Amount of $9,269,311; and Authorizing an Expenditure of Contingency up to the Project Budget. f. Adopt a Resolution Authorizing the City Manager to Execute Agreements for Professional Services for OnCall Legal Services with Burke, Williams & Sorensen, LLP and Goldfarb & Lipman LLP, Each for an Amount Not to Exceed $200,000 and a Term of Two Years with the Option to Extend the Term by One Year. g. Adopt a Resolution Accepting the San Carlos Avenue Eucalyptus Tree Removal Project C1722; and Authorizing the Public Works Director to Issue and Record a Notice of Completion.

8. PUBLIC HEARING
a. Consideration of Adopting a Resolution Establishing the Child Care Development Impact Fee Levels for New Nonresidential Developments in San Carlos and Adopting the Updated Child Care Impact Fee Nexus Study Prepared by Economic & Planning Systems Inc. for the City of San Carlos dated September 9, 2022.

9. STUDY SESSION
a. Review Draft 20232031 Housing Element Prior to Submittal to State Department of Housing and Community Development.

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 Council 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, please contact the City Clerk’s Office at (650) 8024222 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.

1 CITY OF SAN CARLOS
City Council/Successor Agency to the
Redevelopment Agency/Housing Authority
Regular Meeting
September 26, 2022 7:00 PM
Council Chambers, City Hall
600 Elm Street, San Carlos, CA 94070
www.cityofsancarlos.org
AGENDA
This meeting will be conducted both inperson 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.

InPerson Participation:

Location. City Hall – 600 Elm Street, Council Chambers.

Remote Participation :

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

MAYOR: Sara McDowell
COUNCIL: Ronald Collins, John Dugan, Laura ParmerLohan, Adam Rak

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. CHANGES TO THE ORDER OF THE AGENDA

4. PRESENTATIONS
a. Receive an Annual Update from the Community Foundation of San Carlos.

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

9. STUDY SESSION
a. Review Draft 20232031 Housing Element Prior to Submittal to State Department of Housing and Community Development.

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.

2 CITY OF SAN CARLOS
City Council/Successor Agency to the
Redevelopment Agency/Housing Authority
Regular Meeting
September 26, 2022 7:00 PM
Council Chambers, City Hall
600 Elm Street, San Carlos, CA 94070
www.cityofsancarlos.org
AGENDA
This meeting will be conducted both inperson 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.

InPerson Participation:

Location. City Hall – 600 Elm Street, Council Chambers.

Remote Participation :

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

MAYOR: Sara McDowell
COUNCIL: Ronald Collins, John Dugan, Laura ParmerLohan, Adam Rak

1. CALL TO ORDER

2. PLEDGE OF ALLEGIANCE

3. CHANGES TO THE ORDER OF THE AGENDA

4. PRESENTATIONS
a. Receive an Annual Update from the Community Foundation of San Carlos.

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

9. STUDY SESSION
a. Review Draft 20232031 Housing Element Prior to Submittal to State Department of Housing and Community Development.

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.

3 CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Receive an Annual Update from the Community Foundation of San Carlos.

RECOMMENDATION:

Staff recommends that the City Council receive an Annual Update from the Community Foundation of San Carlos.

FISCAL IMPLICATIONS:

There are no fiscal implications to this evening’s presentation.

BACKGROUND:

On November 12, 2019, the City Council adopted a Resolution authorizing the City Manager to enter into an Endowment Fund Agreement and authorizing the transfer of Two Million Dollars ($2,000,000) as an endowment to the San Carlos Community Foundation to benefit the San Carlos community.

To receive the authorized endowment funding and any other funds from the City, the Community Foundation was required to accept certain agreement requirements, which included:

1. Conditions and limitations on the use of the funds;

2. Rules for prudent investment of the endowment and funds it raises; and

3. Procedures to protect the funds the Community Foundation will hold.

Section 5(c) Requirements of the agreement state that:

An Annual Report shall be prepared and delivered to the City no later than 90 days following the close of the Foundation’s annual accounting period. The report shall include at a minimum the following information: annual goals and objectives; accomplishments; assets and liabilities; revenue and expenditures; operations; grants and projects; fundraising activity; and copies of Board meeting agendas and minutes.

The City and Community Foundation entered into an Endowment Fund Agreement on November 25, 2019, accepting all conditions. The Community Foundation provided the Council with its first annual report on September 18, 2020 and its second annual report on October 11, 2021.

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ANALYSIS:

The Council will be receiving the third Annual Report presentation from the Community Foundation (“Foundation”) of San Carlos discussing the activities and programs it has undertaken in the prior fiscal year, operational updates, performance of the endowment funds, and efforts of the all-volunteer board, donors, and community-wide supporters.

Programmatic highlights will include the annual community grant program, partnerships, and ongoing support from the City of San Carlos with the diversity/heritage celebration, community celebration and installation of the “Love More” mural. The Foundation’s Statement of Financial Position is attached as Attachment 1, and their 2021 - 2022 Board Agendas and Minutes can be found on their website: https://cfsancarlos.org/. The Foundation remains in compliance with the requirements of the grant agreement with the City.

Grant Making – 2021 Fall Community Grants
Last fall, the Community Foundation completed its seventh grant round since early 2020. Thirty- eight applications were received and $160,000 in grant awards were made to 27 local area nonprofits serving those who live, work, play, or learn in San Carlos.

With each cycle, the Foundation looks to improve the grant-making process. In this cycle, the scoring criteria was revised and the grants committee was expanded to include more diverse community representation. Based on feedback from grant applicants, the application was simplified and grants can be used for general operating support, something that nearly all nonprofits really wanted. 75% of the fall 2021 grants dollars funded general operating expenses.

Grants were made to support Basic Needs: $77,500 (48%), Education: $35,000 (22%), Mental Health: $32,500 (20%), Arts: $7,500 (5%), and Justice & Equity: $7,500.

The Community Foundation is currently reviewing applications for the fall 2022 community grant cycle. Applications were due 7:00 p.m. on Thursday, September 15, 2022. This grant cycle will be funded by the 2021-22 endowment returns and a contribution of $40,000 from the City of San Carlos received in July 2022. The Community Foundation runs a single annual community grant cycle each fall. However, as emergencies arise, the Board of Directors can decide to fundraise to support response grant cycles or award Board discretionary grants.

Endowment Performance & Financial Update
The year ended June 2022 was the Foundation’s second full year of operations. As a result of a down year in both the debt and equity markets, the Community Foundation’s endowment portfolio experienced a negative 9.6% return during the year. The endowment was valued at just above $2.16 million at the end of June 2022.

During the year, the Foundation received $137,000 in contributions. The Foundation made grants to local organizations totaling $161,000 and supported numerous programs and events.

Operating expenses of $10,000 were well under budget. As a result of the savings, the Foundation was able to make a contribution of $40,000 to the Foundation’s endowment to support future growth. As a result of the Foundation’s Board of Directors’ decision last year to set aside a portion of that year’s earnings to support the Foundation’s operations for two years, the Foundation has sufficient funds available to support continued operations in the upcoming year without having to dip into the endowment.

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Social Justice & Equity Activities
In addition to the Annual Report, additional details will be provided on the Community Foundation’s Social Justice & Equity Committee, with an emphasis on the Committee’s 2021-22 goals and high-level strategies for inviting community members to join the work for social justice and equity.

The three-part, high-level strategies focus on making space (both mentally and in the physical world) to learn and listen in order to celebrate accomplishments. The three-part strategies are to:

1. Curate and support community learning opportunities;

2. Create physical spaces (murals, street art, street banners, etc.); and,

3. Organize community diversity celebrations.

Committee Achievements (July 2021 – June 2022)

1. Community Learning & Conversations
Mental Health Community Conversation (May 2022) - In recognition of the mental toll that the pandemic has taken on our community, the Community Foundation partnered with One Life Counseling Center to host an event aimed to promote awareness, provide education about the impact of mental health on physical health, and provide supportive resources. The educational presentation was followed by a panel discussion led by Suzanne Hughes, with participation by Dr. Aaron Nayfack, Ilana Yakubovich, Madison Duran, Mayor Sara McDowell, and Angie Murphy.

2. Physical Spaces
●“ Love More” is an environmental advocacy mural promoting protection of our native species installed at 1379 Old County Road in the Industrial Arts District of San Carlos by two recent Design Tech HS graduates Lauren Wu of San Carlos and Annie Phillips of Pacifica. A community celebration and paint day was held on Earth Day, April 23, 2022, which hosted over 300 community volunteers and event goers of all ages featuring food/ice cream trucks, live music from 4Ohm Productions, and a pop-up art show by ArtBias. Mayor Sara McDowell was in attendance along with the building owners, the artists’ families, friends, and community members on June 17, 2022. ●Laurel Street Banners were hung to celebrate Latinx Heritage Month (September) and Stand United Against Hate Week (November).

3. Community Diversity Celebrations
●Latinx Heritage Month (September 2021) – online resources, events, activities, and community profile ”Viva Latinx” https://cfsancarlos.org/latinx. In-person celebration held at Devil’s Canyon Brewing Company.
●United Against Hate Poetry Slam (November 2021) - Each year since 2017, Bay Area communities dedicate a week to learning about and taking action to end hate.

On November 19, 2021, the community Poetry Slam event drew in presenters ages 8 to 70 to the mainstage at Devil’s Canyon Brewing Company. This powerful event was packed wall to wall with community members of every race, age, gender, and

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ability who stood in unity to bear witness to the stories and listen to the voices of our community. Videos are available on YouTube. By popular demand, the Poetry Slam will return this year on Friday, November 18, 2022.
●Black History Month (February 2022) – online resources, events, activities and community profile “Black Joy” – https://cfsancarlos.org/blackhistory ●AAPI Heritage Month (May 2022) – online resources, events, and activities. In-person celebration held at Devil’s Canyon Brewing Company featuring performances from the Adult Community Center’s Tai Chi group and a Bollywood medley dance by local community dancers.
●Pride Night (June 2022) – On June 17, 2022, the Community Foundation and the Devil’s Canyon Brewing Company hosted the San Mateo County Pride Center, One Love, and Safespace for an all-ages community Pride event. Young members of these organizations spoke to the audience and set up tables to engage attendees to learn more about their services and offerings. Participants contributed their ‘colors’ to the San Carlos Oak tree art project by applying colorful thumb prints to the community art project.

Respectfully submitted by:

Nil Blackburn, Assistant City Manager
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Community Foundation of San Carlos Statement of Financial Position as of June 30, 2022

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Total
ASSETS
Current Assets
Bank Accounts
Checking - First Republic 130,411
MM - First Republic 120,074
Total Bank Accounts $ 250,485 Accounts Receivable
Account Receivable 0
Receivable - Other 345
Total Accounts Receivable $ 345 Other Current Assets
Uncategorized Asset 0
Undeposited Funds 0
Total Other Current Assets $ 0 Total Current Assets $ 250,829 Other Assets
Investments - Endowment 2,161,050
Total Other Assets $ 2,161,050 TOTAL ASSETS $ 2,411,879

LIABILITIES AND EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable 0
Total Accounts Payable $ 0 Other Current Liabilities
Grants Payable 0
Other Current Liabilities 4,967
Sales Tax Payable 0
Total Other Current Liabilities$ 4,967 Total Current Liabilities $ 4,967 Total Liabilities $ 4,967 Equity
Retained Earnings 2,690,525
Net Revenue -283,613
Total Equity $ 2,406,912 TOTAL LIABILITIES AND EQUITY $ 2,411,879 Community Foundation of San Carlos
Statement of Financial Position
As of June 30, 2022

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August 22, 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 August 22, 2022, 7:00 PM

MINUTES

ROLL CALL
City Council Present: Sara McDowell, Mayor
Ronald Collins, Councilmember
John Dugan, Councilmember
Laura Parmer-Lohan, Councilmember
Adam Rak, Vice Mayor
Staff Present: Nil Blackburn, Assistant City Manager
Lisa Costa Sanders, Principal Planner
Chris Dacumos, Senior Planner
Doherty, Nira, Deputy City Attorney
Sajuti Haque, Senior Management Analyst
Jeff Maltbie, City Manager
Rebecca Mendenhall, Administrative Services Director
Crystal Mui, City Clerk
Tyler Muela, Recreation Supervisor
Dave Pucci, RWCFD Deputy Fire Chief
Al Savay, Community Development Director

1. CALL TO ORDER
The meeting was called to order at 7:00 PM by Mayor Sara McDowell.

2. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Mayor McDowell.

3. CHANGES TO THE ORDER OF THE AGENDA
Mayor McDowell moved Item 8a – Youth Advisory Council appointments, up on the agenda to follow after Section 6 - Consent Calendar.

4. COUNCIL COMMUNICATIONS AND ANNOUNCEMENTS
Vice Mayor Rak reported on attending the Family Camp Out and provided accolades to staff.

Mayor McDowell commented that children are returning to schools this week and reminded the community to drive carefully.

5. PUBLIC COMMENT
Mark Olbert, resident, made allegations against Councilmember Parmer-Lohan’s campaign.

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Councilmember Parmer-Lohan responded to Mr. Olbert’s comments.

6. CONSENT CALENDAR
Mayor McDowell and Vice Mayor Rak thanked staff and Councilmember Parmer-Lohan for their work on the Child Care Development Impact Fee.

RESULT:Adopted [Unanimous] Consent Calendar items ‘a’ – ‘k’; and item ‘l’ – 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; item ‘m’ – Ordinance 1586 Amending San Carlos Municipal Code Chapter 9.30 Noise Control - Section 9.30.070 Exempt Activities, (B) Construction Activities; and
item ‘n’ - 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.

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

Resolution 2022-088
e. 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 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. Resolution 2022-089 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 Morgan Hill, CA in an Amount of $525,980; and Authorizing an Expenditure of Contingency in the Amount of $106,000. Resolution 2022-090 g. Adopt a Resolution Accepting and Approving the Annual Investment Policy for Fiscal Year 2022-23. Resolution 2022-091

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August 22, 2022 3
h. Accept Fiscal Year 2021-22 Fourth Quarter 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 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.

Resolution 2022-092
k. 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 Fiscal Year ("FY") 2021-22 to FY 2022-23, and Authorizing the Expenditure of a Contingency Not- To-Exceed the Project Budget. Resolution 2022-093
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 Ordinance 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.
9a. 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.

This item was moved up on the agenda to follow after Section 6 - Consent Calendar.

Recreation Manager Tyler Muela commenced the item and introduced each proposed Youth Advisory Council (YAC) member and thanked the retiring YAC members.

Public Comment
Debbie Baldocchi, resident, requested two agenda items be added to a future meeting- an item to discuss revisions to the Noise Ordinance to include large scale tree cutting and mulching be considered as "construction noise"; and an item to consider amending the Tree Ordinance to prohibit large scale tree removal without a permit.

RESULT:Appointed [Unanimous] Calista Savay, Vikram Kacholiya, Maya Nayberg and Ivy Zhou as Voting Members to the Youth Advisory Council for one term ending June 30, 2023; Hannah Delizo, Anika Gupta, Eva McLinden, Ellora Mehta and Ava Stathacopoulos as

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August 22, 2022 4
Voting Members for two terms ending June 30, 2024; and Sufiya Kaul and Diya Patel as Alternate Members for one term ending June 30, 2023.

MOVER:Ronald Collins
SECONDER:Laura Parmer-Lohan
AYES:Rak, Dugan, Collins, Parmer-Lohan, McDowell
City Clerk Crystal Mui administered the Oath of Office to the newly appointed members.

7. REPORTS TO COUNCIL
a. Receive an Update on Wildfire Mitigation.

Deputy Fire Chief Dave Pucci provided Council with an update on his department’s recent efforts in mitigating the risk of wildfire in San Carlos and responded to Council questions.

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).

Senior Planner Consultant Chris Dacumous provided background on the 1087 Old County Road property, outlined the proposed amendment and, along with City Manager Jeff Maltbie, responded to Council questions.

Public Comment
None.

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

MOVER:Adam Rak
SECONDER:Ronald Collins
AYES:Parmer-Lohan, Rak, Dugan, Collins, McDowell
RESULT:Introduced [Unanimous] Ordinance 1588 Amending Ordinance 1240 for the Planned Development (PD) Zoning District for the Property Located at 1087 Old County Road (APN 046-184-
270).

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

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.

Item was moved up on the agenda to follow after Section 6 - Consent Calendar.

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10. AGENDA SETTING
Vice Mayor Rak requested staff provide an update on Debbie Baldocchi’s comment earlier this evening regarding the large scale removal of trees by developers at 808 Alameda de las Pulgas.

11. ADJOURNMENT
The meeting adjourned at 8:05 PM.

Crystal Mui,
City Clerk

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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Adopt a Resolution Amending the City of San Carlos' Conflict of Interest Code.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution amending the City’s Conflict of Interest Code.

FISCAL IMPLICATIONS:

None.

BACKGROUND:

The City’s Conflict of Interest Code (“Code”) designates which public officials and consultants are required to file a Statement of Economic Interests (Form 700) and what they must disclose. In 1990, Government Code §87306.5 was added to the Political Reform Act requiring every local agency to review its code by October 1 in even numbered years.

The first revision and report to the Fair Political Practices Commission (“FPPC”) for San Carlos was approved by the City Council in September 1992 and forwarded to the FPPC. It was again modified in 1994 and then biennially reviewed since 1998.

Certain City positions are covered by State law and are required to comply with State regulations, while other positions are governed only by local conflict of interest codes. Employees performing ministerial or manual tasks and members of advisory, non-decision making boards and committees are not usually subject to the Code. Other employees in decision making positions, or those dealing with the expenditure of local funds, have a disclosure obligation. They are referenced under the Code as designated employees and their economic disclosure is outlined in "disclosure categories" in the Code.

A 45-day written period commenced on August 8, 2022 and terminated on September 21, 2022.

This period was an opportunity for interested persons to express any concerns with the proposed amendments to the Code and present written comments. A public hearing on this matter would be held only if an interested person or his or her representative requests a public hearing no later than 15 days prior to the close of the written comment period. The City has not received any comments or requests for a public hearing.

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ANALYSIS:

Accurate disclosure is essential to monitor whether officials have conflicts of interest and to help ensure public trust in government. Staff has reviewed the current Code (last approved in 2020) and is recommends adding the following positions to the Code:
Assistant Community Development Director, disclosure category 1 Code Enforcement Officer, disclosure category 2
Senior Building Inspector, disclosure category 2
Senior Management Analyst (Community Development Dept), disclosure category 2 Recreation Manager, disclosure category 2
Senior Traffic Engineer, disclosure category 2
A red-lined version of the proposed Code is included as Exhibit A to the Resolution.

ALTERNATIVES:

The options available to the City Council include:

1. Adopt a resolution amending the City’s Conflict of Interest Code; or

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Crystal Mui, City Clerk
Approved for submission by:
___________________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution with Exhibit A – Proposed Conflict of Interest Code (redlined)

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RESOLUTION NO. 2022 - ______

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AMENDING THE CITY OF SAN CARLOS’ CONFLICT OF INTEREST CODE. ___________________________________________________________________________

WHEREAS, the Political Reform Act requires certain city officials, specified in section 87200 of the California Government Code, to file economic disclosure forms (Form 700) and abstain from making or participating in making governmental decisions which have a reasonably foreseeable material effect on an economic interest; and

WHEREAS, the Political Reform Act also requires cities to adopt a local Conflict of Interest Code that enumerates specific city positions other than those specified in Government Code Section 87200, which involve making or participating in making decisions which have a reasonably foreseeable material effect on an economic interest, and to designate for each position the specific types of investments, business positions, interests in real property and sources of income which are reportable based on the scope of the decision making authority of the position; and

WHEREAS, State law requires every local government agency to perform review of its Conflict of Interest Code biennially; and

WHEREAS, the San Carlos City Council adopted a revised Conflict of Interest Code in 1992 by Resolution No. 1992-085, which was modified in 1994 and then biennially since 1998; and

WHEREAS, the City Council has reviewed said Conflict of Interest Code and has determined that amendments are required (as shown in red in Exhibit A); and

WHEREAS, the Conflict of Interest Code adopted by this Resolution accurately reflects the duties of each position and the appropriate disclosure categories for each position.

NOW, THEREFORE, BE IT RESOLVED, that:

1. All previously adopted Resolutions amending the City’s Conflict of Interest Code are hereby rescinded.

2. The Conflict of Interest Code for the City of San Carlos, is hereby amended to read as follows:

CITY OF SAN CARLOS

CONFLICT OF INTEREST CODE

The Political Reform Act (Government Code Section 81000, et seq.) requires state and local government agencies to adopt and promulgate conflict of interest codes. The Fair Political Practices Commission has adopted a regulation (2 California Code of Regulations Section 18730) that contains the terms of a standard conflict of interest code, which can be incorporated by reference in an agency’s code. After public notice and hearing, the standard code may be amended by the Fair Political Practices Commission to conform to amendments in the Political Reform Act. Therefore, the terms of 2 California Code of Regulations Section 18730 and any

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amendments to it duly adopted by the Fair Political Practices Commission are hereby incorporated by reference. This regulation and the attached Appendix A, designating positions and establishing disclosure categories, shall constitute the conflict of interest code of the City of San Carlos.

Individuals holding designated positions shall file statements of economic interests with the City of San Carlos, which will make the statements available for public inspection and reproduction (Gov. Code Sec. 81008). All statements will be retained by the City Clerk.

3. If no comments are received pursuant to the 45-day written comment period, there will be no additional public hearing on the proposed code.

4. The City Council, as code reviewing body for the City of San Carlos, has determined that the attached Exhibit A accurately sets forth those positions which should be designated and the categories of financial interests which should be made reportable for each position.

*****

I, Crystal Mui, City Clerk, hereby certify that the foregoing Resolution was passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of September, 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

Exhibit A: Designated Officers and Employees

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APPENDIX A

DESIGNATED OFFICERS AND EMPLOYEES

DESIGNATED POSITION DISCLOSURE CATEGORIES

ADMINISTRATION
Assistant to City Manager 1
Assistant City Manager 1
City Council 1
City Manager 1
City Treasurer 1
Senior Management Analyst 3

CITY ATTORNEY
City Attorney 1
Deputy City Attorney 1

CITY CLERK
City Clerk/Community Relations Director 1

ADMINISTRATIVE SERVICES DEPARTMENT
Administrative Services Director 1
Financial Services Manager 1
Human Resources Manager 1
Information Technology Manager 1
Senior Accountant 2
Senior Systems Analyst 3
Senior Management Analyst 3

COMMUNITY DEVELOPMENT DEPARTMENT
Assistant Planner 2
Assistant Community Development Director 1 Associate Planner 2
Building Inspector 2

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Building Official 1
Code Enforcement Officer 2
Community Development Director 1
Economic Development/Housing Manager 1 Economic Development Coordinator 3
Advanced Planning Manager 1
Principal Planner 1
Senior Building Inspector 2
Senior Management Analyst 3
Senior Planner 2

FIRE
Deputy Fire Chief 1
Fire Chief 1
Fire Prevention Officer 1

POLICE
Police Captain (Assigned to position of Police Chief for San Carlos) 1

PARKS AND RECREATION DEPARTMENT
Parks and Recreation Director 1
Recreation Manager 2
Recreation Supervisor 3

PUBLIC WORKS
Assistant Public Works Superintendent 2 Associate Engineer 1
City Engineer 1
Public Works Director 1
Public Works Inspector 2
Public Works Superintendent 2
Public Works Supervisor 2
Senior Engineer 1
Senior Traffic Engineer 1

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COMMISSIONS
Planning Commissioners 1
Economic Development Advisory Commissioners 1

SPECIFIED CONSULTANTS/NEW POSITIONS 1
Consultants/new positions shall be included in the list of designated officials and employees and shall disclose pursuant to the broadest disclosure category in the Code subject to the following limitation:

The City Manager, or his designee, may determine in writing that a particular consultant or new position, although a “designated position,” is hired to perform a range of duties that is limited in scope and thus is not required to fully comply with the disclosure requirements in this section.

Such written determination shall include a description of the consultant’s or new position’s duties and, based upon that description, a statement of the extent of disclosure requirements. The City Manager’s determination is a public record and shall be retained for public inspection in the same manner and location as this Conflict of Interest Code. (Government Code Section 81008.)

Nothing herein excuses any consultant from any other provision of this Conflict of Interest Code, specifically those dealing with disqualification.

DISCLOSURE CATEGORIES

The disclosure categories listed below identify the types of economic investments that the designated position must disclose for the category to which he or she is assigned. Such economic interests are reportable if they are either located in or doing business in the jurisdiction, are planning to do business in the jurisdiction, or have done business during the previous two years in the jurisdiction of the City.

1. FULL DISCLOSURE
Persons in this category must disclose all investments and business positions in business entities, sources of income including gifts, loans and travel payments, and interests in real property located in the City. Applicable Form 700 Schedules: A through E

2. DEPARTMENT-RELATED INCOME, REAL PROPERTY
Persons in this category must disclose all investments and business positions in business entities and sources of income including gifts, loans and travel payments, and all interests in real property, if the source is of a type which provides, manufactures, or supplies goods, materials, equipment, machinery or services, including training or consulting services, of the type utilized by or subject to the review or approval of the department in which that person is employed.

Applicable Form 700 Schedules: A through E

3. DEPARTMENT-RELATED INCOME
Persons in this category must disclose all investments and business positions in business entities and sources of income, including gifts, loans and travel payments if the source is of a type which provides, manufactures, or supplies, goods, materials, equipment, machinery or services,

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including training or consulting services, of the type utilized by or subject to the review or approval by the department in which that person is employed.

Applicable Form 700 Schedules: A, C, D, E

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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Adopt a Resolution Accepting the 2022 Sewer System CCTV Inspection Project C1736; and Authorizing the Public Works Director to Issue and Record a Notice of Completion.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution accepting the 2022 Sewer System CCTV Inspection Project (“Project”) C1736 and authorizing the Public Works Director to issue and record a Notice of Completion.

FISCAL IMPLICATIONS:

There is no fiscal impact and no additional appropriation is needed at this time. The Project is funded by C1736 which has a budget of $400,000 for Fiscal Year (“FY”) 2021-22. City Council awarded the Project to Pipe and Plant Solutions, Inc. in the amount of $336,897.

The total cost to complete the Project is $352,486.41. There is sufficient budget to close-out the Project.

BACKGROUND:

The City’s sewer system consists of approximately 105 miles of pipeline divided into 17 basins.

The most recent evaluation of the entire sewer system was conducted in 2012. Closed-circuit television (CCTV) footage of the sewers and defect data assembled during the 2012 evaluation are used to prioritize sanitary sewer mains for rehabilitation or replacement as part of the Annual Sewer Rehabilitation Project.

Over time, sanitary sewer mains degrade due to deterioration, tree root intrusion, grease, and other causes. Staff plans to conduct annual sewer cleaning and inspection projects for two to three sewer basins each year and to update the pipe footage condition for the entire system.

Capturing video footage assists maintenance staff in monitoring and preventing sanitary sewer overflows or back-ups until rehabilitation or replacement of the sewer main can be completed as part of the Annual Sewer Rehabilitation Project. Construction management and inspection will be performed by Public Works staff.

Staff prepared the Project specifications and the City Engineer signed the final bid set construction documents on September 27, 2021. The City Council approved the specifications at its October

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11, 2021 meeting.

The City Council awarded the Project to Pipe and Plant Solutions, Inc. at its January 10, 2022 meeting.

ANALYSIS:

The Project began on April 18, 2022 and was completed on September 8, 2022 in accordance with the approved Project specifications.

Therefore, staff recommends accepting the 2022 Sewer System CCTV Inspection Project C1736 and authorizing the Public Works Director to issue and record a Notice of Completion.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Adopt a resolution accepting the 2022 Sewer System CCTV Inspection Project C1736 and authorizing the Public Works Director to issue and record a Notice of Completion; or

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Steven Machida, Public Works Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution

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2 0
7 RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS ACCEPTING THE 2022 SEWER SYSTEM CCTV INSPECTION PROJECT C1736; AND

AUTHORIZING THE PUBLIC WORKS DIRECTOR TO ISSUE AND RECORD A NOTICE OF COMPLETION.

WHEREAS, the existing sewer system consists of approximately 105 miles of pipeline divided into 17 basins; and
WHEREAS, over time, the condition of sanitary sewer mains degrades due to deterioration, tree root intrusion, grease, and other causes; and WHEREAS, capturing video footage assists maintenance staff in monitoring and preventing sanitary sewer overflows or back-ups until rehabilitation or replacement of the sewer main can be completed as part of the Annual Sewer Rehabilitation Project; and WHEREAS, staff prepared the 2022 Sewer System CCTV Inspection Project C1736 (“Project”) specifications and the City Engineer signed the final bid set specifications on September 27, 2021; and WHEREAS, City Council approved the construction documents at the October 11, 2021 meeting; and
WHEREAS, City Council awarded the Project to Pipe and Plant Solutions, Inc. at its January 10, 2022 meeting; and
WHEREAS, the Project began on April 18, 2022 and was completed on September 8, 2022 in accordance with the approved Project specifications; and WHEREAS, staff recommends accepting the 2022 Sewer System CCTV Inspection Project C1736 and authorizing the Public Works Director to issue and record a Notice of Completion.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby accepts the 2022 Sewer System CCTV Inspection Project C1736 and authorizes the Public Works Director to issue and record a Notice of Completion.
* * * * *
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 26th day of September 2022, by the following vote:

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

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2 0
7 ________________________________
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: September 26, 2022
ITEM TITLE: Adopt a Resolution Awarding the Fire Station No. 16 Replacement Project C9823; Authorizing the City Manager to Execute a Public Projects Agreement with Beals Martin & Associates, Inc. of Redwood City, CA in the Amount of $9,269,311; and Authorizing an Expenditure of Contingency up to the Project Budget.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution awarding the Fire Station No. 16 Replacement Project (“Project”) C9823, authorizing the City Manager to execute a public projects agreement with Beals Martin & Associates, Inc. of Redwood City, CA in the amount of $9,269,311, and authorizing an expenditure of contingency up to the Project budget.

FISCAL IMPLICATIONS:

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

Funding for the Project comes from C9823, which was approved for Fiscal Year 2022-23 and has approximately $11,605,613 available.

The lowest responsible and responsive bid received for this Project was $9,269,311. There is sufficient budget to award the Project as well as authorize contingency up to the available budget due to the size and complexity of the Project.

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 the 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

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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.

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 with 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 of the prequalified bidders not receiving the information.

Since that 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 recommended rejecting all bids and re-bidding the Project to ensure receipt of responsible, responsive, and competitive bids.

Per staff’s recommendation, the City Council rejected all bids and authorized staff to re-bid the Project at its August 22, 2022 meeting.

ANALYSIS:

The City re-advertised the Project for construction on August 23, 2022 and bids were opened on September 6, 2022. Only two prequalified bidders submitted new bids for the Project and the following table shows the results in order of lowest to highest:

Contractor Total Bid Amount
Beals Martin & Associates, Inc. $9,269,311
Gonsalves & Stronk Construction Co. $9,700,000
The lowest responsible and responsive bid was submitted by Beals Martin & Associates, Inc. with a total bid amount of $9,269,311.

The variance in the number of bids received can be attributed to previous bid results. There were two prequalified bidders that didn’t submit new bids possibly because they were higher than the previous lowest apparent bidder. Additionally, there was one prequalified bidder that didn’t submit a bid during the first advertisement or the readvertisement of the Project. Lastly, one bidder was preparing to submit a bid; however, was not able to submit prior to the deadline.

The variance between the two bids received can be attributed to additional time to review the construction documents and contact additional subcontractors for competitive pricing.

Staff has reviewed the bids received and recommends awarding the Project, authorizing the City Manager to execute a public projects agreement with Beals Martin & Associates, Inc. in the

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amount of $9,269,311, and authorizing the expenditure of contingency up to the available budget due to the size and complexity of the Project.

ALTERNATIVES:

Options available to the City Council include:

1. Adopt a resolution awarding the Fire Station No. 16 Replacement Project C9823, authorizing the City Manager to execute a public projects agreement with Beals Martin & Associates, Inc. of Redwood City, CA in the amount of $9,269,311, and authorizing an expenditure of contingency up to the Project budget;

2. Do not adopt the resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Steven Machida, Public Works Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution

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2 1
0 RESOLUTION NO. 2022 – ____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS AWARDING THE FIRE STATION NO. 16 REPLACEMENT PROJECT C9823; AUTHORIZING

THE CITY MANAGER TO EXECUTE A PUBLIC PROJECTS AGREEMENT WITH BEALS MARTIN & ASSOCIATES, INC. OF REDWOOD CITY, CA IN THE AMOUNT OF $9,269,311;

AND AUTHORIZING AN EXPENDITURE OF CONTINGENCY UP TO THE PROJECT BUDGET.

WHEREAS, in May 2019, staff sought City Council 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, Council approved the award of a Professional Services Agreement with Shah Kawasaki Architects; and
WHEREAS, in March 2022, staff posted the prequalification for the Fire Station No. 16 Replacement Project (“Project”) and received eight prequalification packages from potential bidders; and
WHEREAS, the City Engineer signed the final bid set on May 12, 2022 and the plans and specifications were approved by City Council at its May 23, 2022 meeting; and WHEREAS, the City advertised for bids for construction of the Project on June 8, 2022, five bids were received, and bids were opened on July 26, 2022; and WHEREAS, during the bidding of the Project, there were six addendums 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, at its August 22, 2022 meeting, City Council rejected all bids and authorized staff to re-bid the Project; and
WHEREAS, the City re-advertised the Project for construction on August 23, 2022, bids were opened on September 6, 2022, and two bids were received; and WHEREAS, the lowest responsible and responsive bid was submitted by Beals Martin & Associates, Inc. with a total bid amount of $9,269,311; and WHEREAS, staff has reviewed the bids received and recommends awarding the Project, authorizing the City Manager to execute a Public Projects Agreement with Beals Martin & Associates, Inc. in the amount of $9,269,311, and authorizing the expenditure of contingency up to the available budget due to the size and complexity of the Project.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council awards the Fire Station No. 16 Replacement Project C9823, authorizes the City Manager to execute a Public Projects Agreement with Beals Martin & Associates, Inc. of Redwood City, CA in the amount of $9,269,311, and authorizes an expenditure of contingency up to the Project budget. * * * * *

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2 1
0 I, 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 26th day of September 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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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Adopt a Resolution Authorizing the City Manager to Execute Agreements for Professional Services for On-Call Legal Services with Burke, Williams & Sorensen, LLP and Goldfarb & Lipman LLP, Each for an Amount Not to Exceed $200,000 and a Term of Two Years with the Option to Extend the Term by One Year.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution authorizing the City Manager to execute agreements for professional services for on-call legal services with Burke, Williams & Sorensen, LLP and Goldfarb & Lipman LPP, each for an amount not to exceed $200,000 and a term of two years, with an option to extend the term by one year.

FISCAL IMPLICATIONS:

There is no fiscal impact or additional appropriation needed at this time.

The proposed agreements for professional services would not commit the City of San Carlos to any fiscal obligations. The purpose of this action is to pre-qualify a select group of firms for services to be provided on an as-needed basis. The agreements include no retainer and no guarantee of work. When professional services are needed, staff will request a proposal from one or more of the firms, selecting the best firm based on cost, timeliness, and approach. Funding for on-call legal services on economic development and housing matters will come from the General Legal Services Account.

BACKGROUND:

Many of the projects the City is currently undertaking require specialized legal services, such as eminent domain proceedings, disposition and development agreements, and below market rate housing transactions and agreements. Frequently, outside legal counsel is used to provide these specialized services. As projects related to economic development and housing move forward, such as the redevelopment of 1232 Cherry Street and the acquisition of other property for economic development or housing purposes, these specialized legal services are increasingly needed. Using the services of outside counsel allows staff to proceed with these projects quickly and in a cautious and conservative manner. In the past, the City has contracted with Burke, Williams, & Sorensen LLP and Goldfarb & Lipman LLP to provide these services on an on-call basis. Special Counsel will work under the direction of or in consultation with the City Attorney.

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On August 18, 2022, the City released an RFQ (Attachment 2) soliciting responses from qualified firms to provide on-call legal services on economic development and housing matters. The City received three responses, which were reviewed by staff for completeness and ranked by submitter qualifications and experience. Staff opted to recommend two firms for on-call contracts.

ANALYSIS:

The intent in selecting two firms for on-call legal services is to allow the City flexibility when selecting which firm to use for particular services. These firms are considered full-service, with varying levels of experience on the Peninsula and in the areas of expertise that staff anticipates over the next several years. (See Attachment 3 for Statements of Qualifications for both firms; please note that work samples have been removed.)
The staff selection committee, consisting of the Community Development Director and Economic Development Coordinator, recommends contracting with Burke, Williams, & Sorensen, LLP and Goldfarb & Lipman LLP to provide on-call specialized legal services on economic development and housing matters.

Burke, Williams, & Sorensen, LLP (“Burke”)
Burke is a public law firm that has expertise in real estate, affordable housing, economic development, and eminent domain. Burke has worked on multiple projects under the previous on- call agreement, including two housing development projects, developer inclusionary housing regulatory agreements, and developing community benefits proposals for negotiation.

Goldfarb & Lipman, LLP
Goldfarb & Lipman is a full-service, Oakland-based firm with expertise in affordable housing, land use, community economic development, and eminent domain. Additionally, Goldfarb & Lipman assisted in representing the City on major development projects, as well as revising the City’s inclusionary housing requirements.

Conclusion.

The proposed agreements for professional services have a term beginning upon execution and ending September 30, 2024. The agreements would be renewable for an additional year at the City Manager’s option. Each of the full-service firm agreements would have a limit not to exceed $200,000 annually.

ALTERNATIVES:

The alternatives available to the City Council include:

1.Adopt a resolution authorizing the City Manager to execute agreements for professional services for on-call legal services with Burke, Williams & Sorensen, LLP and Goldfarb & Lipman LPP, each for an amount not to exceed $200,000 and a term of two years, with an option to extend the term by one year; or

2.Do not adopt the resolution; or

3. Provide staff with alternative direction

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Respectfully submitted by:

Al Savay, Community Development Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution

2. RFQ – Legal Services Economic Development and Housing

3. Statement of Qualifications

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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 AGREEMENTS FOR PROFESSIONAL

SERVICES FOR ON-CALL LEGAL SERVICES WITH BURKE, WILLIAMS, & SORENSEN,

LLP AND GOLDFARB & LIPMAN LLP, EACH FOR AN AMOUNT NOT TO EXCEED $200,000 AND A TERM OF TWO YEARS WITH THE OPTION TO EXTEND THE TERM BY ONE YEAR.

WHEREAS, many of the projects the City is currently undertaking require specialized legal services, such as eminent domain proceedings, disposition and development agreements, and below market rate housing transactions and agreements; and WHEREAS, in the past, outside legal counsel has been used to provide these specialized services; and
WHEREAS, as projects related to economic development and housing move forward, such as the redevelopment of 1232 Cherry Street and the acquisition of other property for economic development of housing purposes, these specialized legal services are increasingly needed; and
WHEREAS, the City released a Request for Quotations (RFQ) soliciting firms to provide on-call specialized legal services on economic development and housing matters; and WHEREAS, the City received three responses, which were reviewed by a selection committee for qualifications, experience, and price; and WHEREAS, the selection committee recommends Burke, Williams & Sorensen, LLP and Goldfarb & Lipman LLP be contracted with to provide on-call specialized legal services on economic development and housing matters.

NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of San Carlos authorizes the City Manager to execute agreements for professional services for on-call legal services for initial terms beginning upon contract execution and ending September 30, 2024; and BE IT FURTHER RESOLVED that the City Manager is authorized to extend the agreements for professional services for on-call legal services for an additional one-year period following the initial term at his or her sole discretion. * * * * *
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 26th day of September 2022, by the following vote:

AYES, COUNCILMEMBERS:___________________________________________ NOES, COUNCILMEMBERS:___________________________________________

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ABSENT, COUNCILMEMBERS:___________________________________________ ________________________________
CITY CLERK of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos

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REQUEST FOR
QUALIFICATIONS:

On-Call Legal Services Related to Economic Development
and Housing

Issue Date: August 18, 2022

Submittals Due: September 08, 2022

City Hall
600 Elm Street
San Carlos, CA
cityofsancarlos.org

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CITY OF SAN CARLOS
Request for Qualifications
2 | P a g e

BACKGROUND

The City of San Carlos (City) is located on the San Francisco Peninsula in San Mateo County and incorporated in 1925 as a General Law city. It is approximately 25 miles south of San Francisco and 26 miles north of San Jose. The city is about 6 square miles and has a population of slightly more than 30,000. Highway 101 runs through the eastern portion of the city, near an assortment of industrial and commercial uses, including a small airport and a small neighborhood of single- family homes. The west side of town extends into the Santa Cruz Mountains and is largely single- family residential with the exception of the El Camino Real and Laurel Street corridors and the City’s downtown. The city has high property values (median single-family home transacting at $2.4 million in 2021) and a high household income (median of $169,640).

Over 1.7 million square feet of high-tech research and development space is likely to be developed in the next few years on the City’s east side. Major employers include Natera, Pacific Gas & Electric, The Home Depot, Recology, Check Point Software Tech, Delta Star, Natera, Joby Aero, Atreca, and Thought Stream. Major retailers include Home Depot, Best Buy, REI, T.J. Maxx, Ross, PetSmart, and Trader Joe’s. Collectively, building construction and materials businesses (cabinetry, flooring, tiling, etc.) represents the largest commercial segment. Several hotel properties with high average daily rates and occupancy contribute to the tax base significantly.

Downtown San Carlos, located along Laurel Street from San Carlos Avenue to Arroyo Avenue, is the heart of the community and is a compact, walkable cluster of primarily one-story retail buildings with small storefronts. It has become an increasingly popular destination for restaurants and unique small shops.

Highways 101 and 280, and State Highway 82 (El Camino Real) move vehicle traffic from the north and south to the primary access points in San Carlos. Several major east-west spines move traffic into the commercial and residential areas. Traffic capacity at several major intersections in the commercial sector nearest the freeway is becoming increasingly constrained. San Carlos is also home to an airport operated by the County of San Mateo. San Carlos is also served by Caltrain, which operates a commuter train that stops at the historic San Carlos Depot near Downtown. Freight trains operate on the rails overnight.

The City is governed by a five-member City Council, with members selecting a Mayor for a one- year term, and an appointed City Manager. There is great emphasis on public participation in local government and the citizenry is quite active as well. Support and guidance for economic development comes from both a City Council subcommittee and a seven-member Economic Development Advisory Commission. The City Council also recently established a Housing Subcommittee.

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CITY OF SAN CARLOS
Request for Qualifications
3 | P a g e

The City has now turned its focus on proactive measures to expand its economic base and increase revenues. The 2016-2019 Economic Development Plan provided a comprehensive set of actions that the City achieved, including the creation of Industrial Business Association and the redevelopment of Wheeler Plaza. In 2021, the City Council adopted the 2021-2024 Economic Development Plan, which was developed with input from the Economic Development Advisory Commission, City staff, and consultants. The Plan includes the following strategic priorities:

 Sustain the Unique Character of Downtown
 Activate the Public Realm
 Promote Environmental Sustainability
 Support the Arts and Cultural Sector
 Support and Encourage Alternative Transportation Modes  Deploy New Technologies and Solutions to Increase Connectivity, Improve Parking, and Reduce Congestion
 Improve the Business Climate
 Create New Opportunities for Business Growth and Expansion  Expand the Supply of Housing
 Proactively Plan for Future Growth
 Increase Access to Childcare
The 2021-2024 Plan, was approved by City Council on November 8, 2021, is available here.

The Focused General Plan Update (Land Use, Housing, and Safety Element Updates, Accompanying Zoning Ordinance Update, and Environmental Impact Report) specifically centers on the City’s Housing and Environmental Safety Element updates as mandated by the State. The project also includes changes to the City’s Zoning Ordinance, particularly to increase residential densities to meeting the City’s Regional Housing Needs Allocation (RHNA). The project is halfway through a two-year initiative to guide housing decisions for the next eight years and to accommodate at least 2,735 new housing units from 2023-2031. This project will also review and update the City’s Environmental Safety Element, which focuses on reducing the potential short and long-term risks resulting from fires, floods, droughts, earthquakes, landslides, climate change, and other hazards.

More information here: https://www.sancarlos2040.org/

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CITY OF SAN CARLOS
Request for Qualifications
4 | P a g e
The City had the support of its Redevelopment Agency from 1986 until it was dissolved by the State in 2012. The Agency funded major public improvement projects, affordable housing and economic development. The City has assumed the role of Successor Agency and has retained several properties and financial assets of the former Low and Moderate Housing Fund.

Additionally, the City has a Below Market Rate Housing Ordinance that is presently under review but currently requires all residential developments of seven or more dwelling units to include least fifteen percent (15%) of the total units as below market rate units restricted for rent or sale by moderate-, low-, and very low-income households.

CONSULTING SERVICES NEEDED
The City of San Carlos is seeking proposals from qualified firms or individuals to provide on-call specialized legal services on economic development and housing matters. The City is interested in entering into contracts with several qualified firms to utilize, on an as-needed basis, based on expertise, availability and cost. Potential scope of services may include, but is not limited to:

Real Estate
Consultant's services will include providing assistance with real property transactions concerning disposition and/or development of City lands, including evaluation and advice regarding deal structure and terms, the negotiation and preparation of Development Agreements, Disposition and Development Agreements, Purchase and Sale Agreements, and Ground Leases, and related services as requested by the City.

Affordable Housing
Consultant's services will include the review and drafting of affordable housing agreements, including developer agreements, resale restriction agreements, regulatory agreements, loan and financing documents and related documents; the provision of advice regarding compliance with state and federal law and regulations; review and drafting of updates to City housing policies and ordinances; the review and negotiation of lender and investor documents, assistance with escrow and closing, general assistance to Economic and Community Development Department staff, and related services as requested by the City.

Eminent Domain
Consultant's services will include provision of advice and representation of the City in connection with potential eminent domain actions as requested by the City.

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CITY OF SAN CARLOS
Request for Qualifications
5 | P a g e

SUBMITTAL OF QUALIFICATIONS

Submittal Content
To be deemed complete, submittals must include all of the following:
 Company profile and qualifications including a summary of representative services or projects managed and specifically staffed by the individuals likely to be assigned.  Complete contact information for three recent clients for whom similar services described in this RFQ have been performed.
 Proposed compensation rates.
 Excerpts of relevant sample work.

Submittal Location and Deadlines

Interested parties should email their proposals by 5:00 p.m. PST, Thursday, September 08, 2022 to:

City of San Carlos
Cristian Padilla
[email protected]

Additional Information

The City assumes no responsibility for delays caused by delivery service. Postmarking by the due date will not substitute for actual receipt. All costs incurred during submittal preparation or in any way associated with the Consultant’s preparations, submission, presentation, or oral interview shall be the sole responsibility of the Consultant.

If awarded a contract, the consultant shall maintain insurance coverage, including worker’s compensation, reflecting the minimum amounts and conditions specified by the City. Consultants are liable for all errors or omissions contained in their proposals.

If you have any questions concerning this request for qualifications, please contact Cristian Padilla via email at [email protected] or phone at (650) 802-4267.

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CITY OF SAN CARLOS
Request for Qualifications
6 | P a g e

SELECTION PROCESS

Evaluation Criteria

In accordance with the Municipal Code, consultant selection shall be on the basis of demonstrated competence and on the professional qualifications necessary for the satisfactory performance of the services required and on fair and reasonable price. Evaluation considerations will include the following:

 Responsiveness of the proposal to the submittal requirements listed above  Clear indication of understanding of the work to be performed and demonstration of intent and ability to perform the work
 Professional qualifications and technical expertise
 Experience and track record conducting similar work for similar cities  Proposed compensation rates
 Completeness of submittal

It is the City’s intention to contract with a highly qualified bench of consultants. Your firm must not demonstrate depth in both economic development and housing but should have substantial experience in at least one of these two areas of expertise.

Should you have any questions concerning the project, please contact Cristian Padilla at [email protected] or (650) 802-4267.

The question cut-off date will be September 02, 2022, by 5 p.m.

Non-Obligation

The City retains sole discretion to evaluate submittals and may make an award to the consultant(s) the City deems to be most responsive to the request for qualifications. Receipt of submittals in response to its request for qualifications does not obligate the City in any way to engage any consultant and the City reserves the right to reject any or all submittals, wholly or in part, at any time, without penalty. The City shall retain the right to abandon the request for qualifications and selection process at any time prior to the actual execution of a contract with a consultant, and the City shall bear no financial or other responsibility in the event of such abandonment. The City reserves the right to negotiate all final terms and conditions of any agreements entered into.

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Agreement for Professional Services 1 Revised 04/08/2022

AGREEMENT FOR PROFESSIONAL SERVICES

This Agreement is made and entered into as of __________________ by and between the City of San Carlos hereinafter called "CITY" and ____________________ hereinafter called "CONSULTANT".

RECITALS

This Agreement is entered into with reference to the following facts and circumstances:

A. That CITY desires to engage CONSULTANT to render certain professional services in the CITY;

B. That CONSULTANT is qualified to provide such services to the CITY and;

THEREFORE, the CITY has elected to engage the services of CONSULTANT upon the terms and conditions as hereinafter set forth.

1. Services. The services to be performed by CONSULTANT under this Agreement shall include those services set forth in Exhibit A, which is, by this reference, incorporated herein and made a part hereof as though it were fully set forth herein.

Performance of the work specified in said Exhibit is hereby made an obligation of CONSULTANT under this Agreement, subject to any changes that may be made subsequently hereto upon the mutual written agreement of the said parties.

Where in conflict, the terms of this Agreement supersede and prevail over any terms set forth in Exhibit A.

2. Term; Termination. (a) The term of this Agreement shall commence upon the date hereinabove written and shall expire on June 30, 2024 unless renewed for one additional year by the City Manager. (b) Notwithstanding the provisions of (a) above, CITY may terminate this Agreement without cause by giving written notice not less than ten (10) days prior to the effective date of termination, which date shall be included in said notice. In the event of such termination, CITY shall compensate CONSULTANT for services rendered, and reimburse CONSULTANT for costs and expenses incurred, to the date of termination, calculated in accordance with the provisions of paragraph 3. In ascertaining the services actually rendered to the date of termination, consideration shall be given both to completed work and work in process of completion. Nothing herein contained shall be deemed a limitation upon the right of CITY to terminate this Agreement for

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Agreement for Professional Services 2 Revised 04/08/2022 cause, or otherwise to exercise such rights or pursue such remedies as may accrue to CITY hereunder.

3. Compensation; Expenses; Payment. CITY shall compensate CONSULTANT for all services performed by CONSULTANT hereunder in an amount based upon CONSULTANT’s hourly rates during the time of the performance of said services. A copy of CONSULTANT’s hourly rates for which services hereunder shall be performed are set forth in CONSULTANT’s fee schedule marked Exhibit B hereof, attached hereto and by this reference incorporated herein.

Notwithstanding the foregoing, the combined total of compensation and reimbursement of costs payable hereunder shall not exceed the sum of Two Hundred Thousand Dollars ($200,000) unless the performance of services and/or reimbursement of costs and expenses in excess of said amounts have been approved in advance of performing such services or incurring such costs and expenses by CITY’s City Manager (for contracts less than $75,000 or authorized by City Council action for contracts $75,000 or more by motion duly made and carried).

Compensation and reimbursement of costs and expenses hereunder shall be payable upon monthly billing therefor by CONSULTANT to CITY, which billing shall include an itemized statement, briefly describing by task and labor category or cost/expense items billed.

4. Additional Services. In the event CITY desires the performance of additional services not otherwise included within the services described in Exhibit A, such services shall be authorized in advance of the performance thereof by CITY’s City Manager (for contracts less than $75,000 or authorized by City Council action for contracts $75,000 or more by motion duly made and carried). Such amendment to this Agreement shall include a description of the services to be performed thereunder, the maximum compensation and reimbursement of costs and expenses payable therefor, the time of performance thereof, and such other matters as the parties deem appropriate for the accomplishment of such services. Any additional services causing the total contract price to exceed $75,000, shall require approval by the City Council. Except to the extent modified by written amendment, all other terms and conditions of this Agreement shall be deemed incorporated in each such amendment.

5. Records. CONSULTANT shall keep and maintain accurate records of all time expended and costs and expenses incurred relating to services to be performed by CONSULTANT hereunder. Said records shall be available to CITY for review and copying during regular business hours at CONSULTANT’s place of business or as otherwise agreed upon by the parties.

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Agreement for Professional Services 3 Revised 04/08/2022

6. Authorization. This Agreement becomes effective when endorsed by both parties in the space provided below.

7. Reliance on Professional Skill of CONSULTANT. CONSULTANT represents that it has the necessary professional skills to perform the services required and the CITY shall rely on such skills of the CONSULTANT to do and perform the work. In performing services hereunder CONSULTANT shall adhere to the standards generally prevailing for the performance of expert consulting services similar to those to be performed by CONSULTANT hereunder. CONSULTANT acknowledges the importance to CITY of the skill, competency, ability to appropriately work with CITY staff and expertise of individual staff assigned to the project, and accordingly the individuals assigned to the Project must be acceptable to CITY.

8. Documents. All documents, plans, drawings, renderings, and other papers, or copies thereof, as finally rendered, prepared by CONSULTANT pursuant to the terms of this Agreement, shall, upon preparation and delivery to CITY, become the property of CITY.

9. Relationship of Parties. It is understood that the relationship of CONSULTANT to the CITY is that of an independent contractor and all persons working for or under the direction of CONSULTANT are its agents or employees and not agents or employees of the CITY.

10. Schedule. CONSULTANT shall adhere to the schedule set forth in Exhibit A; provided, that CITY shall grant reasonable extensions of time for the performance of such services occasioned by governmental reviews of CONSULTANT’s work product or other unavoidable delays; provided, further, that such unavoidable delay shall not include strikes, lockouts, work stoppages, or other labor disturbances conducted by, or on behalf of, CONSULTANT’s officers or employees.

CONSULTANT acknowledges the importance to CITY of CITY’s Project schedule and agrees to put forth its best professional efforts to perform its services under this Agreement in a manner consistent with that schedule.

11. Indemnity. CONSULTANT shall indemnify, defend, and hold harmless City, its officers, employees, agents and volunteers from and against all liability, loss, damage, expense, and cost (including, without limitation, reasonable legal counsel fees, expert fees and all other costs and fees of litigation) of every nature arising out of or in connection with CONSULTANT’s negligence, recklessness, or willful misconduct in the performance of work hereunder, or its failure to comply with any of its obligations contained in this Agreement, except such loss or damage

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Agreement for Professional Services 4 Revised 04/08/2022 caused by the active negligence or willful misconduct of the City. It is expressly understood and agreed that the foregoing provisions are intended to be as broad and inclusive as is permitted by the law of the State of California and will survive termination of this Agreement. Nothing herein contained shall be construed to require CONSULTANT to indemnify CITY its officers, employees, agents and volunteers against any responsibility or liability in contravention of Section 2782 of the California Civil Code.

12. Insurance. CONSULTANT shall acquire and maintain Workers’ Compensation, employer’s liability, commercial general liability, owned and non-owned and hired automobile liability, and professional liability insurance covering risks relating to CONSULTANT’s services to be performed hereunder in form subject to the approval of the City Attorney and/or CITY’s Risk Manager. The minimum amounts of coverage corresponding to the aforesaid categories of insurance per insurable event, shall be as follows:

Insurance Category Minimum Limits

Workers’ Compensation statutory minimum

Employer’s Liability $1,000,000 per accident for bodily injury or disease. CONSULTANT shall submit
to City a Waiver of Subrogation
endorsement in favor of City, its officers,
agents, employees, and volunteers.

Commercial General Liability $1,000,000 per occurrence for bodily injury, personal injury, and property
damage, including without limitation,
blanket contractual liability and
coverage for explosion, collapse and
underground property damage hazards.

If a general aggregate limit applies,
either the general aggregate limit shall
apply separately to this project/location
or the general aggregate limit shall be
twice the required occurrence limit.

Coverage must be at least as broad as
Insurance Services Office form CG 00

01. Automobile Liability $1,000,000 per accident for bodily injury and property damage (coverage
required to the extent applicable to

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Agreement for Professional Services 5 Revised 04/08/2022 CONSULTANT’s vehicle usage in
performing services hereunder)

1Professional Liability $1,000,000 per claim and if a general aggregate limit applies, general
aggregate limit shall be twice the
required occurrence limit.

Concurrently with the execution of this Agreement, CONSULTANT shall furnish CITY with certificates and copies of information or declaration pages of the insurance required hereunder and, with respect to evidence of commercial general liability and automobile liability insurance coverage, original endorsements:

(a) Precluding cancellation or reduction in per occurrence limits before the expiration of thirty (30) days (10 days for nonpayment) after City shall have received written notification of cancellation in coverage or reduction in per occurrence limits by first class mail;

(b) CONSULTANT’s general liability policies shall be primary and non- contributory, and be endorsed using Insurance Services Office form CG 20 10 to provide that City and its officers, officials, employees, and agents shall be additional insured under such policies. An endorsement providing completed operations coverage for the additional insured, ISO form CG 20 37, is also required.

Claims Made Policies
If any of the required policies provide claims-made coverage:

1. The Retroactive Date must be shown, and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of contract work.

Verification of Coverage
Consultant shall furnish the CITY with original certificates and amendatory endorsements effecting coverage required by this clause. All certificates

1 Note: Professional liability insurance coverage is not required if the contractor/vendor/consultant is not providing a service regulated by the state. (Examples of service providers regulated by the state are insurance agents, professional engineers, doctors, certified public accountants, lawyers, etc.) Please check and initial the following if professional liability is NOT required for this agreement.  Recommended ______ [Project Manager]  Approved _______[Risk Manager]

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Agreement for Professional Services 6 Revised 04/08/2022 and endorsements are to be received and approved by the CITY before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Consultant’s obligation to provide them. The CITY reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

Waiver of Subrogation
Consultant hereby grants to CITY a waiver of any right to subrogation which any insurer of said Consultant may acquire against the CITY by virtue of the payment of any loss under such insurance. This provision applies regardless of whether or not the CITY has requested or received a waiver of subrogation endorsement from the insurer.

Acceptability of Insurers
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VII, unless otherwise acceptable to the City.

Special Risks or Circumstances
CITY reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

Coverage
It is a requirement under this agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be made available to the Additional Insured and shall be (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any insurance policy, whichever is greater.

Primary and Non-Contributory Coverage
The Additional Insured coverage under the Consultant’s policy shall be “primary and non-contributory” as will not seek contribution from the CITY insurance or self-insurance and shall be at least as broad as CG 20 01 04

12. Excess Insurance
The limits of insurance required in this agreement may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of CITY before the CITY insurance or self-insurance shall be called upon to protect it as a named insured.

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Agreement for Professional Services 7 Revised 04/08/2022

13. Workers’ Compensation. CONSULTANT acknowledges and certifies awareness of the provisions of the Labor Code of the State of California which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that Code, and CONSULTANT certifies and agrees to compliance with such provisions before commencing the performance of the work of this agreement.

14. Subcontractors (If applicable). CONSULTANT agrees to include with all subcontractors in their subcontracts the same requirements and provisions of this agreement including the indemnity and Insurance requirements to the extent they apply to the scope of the Subcontractors’ work. Subcontractors hired by CONSULTANT agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSULTANT is bound to CITY under the Contract documents.

Subcontract shall agree to include these same provisions in any agreement with a sub-subcontractor. CONSULTANT shall require all subcontractors to provide a valid certificate of insurance and the required endorsements included in the agreement prior to commencement of any work and will provide proof of compliance to the CITY.

Subcontractor shall agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSUTLANT is bound to CITY under the Contract Documents. Subcontractor shall further agree to include the same requirements and provisions of this agreement, including the indemnity and Insurance requirements, with a Sub-subcontractor to the extent they apply to the scope of the Sub-subcontractors’ work. A copy of the CITY Contract Document Indemnity and Insurance provisions shall be furnished to the subcontractor upon request.

15. Non-Discrimination. The CONSULTANT hereby assures that it will comply with Subchapter VI of the Civil Rights Act of 1964, 42 USC Section 2000 (e)(17), to the end that CONSULTANT will not exclude any person from participation in, be denied the benefits of, or be otherwise subject to discrimination from any project, program, or activity supported by this Agreement, based on the grounds of race, color, national origin, sex, disability, age, or religion,. CONSULTANT shall comply with its EEO Certification (Form PW-7). In addition, CONSUTLANT will not discriminate against any employee or applicant for employment because of race, color, religion, sex or national origin. The CONSULTANT will take affirmative action to insure that applicants are employed and the employees are treated during employment without regard to their race, color, religion, sex or national origin. Such action shall include, but not be limited to the following: employment, advancement, demotion, transfer, recruitment, or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including

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Agreement for Professional Services 8 Revised 04/08/2022 apprenticeship. The CONSULTANT shall at all times be in compliance with the requirements of the Federal Americans With Disabilities Act (Public Law 101-336) which prohibits discrimination on the basis of disability by public entities. The CONSULTANT agrees to post in conspicuous places available to employees and applicants for employment any notices provided by the CITY setting forth the provisions of this non-discrimination clause.

15. Notice. All notices required by this Agreement shall be given to the CITY and CONSULTANT in writing, by first class mail, postage prepaid, addressed as follows:

CITY: City of San Carlos
600 Elm Street
San Carlos, CA 94070
Attention: Cristian Padilla

CONSULTANT: _____________________
Address
Phone
Attention: ______________

16. Non-Assignment. This Agreement is not assignable either in whole or in part.

17. Amendments. This Agreement may be amended or modified only by written agreement signed by both parties.

18. Business Registration. VENDOR agrees to comply with Chapter 5.04 of the Municipal Code and pay all fees required to be paid.

19. Validity. The invalidity in whole or in part of any provision of this Agreement shall not void or affect the validity of any other provision of this Agreement.

20. Governing Law. This Agreement shall be governed by the laws of the State of California and any suit or action initiated by either party shall be brought in the County of San Mateo, California. In the event of litigation between the parties hereto to enforce any provision of the Agreement, the unsuccessful party will pay the reasonable attorney’s fees and expenses of litigation of the successful party.

21. Mediation. Should any dispute arise out of this Agreement, the parties shall meet in mediation and attempt to reach a resolution with the

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Agreement for Professional Services 9 Revised 04/08/2022 assistance of a mutually acceptable mediator. Neither party shall be permitted to file legal action without first meeting in mediation and making a good faith attempt to reach a mediated resolution. The costs of the mediator, if any, shall be paid equally by the parties. If a mediated settlement is reached neither party shall be deemed the prevailing party for purposes of the settlement and each party shall bear its own legal costs. If a party refuses or fails to participate in mediation in good faith prior to filing a lawsuit, then that party shall be barred from recovery of attorneys fees and costs of suit.

22. Conflict of Interest. CONSULTANT may serve other clients, but none who are active within the City of San Carlos or who conduct business that would place CONSULTANT in a "conflict of interest" as that term is defined in State law.

23. Entire Agreement. Each party acknowledges that this agreement, the exhibits hereto, and the documents incorporated by reference herein constitute the complete agreement and exclusive statement of the terms and conditions between the parties, which supercedes and merges all prior proposals, understandings and all other agreements, verbal and written, between the parties relating to the subject matter of this agreement. This agreement may not be modified or altered except by written instrument duly executed by both parties.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first above written by their respective officers duly authorized in that behalf.

CITY OF SAN CARLOS:

Dated: _______________ ______________________________ Jeff Maltbie, City Manager

ATTEST:

Dated: _______________ ______________________________ Crystal Mui, City Clerk

APPROVED AS TO FORM:

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Agreement for Professional Services 10 Revised 04/08/2022

Dated: _______________ ______________________________ Gregory J. Rubens, City Attorney

CONSULTANT/CONTRACTOR/VENDOR:

I acknowledge that I have full authority to execute this agreement on behalf of the Consultant/Contractor/Vendor, and have read, understand, and agree to comply with the provisions of this Agreement, including the Insurance and indemnity requirements set forth herein.

Dated: _______________ ______________________________

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Proposal to Provide
Legal Services to the
City of San Carlos
Proposed Lead Attorney
Anna C. Shimko
Burke, Williams & Sorensen, LLP
1 California Street, Suite 3050
San Francisco, CA 94111
p: 415.655.8115
e: [email protected]
Submitted September 8, 2022

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Los Angeles – Inland Empire – Marin County – Oakland – Orange County – Palm Desert – San Diego – San Francisco – Silicon Valley – Ventura County Direct No.: 415.655.8115
[email protected]
1 California Street - Suite 3050
San Francisco, California 94111- 5432
voice 415.655.8100 - fax 415.655.8099
www.bwslaw.com
September 8, 2022
Via email to [email protected]
Cristian Padilla
City of San Carlos
600 Elm Street
San Carlos, California 94070
Re: Proposal to Provide On-Call Legal Services Related to Economic Development and Housing
Greetings:

On behalf of Burke, Williams & Sorensen, LLP (“Burke”), I am pleased to submit this response to the Request for Qualifications issued by the City of San Carlos (“City”). Burke is extremely interested in providing legal services to the City related to real estate, affordable housing, economic development, and eminent domain.

Founded in 1927, Burke is a diverse, dynamic, and preeminent public law firm. For over 90 years, the representation of public agencies has been the cornerstone of Burke’s legal practice.

The firm currently serves the legal needs of over 200 local governmental entities, including cities, counties, joint powers authorities, and water and school districts. At the same time, Burke represents many private landowners and developers in the real estate acquisition, entitlement and development process. Our knowledge of both private and public real estate negotiations and development allows our team to use its insights and expertise to assist the City in its endeavors.

As described in the attached materials, we propose that I serve as lead attorney. I would be assisted by a team selected to provide able legal repr esentation tailored to the City’s specified needs, including Susan E. Bloch, Brenda Aguilar -Guerrero, Eric S. Phillips , and Meghan E.

Nihan.

As you know, Burke and its attorneys have represented the City for many years. Greg Rubens , now a Burke partner, serves as your City Attorney and I have represented the City for more than 15 years on complex land use development projects , CEQA review and litigation , and real estate deals. Such work has included all entitlements and CEQA review, and negotiation of a Development Agreement with City-recovered opportunity costs associated with development by the Palo Alto Medical Center of a new hospital campus. Current work involves two housing development projects and work with staff on several proposed development projects, developing community benefits proposals to negotiate with entities desiring to increase allowed

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Cristian Padilla
City of San Carlos
September 8, 2022

Page 2 ends

density and uses on their lands. Eric Phillips has represented the City of San Carlos in connection with the disposition of City -owned property for a ffordable housing development.

Tasks included negotiating and drafting a non-binding term sheet with the developer, identifying Surplus Land Act, CEQA, and NEPA compliance options, negotiating and drafting a DDA for the City’s property, and preparing supporting City documents. Susan Bloch has assisted Economic and Community Development staff with affordable housing matters, including developer inclusionary housing regulatory agreements and first time buyer resale restriction agreements.

In addition, Burke attorneys have represented the City in connection with several eminent domain matters.

Thank you for considering us. If you have any questions regarding this proposal, or if you would like additional information, please feel free to contact me at the number listed above. I look forward to hearing from you.

Very truly yours,
Burke, Williams & Sorensen, LLP
Anna C. Shimko
Partner and Chair
Real Estate, Law Practice Group

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TABLE OF CONTENTS

Page
Proposal to Provide On-Call Economic Development Page i Legal Services to the City of San Carlos

BURKE, WILLIAMS & SORENSEN, LLP .................................................................................. 1 About Burke ........................................................................................................................ 2 QUALIFICATIONS .................................................................................................................... 3 Affordable Housing .............................................................................................................. 3 Representative Affordable Housing Matters .................................................................. 4 Real Estate ......................................................................................................................... 5 Representative Real Estate Matters .............................................................................. 6 Eminent Domain .................................................................................................................. 7 Representative Eminent Domain Matters ...................................................................... 8 CEQA .................................................................................................................................. 9 Representative CEQA Matters .....................................................................................10 PROPOSED TEAM ..................................................................................................................13 Anna C. Shimko – Real Estate, Land Use and CEQA ........................................................13 Brenda Aguilar-Guerrero – Eminent Domain ......................................................................13 Susan E. Bloch – Affordable Housing .................................................................................14 Meghan E. Nihan – Real Estate, Land Use and CEQA ......................................................14 Eric S. Phillips – Real Estate, Land Use and CEQA ...........................................................15 REFERENCES ........................................................................................................................16 RATES .....................................................................................................................................16 Hourly Rates ......................................................................................................................16 Adjustments .......................................................................................................................16 Reimbursements ................................................................................................................17 Billing Format and Procedure .............................................................................................17 CONCLUSION .........................................................................................................................17 ATTACHMENT A – RESUMES
ATTACHMENT B – EXCERPTS OF WORK

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Proposal to Provide On-Call Economic Development Page 1 Legal Services to the City of San Carlos

BURKE, WILLIAMS & SORENSEN, LLP
Burke, Williams & Sorensen, LLP is a California limited liability partnership. Burke is comprised of 25 owners under the leadership of a Management Committee and Managing Partner. Firm management includes owners who practice substantially or entirely in the area of municipal law, and the firm has a longstanding commitment to the needs of its municipal clients. Details of our firm are listed below.

Firm Name Burke, Williams & Sorensen, LLP
Founded 1927
Name, Address, Telephone Number, and
Email Address of the Proposer’s Point of
Contact

Anna C. Shimko
Burke, Williams & Sorensen, LLP
1 California Street, Suite 3050
San Francisco, California 94111
Tel: 415.655.8115
Email: [email protected]
Number of Attorneys/Staff 139/70
Headquarters Office Burke, Williams & Sorensen, LLP
444 South Flower Street, Suite 2400
Los Angeles, California 90071
Tel: 213.236.0600 | Fax: 213.236.2700
Additional Firm Offices
Inland Empire
1770 Iowa Avenue, Suite 240
Riverside, California 92507
Tel: 951.788.0100 | Fax: 951.788.5785
San Diego
501 West Broadway, Suite 1600
San Diego, California 92101
Tel: 619.814.5800 | Fax: 619.814.6799
Oakland
1901 Harrison Street, Suite 900
Oakland, California 94612
Tel: 510.273.8780 | Fax: 510.839.9104
Silicon Valley
60 South Market Street, Suite 1000
San Jose, California 95113
Tel: 408.606.6300 | Fax: 408.606.6333
Orange County
1851 East First Street, Suite 1550
Santa Ana, California 92705
Tel: 949.863.3363 | Fax: 949.863.3350
San Rafael
181 Third Street, Suite 200
San Rafael, California 94901
Tel: 415.755.2600 | Fax: 415.482.7542
Palm Desert
73-929 Larrea Street, Suite 4A
Palm Desert, California 92260
Tel: 760.776.5600 | Fax: 760.776.5602
Ventura County
2310 East Ponderosa Drive, Suite 25
Camarillo, California 93010
Tel: 805.987.3468 | Fax: 805.482.9834

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Proposal to Provide On-Call Economic Development Page 2 Legal Services to the City of San Carlos

About Burke
For over 90 years, the representation of public agencies has been the cornerstone of Burke’s legal practice. Burke provides public entities with a full range of legal, advisory, transactional, and litigation services organized into nine practice groups: Public Law; Labor and Employment Law; Construction Law; Litigation; Environmental, Land Use and Natural Resources ; Real Estate and Business Law ; Insurance Coverage and Litigation; Intellectual Property; and Education Law. The firm’s 139 attorneys serve clients from ten offices throughout California, as well as modern modes of communication and travel . W e can easily be where our clients need us to be when they need us to be there.

The legal environment in which public entities are required to function is both diverse and complex. Recognizing this, our Public Law Practice Group contains many sub- groups and teams allowing our attorneys to specialize in particular areas of public law while still maintaining general public law expertise. These sub-groups include, but are not limited to, the following:

Real Estate and
Development
Land Use and Environmental
Law
Construction Law
 Surplus Land Act
 Negotiating Agreements
 Letters of Intent
 Disposition and
Development Agreements
 Purchase and Sale
Agreements
 Financing Agreements
 Ground Leases
 Real Property Disposition
 Entitlements
 Due Diligence
 Title and Survey Review
 Property Management
 Landlord/Tenant Matters
 Financing
 Land Use Planning and
Zoning
 California Environmental
Quality Act (CEQA)
 Development Agreements
 Growth Management
 Historic Preservation
 Annexation and
Incorporation – LAFCO
Proceedings
 Redevelopment and
Economic Development
 Endangered Species
 Sustainability and Green
Building
 Water Law and Public Trust
 Advising, preparing,
negotiating, and
resolving construction
claims
 Complex construction
litigation, arbitrations
 Construction contracts
and documentation
 Construction project
insurance
 General construction
advice and counseling
 Public works
construction advice,
claims, litigation

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QUALIFICATIONS
Our experience is described below , including some of our recent projects. Some excerpts of our relevant work are included in Attachment B.

Affordable Housing
Burke attorneys represent public agencies and private and nonprofit housing developers in all aspects of affordable housing development and financing, and the development and implementation of affordable housing programs and policies. Collectively, we have assisted in the development of thousands of units of affordable housing in California in developments funded with state and federal low -income housing tax credits, taxable and tax -exempt bond proceeds, local housing trust fund monies, redevelopment tax increment and housing successor funds, project -based Section 8 and VASH vouchers, CDBG, HOME, funds provided by the California Department of Housing and Community Development, conventional loans, and other sources.

Burke’s proposed team has extensive experience representing housing authorities, cities, counties, and former redevelopment agencies in connection with complex real estate and affordable housing transactions, including the acquisition, development, rehabilitation and disposition of property via purchase and sale and ground leases. In addition, our team provides expertise in land use matters, environmental remediation, public bidding and procurement, and in the negotiation and drafting of architect’s agreements and construction contracts. Our construction lawyers are well- versed in all aspects of procurement requirements and construction law, and our land use lawyers provide expertise in all aspects of land use entitlements.

We regularly advise public agencies regarding compliance with federal and state requirements pertaining to the development and management of affordable housing, including relocation requirements, prevailing wage, Davis -Bacon, CEQA/NEPA, ADA and fair housing issues , state and local land use and zoning laws, rent stabilization ordinances, density bonus law, the Surplus Land Act, Article 34, state and federal relocation requirements, California and federal fair housing laws, and state statues pertaining to agencies that have assumed the housing obligations and assets of former redevelopment agencies.

We have assisted in the design and implementation of program guidelines, development agreements, loan documents, regulatory agreements, and resale restriction agreements for first- time homebuyer, density bonus, inclusionary housing, rehabilitation loan programs, and other local affordable rental and homeownership programs.

On behalf of our public agency clients , we have negotiated and drafted documentation for ground lease transactions, multi -phase developments, and m ixed use projects that include ground floor retail and public purpose uses. In many cases, the transactions include the public agency’s retention of rights of first refusal or options to purchase the improvements at the end of the 15-year tax credit compliance period. We have extensive experience representing housing authorities, cities, and counties in connection with the financing of affordable housing rehabilitation and construction in transactions involving predevelopment, acquisition,

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rehabilitation, and construction/permanent financing structured as residual receipts loans. We represent public agencies in their roles as seller/ground lessor and as lender in connection with the review of developer limited partnership agreements, equity investor documents, including development agreements and right of first refusal/option agreements, and private and public agency construction and permanent loan documents, including the negotiation and drafting of subordination and inter -creditor agreements. We have negotiated and document ed dozens of public agency affordable housing loan transactions, including the preparation of disposition and development agreements, ground leases, predevelopment loan agreements, seller “carryback” loan documents, construction and permanent loan agreements, promissory notes, deeds of trust, indemnity and guaranty agreements, assignment and security agreements, affordable housing regulatory agreements for multi -family projects, and regulatory agreement/resale restriction agreements for affordable ownership projects. We handle title review, escrow and closing.

Representative Affordable Housing Matters
 Currently representing the Richmond Housing Authority and the City of Richmond on ground lease/disposition and financing matters relating to the conversion of the Authority’s public housing portfolio. We have represented the Richmond Housing Authority on these matters since the Spring of 2021, and the City of Richmond on land use, labor and employment, and other matters since 2010.  Currently representing the Santa Clara County Housing Authority on matters related to the management, operations, and financing of the Buena Vista Mobilehome Park, including leasing and tenant relocation matters. We have represented the Housing Authority on real estate and housing matters since 2015.  Currently representing the City of Petaluma in connection with the financing of affordable housing projects financed with City and County funds, CDBG -DR, Serna farmworker financing, and Project Homekey financing provided by HCD, and tax credit and tax - exempt bond financing. We have represented the City of Petaluma and its former redevelopment agency in similar matters for over 10 years.  Currently representing the City of Mountain View in connection with the disposition/ground lease of several City -owned properties for development of affordable housing, the refinancing of CDBG and HOME-financed developments, and in connection with affordable housing policy, development and finance matters, including projects developed using a combination of City housing trust funds, HOME funds, CDBG funds, low-income housing tax credits, tax -exempt bonds, and other sources. We have represented the City of Mountain View in these matters since 2013.  Currently representing the City of Napa and the Housing Authority of the City of Napa in connection with the financing of affordable housing projects financed with City and County funds, CDBG -DR and Serna farmworker, and Project Homekey financing provided by HCD, and tax credit and tax -exempt bond financing. We have represented the City of Napa and the Housing Authority in similar matters for over 10 years.

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 Currently representing Christian Church Homes in connection with purchase and sale/development and joint venture agreements for development of affordable senior housing on sites in California, Colorado, and Tennessee, and in negotiations with HCD and CalHFA regarding refinancing transactions. We have represented CCH on such matters since the Fall of 2020.
 Currently representing Renewal Ent erprise District, a joint powers agency of the City of Santa Rosa and Sonoma County and its affiliated nonprofit, the RED Housing Fund, as general counsel, and in connection with operation of an affordable housing loan fund.

Our representation includes provision of advice regarding Brown Act, conflict of interest, governing board composition and operating procedures, public records act issues, preparation and review of agendas and board packets, negotiation and drafting of consulting contracts, and the preparation and negotiation of loan documents. We have represented these entities since their formation in the Spring of 2020.  Currently representing YWCA Golden Gate Silicon Valley and YWCA Apartments, Inc., in connection with refinancing of public agency l oans, and property management issues for a HUD Section 202 senior apartment project. We have represented these entities since 2014.
 Currently representing the City of Morgan Hill on affordable housing policy matters including density bonus and inclusionar y housing, finance and transactional matters including disposition, development and loan transactions for multi -family acquisition, rehabilitation and new construction projects, and the administration of first -time homebuyer programs. We have represented the City on these matters since 2013.

Real Estate
Burke attorneys regularly represent public agencies (as well as private development entities) throughout California in connection with land disposition and development transactions, including the sale of lar ge blocks of previously undeveloped real estate such as former military base properties. Our real estate and disposition and development work includes advising public agency clients regarding compliance with the State Surplus Land Act (Government Code section 54220 et seq.), including evaluation of potential exemptions, and where exemptions are not available, preparation of notices of availability, negotiation with preferred housing sponsors, drafting of declarations of restrictive covenants to comply with Government Code sections 54233 and 54233.5, and preparation and submittal to the State Department of Housing and Community Development (HCD) of requests for compliance determination as desired. Burke attorneys have extensive experience drafting and negotiating exclusive negotiating agreements, letters of intent, sale disposition and lease disposition and development agreements, purchase and sale agreements, ground leases and leases for interim operation, management and security. In addition to our real p roperty transactional expertise, Burke attorneys have a broad range of experience with all manner of real property development including entitlement, due diligence, title and survey review, asset management, loan administration, property management and landlord/tenant matters, subdivision matters, statutory development agreements, allocation of environmental risks in acquisitions, sales, and leasing transactions, financings, formation of community facilities and assessment districts, and review and drafting

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of CC&Rs. Burke attorneys offer a broad range of knowledge and experience that enables us to effectively negotiate and document all aspects of complex real estate transactions, and to protect and enforce our clients’ interests in litigation when called upon.

Representative Real Estate Matters
 Currently representing the City of Santa Clara concerning all real estate and land us e aspects of the public-p rivate partnership between the City of Santa Clara and Related Companies for phased development of 240 acres of City-o wned, former municipal landfill property . We negotiated and drafted the Dispos ition and Development Agreement, the Development Agreement and the form leas es for Related to ground lease the land from the City in about 7 phases consisting of 9.1 million square feet of retail, entertainment, hotel, office and residential uses. Our team advised on all aspects of the environmental impact report (“EIR”) for the project and suc cessfully defended the EIR in court. We helped to c raft the new General Plan des ignation and other General Plan amendments, and the new Mas ter Community Plan (zoning document) to guide all future development with a balance of clear standards and flexibility to accommodate future market shifts, as well as the Infrastructure Master Plan to ens ure fair and timely pairing of development with infrastructure. We continue to work on projec t implementation, including negotiating and drafting implementation agreements concerning landfill operation and maintenance, insurance levels, road construction and maintenance, CC&Rs, reimbursement for extra polic e services, and funding of transportation improvements; removing title ex ceptions; and further discretionary approvals for the forthcoming initial phases of the project.  Currently advising the City of San Carlos with respect to development agreement negotiations and community benefits packages for proposed projects, including the Alexandria Center for Life Science and the proposed development at 405 Industrial.  Represented the City of Fos ter City with disposition of a 15-a cre surplus City -owned property to a developer for development of the Foster Square mixed use project whic h includes 200 for sale homes, 66 affordable housing units, 150 assisted living units and 30,000 square feet of neighborhood retail s urrounding a privately owned and maintained, publicly accessible plaza area. The sale transaction included provision of City-seller carryback financing which was repaid in full prior to successful completion of the project. Burke also represented the City of Foster City in connection with a mas ter development agreement and various phase specific development agreements for the Foster City Pilgrim Triton mixed use project which includes commercial office uses, neighborhood serving retail and 800+ residential units, including 60+ live/work units, and a large privately owned and maintained and public ly accessible plaza area. This multi- phased development required coordination among multiple property owners/developers.  Represented the City of Vallejo in connection with the negotiation and drafting of a disposition and development agreement for the sale of 125 acres of North Mare Island property to the Nimitz Group that was approved in April 2022.

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 Currently representing City of Menlo Park in all CEQA review and entitlements , and negotiating development agreement with Meta (formerly Facebook) , for approximately 3 million square foot mixed -use project. The development is at the City’s bonus level of density, requiring that the applicant provide community amenities valued at half the amount of the increased value to the developer from the bonus level development.  Currently assisting the City of Oakland in negotiating and preparing a developm ent agreement for the proposed Oakland A’s new ballpark and mixed- use project at Howard Terminal in Oakland, which will be coordinated with Port of Oakland ground lease documents and a public facilities financing plan. We are also working on all entitlements documents, including General Plan amendment, a new zoning designation, a Planned Development permit and a tentative map.

Eminent Domain
Burke’s eminent domain attorneys have substantial experience, both substantively and procedurally, and have represented public entities in acquiring virtually all types of properties, involving both full take and partial takes. O ur eminent domain legal team, which consists of 14 attorneys throughout 7 offices, regularly helps public entities use eminent domain authority effectively and responsibly to build public projects. From project planning to public hearings, and from negotiation to trial and appeal, we help keep the process on track and minimize public entities’ financial risks. We work with our public entity clients to negotiate resolution of cases efficiently and economically, and to use eminent domain only as a last resort. We understand our clients’ concern over potential negative public sentiment reg arding eminent domain. When cases cannot be resolved through settlement efforts, we help educate our clients regarding the process and have an outstanding record of success using the court process to achieve our clients’ objectives. This includes obtaining pre -condemnation rights of entry, obtaining pre- judgment orders for possession, resolving “right to take” objections by demur or bench trials, and resolving valuation issues through jury trials.

Burke’s attorneys have litigated eminent domain and/or inverse condemnation matters throughout the State, including in San Bernardino, Riverside, Los Angeles, Orange, San Diego, Ventura, San Benito, Monterey, Santa Cruz, Santa Clara, San Mateo, Alameda , El Dorado, Calaveras, and Placer Counties. If an eminent domain action is filed, our eminent domain team handles every aspect of the litigation, including the drafting of pleadings, undertaking discovery, obtaining prejudgment orders of possession and, where necessary, taking the matters through trial and appeal. We routinely and effectively uses legal issues motions pursuant to Section 1260.040(a) of the Code of Civil Procedure to narrow the issues and drive eminent domain litigation towards settlement instead of trial. We also has substantial experience in preventing and, when necessary, successfully litigating right -to-take challenges. Burke regularly defends public agencies against inverse condemnation claims brought by property owners and businesses claiming damages stemming from, among other things, the construction of nearby public project s, the temporary/permanent re- routing of traffic and the expiration of temporary construction easements when the project is not yet complete.

In addition to litigating eminent domain actions, Burke’s attorneys routinely draft transactional documents necessary for the acquisition of real and personal property, including purchase and

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sale agreements, possession and use agreements, rights of entry, land swaps, options, reversionary interests, deeds, leases, and other real estate transactional documents. The firm’s eminent domain attorneys are well- versed in assisting clients with issues arising under the Uniform Relocation Act and California’s Relocation Assistance Act, CEQA, and complicat ed land use issues. Burke’s attorneys have also provided advice and assisted with the disposition of excess/surplus remnant parcels at the end of a project.

Burke is proud to have provided eminent domain and condemnation advice, representation and litigation services to the following public agencies located throughout California: Alameda Corridor-East Construction Authority (ACE) on behalf of the San Gabriel Valley Council of Governments, Alameda County, Alhambra and Alhambra Redev. Ag., Banning, Beaumont, Bellflower, Buellton, Calistoga, Camarillo, Chino Hills, Concord, Contra Costa County, Council of San Benito County Governments, Danville, El Segundo, Emeryville , Fremont, Friant Water District, Hawthorne School District, Hemet, Housing Authority of the City of Los Angeles, Industry/Industry Urban Development Agency, Inglewood, Irvine Ranch Water District, Laguna Woods, Livermore, Los Angeles County Sanitation District No. 2; Los Angeles County Metropolitan Transportation Authority (LACMTA), Los Angeles World Airports (LAWA), Moorpark, Napa, Placentia, Pasadena, Orange County Flood Control District; Otay Water District, Pacific Gas & Electric Company; Rohnert Park, San Benito County, Santa Clara, Santa Clara County, Santa Clara Valley Transportation Authority, Housing Authority of the County of Santa Clara, San Gabriel Valley Council of Governments, Silicon Valley Power, Santa Clarita and Santa Clarita Redev. Ag., Sonoma County Transp. District, Southwestern Community College District, Sacramento, The San Francisco Bay Area Rapid Transit District (BART), Stockton, Stanton, Santa Monica Community College District , Transportation Agency of Monterey County, and Wildomar.

Representative Eminent Domain Matters
 Currently representing the City of Inglewood to acquire 10 private parcels out of 41 parcels that are needed for the Inglewood Basketball and Entertainment Center Project.

The City has owned 31 of the parcels that sat vacant for decades. In fact, despite four decades of efforts, 25 acres, (nearly 90% of the Projec t Site) sits vacant. We assisted the City with the negotiation and drafting of a disposition and development agreement and development agreement to ensure minimal roadblocks in case the City opted to utilize eminent domain to acquire said parcels. Despite numerous right to take challenges, the City obtained early prejudgment possession which allowed construction to start within six months of filing the various actions. The City also prevailed at the Right to Take Bench trial, has settled four of the matters, and we are now preparing for the Just Compensation jury trials.
 Assisted the Council of San Benito County Governments (COG) with all aspects of the right of way process and acquisitions and condemnation for the Highway 25 Bypass Project and the Highway 25 Safety Project. A total of 44 property acquisitions were required for the Bypass Project. Two properties were acquired in their entirety as full fee takes, one business was relocated, one household was relocated, and one rental tenant was relocated. The remaining acquisitions were partial fee takes, public utility easements, and temporary construction easements. We assisted COG staff and

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consultants in preparing initial offers, staff reports, resolutions of necessity, an amendment to their joint powers agreement, in negotiating settlements, and in drafting purchase and sale agreements. We attended project meetings and assisted with coordination of all consultants and the project team which included Caltrans representatives, design personnel, utility representatives, and right of way consultants.

Sixteen cases were f iled. Most involved complex legal and valuation issues relating to severance damages, highest and best use, development potential, dedication requirements, zones of value, and benefits. Thirty roadway easements and partial fee acquisitions were needed for the Highway 25 Safety Project, but we settled them all and only ended up filing two cases which ultimately settled in the early stages of litigation.  Represented BART and VTA in several multi -property acquisitions for the BART extension project from t he City of Fremont to Downtown San Jose, as well as other BART expansions over the years. For Phase 1 of BART’s extension to Silicon Valley, the acquisitions for which we assisted ranged from full takes of multi -acre industrial parks containing numerous m ultitenant masonry buildings requiring complicated relocations of numerous business tenants, to complex acquisitions involving highest and best use and project influence issues. We drafted numerous purchase and sale agreements including one for a property valued at $26 million, drafted license agreements, and obtained orders for prejudgment possession. We also assisted with complicated relocation, valuation, goodwill, and “improvements to the realty,” issues.

CEQA
Burke attorneys regularly represent public agencies throughout California in connection with real estate development matters including CEQA compliance, land use, entitlement, zoning and permitting matters, and California’s increasingly stringent housing development laws . Burke attorneys offer a broad range of knowledge and experience that enables us to effectively function as key and integral members of the City’s team of staff and other consultants. We roll up our sleeves and pitch in where needed to achieve the City’s legal and policy objectives.

Burke’s CEQA and land use attorneys have substantial experience advising our clients on the development of general plans, specific plans, and zoning codes, and litigating challenges thereto. Burke’s team often work on master plan approvals for lar ge campus-like areas (including for Pixar’s Emeryville campus, VMWare’s Palo Alto campus, Kaiser’s San Francisco campuses, and the Santa Clara City Place project). In so doing, we strive to help create a CEQA envelope and land use entitlement package that w ill serve long term needs, structured creatively with sufficient flexibility to address evolving markets, service needs, and technologies.

As to CEQA compliance, Burke regularly assists public agencies with the preparation and defense of environmental documents prepared pursuant to CEQA. Even when representing private entities, our lawyers often become trusted advisors to all parties in the CEQA process because of our cooperative and straight -forward approach to the issues and the depth of our expertise. Our team deals with CEQA issues on a daily basis and provides regular legal advice, opinions, and comments regarding all aspects of the process, including strategy and adequacy of documents.

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Throughout the administrative project consideration process, our CEQA/NEPA attorneys keep in mind the possibility of litigation, and build the administrative record with that as a possibility, ensuring that all necessary documents are put before the decision- maker to ensure the best possible record to support the client’s position on a project. Because many of Burke’s lawyers work at both the administrative approval and advice level and in ensuing litigation, we find ourselves well poised for seamless and cost effective litigation.

We regularly provide legal advice, opinions, and litigation services to our clients in potential or on-going CEQA lawsuits. Burke’s attorneys have served as counsel to petitioners, respondents, real parties in interest and amicus parties in CEQA litigation, including some of the higher impact CEQA decisions. While we often have been involved at the administrative level CEQA review and project approval processes that lead up to litigation, we are also sometimes called in as noted CEQA litigation experts to take on cases once litigation ensues. At both the trial and appellate court levels, we have successfully defended CEQA determinations made by our public agency clients or the public agencies that granted our private clients’ entitlements. We are well prepared at all court levels to quickly address and fend off injunctive relief and stay requests and pride ourselves on developing complete litigation plans and then successfully implementing them through strategic law and motion practice and persuasive merits briefing and oral argument. Finall y, recognizing that sometimes settlement is the best option for the client, we have frequently negotiated agreements to resolve lawsuits (sometimes even before the litigation is filed) without the need for trial or to avoid appeals.

Representative CEQA Matters
 City of San Carlos. For many years, we have acted as special counsel to the City of San Carlos concerning CEQA compliance and land use assistance for large or complex projects. For instance, we represented the City with respect to the full EIR, General Plan designation, zoning amendments and detailed Development Agreement for the controversial Palo Alto Medical Facility hospital and medical center. We defended the City’s Mitigated Negative Declaration to transform fields at Highlands Park to turf fi elds, and helped negotiate and document a settlement agreement in that case. Recently, we advised the City on an EIR for lighting and other improvements at two popular parks/sports fields. In addition, we assisted the City with the EIR and entitlements f or a large new office building. We are currently assisting the City with CEQA review and Housing Accountability Act issues concerning two adjacent proposed housing projects.  C
ity of Santa Clara – Tasman East. Our team represented the City with respect to all CEQA and land use aspects of the preparation of the Tasman East Focus Area Specific Plan (“Specific Plan”), which was adopted in November 2018 and now governs the development of a 46-acre, transit-oriented, primarily residential neighborhood (up to 4,500 dwelling units in total ), with 10 acres of open space, up to 106,000 square feet of retail uses, and potentially a new school. The Specific Plan and its EIR are expected to be used to streamline land use approvals and CEQA review for proposed residential developments within the Specific Plan Area. As such, the Specific Plan will play a key role in the City’s efforts to meet its Regional Housing Needs Allocation (RHNA) goals.

Our team advised on both legal and policy considerations pertaining to the Specific Plan itself, together with the drafting of amendments to the General Plan and Municipal Code

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to reflect the creation of a new Transit Neighborhood Zoning district. We also participated in the scoping and preparation of the Specific Plan EIR, including strategizing on responses to comments on a range of issues such as the adequacy of public transit services, the preservation of aquatic habitat, and traffic and other environmental impacts specific to the establishment of a school within the Specific Plan Area.
 City of Los Angeles – Target. We have defended the City in numerous CEQA and land use lawsuits. In this one, we worked closely with the City and counsel for Target to defend the City’s creation of a new specific plan designation and application of it to only the site for the West Hollywood Target, relying on an earlier EIR for the Target store.

The City had taken these actions following disapproval by the trial court of variances for the project. The lawsuit, brought by two neighborhood groups, concerned supplemental CEQA review, whether and what reasonably foreseeable future projects were required to be addressed (reminiscent of Laurel Heights Improvement Assn. v. Regents of Univ. of California (1988) 47 Cal. 3d 376 “Laurel Heights I”), and spot zoning. Our team assembled the administrative record and briefed the issues. Anna Shimko argued for the City at the trial court. The trial court ruled against the City and an appeal followed.

Again, our team comprehensively briefed the issues and Anna argued the case at the Court of Appeal, joined by former Court of Appeal Justice Vogel on behalf of Target.

The Court of Appeal reversed the trial court in full in Citizens Coalition Los Angeles v.

City of Los Angeles (2018) 26 Cal. App. 5th 561. Both challenger organizations filed Petitions for Review with the California Supreme Court. Our team prepared the City’s Answer opposing such petitions, and the Supreme Court declined to take review but depublished the Court of Appeal opinion. The Target store is now open.  City of Los Angeles – Landmark Apartments. Our land use litigation team helped the City to defend an EIR for a large apartment project, with success on all but one small issue and defeating a motion for attorneys’ fees. In a case brought by Golden State Environmental Justice Alliance (“GSEJA”), we assisted with the full complement of briefing at the trial court concerning greenhouse gas emissions, health risk assessments, shading impacts, energy analysis, and the EIR certification process. Anna Shimko argued the case (and numerous motions) at the trial court level. The court upheld the EIR in all respects except the energy analysis due to an error in the calculations that mistakenly indicated that the project would result in a decrease in energy use. Following argument over the contents of the writ of mandate, the court ruled that, though a recirculated energy section was required, the project approvals and EIR could remain in place and construction could continue. Counsel for GSEJA filed a motion seeking more than $600,000 in attorneys’ fees. In response, we initiated much - contested discovery against the GSEJA lawyers and executive director, staved off efforts to depose the City’s and developer’s counsel, and took four depo sitions. Using data gleaned, we opposed the attorneys’ fee motion. In January 2019, the trial court denied the motion on the grounds that the result secured was not a substantial public benefit and that GSEJA has a financial interest in litigation it initiates. In the meantime, we assisted the City in preparing the Recirculated Energy Analysis, certifi ed in February 2019. We have successfully caused an untimely appeal to the Court of Appeal to be dismissed and opposed two Petitions for Writ of Supersedeas at the Court of Appeal

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aimed at stopping project construction. We represented the City in defending the timely appeal on the merits, focused on the thresholds of significance and methodology for analyzing greenhouse gas emissions. Steve Velyvis, Gail Kavanagh, and Anna Shimko prepared the brief to the Court of Appeal. Ms. Shimko argued this case before the Court of Appeal and the City prevailed in the case. When the Petitioner appealed the trial court’s denial of attorneys’ fees, Burke lawyers Gail Kavanagh and Anna Shimko briefed and argued such case for the City at the Court of Appeal, and the City prevailed here as well. Ms. Kavanagh prepared an Answer to a request that the California Supreme Court accept the case for review, and the Court denied the Petition for Review.  Monterey Peninsula Water Supply Project. For two decades, our team has represented numerous environmental consulting firms undertaking CEQA and NEPA review work for projects before the CPUC, including transmission lines, nuclear power units, and the sales of all fossil-fueled power plants in the state. Under this construct, our client is the pertinent consulting firm but we work closely with and our work benefits the CPUC. The Monterey Peninsula Water Supply Project is a proposed desalination plant along Monterey Bay, proposed by California American Water to supply water in lieu of illegal water removal from the Carmel River. Over the past decade, we helped prepare an EIR for the project in a form that was approved but later abandoned after CPUC approval.

More recently, our team assisted actively in preparing a comprehensive and detailed joint CEQA/NEPA EIR/EIS for the controversial current iteration and location of the desalination project. The EIR/EIS depended on groundwater characterization and modeling, and we researched and drafted all elements of the EIR/EIS addressing water rights as well as several master responses and many individual responses to comments.

We helped to scope and reviewed in detail all parts of the EIR/EIS, including multiple rounds of late comments. We drafted the CPUC’s CEQA findings, commented internally on the proposed CPUC decision, and recently completed work on the analysis to the CPUC on the requests for rehearing of its approval. Two entities filed Petitions for Writ of Review with the California Supreme Court, the only court with authority to consider the sufficiency of the EIR/EIS under CEQA if it elects to do so. We assisted the CPUC with its Answer aimed at convincing the Supreme Court not to grant review, and the Supreme Court denied review.
 Kaiser Foundation Health Plan. The Burke team works with Kaiser Foundation Health Plan, Inc., on CEQA and land use issues in several jurisdictions, including in San Francisco and Oakland. We have helped to draft and process Kaiser’s Institutional Master Plan, required by the City and County of San Francisco. We have worked with Kaiser on entitlement issues at the Geary campus and the French campus, such as helping secure demolition permits for facilities no longer needed. We worked extensively on a proposed new medical office building in the Potrero Hill area of San Francisco, working closely with City staff and with a co-developer of the proposed site on entitlement applications and preparation of a “community plan exemption” streamlined CEQA document under CEQA Guidelines section 15183. In light of community opposition, we helped Kaiser successfully pivot to a site in the Mission Bay area of San Francisco, where the medical center was built.

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PROPOSED TEAM
We propose Anna C. Shimko to serve as lead attorney. We propose Anna, Eric S. Phillips, and Meghan E. Nihan for real estate, land use and CEQA matters, Susan E. Bloch for affordable housing matters, and Brenda Aguilar -Guerrero for eminent domain. Resumes detailing our team’s experience are attached. We would tailor a team to efficiently address the City’s needs for each particular matter, and if appropriate, we would draw upon the expertise of additional Burke attorneys with expertise in applicable issues. In addition, the fact that Greg Rubens, the City Attorney, practices at Burke would streamline effective communications and coordination.

Anna C. Shimko – Real Estate, Land Use and CEQA
Anna Shimko joined Burke in 2014 as a Partner in Burke’s San Francisco office. Anna is chair of Burke’s Real Estate and Business Practice Group and focuses her practice on all areas of land use, real estate development and environmental law, representing both public agencies and private landowners and developers in administrative and court proceedings. Anna has particular expertise in compliance with CEQA and NEPA and has worked daily in those arenas for more than 25 years. She works closely with project proponents, public agencies, and environmental consultants on preparing and defending CEQA and NEPA documents such as categorical exemptions, negative declarations, environmental impact reports (EIRs), and environmental impact statements (EISs), including for complex projects such as water right s transfers, desalination plants, and alterations to nuclear plants. She enjoys rolling up her sleeves to help clients devise the optimum CEQA/NEPA path and tackling complex projects that raise challenging issues in the CEQA/NEPA puzzle (particularly in the realms of transportation, air quality and climate change, water supply and rights issues, growth- inducing effects, alternatives, and cumulative impacts). Anna helps private clients through all stages of the land use approval process, obtaining entitlements to build or expand large shopping centers, stand - alone retail stores, mixed- use projects, hospitals, hotels and resorts, golf courses, residential developments and quarries, among others. She also assists cities, counties, special districts, and state agencies in regulating land and development, negotiating real estate transactional documents and development agreements, and updating general plans, specific plans, and zoning codes.

Brenda Aguilar-Guerrero – Eminent Domain
Brenda Aguilar -Guerrero recently joined Burke as a partner in Burke’s Oakland office. She formerly served as the chair for Meyers Nave’s statewide Eminent Domain and Inverse Condemnation Practice Group and has been representing public entities on complex eminent domain and inverse condemnation matters for more than 25 years. She has assisted clients with large, complex multi -billion infrastructure projects requiring hundreds of acquisitions, as well as smaller scale projects throughout the state for a variety of clients. Brenda likes to get involved at the initiation of a project to ensure that her clients are following all state and federal regulations and laws. She attends project meetings, obtains right of entry, drafts and/or reviews/revises acquisition documents, works with cons ultants/clients to execute acquisition strategies, reviews appraisals for legal compliance, and negotiates with property owners; assists in drafting staff reports, resolutions of necessity and notices to property owners; prepares

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complaints and all documents required to file the condemnation action(s); obtains orders for prejudgment possession; and handles all litigation through the filing and recording of Final Orders of Condemnation. She has served as lead counsel on numerous right to take bench and jury trials for a number of clients. She has been recognized as a Northern California Super Lawyer and The Best Lawyers in America for Eminent Domain and Inverse Condemnation in 2020, 2021, and 2022. She received her J.D. from the University of California, Los Angeles, School of Law in 1990 and was admitted to the State Bar of California that same year. She received her B.S. from U.C. Berkeley.

Susan E. Bloch – Affordable Housing
Susan Bloch has over 25 years of experience representing public agencies and private and nonprofit developers in connection with the disposition, development and financing of affordable housing and mixed- use projects, and the development and implementation of affordable housing policies and programs.

Susan has provided special counsel services on real estate and affordable housing transactions for Alameda County, Placer County, the Santa Clara County Housing Authority, the City of Richmond Housing Authority, and the cities of Oakland, Union City, San Leandro, San Jose, Mountain Vi ew, Morgan Hill, San Carlos, Daly City, South San Francisco, Petaluma, Napa, Pleasanton, Dublin, and Livermore. Her nonprofit housing clients include Veterans Housing Development Corporation, the California Odd Fellows Foundation, the Hilarita- Tiburon Ecumenical Association , Christian Church Homes, YWCA Golden Gate - Silicon Valley , the Renewal Enterprise District and the RED Housing Fund.

Susan has extensive experience in negotiating and documenting ground leases, disposition and development agreements, loan documents, affordable housing regulatory agreements, and inclusionary housing and density bonus agreements. . She has represented numerous jurisdictions in connection with the disposition, development and financing of affordable housing and mixed-use projects that involve public agency financing and/or the sale or ground lease of City or County-owned land.

Meghan E. Nihan – Real Estate, Land Use and CEQA
Meghan Nihan received her J.D. from the University of California, Los Angeles School of Law in 2013 and was admitted to the State Bar of California the same year. She received a B.A. in Political Science and a B.A. in History from the University of California, Los Angeles. Meghan practices in the areas of real estate and land use. She assists cit ies in preparing and negotiating disposition and development agreements . She also assists public agency clients and private landowners in negotiating and preparing purchase agreements, deeds, ground leases, leases, subleases, licenses, and easements. At a previous firm, Meghan also advised public agency staff regarding the property acquisition and eminent domain process during the planning phase of public transportation projects.

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Eric S. Phillips – Real Estate, Land Use and CEQA
Eric Phillips received h is J.D. from the University of California, Berkeley School of Law in 2012 and was admitted to the State Bar of California the same year. He received his B.S. in Urban and Regional Studies from Cornell University. Eric practices in the areas of land use, r eal estate, and CEQA compliance. He represents clients in all phases of the development process, including property acquisition, entitlement and administrative approvals, CEQA compliance, compliance with state housing laws, and negotiating real estate dis putes. Eric has particular experience with State Density Bonus Law, the Housing Accountability Act, SB 35, and Housing Element Law. In addition to working on these issues as a lawyer since 2012, Eric started his career in 2002 as a planning consultant based in Berkeley, California.

Eric has served as special counsel to numerous public agencies and provides advice on writing ordinances and legislative findings related to zoning, subdivisions, inclusionary housing programs, rent control and tenant protection measures, and impact fees. Eric has experience preparing, reviewing, and applying land use plans and development standards; reviewing subdivision proposals and crafting conditions and implementation agreements to comply with the Map Act; negotiating and drafting development agreements; and overseeing the work of technical consultants to prepare draft and final EIRs and other CEQA -compliant documentation.

Eric also serves as the Vice President of Policy and Legislation for the California Chapter of the American Planning Association, and he frequently presents to state elected officials, legislative staff, local boards, and planners regarding compliance strategies in the ever -evolving fields of land use and housing law.

Eric has recently worked with the Ci ty of San Carlos on two projects. On behalf of the City, Eric drafted the term sheet, exclusive negotiating agreement, and predevelopment loan agreements with Eden Housing for the development of an affordable housing project on property acquired by eminent domain on Cherry Street, and he continues to work with City staff to create a Development and Disposition Agreement and permanent loan documents to facilitate development of the housing project. Eric has also advised City staff regrading CEQA compliance for a proposed housing development on Alameda de las Pulgas. In addition, as his prior firm, Eric worked with the City to draft an updated Inclusionary Housing Ordinance following the adoption of AB 1505, also known as the “Palmer fix” legislation.

Some other recent examples of Eric’s work include the preparation of a development agreement and related approvals for the “North Village” development in Healdsburg, approval of a 100% - affordable residential development project in unincorporated Alameda County and the successful defense of the County’s approval against a CEQA lawsuit, consultation on complex entitlement applications for mixed- use projects in Mountain View and Sunnyvale, and drafting updates to inclusionary housing, ADU, and density bonus or dinances in myriad jurisdictions throughout the state. Eric also recently assisted the City of Coronado and the City of Solana Beach in drafting ordinances to implement SB 9. Eric has overseen comprehensive General Plan and zoning code updates in Belmont, and he has contributed to Specific Plans in Mountain View, Sunnyvale, Cupertino, and other jurisdictions. He also worked on aspects of Housing Element Updates in Coronado, Solana Beach, Napa County, Menlo Park, Moraga, San Marino, and Alhambra.

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REFERENCES
We are proud of our service record with our clients. We encourage you to contact the existing client references listed below about the merits of Burke, its personnel, and its services.

Client Name and Address Contact | Tel | Email
City of Menlo Park
701 Laurel Street
Menlo Park, CA 94025
Justin Murphy, City Manager
650.330.6610
[email protected]
City of Santa Clara
1500 Warburton Avenue
Santa Clara, CA 95050
Elizabeth Klotz, Assistant City Attorney
408.615.2232
[email protected]

Ruth Shikada, Assistant City Manager
408.615.2219
[email protected]
City of Mountain View
500 Castro Street, 3rd Floor
Mountain View, CA 94041
Sandra Lee, Assistant City Attorney
650.903.6480
[email protected]

RATES
We believe that the rates quoted below are reasonable and competitive.

Hourly Rates

Staffing Hourly Rate
Senior Partners $525
Junior Partners $460
Senior Associates $395
Junior Associates $345
Adjustments
The rates for legal services quoted in this proposal will remain in effect for the first year of the contract, until January, 2024. At that point and annually t hereafter, rates would be adjusted based upon the CPI for the San Francisco Bay Area.

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Reimbursements
We routinely charge our clients for our direct out -of-pocket expenses and costs incurred in performing the services. These costs and expenses commonly include such items as reproduction of documents, facsimile, mileage reimbursement for travel at the IRS approved rate, and other costs reasonably and necessarily incurred in performing services for the City.

We do not charge a service fee or overhead for cost reimbursement items. We also do not charge for computer or word processing time. Reimbursement amounts may be adjusted annually.

Expense Rate
In-house reproduction charges
black and white 20¢ per page
Color $1 per page
Mileage 62.5¢ per mile (or current IRS rate)
Facsimile $1 per page
All other costs reasonably and
necessarily incurred in performing
services for the City

at cost

Billing Format and Procedure
Bills are sent out each month invoicing charges for the prior month. Fees for our services are charged in increments of 1/10th of an hour. The bills provide a specific description of the work performed by all attorneys, the time actually spent on the work item, and the billing rate of the attorney. These bills also contain itemized descriptions of any out -of-pocket expenses incurred during the prior month.

CONCLUSION
Burke has the experience, dedication, and resources to serve the City’s needs ethically, efficiently, and cost-effectively. We will be happy to provide you with any additional information you require about our firm and welcome the opportunity to meet face -to-face to discuss Burke’s capabilities and readiness to represent the City of San Carlos . We appreciate your consideration of our proposal.

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ATTACHMENT A – RESUMES

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PRACTICE GROUPS
Environmental, Land Use, and Natural
Resources
Real Estate and Business

EDUCATION
J.D., Cornell Law School, 1986
B.A., Urban Studies, University of
California, Davis, 1983

ADMISSIONS
State Bar of California

AFFILIATIONS
Secretary/Librarian, Land Use and
Environment Committee, American
College of Real Estate Lawyers
President, Harbor Equity Group, Waldo
Point Harbor, April 2015 – present
Marin Montessori School Campus
Planning Committee, 2015-present
Advisory Council and Board of Directors,
San Francisco Planning and Urban
Research Association, 2003-2014
California Building Industry
Association/California Business Properties
Association, CEQA Reform Task Force,
1992-present
Treasure Island/Yerba Buena Island
Citizens Advisory Board, 2001-2004
San Francisco Juvenile Probation
Commission, 1996-2000
Vice President, Associated Students of UC
Davis, 1981
City of Davis Ad Hoc Committee to Update
the Housing Element, 1982
Anna C. Shimko
Partner
Pronouns: she, her, hers
San Francisco [email protected]
1 California Street, Suite 3050 415.655.8115 D
San Francisco, California 94111 415.655.8100 T

Anna Shimko is Chair of Burke's Real Estate and Business Practice Group.

She focuses her practice on all areas of land use, real estate development, and environmental law, representing both public agencies and private landowners and developers in administrative and court proceedings to bring projects to fruition . Anna has part icular expertise in compliance with the California Environmental Quality Act (CEQA) and the National Environmental Policy Act (NEPA). She works closely with project proponents, public agencies, and environmental consultants on preparing and defending CEQA and NEPA documents such as negative declarations, environmental impact reports (EIRs), and environmental impact statements (EISs), including for complex projects such as water rights transfers, multi-phased mixed -use projects and large campus master plans . Anna helps private clients through all stages of the land use approval process, obtaining entitlements to build or expand large shopping centers, stand -alone retail stores, mixed -use projects, hospitals, hotels and resorts, golf courses, residential dev elopments, and quarries, among others. She also assists cities, counties, special districts, and state agencies in regulating land and development, negotiating real estate transactional documents and development agreements, and updating general plans, spe cific plans, and zoning codes. Anna represents clients in matters involving the Subdivision Map Act, annexation, historic resources, public-private partnership transactions and financing mechanisms, the Coastal Act, air quality regulations, water supply, climate change regulations, transportation planning, eminent domain, and inverse condemnation. Anna litigates land use, CEQA, and NEPA matters for public and private clients at trial court and appellate court levels, and serves as an expert witness throughout California in cases involving land use development issues.

RESULTS
Private Developers
 Represented a well -known Bay Area computer animation studio in securing development agreement and zoning for a four -phase headquarters project.
 Defended in court the EIR and entitlements for a 20,000 -acre residential development and open space preserve in the Carmel Valley.  Represented one of California’s largest grocery store chains and a large nationwide home improvement store in numerous projects throughout the state to build new stores or expand existing venues.  Represented residential developer in obtaining local and coastal permits, including through several lawsuits and global settlement of Coastal Act, wetland, subdivision, traffic, and inverse condemnation issues.

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 Assisted prominent football team in drafting ballot measure and seeking permits for new stadium and shopping mall.
 Represent Native American tribe with environmental review under state compact for new casino, as well as with CEQA and NEPA documen ts for federal and state permits related to highway improvements, management contract and other permits, and with associated litigation.  Secured major use permit amendments for renovation of Napa Valley resort on National Register of Historic Places.
 Defended in court EIR and general plan consistency findings for shopping center in Monterey County involving water supply, traffic impact, and hazardous materials issues.  Assisted private developer with transit-oriented development grant funding and entitlements from and agreements with public agencies for housing project near rapid transit station.  Represented national developer in obtaining development agreement and all permits for phased shopping center, residential, and hotel project on redevelopment lands.
 Defended CEQA review and height variance at trial court and Court of Appeal for demolition of unreinforced masonry building and construction of new research laboratory.  Worked with a Bay Area developer on an EIR, development agreement and permits for a mi xed-use, phased redevelopment of commercial uses on port lands.
 Represented a national hotel chain in its renovation of a high-end San Francisco hotel.

Public Agencies
 Represent the City of Los Angeles defending land use and CEQA litigation concerning City approval of development projects at the trial and appellate court levels.  Represented City of Albany in preparing an EIR for a waterfront development master plan, and later negotiated and defended in court a development agreement and gaming ordinance for a card room facility at a live horse racing venue on the waterfront.
 Assisted the University of California at San Francisco with preparing EIRs (and defending associated litigation) for its acquisition of the Mount Zion Hospital and development of a biome dical research facility and administrative research space at the Laurel Heights campus.
 Represent City of Santa Clara with ground leases, development agreements, EIRs and entitlements for private development of entertainment, office, retail, and residential uses on city land adjacent to Levi’s Stadium.  For City of San Carlos, prepared development agreement with Palo Alto Medical Foundation for hospital and medical office project, and assisted with EIR, general plan amendments and all permits.  Represented City of Orinda with a specific plan and EIR for mixed-use development of the Gateway Valley.  Worked with consulting firms to advise the California Public Utilities Commission in environmental review for the sale of fossil-fueled and hydroelectric power plan ts and siting new transmission lines and substations throughout the state, for replacement facilities at nuclear power plants, and for desalination plant to supply water to Monterey Peninsula.
 Assisted Zone 7 Water Agency with an EIR for a water supply, transfer, and storage program.  Defended CEQA review of City of San Carlos decision to replace grass with turf on City play fields.

INSIGHTS
Presentations
“Avoiding Speed Bumps at the Intersection of Land Use and Real Estate Law,” 37th Annual Real Property La w Section

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Retreat, Hyatt Regency Embarcadero, April 21, 2018
“CEQA: An Update,” California Water Law Conference, San Francisco, CA, November 13, 2017 “California Environmental Quality Act: Key Developments Affecting Water Projects,” Annual California Wate r Law Conference, San Francisco, November 2016
“Current Developments in CEQA Law and Practice,” The Administrative and Public Environmental Law Conference, June 2015
Speaker, “Current Issues in Land Use Regulation and Development,” California Environmental Quality Act Update Cases Late 2011 to Present, California Continuing Education of the Bar, September 2012 “Aetna Springs Resort,” California Building Industry Association Select Conference on Industry Litigation, April 2012 “Hydraulic Fracturing: Permitting and Environmental Reviews,” The Seminar Group, November 2011 “Americans with Disabilities Act Primer,” 2011 for insurance company “Cumulative Impacts,” Climate Change, Cumulative Impacts and Compliance: 6th Annual National Environmental Policy Act (NEPA) CLE International Conference, January 2010 “Coming Soon to Your State or Federal Government: the Climate Change Regulation Experience in California,” ICSC U.S. Shopping Center Law Conference, October 2009
“The Benefits of Development Agreements,” League of California Cities Planners Institute, March 2009 “Land Use in Northern California,” Law Seminars International, March 2009 “AB 32 Session Climate Change: Science, Law & Policy,” California Business Properties Association, Fall 2008 “The Changing Climate of California Real Property Law,” California Continuing Education of the Bar, Fall 2008 “Green Building Conference,” CLE International, February 2008 “The Challenges of Urban Development: Trends and Legal Issues for Real Property Practitioners,” C alifornia Continuing Education of the Bar, Fall 2007
“Land Use Regulation and Development,” California Continuing Education of the Bar, Fall 2006 “Regulatory Takings Conference,” CLE International, 2003 “2002 Spring CEQA Workshop Series,” Association of Environmental Professionals, 2002 “Regulatory Takings Conference,” CLE International, 2002 “CEQA: What Is It and How Does It Impact Telecommunications Projects?,” Federal Communications Bar Association, Northern Chapter, 2002

RECOGNITIONS
American College of Real Estate Lawyers, Elected Member Lambda Alpha International (global land economics society), Elected Member California’s Top 50 Development Lawyers, Daily Journal, 2014 Selected to The Top 50 Women Attorneys in Northern California, Super Lawyers Magazi ne 2004-2005 Selected to Northern California Super Lawyers, 2004 – present Best Lawyers in America (Land Use and Zoning), 2012 – present

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PRACTICE GROUPS
Public
Real Estate and Business
Litigation

EDUCATION
J.D., University of California, Los Angeles,
1990
B.A., Social Welfare, University of
California, Berkeley, 1987

ADMISSIONS
State Bar of California
Supreme Court of the United States
United States Court of Appeals for the
Ninth Circuit
United States District Court for the Eastern
District of California
United States District Court for the
Northern District of California

AFFILIATIONS
Board Member, Alameda County Bar
Association, 2022
Member, Women Lawyers of Alameda
County, Alameda County (past President)
Member, Chapter 2 (San Francisco/Santa
Rosa) and 42 (San Jose) of the
International Right of Way Association
UC Berkeley Alumni Delegate to the
California State Legislature
Member, East Bay La Raza Association,
2017
Program Co-Chair, Annual Northern
California Eminent Domain Conference,
CLE International, 2007- current

Brenda Aguilar-Guerrero
Partner
Oakland [email protected]
1901 Harrison Street, Suite 900 510.903.8819 D
Oakland, California 94612 510.273.8780 T

Brenda Aguilar-Guerrero has represented public entities on complex eminent domain and inverse condemnation matters for more than 25 years. She has assisted clients with large, complex multibillion -dollar infrastructure projects requiring hundreds of acquisitions, as well as smaller scale projects throughout the state for a variety of clients.

Brenda likes to get involved at the initiation of a project to ensure that her clients are following all state and federal regulations and laws. She attends project meetings, obtains rights of entry, drafts and/or reviews acquisition documents, works with consultants/clients to execute acquisition strategies, reviews appraisals for legal compliance, and negotiates with property owners; assists in drafting staff reports, resolutions of necessity and notices to property owners; prepares complaints and all documents required to file the condemnation action(s); obtains orders for prejudgme nt possession; and handles all litigation through the filing and recording of Final Orders of Condemnation.

Brenda has served as lead counsel on right -to-take and jury trials for a number of clients. She has also defended clients sued for inverse condemnation, dangerous condition of public property, and nuisance claims.

She has handled eminent domain and/or inverse condemnation actions for the Santa Clara Valley Transportation Authority, Council of San Benito County Governments, Bay Area Rapid Transit Distr ict, San Mateo County Transit District, Transportation Agency of Monterey County, Santa Cruz County Regional Transportation Commissi on, Central Contra Costa Sanitation District, County of Calaveras, County of El Dor ado, County of San Benito, County of Yolo, Town of Los Altos, City of Dublin, City of Inglewood, City of Sacramento, City of San Leandro, City of Morgan Hill, City of Palmdale, City of Rancho Cordova, City of South San Francisco, East Bay Regional Park Dis trict, Santa Clara Valley Water District, Glendale Housing Authority, Fremont Redevelopment Agency, City of Fremont, City of Elk Grove, County of Fresno, County of Napa, Napa County Flood Control and Water Conservation District, City of Brentwood, Hayward Unified School District, City of Antioch, and City of Saratoga.

RESULTS
 Inglewood v. Savine; Danfar/Affif; Quon; Michino & Bhalla , et al., LASC Court Case Nos. 21STCV06223, 21STCV06249, 21STCV06195, 21STCV06062, 21STCV06064, and 21STCV06065 (2021)
For purposes of conducting the right to take trial, The Honorable Elaine Lu consolidated six eminent domain actions filed to acquire properties needed for the Inglewood Basketball and Entertainment Project , the future home of the Clippers NBA team, after defendants in each of those cases asserted right to take challenges including a Public Use Challenge.

There were a total of twelve right to take challenges asserted. Brenda served as lead counsel for the City of Inglewood and after a five day bench trial, Inglewood prevailed on all the challenges.

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RECOGNITIONS
Northern California Super Lawyers list:

Eminent Domain, Super Lawyers
Magazine, 2020-2021
The Best Lawyers in America, Eminent
Domain and Inverse Condemnation Law,
2020-2022
"Top Defense Result," Top Verdicts of
2015 Special Report, Daily Journal,
February 2016
Unity Award, Minority Bar Coalition, 2015
Wiley Manuel Pro Bono Award, The State
Bar of California
Sloan Fellowship, Carnegie Mellon
University, Pittsburgh, Pennsylvania,
School of Urban and Public Affairs
 TAMC v. MWM Investments, LLC, et al., Monterey Superior Court Case No. 17CV001231 (2019)
Brenda served as lead trial counsel for TAMC on this case where TAMC needed to acquire a portion of a warehouse building on a 4.7 ‐acre industrial parcel. After a three ‐week jury trial, the jury found TAMC owed nearly $930,000 less than the landowner’s final demand. The jury verdict was $730,000 less than the deposit made by TAMC and ordered by the trial judge
 Celebron v. City of Palmdale et a l.: Simmons v. Palmdale and Faulk v. Palmdale (2017)
More than 30 plaintiffs brought separate actions against the City of Palmdale involving inverse condemnation, nuisance, negligence, and trespass claims as a result of a massive 2015 rain storm that caused substantial flash flooding and debris flow. With a “return frequency” at 1000 years, the storm overwhelmed the City's public improvements.

Brenda served as lead counsel on the cases and obtained favorable results for Palmdale by: (1) negotiating the dismissal of Palmdale from the Simmons action within a fe w months of the filing of the action, (2) prevailing on a summary judgment motion in the Faulk action by establishing that the epic storm was a superseding, intervening cause of plaintiffs’ damages , and (3) negotiating a settlement of the remaining Dunagan/Celebron plaintiffs, which was paid by the pooling entity with a minimal contribution from the City of Palmdale. After Brenda successfully argued a summary judgment motion that resulted in the dismissal of numerous plaintiffs, the motion served as the catalyst to get the remaining cases settled at substantially less than it would have cost the City to prepare summary judgment motions in those cases.
 Gonzalez v. Johnson (2015)
Brenda successfully represented the City of Sacramento in defeating the last legal challenge to the $477 million entertainment and sports arena in downtown Sacramento that serves as the home for the Sacramento Kings NBA team. After an 11-day trial with 18 witnesses, more than 150 exhibits and the presentation of an administrative reco rd, Sacramento Superior Court Judge Tim Frawley issued a proposed Statement of Decision finding that “plaintiffs have failed to meet their burden of proof on any of their causes of action” and awarded the recovery of defense costs.

Opponents settled their case for dismissal of all claims with prejudice in exchange for a waiver of costs. In an attempt to overturn the City’s approval of the arena, opponents had alleged that the public -private partnership supporting the arena engaged in a “secret subsidy,” col lusion, fraud, concealment, waste and illegal expenditure of public funds, along with alleged illegalities in the City’s $325 million in bond financing. The case also addressed unadjudicated law as plaintiffs’ reverse validation claim challenged the City’s finding that there were “significant public benefits” from issuing bonds under the Marks -Roos Local Bond Pooling Act of 1985. Prior to Gonzalez v. Johnson , there was little judicial guidance for cities in their issuance of bonds under the Act. The Daily Journal selected the victory in Gonzalez v. Johnson as a “Top Defense Result” in its special report of the Top Verdicts for 2015.  Bay Area Rapid Transit (BART) v. PPF Industrial, et al. (2015) In a case raising complex questions on valuation of “improvements pertaining to the realty,” as well as unique relocation and goodwill issues,

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Brenda overcame the bloated appraisals from a business owner, saving the transit district over $4 million. A medical device sterilization business, represented by Norm Matteonni and Peggy O’Laughlin, sought $9.85 million in eminent domain just compensation from BART. As a result of motions in limine, that amount was reduced to $9.4 million. The jury awarded the business only $5.4 million, forcing it to return $400,0 00 to BART from the agency’s pretrial deposit—a rare occurrence in eminent domain disputes.  Santa Clara Valley Transportation Authority (VTA): SVBX BART Project and CELR Project Brenda served as counsel on numerous eminent domain matters filed by VTA to acquire property for a 10 -mile extension of the BART system to the Silicon Valley. The acquisitions range d from full takes of multi -acre industrial parks containing numerous multitenant masonry buildings requiring complicated relocations of numerous business tenants, to complex acquisitions involving highest and best use and project influence issues.

Brenda drafted purchase and sale agreements including one for a property valued at $26 million, drafted license agreements, and obtained orders for possession. She also assisted with complicated relocation, valuation and improvements to the realty issues.

Brenda was also successful in having the Business Owner accept her final offer, after the jury w as empaneled, that was hundreds of thousands of dollars below the Business Owner’s trial testimony. ( VTA v. RK Logistics (2013)).

Brenda was part of the trial team that prevailed at a trial involving 10 separate right -to-take challenges. The challenges were raised in a condemnation action brought to acquire property owned by a shopping center for the construction of the Capitol Expressway Light Rail Project. In Santa Clara Valley Transportation Authority v.

Eastridge Shopping Center, LLC (Case No. 1 -11-CV- 209524), judgment was entered in favor of VTA on all ten challenges including CEQA objections raised by Eastridge’s counsel (Gibson Dunn), Macy’s West Stores’ counsel (Matteonni O’Laughlin & Hechtman), J.C. Penney’s counsel (Turner & Turner Law) and Sears’ counsel (SNR Denton).
 Santa Clara Valley Transportation Authority: The U.S. 101 Auxiliary Lanes Project After the complaints and motions for prejudgment possession had been filed by in -house counsel to respond to the numerous oppositions filed by several large developers, Google, a water district, and a City, Brenda was successful in getting stipulated orders for possession and reaching early settlements with all the property owners.

Five actions were filed to acquire various property interests needed for this project to relieve traffic congestion by constructing auxiliary lanes and extending high occupancy vehicle (HOV) lanes on Highway 101 between State Route 85 in Mountain View and Embarcadero Road in Palo Alto. The settlements required coordination with the various property owners and Caltrans, as well as implementation of creative strategies.  Transportation Agency of Monterey County (TAMC) – Salinas Rail Extension Project Brenda is presently assisting TAMC with Package 2 of a 16 -mile commuter rail exten sion project. She filed 10 eminent domain actions, settled nine and tried one of these actions to verdict for Package 1 and for Package 2, she filed three actions. She has settled all three actions and is assisting with the final aspects of Package 2 . She advised TAMC through the pre -condemnation phase, assisting with valuation, relocation, project coordination, and appraisal issues for both packages. She also assisted TAMC with numerous hardship acquisitions.  Council of San Benito County Governments (COG) – Highway 25 Bypass Project Brenda assisted COG with all aspects of the right -of-way process, acquisitions and condemnations for the Highway 25 Bypass Project. A total of 44 property acqu isitions were required for the P roject. Two properties were acquired in their entirety as full fee takes; one business was relocated; one household was relocated; and one rental tenant was relocated. The remaining properties were acquired as partial fee takes, in addition to the acquisition of public utility easements and temporary construction easements. Brenda assisted COG staff and consultants in preparing initial offers, staff reports, resolutions of necessity, and an amendment to their joint powers agreement, as well as in negotiating settlements. Sixteen cases were f iled. Most involved complex legal and valuation issues relating to severance damages, highest and best use, development potential, dedication requirements, zones of value, and benefits.

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Four cases are described below.

Council of San Benito County Governme nts v. Hollister Inn , (2012) 209 Cal.App.4th 473. The property owner, Hollister Inn, who owned and operated a Best Western Hotel in the City of Hollister near the intersection of Highways 25 and 156, objected to the taking of its access easement across ano ther property owner’s property which provided the hotel direct access to Highway 25, which it alleged was its main entrance. At the right -to-take trial, the court found that COG committed a gross abuse of discretion by failing “to consider the possibility of taking the property of an adjoining landowner to provide Hollister Inn access to Highway 25” pursuant to section 1240.350. The trial court further found that COG “failed to exercise its discretion to determine whether the project was planned or located in the manner that will be most compatible with the greatest public good and the least private injury.”
After COG complied with the conditional dismissal, Hollister Inn accepted COG’s final offer, and COG appealed.

The Court of Appeal reversed the trial co urt and vacated the award of attorney’s fees and costs. It found that the trial court erred in issuing an order of conditional dismissal against COG and in awarding reasonable litigation expenses to Hollister Inn. It also found that section 1240.350 does n ot authorize a public entity to condemn land to provide access to other private property when that property is cut off from access to a particular public access but is not landlocked.

Council of San Benito County Governments v. Roberts et al., San Benito Superior Court, Case No. CU -06-00050.

This case involved a full take of two adjacent parcels with a total area of 2.76 acres. One of the parcels was partially improved for use as a trailer sales and repair facility. Portions of both parcels were taken as un economic remnants. The case was bifurcated after the tenant disclaimed any and all rights to compensation for its leasehold interest in the property. The property owner made an initial demand of $3,606,780, supported by a summary statement of his trial appraiser. COG deposited $1,052,000 as just compensation. The case settled for $1,562,938 on the eve of trial. The court granted judgment for COG as to the tenant’s claim for loss of goodwill; the tenant was seeking a six-figure settlement.

Council of San Be nito County Governments v. K&S Market, et al., San Benito Superior Court, Case No. CU -06- 00047. This case involved a partial take of two adjacent parcels totaling 5.271 acres. The land was improved with a Safeway Food and Drug Store and a Safeway Service S tation. As a result of one of the fee takes, Safeway lost 28 parking spaces. It was undisputed that the Safeway parking was already at a minimum. After negotiations with Caltrans and the owners/tenants, Brenda negotiated a settlement in which Caltrans agre ed to allow COG to provide an excess parcel to the defendants for conversion into a parking lot for the store. This creative settlement resulted in great savings for all parties, especially COG.

Council of San Benito County Governments v. McNamee, et. al. , San Benito Superior Court, Case No. CU -06- 00048. This case involved a partial take of 1,494 square feet that eliminated 175.01 feet of the parcel’s frontage on San Felipe Road. The defendants sought substantial severance damages. Brenda argued at trial that defendants were not entitled to any severance damages because they could not show a “substantial impairment of access to their remainder parcel.” The trial court agreed and the Court of Appeals for the Sixth Appellate District affirmed.  BART’s San Francisco Airport Extension Project
Brenda represented San Mateo County Transit (SamTrans) and BART on various cases related to BART’s extension to the San Francisco International Airport.

Two cases are described below.

San Mateo County Transit District v. Ci ty and County of San Francisco, et al., San Mateo County Superior Court, Case No. 405695. Brenda represented SamTrans in this action involving 50 separate parcels of property over approximately 8 miles of the former San Francisco Market Street Railway righ t-of-way. This case presented numerous challenging appraisal issues regarding full and partial takings, temporary construction and subterranean utility easements located on both residential and commercial property, as well as loss of goodwill. Favorable settlements were negotiated with 58 of the 59 named defendants. One defendant business tenant refused to settle and Brenda obtained summary judgment by establishing its lack of entitlement to loss of goodwill. On appeal, the summary judgment was affirmed.

San Mateo County Transit District v. Tanforan Park Shopping Center, et. al., San Mateo County Superior Court, Case No. 407836. Brenda represented SamTrans to acquire land for the construction of the San Bruno BART

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Station. The subject fee acquisition consist ed of 5 acres of land that had been designated as parking for a shopping center. Permanent underground utility and temporary construction easements affecting approximately 8,800 square feet were also condemned. The case presented complex valuation issues r elated to severance damages, including entitlement, highest and best use, development potential, parking usage, and benefits.

Significant goodwill loss claims also were asserted. As part of the eight -week jury trial, Brenda tried the goodwill issues. The jury returned a verdict of $0 for national retailer Sears on its goodwill claim.  North Concord BART Station
Brenda defended BART in an inverse condemnation action brought by over 100 plaintiffs living near the BART extension from Concord to the North Concord Station. The case consisted of three consolidated actions brought by homeowners and residents who claimed physical damage and personal injuries allegedly suffered during the period of construction and operation. Thirteen separate causes of action w ere alleged. Brenda negotiated a very favorable settlement for BART that included payment on only some of the construction related claims. Judgment was entered in favor of BART on all other claims.

INSIGHTS
Presentations
“Career Advancement Obstacles and Opportunities,” Bay Area Women Lawyers Retreat, February 2020 “Identifying and Minimizing Implicit Bias in the Land Use Context,” County Counsels’ Association of California, Fall Land Use Conference, 2019
Program Co -Chair and Presenter, “Prejudgment Possession: What You Need to Know,” 21 st Annual Northern California Eminent Domain Conference - Legal, Appraisal & Government Perspectives, CLE International, 2019 “Identifying and Minimizing Implicit Bias,” 21st Annual Northern California Eminent Domain C onference, CLE International, 2019
Program Co-Chair, “Eminent Domain: Legal, Appraisal & Right of Way Perspectives,” 20 th Annual Northern California Eminent Domain Conference, CLE International, 2018
“Women In Law Series Panel Discussion: Battling Bias,” A lameda County Bar Association and Women Lawyers of Alameda County seminar, 2018
“High Stakes & High Risks: Strategies for Handling High -Profile Litigation,” California Minority Counsel Program seminar, 2018
Program Co-Chair, “Eminent Domain: Law & Policy,” and “Relocation Law,” 19th Annual Northern California Eminent Domain Conference, CLE International, 2017
“Pathways to Partnership,” California Women Lawyers Annual Conference, 2016 “Eminent Domain Litigation and New Law Regarding Final Offers,” Right of W ay Annual Spring Conference, Chapter 42 of the International Right of Way Association, 2016
Program Co-Chair, “Case Law and Legislative Update,” 18th Annual Northern California Eminent Domain Conference, CLE International, 2016
“What’s New? The Latest Lega l Developments You Need to Know,” 18th Annual Southern California Eminent Domain Conference, CLE International, 2016
Program Co -Chair, “Eminent Domain 101,” 17th Annual Northern California Eminent Domain Conference, CLE International, 2015
Program Co -Chair, “The Effects of the Casasola Decision on the After Condition Goodwill Analysis,” 16th Annual Northern California Eminent Domain Conference, CLE International, 2014

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PRACTICE GROUPS
Public
Real Estate and Business
Environmental, Land Use, and Natural
Resources

EDUCATION
J.D., University of California, Davis, 1995
Master of City Planning, University of
California, Berkeley, 1987
B.A., (with distinction), University of
Michigan, 1979

ADMISSIONS
State Bar of California
United States Court of Appeals for the
Ninth Circuit
United States District Court for the Central
District of California
United States District Court for the
Northern District of California

AFFILIATIONS
State Bar of California, Real Property Law
Section
Los Angeles County Bar Association, Real
Estate Section
American Bar Association, State and Local
Government Law Section
American Bar Association, Affordable
Housing and Community Development
Forum
Susan E. Bloch
Partner
Oakland [email protected]
1901 Harrison Street, Suite 900 510.903.8809 D
Oakland, California 94612 510.273.8780 T

Susan Bloch specializes in affordable hous ing, economic development , and transactional real estate matters. Susan has over 25 years of experience representing private and non -profit developers and public agencies, including cities, counties, housing authorities, and redevelopment successor agencies in transactions involving the acquisition, development, financing, leasing and sale of residential, commercial and industrial properties; and the development and implementation of affordable housing policies and programs.

Susan has provided special counsel services on real estate and affordable housing transactions for Alameda County, Placer County, the Santa Clara County Housing Authority, the cities of Oakland, San Jose, Union City, San Leandro, Mountain View, Morgan Hill, San Carlos, Daly City, South San Francisco, Petaluma, Napa, Pleasanton, Redwood City, Dublin, Cathedral City, Rialto, Hemet, and Livermore, and other public entities including Los Angeles World Airpor ts (LAWA), the Community Redevelopment Agency of the City of Los Angeles, Renewal Enterprise District, Sacramento Regional Transit District, East Bay Regional Parks District, the Transportation Agency of Monterey County, and the Moraga -Orinda Fire District . Her nonprofit clients include Veterans Housing Development Corporation, Christian Church Homes, YWCA Golden Gate Silicon Valley, the California Odd Fellows Foundation, and the Hilarita-Tiburon Ecumenical Association.

Before beginning her practice as a n attorney, Susan served as Program Manager with the Sacramento Housing and Redevelopment Agency and as a consultant to the Neighborhood Reinvestment Corporation and the National Economic Development and Law Center. She has been a speaker at conferences and seminars sponsored by the League of California Cities, the California Continuing Education of the Bar (CEB), the Real Property Section of the California State Bar, the California Redevelopment Association, Housing California, the Northern California Ass ociation for Non -Profit Housing, California Association for Local Economic Development (CALED), the California Association of Local Housing Finance Agencies (Cal -ALHFA), the Bay Area City Attorneys Association (BACA) and the City Attorneys Association of Los Angeles County (CAALAC). She has served as a member of the Board of Directors of California Association of Local Housing Finance Agencies since 2014.

RESULTS
City of Oakland /Oakland Redevelopment Successor Agency – representing the Successor Agency to the Oakland Redevelopment Agency in connection with redevelopment agency dissolution matters, including development of asset disposition and retention strategies, implementation of enforceable obligations, and representation before the State Department of Finance.

Represented the City of Oakland in connection with ground lease and financing transactions for the development of affordable and mixed -income housing as components of the Coliseum and Fruit vale Station transit-oriented developments.

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 County of Placer/Placer County Successor Agency – representation on redevelopment and affordable housing matters, including matters related to dissolution of the Redevelopment Agency and implementation of enforc eable obligations. Recent projects include updating first -time homebuyer and residential rehabilitation loan documents; negotiation and drafting of financing and development documents for a scattered -site affordable housing project and a mixed-use/mixed-income housing development.
 Santa Clara County Housing Authority – representation on real estate and finance matters including the acquisition, management and financing of the Buena Vista Mobile Home Park, the acquisition and disposition of property for development of affordable housing , and regulatory matters including compliance with affordability restrictions and state and federal relocation law.
 City of Petaluma – representation on real estate, affordable housing and successor agency matters, including the disposition of City property for construction of affordable housing project s, and the documentation of City financing.
 California Odd Fellows Foundation – representation as general counsel to the Board of Directors, representing the Foundation in connection with a joint venture for the redevelopment and refinancing of Fellowship Plaza, a 150-unit senior housing development in Saratoga, California.  City of Pleasanton – representation in connection with a multi -phased affordable housing project under development on land leased by the City to a nonprofit developer, and a special needs project proposed for development on land to be ground leased from the City. Prepared and negotiated ground leases and City loan documents.
 City of Livermore - affordable housing development and finance matters, including preparation of a purchase and sale agreement, affordable housing regulatory agreement, and City loan documents for a special needs project.  City of Morgan Hill – representation on affordable housing policy, finance and transactional matters including disposition, development and loan transactions for multi -family acquisition, rehabilitation and new construction projects, and the administration of first-time homebuyer and inclusionary housing programs.  Veterans Housing Development Corporation – representation in connection with the development of transitional housing and permanent supportive housing for formerly homeless veterans in several northern California jurisdictions, including a three-phase project on the former Mather Air Force Base in Rancho Cordova.  City of Mountain View – representation in connection with affordable housing policy, development and finance matters, including projects developed using a combination of City housing trust funds, HOME funds, low -income housing tax credits, tax-exempt bonds and other sources.  City of Union City – representation in connection with disposition, development and financing transaction s for market-rate and affordable housing component of the City ’s transit-oriented development at the Union City BART station.
 RC Peninsula Park, LLC. Represented private developer in the negotiation and drafting of a long -term development agreement governing a phased residential condominium, retail and hotel projec t; an infrastructure financing agreement; and agreements governing developer contributions for affordable housing and childcare.  Sacramento Regional Transit District – Transit-Oriented Mixed-Use Developments. Represented the District in the negotiation and preparation of disposition and development agreements for two proposed transit -oriented developments that will provide a mix of residential, retail and commercial uses. The documentation included option agreements and loan and security instruments for the District’s construction-to-permanent financing for the projects.
 City of Reno. Represented the City of Reno and its Redevelopment Agency in connection with the private development of a minor league baseball stadium and related retail projects, includ ing the negotiation and drafting of complex disposition and development agreements, ground leases, property exchange and option agreements, retail leases, and financing documents.
 Community Redevelopment Agency of the City of Los Angeles – Alexandria Hotel. Represented the Agency in connection with financing the rehabilitation of a historic hotel into 463 studio apartments. Negotiated permanent loan documents with the private developer while concurrently negotiating a proposed settlement agreement in complex federal litigation related to the project.

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 City of South San Francisco/Successor Agency. Represented the City of South San Francisco and its Redevelopment Agency in affordable housing and commercial transactions involving the purchase, sale and rehabilitation of residential and commercial properties and the negotiation and preparation of financing, acquisition and disposition agreements. Represented the Successor Agency in connection with redevelopment agency dissolution matters.
 San Leandro Redevelop ment Agency – Senior Housing. Represented the Agency in connection with the financing of an affordable senior housing project. The project was financed with a combination of city, agency, and county loans; HUD 202 financing; tax-exempt bonds; and low-income housing tax credits.  City of Dublin – Inclusionary Housing and First -Time Homebuyer Programs. Represented the City in connection with the implementation of its inclusionary zoning ordinance and its first -time homebuyer loan program. This included negotiation with the developers of single family and condominium developments that are subject to the inclusionary ordinance; drafting program guidelines and regulations; drafting amendments to the ordinance and regulations as changing circumstances have warr anted; and assisting staff in a myriad of implementation issues such as requests for refinancing, violation of resale restriction agreements and foreclosures.  City of Dublin – Mixed-Income Housing. Represented the City in connection with development of a 660-unit, mixed-income housing development that includes senior and multi -family phases financed with 4 percent tax credits, tax -exempt bonds and a low -interest City loan. Negotiated and drafted development agreements detailing the developer’s obligations to construct public improvements, loan documents, and affordable housing regulatory agreements to ensure compliance with the City’s inclusionary zoning requirements. Represented the City in negotiations for the disposition and redevelopment of Dublin Hou sing Authority property for redevelopment as a mixed-income senior, multi-family, and homeownership development.  City of Dublin – Low-Income Senior Housing. Negotiated and drafted ground lease, predevelopment and construction loan documents, regulatory agreements, and easement agreements for a low -income senior housing project financed with a City loan, tax credits and a conventional construction loan. This project required coordination with the City’s concurrent construction of a senior center on an adja cent parcel. The project included shared access, parking and reciprocal easements.
 Milpitas Redevelopment Agency – Affordable Housing, County Health Center and Parking Facility. Negotiated and documented numerous owner participation agreements, dispositi on and development agreements and financing documents for these projects. Transactions included the Agency’s conveyance of adjacent parcels to a non-profit developer and to Santa Clara County for construction of an affordable senior housing development an d a County health clinic facility, and the ground lease of an additional Agency -owned parcel for County construction of a parking garage. Documentation included a ground lease with option to purchase, loan documents for the housing project, and a reciproc al access easement agreement governing construction and maintenance of a common driveway.
 San Leandro Redevelopment Agency – Affordable Housing, Motel Conversion, Commercial Development and Rehabilitation. Represented the City of San Leandro and San Leand ro Redevelopment Agency on housing and economic development matters including residential and commercial rehabilitation programs, multi -family housing development, and the disposition and development of land for commercial and residential projects. Assist ed the Agency in the acquisition of a dilapidated motel, and the negotiation and preparation of ground lease and financing documents pursuant to which the Agency leased the property to a non -profit developer for conversion into affordable studio apartments, provided construction financing, and will provide an operating subsidy to ensure continued affordability.

INSIGHTS
Presentations
“The Future of Housing in California: Economic, Policy, and Development Perspectives,” 37th Annual Real Property Law Section Retreat, April 20, 2018
“State Housing Programs, California Association of Local Housing Finance Agencies (Cal -ALHFA),” November 12, 2015
“Update on Post-Redevelopment Legislation and Litigation,” California Association of Local Housing Finance Agencies (Cal-ALHFA) Regional Meeting, February 12, 2015

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“How to Build a Winning Team for Affordable Housing Development,” California Association of Local Housing Finance Agencies (Cal-ALHFA) Annual Conference, November 13, 2014 “Reinvention 2014 - New Approaches t o Housing, Redevelopment, and Economic Development,” California Association of Local Housing Finance Agencies (Cal-ALHFA) Conference, April 3, 2014 “Development in the Post -Redevelopment Era: The Legal Aspect,” 86th State Bar of California Annual Meeting, October 2013
“Where Are We Going: Legislation & Litigation,” California Redevelopment Association Webinar, July 2013 “Housing Successor Agency Implementation Issues” California Association of Local Housing Finance Agencies (Cal - ALHFA), conference workshop, October 2012
“What Does AB 1484 Really Mean in the Post -Redevelopment Era?” California Association for Local Economic Development (CALED) Webinar, July 2012
“Post-RDA Latest Developments,” City Attorney’s Association of Los Angeles County,” July 2012 “Implementing ABx1 26 - Successor Agency Training,” California Redevelopment Association, 2012 “Housing - Successor Agency Training,” California Redevelopment Association, 2012 “Nuts and Bolts for Successor Agencies,” Webinar, 2012
“Toolkit for Economic Development: Land Use and Housing,” Webinar, 2012 Publications
“Revised Department of Finance Budget Trailer Bill Addresses Redevelopment Dissolution,” Burke Public Law Alert , February 20, 2015
“Department of Finance Publishes Budget Trailer Bill Language Addre ssing Redevelopment Dissolution,” Burke Public Law Alert, February 11, 2015
“Governor Signs AB 1963 Extending Deadline for Approval of Long -Range Property Management Plans and Limiting Scope of State Controller Review of Property Transfers,” Burke Public Law Update, July 22, 2014

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PRACTICE GROUPS
Real Estate and Business

EDUCATION
J.D., University of California, Los Angeles
School of Law, 2013
B.A., University of California, Los Angeles,
2010

ADMISSIONS
State Bar of California
United States Court of Appeals for the
Ninth Circuit
United States District Court for the Central
District of California

AFFILIATIONS
Orange County Bar Association
St. Thomas More Society of Orange
County
Orange County Women Lawyers
Association

Meghan E. Nihan
Senior Associate
Orange County [email protected]
1851 East First Street, Suite 1550 949.265.3404 D
Santa Ana, California 92705 949.863.3363 T

Meghan Nihan’s practice focus es on real estate transactional matters and public/private partnership development matters. She has experience with purchase, sale, easement, license, and lease transactions; government purchases of property in lieu of condemnation; ancillary matters such as title review and due diligence; and advising clients on property management landlord/tenant issues.

Meghan was previously an associate in the Corporate and Real Estate practice groups of two Southern California law firms. She was also an associate in the Eminent Domain practice group of a law firm based in Orange County for five years, where she advised s taff during t he planning phase of a public transportation project, drafted and negotiated purchase and sale agreements , and handled all aspects of eminent domain litigation if a voluntary purchase transaction was not consummated.

During law school, Meghan completed environmental coursework. Early in her career, she worked as a Legal Fellow at Orange County Coastkeeper, whose mission i s to protect the region’s water resources. Meghan’s work there included bringing lawsuits to enforce the Clean Water Act and reviewing and drafting comments regarding local policies or Environmental Impact Reports.

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PRACTICE GROUPS
Environmental, Land Use, and Natural
Resources
Public
Real Estate and Business

EDUCATION
J.D., University of California, Berkeley
School of Law, 2012
B.S., Urban and Regional Studies, Cornell
University, 2002

ADMISSIONS
State Bar of California
United States Court of Appeals for the
Ninth Circuit
United States District Court for the
Southern District of California

AFFILIATIONS
California Chapter of the American
Planning Association, Vice President of
Policy and Legislation

Eric S. Phillips
Partner
Pronouns: he, him, his
San Francisco [email protected]
1 California Street, Suite 3050 415.655.8114 D
San Francisco, California 94111 415.655.8100 T

Eric Phillips practices in the areas of land use, real estate, and CEQA compliance. Eric represents clients in all phases of the development process, including property acquisition, entitlement and administrative approvals, CEQA compliance, compliance with sta te housing laws, and negotiating real estate disputes. Eric has particular experience with State Density Bonus Law, the Housing Accountability Act, SB 35, and Housing Element Law.

Eric assists private clients to successfully obtain subdivision maps, densi ty bonuses, development agreements, and other land use approvals. He also has served as special counsel to numerous public agencies and provides advice on writing ordinances and legislative findings related to zoning, subdivisions, inclusionary housing pro grams, rent control and tenant protection measures, and impact fees. In both roles, Eric has worked with various clients to negotiate and close purchase and sale agreements, draft loan agreements, create below -market-rate rental and for -sale programs, perform property diligence, craft residential preference programs, and work with technical consultants to prepare Draft and Final EIRs.

INSIGHTS
Presentations
“Got Sites? Preparing for Sixth Cycle Housing Elements,” California Chapter of the American Planning Association, September 2019
“2019 California Legislative Update,” California Chapter of the American Planning Association, September 2019
“Housing Legislation Frenzy Continues,” Bay Area Planning Directors Association, May 2019
“Nuts and Bolts of Project Approvals,” Housing California, April 2019 “Legislative Update and RHNA Reform,” Sacramento Area Council of Governments, April 2019
“Resurgence of Rent Control and Tenant Protection Law in California,” San Diego Housing Federation, October 2018
“Getting to Yes – Leveraging State Law to Secure Project Approvals,” Southern California Association of Non Profit Housing, October 2018

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w w w . b w s l a w . c o m
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990051\06\3357903.2

PROPOSAL IN RESPONSE TO

CITY OF SAN CARLOS

REQUEST FOR QUALIFICATIONS

FOR ON-CALL LEGAL SERVICES RELATED TO ECONOMIC DEVLEOPMENT AND HOUSING

Goldfarb & Lipman LLP is a certified woman-owned enterprise.

Oakland
1300 Clay Street
11th Floor
Oakland, CA 94612

Los Angeles
550 South Hope Street
Suite 2685
Los Angeles, CA 90071
San Diego
2260 El Cajon Boulevard
No. 922
San Diego, CA 92104

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TABLE OF CONTENTS
INTRODUCTION ............................................................................................................................... 2 REAL ESTATE.................................................................................................................................... 3 AFFORDABLE HOUSING ................................................................................................................... 3 EMINENT DOMAIN .......................................................................................................................... 5 PROPOSED FEE STRUCTURE .......................................................................................................... 10 REFERENCES .................................................................................................................................. 11 Exhibit A: Public Agency Clients
Exhibit B: Public Agency Real Estate Transactions
Exhibit C: Brief Biographies of Goldfarb & Lipman Attorneys Exhibit D: Excerpts of Relevant Sample Work

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INTRODUCTION
Goldfarb & Lipman LLP is one of California's leading law firms practicing in the fields of affordable housing, land use, community economic development, and municipal law, including trial and appellate litigation in each of these practice areas since 1971.

Our practice focuses on affordable housing and urban development, community economic development, real estate syndications, public finance, land use, fair housing, municipal law including the Brown Act and Public Records Act, relocation, environmental law, and litigation related to those matters, including eminent domain. Our practice includes all areas of legal experience required by our clients related to the development of projects, adoption and implementation of government programs, and trial and appellate litigation related to those matters.

Goldfarb & Lipman focuses on providing superior legal representation to both public and private entities, a diverse combination of clients that includes cities, counties, and public housing authorities, as well as private nonprofit and for-profit developers. Our broad client base provides our attorneys an unmatched ability to understand complex transactional and litigation matters from multiple perspectives. Goldfarb & Lipman has provided invaluable service and advice to our clients in thousands of real estate transactions from small urban infill and rural developments to large, high-profile projects throughout California.

A representative list of the firm's public agency clients is included in Exhibit A, and examples of projects on which we have represented public agencies are included in Exhibit B. Based on our extensive knowledge and experience, our clients turn to us as trusted advisors to assist them to reach their goals. We are committed to providing our clients excellent legal services in the most timely and cost-effective manner.

The resumes of the primary attorneys, who would perform the work requested by the City, as well as brief biographies of all other attorneys in the firm, are included in Exhibit C.

We propose to provide services in the following areas set forth in the City's Request for Qualifications:

 Real Estate
 Affordable Housing
 Eminent Domain and Inverse Condemnation

Specific qualifications and experience related to each practice area are discussed below.

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REAL ESTATE
Goldfarb & Lipman's real estate practice represents public agencies and private developers in the acquisition, development, financing, sale, and leasing of real estate. We have successfully represented public agencies on major development projects throughout California, ranging from the redevelopment of Whiskey Gulch in East Palo Alto, the Richmond City Center and Marin City, to the development of Staples Center and the Grand Avenue projects in Los Angeles and Levi's Stadium in Santa Clara. Our real estate experience covers a diversity of property types, including multifamily and single family residential, commercial, sports arenas, stadiums, entertainment complexes, offices, mixed-use developments, hotels, transit villages, cooperatives, mobile home parks, land trusts, condominiums, air rights parcels and other subdivisions. We represent our clients in acquisitions, dispositions, conveyances, sale/leasebacks, relocation, eminent domain, environmental issues, land use, general leasing, and ground leasing transactions. We also provide advice and guidance on compliance with the Surplus Lands Act and other laws governing the disposition of public property. Project activities include new development, rehabilitation, single site, and multi-parcel assembly, and, redevelopment to a new use. Our multidisciplinary experience working with public agencies and private developers on complex real estate transactions gives us detailed knowledge and a unique understanding of the issues that arise in every phase of major development projects.

Goldfarb & Lipman has far-reaching experience structuring and negotiating financing transactions for the feasible development of various types of development transactions. Our experience in this area includes providing assistance in structuring transactions, preparing development and financing documents, and advising clients with respect to ongoing operation and maintenance of developments.

Our multidisciplinary experience working with public agencies and private developers on complex real estate transactions gives us detailed knowledge and a unique understanding of the issues that arise in every phase of major development projects.

AFFORDABLE HOUSING
Goldfarb & Lipman is eminently qualified to provide affordable housing services to the City of San Carlos. Goldfarb & Lipman supports and shares our clients' commitment to affordable housing development. Since 1971, we have been a leader in affordable housing law representing hundreds of public agencies and non-profit and housing developers in creating affordable housing for low and moderate income households. We have helped our clients develop over fifty thousand affordable housing units throughout California, utilizing a wide variety of public and private financing sources.

Through our representation of cities, counties, and housing authorities, in their capacities as both lenders and developers of affordable rental housing, Goldfarb & Lipman has broad experience in structuring local assistance to affordable housing developers in complex real estate transactions and has devised methods to assist local public agencies in regulating and retaining affordable developments in their communities. Our attorneys have worked extensively with all federal, state, and local government housing programs, including the U.S.

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Department of Housing and Urban Development, the California Department of Housing and Community Development, the California Housing Finance Agency, and local funding mechanisms such as multifamily housing revenue bonds and housing trust funds. We frequently advise our public agency clients on inclusionary housing and density bonus programs, and have drafted numerous ordinances and implementation documents for both types of programs. Goldfarb & Lipman has assisted in the creation and documentation of numerous first time homebuyer programs, funded with the former redevelopment housing funds, CDBG funds, HOME funds, and local housing trust funds. Our work with local public agencies includes drafting and negotiating land disposition, predevelopment, and construction loan and grant documents for public agency assistance, regulatory agreements for multifamily developments, resale restrictions and shared appreciation loan documents for low and moderate income homebuyers. Our attorneys have the skill and experience to ensure that our clients meet the requirements of applicable funding programs as well as the requirements of first mortgage lenders, investors, mortgage insurers, and secondary mortgage market entities, including CalHFA, FHA, Fannie Mae, and Freddie Mac. We are also well-versed on utilizing federal and state low-income housing tax credits to develop affordable housing.

We have extensive experience advising public agencies and their private development partners in transactions using many economic development tools, such as:

Private Equity
- State tax credits
- Federal tax credits (New Market, Historic, Renewable Energy

Tax and Assessment Financing
- Infrastructure financing districts
- Mello-Roos special tax districts
- Business improvement districts
- Other assessment districts
- Certificates of participation

State and Federal Economic Development Tools
- Section 108
- Brownfields
- Enterprise zones
- Infrastructure bank financing

State and Local Regulatory Incentives
- CEQA streamlining and exemptions
- Density bonuses and other zoning concessions
- Development agreements
- Transferrable development rights

We develop and lead training workshops on these tools and continue to work with legislators, local governments, and citizen groups on community economic development legislation. We are a recognized leader in the economic development community and provide

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technical support to groups advocating for new programs that will provide local governments with the financing, land assembly, and environmental remediation tools needed to form public- private partnerships and effectively invest in infrastructure, transportation, transit-oriented development, and other improvements that will enhance sustainability efforts as well as strengthen local economies. With such intimate knowledge and experience with affordable housing and community economic development programs, we are well equipped to offer the Economic and Community Development Department staff general assistance and related services as requested by the City.

EMINENT DOMAIN
Goldfarb & Lipman has guided our clients in the acquisition of all types of properties and property interests through voluntary negotiations and condemnation. We have handled acquisition projects ranging from the acquisition of one parcel to the acquisition of multiple parcels for large scale developments as well as road construction, right-of-way and street widening projects. We are well-versed in the technical and procedural aspects of public agency acquisition, including clearing clouds on title, relocation of residents and business facilities, complex goodwill issues, valuation issues including severance damages, easement rights, temporary interference with business operations, acquisition of outdoor advertising, and hazardous materials remediation.

Our attorneys are highly knowledgeable and experienced in the areas of real estate and public law relevant to public agency acquisition of land. We also are recognized as leading experts in the complexities of relocation law under both federal and state law, regularly providing trainings and seminars on both the legal and practical aspects of implementing relocation programs. We have extensive experience in eminent domain and inverse condemnation litigation, including advising public agencies on minimizing the risks of inverse condemnation liability as well as advising clients whose property is being condemned about the eminent domain rules and valuation concepts.

Goldfarb & Lipman has also assisted clients in undertaking various activities that precede or accompany the filing of eminent domain actions, including appraisals, negotiations, resolutions of necessity, staff reports, legal notices, CEQA/NEPA compliance, and relocation plans. We also have extensive experience in the litigation of issues affecting condemnation, valuation of property, and the right to take, including CEQA challenges, conflict of interest laws, the Meyers- Milias-Brown Act and similar laws, federal bankruptcy proceedings, challenges to statutory or constitutional authority to condemn, and unique issues relating to the type of property to be condemned. With our vast litigation experience, Goldfarb & Lipman provides our clients with an accurate assessment so they have a realistic understanding of the time, cost and issues involved in condemnation.

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ATTORNEYS INTENDED TO BE ASSIGNED TO ASSIST SAN CARLOS

Partner Karen Tiedemann will serve as lead attorney for all matters involving the City, and will direct services related to real estate and affordable housing. Ms. Tiedemann's resume and representative list of public agency real estate work are attached as Exhibit B.

Partner Celia Lee will serve as lead attorney on eminent domain matters. Ms. Lee’s resume and a list of recent eminent domain cases led by Ms. Lee are attached as Exhibit B.

Partner Barbara Kautz will continue to advise the City on housing-related land use matters, including assistance with the City’s inclusionary ordinance. An inclusionary ordinance recently adopted by the City of Richmond is attached as Exhibit D.

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PRIMARY ATTORNEY RESUMES
KAREN M. TIEDEMANN
[email protected]

1300 Clay Street, 11t h Floor
Oakland, CA 94612

Oakland
510 836-6336

Los Angeles
213 627-6336

San Diego
619 239-6336

goldfarblipman.com

Ms. Tiedemann is a partner in the firm with an emphasis of practice in community economic development, real
estate transactions, affordable housing, nonprofit
organization, and environmental law.

Ms. Tiedemann has negotiated and drafted disposition
and development agreements for complex developments
involving multiple uses, including transactions that
involved the acquisition of numerous properties and the relocation of business and residential tenants. She also advises clients on compliance with environmental laws
including shepherding developments through CEQA. Ms.

Tiedemann has extensive experience in financial analysis for projects utilizing multiple funding sources. Ms.

Tiedemann is a frequent speaker on relocation and fair
housing issues. Additionally, as general or special
counsel to several public agencies, Ms. Tiedemann
provides advice on compliance with the Brown Act, the
Fair Political Practices Act and Public Records Act, as well as general law questions.

Ms. Tiedemann is a co-author of A Legal Guide to
California Redevelopment (Third Edition), and Between
the Lines, a Question and Answer Guide on Fair Housing
in Supportive Housing.

Professional Experience Goldfarb & Lipman LLP, Oakland, California, 1988-present.

Director, Renters Assistance Project for Students (RAPS), Associated Students of the University of California.

Education J.D., Berkeley Law School, University of California at Berkeley, with Order of the Coif honors. Associate Editor, Ecology Law Quarterly.

M.C.P., University of California at Berkeley.

B.A., Rhetoric, University of California at Berkeley.

Professional & Volunteer
Affiliations

Member, State Bar of California, Board Member, California Center for Cooperative Development, Board Member, Merritt Community Capital.

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CELIA W. LEE
[email protected]

1300 Clay Street, 11th Floor
Oakland, CA 94612

Oakland
510 836-6336

Los Angeles
213 627-6336

San Diego
619 239-6336

goldfarblipman.com
Celia Lee is a partner in the firm. Her practice
encompasses a broad range of civil litigation and
investigations on behalf of public agencies, nonprofit, and private entities in real estate, housing, land use, and municipal law disputes.

Ms. Lee served as a Deputy City Attorney in the Office of the City Attorney for the City and County of San Francisco for almost a decade. From 2010 to 2013, she was a
member of the Neighborhood and Resident Safety/Code
Enforcement Team, representing the City and County and
its departments and employees in its civil enforcement of state and local public safety and public nuisance laws.

From 2004-2010, she served on the Trial Team of the City Attorney's Office, where she litigated a wide variety of matters for several City departments. From 1994 to 2004, she practiced commercial litigation and insurance
litigation at two San Francisco law firms.

Professional Experience Goldfarb & Lipman LLP, Oakland, California, 2014 – present.

Office of the City Attorney for the City and County of San Francisco.

Education J.D., University of Michigan Law School, 1994.

B.A., University of California at Berkeley, 1991; magna cum laude, Phi Beta Kappa.

Professional & Volunteer
Affiliations

President, Asian American Bar Association of the Greater Bay Area (AABA), 2008-2009.

Chair, Board of Trustees for Chinese for Affirmative
Action/Asian Americans for Civil Rights and Equality
(CAA/AACRE), a civil rights organization based in San
Francisco's Chinatown that advocates for the Asian Pacific American community, 2009-present.

Member, Board of Directors, San Francisco Conservation
Corps, a nonprofit organization that offers education, job training, and employment in recycling and conservation
work around San Francisco to at-risk individuals aged 18- 26, 2009-present.

Member, Lawyers' Committee for Civil Rights for the San Francisco Bay Area, 2011-present.

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BARBARA KAUTZ
[email protected]

1300 Clay Street, 11t h Floor
Oakland, CA 94612

Oakland
510 836-6336

Los Angeles
213 627-6336

San Diego
619 239-6336

goldfarblipman.com
Ms. Kautz is a partner in the firm, with an emphasis of practice in the areas of land use (especially housing-related land use), CEQA compliance, real estate, economic
development, fair housing, and affordable housing. She is the author of In Defense of Inclusionary Zoning: Successfully Creating Affordable Housing, 36 U.S.F. Law Review 971
(2002); No More Kids: How Overcrowded Schools May Lead
to Violations of Fair Housing Laws, California Real Property Journal (2015).

Prior to joining the firm, Ms. Kautz was Community
Development Director and Assistant City Manager for the City of San Mateo, California, where she was responsible for managing the planning, redevelopment, code enforcement, and building operations of the city. She also served as Planning Director for the Town of Corte Madera, California.

Ms. Kautz has been active in the League of California Cities, serving on the Board of Directors, Planning Department
President, as editor of the Land Use chapter in the Municipal Law Handbook, and in the California Chapter of the
American Planning Association, where she served as Vice President for Policy and Legislation.

Ms. Kautz is a frequent lecturer on California housing laws, inclusionary housing, housing approvals, housing elements, affordable housing programs, and density bonus law.

Professional Experience Goldfarb & Lipman, Oakland, California, 2004-present.

Community Development Director and Assistant City
Manager, City of San Mateo, California.

Education J.D., University of San Francisco Law School, summa cum laude. Articles Editor, USF Law Review.

M.C.P., University of California, Berkeley.

A.B., Stanford University, Phi Beta Kappa, cum laude.

Professional & Volunteer
Affiliations

State Bar of California. Fellow, American Institute of Certified Planners. Member, American Bar Association,
Section on State and Local Government. Member, Urban
Land Institute. Member, Association of Environmental
Professionals

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PROPOSED FEE STRUCTURE
Goldfarb & Lipman proposes to offer legal services to the City at the following discounted hourly rate:

Goldfarb & Lipman does not charge for word processing services. Reimbursable expenses that will be billed at cost by Goldfarb & Lipman include, but are not limited to: application, filing and similar fees required by third parties; and delivery charges other than by first class United States mail. Please note our hourly rates are adjusted from time to time and may change during the course of our engagement upon 60 days prior written notice to you. If you choose not to consent to the increased rates, you may terminate our services by written notice effective when received by us. We will have the right to withdraw as your attorney if permitted under the Rules of Professional Conduct of the State Bar of California and applicable law.

Partner $350 - 365
Senior Counsel $345 - 365
Associate $210 - 345
Senior Law Clerk $195
Law Clerk $180
Litigation Project Coordinator $210
Project Coordinator $180

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REFERENCES

John Nagel
City Attorney
City of Sunnyvale
Office of the City Attorney
456 W Olive
Sunnyvale, CA 94088
(408) 730-7464

Tom Williams
City Manager
City of Millbrae
621 Magnolia Avenue
Millbrae, CA 94030
(650) 259-2334

Silva Darbinian
Deputy County Counsel
County of Napa
1195 Third Street
Napa, CA 94559
(707) 259-8250
[email protected]

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EXHIBIT A

PUBLIC AGENCY CLIENTS
City of Arcata
City of Arvin
City of Avenal
City of Barstow
City of Berkeley
City of Brea
City of Brentwood
City of Brisbane
City of Campbell
City of Clayton
City of Clovis
City of Concord
City of Cupertino
City of Del Rey Oaks
City of East Palo Alto
City of El Cerrito
City of Elk Grove
City of Eureka
City of Fremont
City of Fresno
City of Hayward
City of Hollister
City of Irvine
City of La Mirada
City of Livermore
City of Long Beach
City of Los Angeles
City of Marina
City of Martinez
City of Menlo Park
City of Millbrae
City of Modesto
City of Monrovia
City of Montebello
City of Monterey
City of Moreno Valley
City of Morgan Hill
City of Mountain View
City of Newark
City of Oakland
City of Orange
City of Pacifica
City of Palo Alto
City of Pittsburg
City of Rancho Cucamonga
City of Reno
City of Richmond
City of Rosemead
City of Sacramento
City of Salinas
City of San Bruno
City of San Carlos
City of San Diego
City of San Rafael
City of Santa Clara
City of Seaside
City of Shafter
City of Solana Beach
City of South Lake Tahoe
City of South San Francisco
City of Stockton
City of Sunnyvale
City of Tracy
City of Tustin
City of Union City
Town of Fairfax
Town of Tiburon
County of Alameda
County of Butte
County of Contra Costa
County of Fresno
County of Humboldt
County of Mendocino
County of Napa
County of Orange
County of Nevada
County of Sacramento
County of San Mateo
County of Santa Clara
County of Santa Cruz
County of Sonoma
County of Yolo

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HOUSING AUTHORITY CLIENTS

Alameda County Housing Authority Regional Housing Authorities of Sutter & Nevada Counties
Berkeley Housing Authority Richmond Housing Authority
City of Alameda Housing Authority San Bernardino County Housing Authority Eureka Housing Authority City of San Buenaventura Housing Authority Hawaii Public Housing Authority San Francisco Housing Authority Kern County Housing Authority Wasco Housing Authority
Marin Housing Authority Yolo County Housing Authority
Oakland Housing Authority

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EXHIBIT B

PUBLIC AGENCY REAL ESTATE TRANSACTIONS

Alameda County. The firm has represented Alameda County and its Surplus Property Authority to secure entitlements for and realize maximum disposition value from several hundred acres of undeveloped or unneeded property eligible for annexation by nearby cities. We have written disposition rules designed to make the disposition process as streamlined and flexible as possible, within statutory constraints; negotiated residential and industrial purchase and sale agreements; participated in negotiations with neighboring landowners and the U.S. Army, the former owner of much of the property in question; and represented and assisted County staff in securing subdivision approval and development agreements and other entitlements from cities.

Berkeley Mixed–Use Project. Goldfarb & Lipman represented the City of Berkeley in negotiation of a disposition and development agreement of mixed-use development consisting of a publicly owned parking garage, retail space, affordable housing, and environmentally- friendly office space that used New Markets Tax Credit, a Section 108 loan and a Brownfields Economic Development Initiative (BEDI) Grant as part of the financing.

East Palo Alto - Gateway Center. Representation of the redevelopment agency on all aspects of 250,000 square foot "big box" retail center including disposition agreements with five retailers, residential and business relocation and property acquisition, representation of the agency and the City in eminent domain and inverse condemnation cases relating to property acquisition, compliance with hazardous waste laws, and assistance with obtaining land use approvals and subdivision map approvals.

East Palo Alto - University Circle. Representation of redevelopment agency in negotiating and drafting the disposition and development agreement for a 12-acre hotel and office complex.

We assisted with the preparation and review of environmental documents, relocation plan, and replacement housing plan. The firm has assisted the agency in acquisition of approximately 40 separate parcels of land and provided oversight of the relocation of 100 residential tenants and 37 businesses.

Fresno Bee Building. Goldfarb & Lipman provided representation for the City of Fresno in connection with the rehabilitation of the Fresno Bee Building, a federally recognized historic building located in the Cultural Arts District of Downtown Fresno, with the use of New Markets Tax Credits. The firm assisted the City in the drafting of the transfer documents which provided for the disposition of the Fresno Bee Building to a City controlled California nonprofit public benefit corporation. The firm also prepared documents in connection with the financing of the rehabilitation expenses for the Fresno Bee Building.

Hollywood and Vine. The Hollywood and Vine project involves the construction of a multi- family rental housing development consisting of approximately two hundred sixty-two (262) units, approximately forty-five thousand (45,000) square feet of retail space along with

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approximately six hundred eighty-three (683) parking spaces, a four-star hotel consisting of approximately three hundred (300) rooms, lounge, restaurant, retail space, approximately two hundred eighty-five (285) parking spaces, a condominium development consisting of approximately ninety-six (96) units of for-sale housing with approximately one hundred ninety- two (192) parking spaces (the "Project"). The Project is located on approximately 4.6 acres of real property bounded by Hollywood Boulevard to the north, Argyle Avenue on the east, Selma Avenue on the south, and Vine Street in Los Angeles.

Monterey Hotel/Housing Project. Goldfarb & Lipman represented the City of Monterey and the Redevelopment Agency in the development of an 18 unit affordable housing project, constructed concurrently with the renovation of an adjacent Hotel. Goldfarb & Lipman prepared loan documents and development agreements, assisted in City in negotiating the work-out documents when the first developer experienced financial difficulty and defaulted on the project; and prepared the documents for the new developer which completed the construction of the project.

Oakland Fox Theater Project. Goldfarb & Lipman provided representation for the Redevelopment Agency of the City of Oakland in connection with the rehabilitation of the Oakland Fox Theater, a federally recognized historic building located in the Uptown area of Oakland, with the use of a combination of New Markets Tax Credits and Historic Rehabilitation Tax Credits. The firm assisted the agency in the drafting of the disposition and development agreement which provided for the disposition of the Fox Theater to an agency-controlled California nonprofit public benefit corporation, as well as structuring the financing to assist with the costs of rehabilitating the Fox Theater. We also prepared the subleases with the live theater operator and charter school that utilize the rehabilitated building.

Pinole Vista Shopping Center. Goldfarb & Lipman negotiated and drafted on behalf of the redevelopment agency, purchase of the land, sale of the land to two major retailers (Target and Mervyns), and the ground lease of the remaining land to a developer for build-out of the rest of the site.

Rafael Theater. Goldfarb & Lipman drafted and negotiated the agreement for acquisition of a historic art deco theater in downtown San Rafael and the disposition agreement providing for a non-profit film organization to preserve and rehabilitate the theater (including seismic rehabilitation) for film festival use. The unique disposition agreement includes a covenant that the building remains in movie theater use and for periodic city use of the theater for city fund raising purposes.

Richmond – Transit Village. Representation of the Richmond Community Redevelopment Agency in negotiating and drafting the cooperation, design and funding, and construction agreements with the San Francisco Bay Area Rapid Transit District relating to the construction of a parking garage at the Richmond BART station.

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Santa Clara Stadium Project. Goldfarb & Lipman represents the Santa Clara Stadium Authority in the development of a new stadium to serve as the home of the San Francisco 49ers. Our work on this project includes negotiation of the lease between the Stadium Authority and the 49ers, advice on myriad complex financing, land use and real estate issues including triggers for environmental review, public bidding process, sale of seat licenses and naming rights, concession agreements, use of off-site parking, and protections under long term ground leases.

South Lake Tahoe Park Avenue. Goldfarb & Lipman represented the South Lake Tahoe Redevelopment Agency in negotiation of agreements that led to development of a large mixed- use resort development in South Lake Tahoe near the Nevada border. The project includes a gondola serving the Heavenly ski area, two large time share developments, a transit center and restaurant, retail and entertainment uses.

Staples Center/L.A. LIVE. We provided representation to the Community Redevelopment Agency of the City of Los Angeles (the "CRA") in connection with the development of the Staples Center arena. The firm drafted and negotiated the disposition and development agreement ("DDA") on behalf of the CRA which provided for the acquisition of an approximately eight-block area and the disposition of the land to the developer of the arena. Following the execution of the DDA, the firm worked with the City Attorney's Office and CRA staff to oversee the acquisition and condemnation process for the arena land.

Sunnyvale Town Center Project. Goldfarb & Lipman represented the City of Sunnyvale Redevelopment Agency in negotiating and drafting the documents for the redevelopment of an unsuccessful 1970's shopping center into a modern mixed use residential, and retail complex scheduled to include approximately 1 million square feet of retail uses, 300 residential units and 300,000 square feet of office uses.

PUBLIC AGENCY EMINENT DOMAIN CASES

City of Hayward v. Ghulam Rabani, et al., Alameda County Superior Court Case No.

HG13692337: Representation of the City of Hayward in an eminent domain valuation action.

Los Angeles County Metropolitan Transportation Authority v. The Community Development Commission of the County of Los Angeles, et al., Los Angeles County Superior Court Case No.

BC644125: Representation of the County of Los Angeles as the property owner where the property was being condemned by the LA Metropolitan Transpiration Authority.

City of Millbrae v. San Francisco Bay Area Rapid Transit District, et al., County of San Mateo Superior Court Case No. 22-CIV-02713: Representation of the City of Millbrae in a condemnation action.

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EXHIBIT C

BRIEF BIOGRAPHIES OF GOLDFARB & LIPMAN ATTORNEYS

M DAVID KROOT

Education: B.A., University of Michigan, Honors Program in Economics. J.D., University of Chicago Law School. Previous Employment: Chief Housing Attorney, U.S. Department of Housing and Urban Development (HUD), Office of Area Counsel, San Francisco, California.

Professional and Volunteer Affiliations: State Bar of California. American Bar Association.

Member, Forum on Affordable Housing & Community Development Law of the American Bar Association. Chief Legal Officer, Board of Directors, Tenderloin Neighborhood Development Corporation.

LYNN HUTCHINS

Education: B.A., Stanford University. J.D., University of California, Davis, Order of the Coif honors. Professional & Volunteer Affiliations: State Bar of California. American Bar Association. Member, Real Property Law Section, Member, Forum on Affordable Housing and Community Development Law. Secretary, California Housing Consortium.

THOMAS H. WEBBER

Education: B.A., University of Massachusetts, Amherst. J.D., Golden Gate University School of Law. Previous Employment: Assistant to the City Attorney, Office of City Attorney, City of Oakland. Planner, Office of Economic Development and Employment, City of Oakland.

Professional & Volunteer Affiliations: State Bar of California.

DIANNE JACKSON MCLEAN

Education: A.B., University of California, Berkeley. Masters in City Planning, University of California, Berkeley. J.D., University of California, Hastings College of the Law. Previous Employment: Associate Planner, City of Daly City. Associate Planner, City of Sacramento. City Planner, City of Emeryville Redevelopment Agency. Professional & Volunteer Affiliations:

Member, State Bar of California. Member, California Lawyers Association, Ethics Committee.

Advisor, California Lawyers Association, Real Property Law Section Executive Committee.

Member, Charles Houston Bar Association. Member, National Bar Association. Fellow, American Bar Foundation. Member, American Bar Association. Member, California Association of Black Lawyers. Member, Bar Association of San Francisco, Ethics Committee.

ROBERT C. MILLS

Education: B.A., California State University, Northridge, cum laude. J.D., Hastings College of the Law. Associate Articles Editor, Communications and Entertainment Law Journal. Previous Employment: Staff Attorney, U.S. Department of Housing & Urban Development, Office of Counsel, Pacific/Hawaii Area. Professional & Volunteer Affiliations: State Bar of California.

Member, National Association of Housing and Redevelopment Officials.

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ISABEL L. BROWN

Education: B.S.E. in Civil Engineering and Certificate in Architecture, Princeton University, cum laude. Masters degree in Architecture, University of California, Berkeley. J.D., UC Berkeley School of Law. Articles Editor, Ecology Law Quarterly. Sadie & Alvin Landis Prize in Local Government Law. Previous Employment: Legislative Assistant, U.S. House of Representatives.

Assistant Architect, City of New York, Department of Housing, Preservation & Development.

Professional & Volunteer Affiliations: State Bar of California.

JAMES T. DIAMOND

Education: B.A., University of San Francisco, cum laude. J.D., Hastings College of the Law.

Professional & Volunteer Affiliations: State Bar of California. State Bar of California. American Bar Association, Employment Law Section. Alameda County Bar Association Labor & Employment Law Section, Executive Committee Member. Oakland African American Chamber of Commerce.

MARGARET F. JUNG

Education: B.A., University of California, Los Angeles, magna cum laude, Phi Beta Kappa. J.D., UC Berkeley School of Law. Previous Employment: Public Accountant, Ernst & Young, LLP.

Professional & Volunteer Affiliations: State Bar of California, Business Law and Taxation Sections. Certified Public Accountant (inactive), California Board of Accountancy. Board of Directors, Chinatown Community Development Center. Member, National Coalition for Asian Pacific American Community Development.

HEATHER J. GOULD

Education: B.A., Carleton College, magna cum laude, Northfield, Minnesota. J.D., UC Berkeley School of Law. Professional & Volunteer Affiliations: State Bar of California.

WILLIAM F. DICAMILLO

Education: B.A., State University of New York, Buffalo, magna cum laude. Phi Beta Kappa. J.D., University of California, Los Angeles. Previous Employment: Travelers Aid Society of Alameda County, Case Manager. Professional & Volunteer Affiliations: State Bar of California. State Bar of New York.

AMY DeVAUDREUIL

Education: B.A., University of Rhode Island, Highest Honors, Phi Beta Kappa. J.D., UC Berkeley School of Law. Professional and Volunteer Affiliations: State Bar of California, Real Property and Taxation Sections. American Bar Association, Forum on Affordable Housing and Community Development. Board Member, San Diego Housing Federation.

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RAFAEL YAQUIAN

Education: B.S., Community and Regional Development, University of California, Davis. M.A., Urban Planning, University of California, Los Angeles. Jesse Marvin Unruh Assembly Fellow, California State University of Sacramento Center for California Studies. J.D., University of California, Los Angeles, Epstein Program in Public Interest and Law Policy. Professional & Volunteer Affiliations: State Bar of California, Real Property and Taxation Sections. American Bar Association. Member, Forum on Affordable Housing and Community Development Law.

DOLORES BASTIAN DALTON

Education: B.A., Philosophy, University of California at Berkeley. J.D., University of San Francisco School of Law. Comments Editor of the Law Review. Professional & Volunteer Affiliations: State Bar of California. Member, The Mediation Society. Member, State Bar of California Litigation Section. Member, Appellate Mediation Panels, CA Court of Appeal, Third and Sixth Districts. Ms. Dalton has been certified by the State Bar of California as specialist in appellate law. Ms. Bastian Dalton is an adjunct professor at the University of San Francisco School of Law.

JOSHUA J. MASON

Education: B.A., cum laude, University of California, Los Angeles. UCLA Community Service Commission Project Director of the Year. Distinguished Bruin Award. Chancellor’s Service Award. Charles E. Young Humanitarian Award. Masters in City Planning, University of California, Berkeley. J.D., University of California, Hastings College of the Law. PILP Pro Bono Publico Award. PIC Public Interest Law Certificate. Imelda Rosenthal Bar Scholarship. Equal Justice Works Summer Corps. Previous Employment: Staff Attorney, US Department of Housing and Community Development. Professional & Volunteer Affiliations: State Bar of California.

ELIZABETH R. KLUECK

Education: B.A., cum laude, University of California, Berkeley. J.D., University of California, Davis. The Order of Barristers; CEB/UC Award for Excellence in Legal Writing; Competitions Chair, UC Davis Moot Court Board; Executive Board of Directors, King Hall Legal Foundation; American Inns of Court Scholarship Recipient; Finalist, Martin Luther King, Jr. Public Service Award. Professional & Volunteer Affiliations: State Bar of California.

JEFFREY A. STREIFFER

Education: B.A., Earlham College, phi beta kappa. J.D., Hamline University School of Law.

Previous Employment: Senior Counsel, US Department of Agriculture; Board Member, SPIRE Credit Union. Professional & Volunteer Affiliations: State Bar of California; State Bar of Minnesota; American Bar Association; Legal Consultant, LegalCORPS; Bankruptcy Attorney, Volunteer Lawyers Network.

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JHAILA R. BROWN

Education: B.A., University of California, Berkeley. J.D., University of San Francisco School of Law. Previous Employment: Deputy County Counsel IV, County of Riverside; Deputy City Attorney, Calabasas, California. Professional & Volunteer Affiliations: State Bar of California; Housing and Development Law Institute, County Counsels' Association of California.

GABRIELLE B. JANSSENS

Education: B.A., University of California, Berkeley. J.D., UC Davis School of Law. Previous Employment: Deputy City Attorney for the City of Livermore; Associate County Counsel for Alameda County; Deputy County Counsel for Santa Barbara County. Professional & Volunteer Affiliations: State Bar of California, League of Cities, Municipal Handbook Chapter Chair; Mediator Training, 28 Hours; Ventura Center for Dispute Settlement WSET Level II Certificate.

RYE P. MURPHY

Education: B.A., University of Oregon. Center for Arab and Middle Eastern Studies, American University of Beirut. J.D., University of California, Hastings College of Law. Hastings International & Comparative Law Review, Articles Editor; CALI Award, Constitutional Law.

Professional & Volunteer Affiliations: State Bar of California.

BENJAMIN FUNK

Education: B.M., Vanderbilt University. J.D., American University, Washing College of Law.

Certificate of Completion, Volunteers of America Executive Development Programs, University of Notre Dame. Previous Employment: Assistant General Counsel for Housing, Volunteers of America, Inc. Professional & Volunteer Affiliations: State Bar of California, State Bar of Maryland, State Bar of the District of Columbia, California Bar Association, American Bar Association, Maryland Bar Association.

AILEEN NGUYEN

Education: B.A., phi eta sigma, Emory University, Atlanta, Georgia. J.D., Georgetown University Law Center. Professional and Volunteer Affiliations: State Bar of California.

KATIE DAHLINGHAUS

Education: A.B., Harvard University. J.D., University of California, Berkeley, School of Law.

Previous Employment: Law Clerk, United States Department of Agriculture; Program Manager, LifeMoves. Professional and Volunteer Affiliations: State Bar of California.

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MATTHEW S. HEATON

Education: B.A., University of Pennsylvania. J.D., St. John's University School of Law.

Professional and Volunteer Affiliations: State Bar of California, State Bar of New York, California Lawyer's Association - Real Property Section.

NAZANIN SALEHI

Education: B.A., University of California, Berkeley. J.D., The George Washington University Law School. Professional and Volunteer Affiliations: State Bar of California.

ERIN LAPEYROLERIE

Education: B.A., New College of Florida – The Honors College of Florida. M.C.P., University of California, Berkeley. J.D., University of California, Hastings College of the Law. Professional and Volunteer Affiliations: State Bar of California.

MINDA BAUTISTA HICKEY

Education: B.A., University of California, Berkeley. Teresa Hak-Kyung Cha Undergraduate Fellowship Award, BAMPFA, HAAS Scholar Fellow. J.D., University of Davis California. Chair, Filipino Law Students Association; Board Member, Asian Pacific American Law Students Association; Student Board Member, Aoki Center; John Paul Stevens Public Interest Fellowship Recipient. Professional and Volunteer Affiliations: State Bar of California.

CONNOR T. KRATZ
Education: B.A., magna cum laude, Boston College. J.D., Georgetown University Law Center.

Professional and Volunteer Affiliations: State Bar of California.

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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Adopt a Resolution Accepting the San Carlos Avenue Eucalyptus Tree Removal Project C1722; and Authorizing the Public Works Director to Issue and Record a Notice of Completion.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution accepting the San Carlos Avenue Eucalyptus Tree Removal Project (“Project”) C1722 and authorizing the Public Works Director to issue and record a notice of completion.

FISCAL IMPLICATIONS:

The funding for the Project comes from C1722, which has a budget of $523,439 for Fiscal Year 2022-23. The Project was awarded in the amount of $166,000, with contingency in the amount of $49,800. However, during the course of the project there was a reduction in work, so the Project cost $133,000 to complete.

There is sufficient budget to close-out the Project; therefore, no additional appropriation is requested and there is no fiscal implication for this action.

BACKGROUND:

In October 2017, City Council adopted Resolution 2017-087, “Adopting a Mitigated Negative Declaration for the San Carlos Avenue Eucalyptus Tree Removal Project.” The City Council also adopted Ordinance 1524, “Amending San Carlos Zoning Ordinance Section 18.41.020 Removing Founders Tree from the Definition of Protected Trees.”
Staff retained Harris & Associates to complete an assessment survey, prepare the construction documents, and provide construction support for the removal of the eucalyptus trees along the San Carlos Avenue corridor (“Corridor”).

Phase I of the Project was completed in the summer of 2018, which removed a combination of eighteen trees and stumps within the public right-of-way along the Corridor.

Subsequently, Phase II of the Project was completed in the summer of 2019 removing twenty- three trees on private property and the one remaining tree in the public right-of-way.

Phase III of the Project removed the remaining thirty-three trees and/or stumps located adjacent

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to Pulgas Creek within private properties.

The City Engineer signed the final bid set construction documents on March 17, 2022, and the City Council approved the construction documents at its April 11, 2022 meeting.

The City Council awarded the Project to Professional Tree Care Co. at its May 23, 2022 meeting.

ANALYSIS:

The Project began on July 25, 2022, and was completed on August 10, 2022, in accordance with the approved Project plans and specifications. Staff performed a final inspection and accepted the Project on August 11, 2022.

Therefore, staff recommends accepting the San Carlos Avenue Eucalyptus Tree Removal Project C1722 and authorizing the Public Works Director to issue and record a notice of completion.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Adopt a resolution accepting the San Carlos Avenue Eucalyptus Tree Removal Project C1722 and authorizing the Public Works Director to issue and record a notice of completion; or

2. Do not adopt a resolution; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Steven Machida, Public Works Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution

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2 0
5 RESOLUTION NO. 2022 – ____

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

ACCEPTING THE SAN CARLOS AVENUE EUCALYPTUS TREE REMOVAL PROJECT C1722; AND AUTHORIZING THE PUBLIC WORKS DIRECTOR TO ISSUE AND RECORD A NOTICE OF COMPLETION.

WHEREAS, In October 2017, City Council adopted Resolution 2017-087, “Adopting a Mitigated Negative Declaration for the San Carlos Avenue Eucalyptus Tree Removal Project.”; and
WHEREAS, City Council also adopted Ordinance 1524, “Amending San Carlos Zoning Ordinance Section 18.41.020 Removing Founders Tree from the Definition of Protected Trees.”; and
WHEREAS, staff retained Harris & Associates to complete an assessment survey, prepare the construction documents, and provide construction support for the removal of the eucalyptus trees along the San Carlos Avenue corridor (“Corridor”); and WHEREAS, Phase I of the Project was completed in the summer of 2018, which removed a combination of eighteen (18) trees and stumps within the public right-of-way along the Corridor; and WHEREAS, Phase II of the Project was completed in the summer of 2019 removing twenty- three (23) trees on private property and the one remaining tree in the public right-of-way; and WHEREAS, Phase III of the Project removed the remaining thirty-three (33) trees and/or stumps located adjacent to Pulgas Creek within private properties; and WHEREAS, the City Engineer signed the final bid set construction documents on March 17, 2022, and City Council approved the construction documents at the April 11, 2022 meeting; and WHEREAS, City Council awarded the Project to Professional Tree Care Co. at its May 23, 2022 meeting; and
WHEREAS, the Project began on July 25, 2022 and was completed on August 10, 2022 in accordance with the approved Project plans and specifications; and WHEREAS, staff recommends accepting the San Carlos Avenue Eucalyptus Tree Removal Project C1722 and authorizing the Public Works Director to issue and record a Notice of Completion.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby accepts the San Carlos Avenue Eucalyptus Tree Removal Project C1722 and authorizes the Public Works Director to issue and record a Notice of Completion.
* * * * *
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 26th day of September 2022, by the following vote:

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2 0
5 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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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Consideration of Adopting a Resolution Establishing the Child Care Development Impact Fee Levels for New Nonresidential
Developments in San Carlos and Adopting the Updated Child Care Impact Fee Nexus Study Prepared by Economic & Planning Systems Inc. for the City of San Carlos dated September 9, 2022.

RECOMMENDATION:

Staff recommends that the City Council adopt a resolution establishing child care development impact fee levels for new nonresidential developments in San Carlos and adopt the revised Child Care Impact Fee Nexus Study prepared by Economic & Planning Systems Inc. for the City of San Carlos dated September 9, 2022.

FISCAL IMPLICATIONS:

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 more 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 financing options to increase the supply of child care facilities and develop strategies to address 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 to 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.

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 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 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 the City’s local regulations summarized above, staff and consultants were asked to evaluate different approaches to creating new child care spaces, specifically focusing on child care development impact fees. In July 2020, EPS presented the Child Care Impact Fee Nexus Study to Council with information on how to establish child care impact fees justifiable under the Mitigation Fee Act. Following the presentation, the Council requested further evaluation of funding options. Since then, staff held three collaborative working sessions with the Child Care Subcommittee (“Subcommittee”) in June 2021, November 2021, and September 2022 to review findings and develop preliminary recommendations for the Council to discuss and provide feedback.

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 program for new nonresidential developments in the city (see attachment 3). On June 27, the Council also adopted Resolution 2022-07 approving and adopting the Child Care Impact Fee Nexus Study prepared by EPS for the City of San Carlos dated July 14, 2021 (see attachment 4). On August 22, 2022, the Council completed the second reading of Ordinance 1585, which became effective 30 days thereafter.

The next step in the process is to adopt a resolution establishing the exact fee levels for the child care development impact fee.

ANALYSIS:

Nexus-Based Fees.

Development impact fees 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 prepared the Child Care Impact Fee Nexus Study in January 2020 and updated it in July 2021 and September 2022 (the updated nexus study is referred to herein as “Nexus Study” and is included as Attachment 2). The Nexus Study set forth the nexus between the impacts of new development and the need for childcare in San Carlos and calculated a maximum fee that is proportionate to those impacts. The main goal of the Nexus Study is to address the shortage of child care spaces in San Carlos by establishing a funding mechanism that aims to expand the supply of child care spaces.

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The Nexus Study evaluates the impact of new residential and nonresidential development; however, the Subcommittee and the Council previously provided direction not to apply the fee to new residential development. The City's General Plan and the 2022 City Council Strategic Goals highlight the importance of actively encouraging and supporting the creation of housing, which is why the City Council desires to only apply the impact fee to nonresidential developments. The nexus-based fees are the maximum fees that can be justified given the current impacts of nonresidential development on the need for child care facilities and the cost of developing new child care spaces. The Council 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 nonresidential development set according to “nexus logic.” The funds collected can only be used to fund capital projects (not maintenance 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 to 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 nexus 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 cost 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:

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 are being implemented in comparable jurisdictions. The table below highlights the fee ranges from a few cities, while Attachment 5 provides a more comprehensive overview.

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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

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, the fee burden for all office/R&D, retail, hotel, and industrial developments 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%

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At its March 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 6 for the full analysis chart.

At its March Study Session, the City Council also directed staff to develop a resolution adopting the reduced child care impact fee levels (shown in the table below). This is because adopting the maximum-justified child care development impact fees may adversely affect the extent of nonresidential development in the city if the fees are 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 reduced fee levels to address the issue of child care shortage without impacting the aggregate fees dramatically. The reduced fee levels are 50% lower than the maximum fees. Adopting the reduced fee levels is consistent with other jurisdictions and justified within the Nexus Study.

Reduced Fees for Nonresidential Development
Office/Research & Development
(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.

Capital Improvement Plan.

The adopted Nexus Study was updated in September 2022 due to some major updates with State Law requirements related to AB 602 (see Section 6 of the Nexus Study in attachment 2). All large jurisdictions are now required to provide a Capital Improvement Plan (CIP) to demonstrate how the City intends to use the funds collected through the Child Care Impact Fee program. Staff and consultants developed a CIP and met with the Child Care Subcommittee on August 30 to discuss the implementation measures. The proposed CIP includes three ways to use the funds collected.

Implementation Measure A - Child Care Space Reimbursement: The City may use impact fee revenue to reimburse applicants who choose to meet the child care impact fee requirement by building child care onsite (rather than by paying the fee) and who oversize the child care space provided relative to the value of the impact fee requirement. The amount of the reimbursement will not reduce the value of the applicant's child care obligation; rather, it can partially or fully subsidize the cost incurred by the applicant in excess of what the fee obligation would have been.

The subsidy amount shall be at the City’s discretion.

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Implementation Measure B - Family and Commercial Daycare Grant Program: The City may make child care impact fee revenue available as a grant to at-home and commercial day care providers. The revenue would need to be used to develop new child care facilities or improve existing child care facilities, such that the operator is able to serve more children. The goal is to fund up to four opportunities per year, up to $25,000 per grant, initially. The amount per grant could be increased, based on demand and available revenue. The City will develop an outreach program to let child care operators know that funding is available.

Implementation Measure C - New Child Care Facility Development: The City may use impact fee revenue to develop new child care space in the City. This may include acquiring, adapting, rehabilitating, renovating, etc. existing space and converting it to child care or developing new child care space. The space would then be available to be operated by a licensed, child care operator/provider. The amount invested may vary depending on the availability of revenue and opportunities.

It is important to note that the CIP identifies several options for the use of the child care impact fee revenue. The City will prioritize use of the fee revenue based on emerging opportunities and available resources. If another project concept emerges that would more effectively or efficiently result in new child care spaces in the City and is consistent with the requirements set forth in the Mitigation Fee Act, the City many consider such alternative projects. The CIP will be updated annually to reflect new opportunities and available resources.

Summary of Recommendations.

Child Care Development Impact Fee Levels.

Staff recommends adopting a resolution establishing the child care development impact fee levels (as shown in the table below) for new nonresidential developments in the City of San Carlos.

Reduced Fees for Nonresidential Development
Office/Research & Development
(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.

Updated Child Care Impact Fee Nexus Study.

Staff recommends adopting the updated Child Care Impact Fee Nexus Study prepared by EPS for the City of San Carlos dated September 9, 2022. The Nexus Study includes the CIP table to demonstrate how the City intends to use the funds collected through the Child Care Impact Fee Program. The CIP will be updated annually based on the City’s priorities.

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ALTERNATIVES:

The alternatives available to the City Council include:

1.Adopt a resolution establishing the Child Care Development Impact Fee Levels for new nonresidential developments in San Carlos and adopting the updated Child Care Impact Fee Nexus Study prepared by Economic & Planning Systems Inc. for the City of San Carlos dated September 9, 2022.; or

2.Do not adopt the resolution; or

3.Provide staff with alternative direction.

Respectfully submitted by:

Al Savay, Community Development Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Resolution

2. Updated Child Care Impact Fee Nexus Study dated September 9, 2022

3. Ordinance 1585

4. Council Resolution 2022-077

5. Child Care Development Impact Fee Survey

6. Aggregate Fee Burden

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RESOLUTION NO. 2022 – ____

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

ESTABLISHING THE CHILD CARE DEVELOPMENT IMPACT FEE LEVELS FOR NEW

NONRESIDENTIAL DEVELOPMENTS IN SAN CARLOS AND ADOPTING THE UPDATED

CHILD CARE IMPACT FEE NEXUS STUDY PREPARED BY ECONOMIC & PLANNING SYSTEMS INC. FOR THE CITY OF SAN CARLOS DATED SEPTEMBER 9, 2022. ____________________________________________________________________________

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 in 2017 states that there is a shortage of more than 650 spaces for infant and preschool-aged children in San Carlos; 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, July 2021, and September 2022 a study was prepared and then updated twice by EPS entitled Child Care Impact Fee 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 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, 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 and establishing a child care development impact fee program for new nonresidential developments, and approved the Ordinance with the second reading on August 22, 2022; and WHEREAS, on June 27, 2022, the City Council adopted Resolution 2022-077 approving and adopting the Child Care Impact Fee Nexus Study prepared by EPS for the City of San Carlos dated July 14, 2021; and
WHEREAS, the City Council expressed interest in adopting the reduced child care impact fee levels because it is consistent with other jurisdictions and justified within the Child Care Impact Fee Nexus Study; and
WHEREAS, the adopted Child Care Impact Fee Nexus Study was updated in September 2022 (“Nexus Study”) due to major changes with the State Law requirements related to AB 602 and the new requirement to include a Child Care Impact Fee Capital Improvement Program (“CIP”); and

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WHEREAS, the updated Nexus Study, dated September 9, 2022, is attached to the staff report accompanying this resolution and is incorporated herein by reference; and WHEREAS, August 30, 2022, City staff and consultants met with the Child Care Subcommittee to discuss the proposed CIP, which includes three implementation measures including (1) child care space reimbursement, (2) a family and commercial daycare grant program, and (3) new child care facility development; and
WHEREAS, the City will prioritize use of the fee revenue based on emerging opportunities and available resources, but if another project concept emerges that would more effectively or efficiently result in new child care spaces in the city and is consistent with the requirements set forth in the Mitigation Fee Act, the City may consider such alternative projects; and WHEREAS, the City Council wished to adopt the updated Child Care Impact Fee Nexus Study, including the CIP, prepared by EPS for the City of San Carlos dated September 9, 2022; and
WHEREAS, thirty (30) days and five (5) days advance notice of the public hearing at which this Resolution was introduced was given by publication in accordance with Government Code Sections 66016.5, 66019, and 6062a; and
WHEREAS, pursuant to Government Code Sections 66019 and 66016.5, notice of the time and place of the meeting, including a general explanation of the matters to be considered and a statement that required data is available was mailed at least thirty (30) days prior to the meeting to those members of the public who filed a written request with the City; and WHEREAS, at least ten (10) days prior to the public hearing referenced above, the City made available for public inspection information required under Government Code Section 66000, et seq.

NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby resolves as follows:

Section 1.Findings. The City Council finds and determines as follows:
a. The above recitals are correct and are material to this Resolution and are incorporated into this Resolution as findings of the City Council. b. The child care development impact fees proposed bear a reasonable relationship to the need for child care facilities created by new nonresidential development.

Section 2.Adoption of Nexus Study. The City Council finds and determines that the Nexus Study complies with California Government Code section 66000 et seq., is consistent with the General Plan, and contains the information required by Government Code section 66001. The City Council hereby approves and adopts the Nexus Study.

Section 3.Adoption of the Child Care Development Impact Fee Capital Improvement Program (“CIP”). The City Council hereby approves and adopts the CIP included in the Nexus Study.

Section 4.Rates for Child Care Development Impact Fees. The City Council hereby sets rates for the child care development impact fees as shown in Exhibit A, attached hereto and incorporated by this reference. These rates will be incorporated into the Master Fee Schedule.

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Section 5.Effective Date. This Resolution shall be in full force and effect 60 days after the adoption and shall be published or posted as required by law.

Section 6.Environmental review. The City Council finds that the adoption of the child care development impact fee amounts and Nexus Study are not considered a project under Public Resources Code Section 21065 and CEQA Guidelines Section 15378 because these actions do not have the potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and they create government funding mechanisms which do not involve any commitment to any specific project. They are also exempt from CEQA as there is no possibility for causing a significant effect on the environment, per Section 15061(b)(3).

No specific projects are associated with these actions.

Section 7. Severability. Should any section, subsection, paragraph, sentence, clause, or phrase of this Resolution be declared unconstitutional or invalid for any reason, such declaration shall not affect the validity of the remaining portions of this Resolution.

The City Council hereby declares that it would have passed this and each section, subsection, phrase, or clause thereof irrespective of the fact that any one or more sections, subsections, phrase, or clauses be declared unconstitutional on their face or as applied. * * * * *
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 26th day of September 2022, by the following vote:

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Exhibit A- Child Care Development Impact Fee Levels for Nonresidential Development

Reduced Fees for Nonresidential Development
Office/Research & Development
(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.

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Revised Report
Child Care Impact Fee Nexus Study

Prepared for:

City of San Carlos

Prepared by:

Economic & Planning Systems, Inc.

Revised September 9, 2022

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 .......................................................................................... 6 Child Care Choice .................................................................................................... 7 Population Density .................................................................................................. 8 Employment Density ............................................................................................... 9

3. CHILD CARE FACILITY COST ESTIMATES ..................................................................... 10

4. CHILD CARE FEE CALCULATIONS .............................................................................. 11 Residential Fees .................................................................................................... 11 Nonresidential Fees ............................................................................................... 12

5. MITIGATION FEE ACT NEXUS FINDINGS ...................................................................... 14

6. AB 602 REQUIREMENTS ....................................................................................... 16 Capital Improvement Plan ...................................................................................... 16 Levels of Service ................................................................................................... 17 Original Nexus Study ............................................................................................. 17

7. FEE PROGRAM IMPLEMENTATION AND ADMINISTRATION ................................................... 18 Fee Collection and Amount ..................................................................................... 18 Annual Review and Five-Year Review ....................................................................... 19 Accounting, Reporting, and Updates ........................................................................ 20

APPENDICES
Appendix A: Child Care Impact Fee Capital Improvement Plan Appendix B: Estimate of Potential Fee Revenue

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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 ........................................................................................ 9 Table 8. Average Cost per Child Care Space by Type of Facility ........................................ 10 Table 9. Child Care Fees for Residential Development ..................................................... 11 Table 10. Child Care Fees for Nonresidential Development ................................................ 12

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Economic & Planning Systems, Inc. 1 Z:\Shared\Projects\Oakland\211000s\211028_San Carlos Childcare F ee Update\Report\211028_Child Care Impact Fee Nexus Study_San C arlos_Revised Draft Report_2022Sep09.docx

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.) and as further specified by AB 602, which applies to impact fee programs adopted after January 1, 2022.

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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Child Care Impact Fee Nexus Study
Revised Report 9/9/22

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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 Public Facility, Equipment, and Infrastructure Improvements. Impact fee revenue can be collected and used to cover the cost of constructing public facilities and infrastructure improvements required to serve new development and growth in the City.

Child care facilities are a community amenity and, therefore, qualify as public facilities per Government Code section 66000 (d). 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

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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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.

Table 4. Labor Force Participation

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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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.

Table 5. Child Care Choice

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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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.

Table 6. Population and Households by Number of Units in Structure

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.

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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
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

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.

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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 Child Care Space Reimbursement: City may use impact fee revenue to reimburse applicants who choose to meet the child care impact fee requirement by building child care onsite rather than by paying the fee and who oversize the child care space provided relative to the value of the impact fee requirement.

The amount of the reimbursement will not reduce the value of the applicant's child care obligation; rather, it can partially or fully subsidize the cost incurred by the applicant in excess of what the fee obligation would have been.
 Family and Commercial Daycare Grant Program: City may make child care impact fee revenue available as a grant to at-home and commercial day care providers. The revenue would need to be used to develop new child care facilities or improve existing child care facilities, such that the operator is able to serve more children.

Goal is to fund up to 4 opportunities per year, up to $25,000 per grant initially. Amount per grant could be increased, based on demand and available revenue. The City will develop an outreach program to let child care operators know that funding is available.  New Child Care Facility Development: City may use impact fee revenue to develop new child care space in the City. This may include acquiring, adapting, rehabilitating, renovating, etc. existing space and converting to child care or developing new child care space. The space would then be available to be operated by a licensed, child care operator/provider. The amount invested may vary depending on the availability of revenue and opportunities.

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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. Child care facilities are a community amenity and, therefore, qualify as public facilities per Government Code section 66000 (d).

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 in the City, 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. The residential fee calculation is based on an analysis of current demographic data, which is used to calculate the marginal demand for new child care spaces in the City as new residential development occurs. The nonresidential fee calculations are based on survey data from the 2017 San Mateo County Early Learning Facilities Study. The survey found that on average, for every 100 employees, four child care spaces were filled (0.0417 child care spaces per employee). Consistent with Government Code section 66001 (g), this existing level of service is used to estimate the future impact of new nonresidential development on the need for child care. Applying the existing level of service to new development in San Carlos ensures that new development is mitigating its demand on the need for child care and that the current shortage of child care spaces is not exacerbated as new development occurs.

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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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6. AB 602 REQUIREMENTS
AB 602 went into effect on January 1, 2022 and adds additional requirements for development impact fee programs and updates adopted under the Mitigation Fee Act. Three topics that must be addressed in or in association with a Nexus Study, include (1) the adoption of a capital improvement plan; (2) a discussion of the level of service; and, (3) a review of the original nexus study (if applicable). These topics are discussed below.

Capital Improvement Plan
AB 602 notes that “large jurisdictions shall adopt a capital improvement plan as a part of the nexus study.” Because San Carlos is located in the County of San Mateo, which has a population of greater than 250,000, the City of San Carlos falls under the definition of a large jurisdiction.

As a result, the City prepared a Child Care Impact Fee Project List for adoption as shown in Appendix A.

As well as being a requirement of AB 602, the Child Care Impact Fee Project List helps demonstrate that there is a need for the anticipated impact fee revenue based on the impact of new development and how the City intends to spend the revenue. The discussion below describes the potential revenue that could be raised through the recommended impact fee levels based on the City’s current development pipeline and compares the revenues to the estimated costs in the Child Care Impact Fee Project List.

The City’s current development pipeline (as of December 2021 and based on an analysis conducted by RSG) anticipates more than 2.7 million square feet of net new development by 2030 (the current General Plan horizon (2030). As indicated in the RSG study, this level of new development would result in approximately 6,627 new employees.

Applying the child care demand ratio of 0.0417 spaces per employee 1 to 6,627 new employees
suggests a need for approximately 276 new child care spaces (beyond the existing deficiency in the City) to meet future child care demand between now and 2030. The total cost to develop these spaces, based on the estimated cost per child care space of $80,391 used in the Nexus Study, is estimated at more than $22 million.

Because this demand would result in fee levels that could not be feasibly charged to new development, the City expects to reduce the maximum, nexus-based fees by approximately 50 percent. The reduced fee levels applied to the development pipeline could generate approximately $16.4 million, although it is possible that not all of this development will materialize. In addition, the City anticipates that a portion of this pipeline development (particularly the larger projects) will comply with the child care impact fee requirement by building child care onsite. For these projects, child care impact fee revenue will not be generated.

1 The maximum child care development impact fee established in this Nexus Study is based on a child care space demand of 0.0417 spaces per employee, or approximately four spaces per 100 employees.

This amount is based on data reported in the 2017 San Mateo County Early Learning Facilities Study.

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The Child Care Impact Fee Project List, shown in Appendix A, indicates a range of potential investments and includes general project location, estimated size, estimated cost, and timeline.

Further detail regarding the planned projects included in the Project List will be provided as the City begins to collect impact fee revenues and begins pursuing child care facility projects. To that end, the Project List will be updated annually with the City’s impact fee AB 1600 reports.

Levels of Service
AB 602 notes that “when applicable, the nexus study should identify the existing level of service for each public facility, identify the proposed new level of service, and include an explanation of why the new level of service is appropriate.” The City is considering a Child Care Development Impact Fee to be charged to new, non-residential development for the first time. The level of service that is used in the Nexus Study and that underpins the fee calculations is based on survey data from the 2017 San Mateo County Early Learning Facilities Study. The survey evaluated several large employers in San Mateo County with onsite child care facilities, and this study has presumed that the survey results would apply to large employers offering onsite child care in San Carlos. The survey found that on average, for every 100 employees, four child care spaces were filled (0.0417 child care spaces per employee). This existing level of service is used to estimate the future impact of new nonresidential development on the need for child care and varies by land use category based on employment density (i.e., the average number of jobs per square foot), as shown on Table 10. Applying the existing level of service to new development in San Carlos ensures that new development is mitigating its demand on the need for child care and that the current shortage of child care spaces is not exacerbated as new development occurs.

Original Nexus Study
AB 602 also notes that “if a nexus study supports the increase of an existing fee, the local agency shall review the assumptions of the nexus study supporting the original fee and evaluate the amount of fees collected under the original fee.” Because the City is considering a Child Care Development Impact Fee for the first time, there is no original nexus study or amount of fees collected under the original fee to review.

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7. 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 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. 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. 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.

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Child Care Impact Fee Nexus Study
Revised Report 9/9/22

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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, including:
 A description of the type of fee in the account
 The amount of the fee
 The beginning and ending balance of the fund
 The amount of fees collected and interest earned
 Identification of the improvements constructed
 The total cost of the improvements constructed

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Child Care Impact Fee Nexus Study
Revised Report 9/9/22

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 The percentage 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.

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

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Child Care Impact Fee Nexus Study
Revised Report 9/9/22

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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.

Updates
In addition, 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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APPENDICES:

Appendix A: Child Care Impact Fee
Capital Improvement Plan
Appendix B: Estimate of Potential Fee Revenue

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APPENDIX A:

Child Care Impact Fee
Capital Improvement Plan

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Table A-1
Capital Improvement Project Identification, as of August 2022 Child Care Impact Fee
Project
Reference Project Name Project Description Project Size Project Location Estimated Timing
Total
Project Cost
Estimate
A Child Care Space
Reimbursement
City may use impact fee revenue to reimburse applicants who choose to meet the child care impact fee requirement by building child care onsite rather than by paying the fee and
who oversize
the child care space provided relative to the value of the impact fee requirement.

Will vary depending on
applications received.

The East Side is most likely,
but funds may be spent
anywhere in the City.

Within ten years
of impact fee
adoption. [1]
$8,000,000 [2]
B Family and Commercial
Daycare Grant Program
City may make child care impact fee revenue available as a grant to at-home and commercial day care providers. The revenue would need to be used to develop new child care facilities or improve existing child care facilities, such that the operator is able to serve more children. [3]
Goal is to fund up to 4 opportunities per year, up to $25,000 per grant initially. Amount per grant could be increased, based on demand and available revenue. The City will develop an outreach program to let child care operators know that funding is available.

Will vary depending on size
of grants and applications
received.

Funds may be spent
anywhere in the City where
child care is a permitted use.

As soon as
sufficient funding
is available. [4]
$800,000 [5]
C New Child Care Facility
Development
City may use impact fee revenue to develop new child care space in the City. This may include acquiring, adapting, rehabilitating, renovating, etc. existing space and converting to child care or developing new child care space. The space would then be available to be operated by a licensed, child care
operator/provider.

The amount invested may vary depending on the availability of revenue and opportunities.

Will vary depending on the
opportunity.

Funds may be spent
anywhere in the City where
child care is a permitted use.

As an
appropriate
opportunity
emerges and as
soon as
sufficient funding
is available.
$4,000,000 [6]
[1] Timing will depend on whether applications to provide onsite child care (rather than pay the child care impact fee) emerge. [3] The grant application will document the number of new spaces that are expected to be created through use of the grant. [4] The City will develop an outreach program to let child care operators know that funding is available as the account balance allows. [5] Assumes four $25,000 grants for eight years (remainder of current General Plan time horizon).

Source: City of San Carlos.
[2] A $4 million child care project is expected to be able to serve approximately 50 children at a cost per space of approximately $80,000. Two such projects are anticipated during the time horizon of the current General Plan (2030). Projects of this scale are expected to be funded primarily by the developer with reimbursement for oversizing from the City. [6] A $4 million child care project is expected to be able to serve approximately 50 children at a cost per space of approximately $80,000.

Note: This CIP identifies several options for the use of the child care impact fee revenue. The City will prioritize use of the fee revenue based on emerging opportunities and available resources. If another project concept emerges that would more effectively or efficiently result in new child care spaces in the City and is consistent with the requirements set forth in the Mitigation Fee Act, the City may consider such alternative projects.

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APPENDIX B:

Estimate of Potential Fee Revenue

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Table B-1
Development Pipeline, as of December 2021
Child Care Impact Fee
Proposed New Developmnet Existing
Sq.Ft. Existing Use Proposed
Sq.Ft. Proposed Use Net New
Sq.Ft.

Child Care Impact Fee
(at Recommended Levels)
Total Estimated
Childcare Impact
Fee Revenue [1]
887 Industrial (Alexandria) 134,187 Commercial/industrial 528,520 Life Science 394,333 $5.00 per sq.ft. $2,307,133 1091 Industrial 40,067 Commercial/industrial 138,710 Life Science 98,643 $5.00 per sq.ft. $593,383 1030 Brittan Avenue (MBC Bio Labs) 0 Vacant (parking) 96,175 Life Science 96,175 $5.00 per sq.ft. $480,875 987 Commercial Street (Alexandria) 610,907 Commercial/industrial 1,520,774 Life Science 909,867 $5.00 per sq.ft. $6,076,603 888 Bransten Road (Black Mountain
Properties) 57,068 Commercial 211,000 Life Science 153,932 $5.00 per sq.ft. $912,330 800 Old County Road (Sobrato) 29,723 Commercial 300,000 Life Science 270,277 $5.00 per sq.ft. $1,425,693 405 Industrial Road (Menlo Equities) 16,445 Public storage 166,000 Life Science 149,555 $5.00 per sq.ft. $803,688 777 Industrial Road (Presidio) 44,000 Car sales/repair (Honda) 120,000 Life Science 76,000 $5.00 per sq.ft. $490,000 501 Industrial Road (Hotel) 26,000 Construction yard 119,000 Hotel - 188 guest rooms 93,000 $3.35 per sq.ft. $553,400 1021 Howard Avenue 44,812 Commercial/industrial 190,869 Life Science 146,057 $5.00 per sq.ft. $842,315 642 Quarry Road 80,038 Industrial 410,092 Life Science 330,054 $5.00 per sq.ft. $1,922,399 Total Proposed [2] 3,801,140 2,717,893 $16,407,817
Source: City of San Carlos.
[2] Based on recent child care development activity observed in other nearby jurisdictions (Redwood City, South San Francisco, San Mateo), a portion of this pipeline development (particularly the larger projects) is likely to comply with the child care impact fee requirement by building child care onsite. For these projects, child care impact fee revenue will not be generated. In addition, some of this development may not occur as planned. The level of anticipated revenue (assuming 50 percent of the development pipeline either does not emerge or provides child care onsite) is approximately $8.2 million, which is consistent with the envisioned potential investments identified in Appendix A. [1] Estimate of child care impact fee revenue is based on net new square footage, and calculated as follows: proposed square footage multiplied by proposed land use fee level, less existing square footage multiplied by existing land use fee level.

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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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CITY COUNCIL

STAFF REPORT
MEETING DATE: September 26, 2022
ITEM TITLE: Review Draft 2023-2031 Housing Element Prior to Submittal to State Department of Housing and Community Development.

RECOMMENDATION:

Staff recommends that the City Council review the Preliminary Draft 2023-2031 Housing Element (“Draft Housing Element”) and provide staff with comments to consider prior to sending the document to the State Department of Housing and Community Development (HCD) for review.

FISCAL IMPLICATIONS:

There are no fiscal impacts for reviewing the Draft Housing Element.

BACKGROUND:

All California cities and counties are required to have a Housing Element included in their General Plans. The Housing Element establishes housing objectives, policies, and actions (i.e. programs) in response to community housing conditions and needs. The Draft Housing Element (Attachment 4) is designed to respond to current and near-term housing needs in San Carlos and to provide a framework for the community’s longer-term approach to addressing its housing needs.

State Law Requirements
Unlike other mandatory General Plan elements, Housing Elements requires periodic updating and is subject to detailed statutory requirements and mandatory review by HCD.

State law establishes detailed content requirements for Housing Elements and a regional “fair share” approach for distributing new housing throughout all communities in the Bay Area. The law recognizes that in order for private sector and non-profit housing sponsors to address housing needs and demand, local governments must adopt land use plans and implement regulations that provide opportunities for, and do not unduly constrain, housing development.

The City of San Carlos’ fair share of the region’s housing need is 2,735 new units for the 2023- 2031 planning period. Of these 2,735 new units, 1,602 must be affordable to persons with income levels that are below 120% of the median income of San Mateo County (see Table 1 below).

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Table 1. Regional Housing Needs Allocation (RHNA) for 2023-2031, San Carlos Income Level Projected Housing
Need
Percentage
Distribution
Very Low (up to 50% of area median income) 739 27%
Low (51% to 80% of area median income) 425 16%
Moderate (81% to 120% of area median
income) 438 16%
Above Moderate (>120% area median
income) 1,133 41%
TOTAL 2,735 100%
Since not every property identified for housing development is guaranteed to be constructed with the amount of affordable housing to meet the RHNA, a common practice by many jurisdictions is to plan for a higher number of units as back up, or as “buffer” units. Although HCD’s focus will be to ensure San Carlos has enough sites to accommodate 2,735 units, staff and the consultant team recommended 30% more low income “buffer” units. 30% more low income RHNA units than the currently projected 1,602 units (739 “very low” income units, plus 425 “low” income units, plus 438 “moderate” income units) would add 481 units, or a total of 3,216 units to plan for in this housing element update. Because there are a number of projects in the pipeline (352 units) and some identified sites may be removed through the HCD review process and deemed inadequate, an additional small buffer was included in this first draft Housing Element, resulting in a total of 3,595 housing units to plan for in this housing element update.

The State also requires Housing Elements to include and address the following:
▪Provide goals, policies, quantified objectives and scheduled programs to preserve, improve, and, develop housing.
▪Identify and analyze existing and projected housing needs for all economic segments of the community.
▪Identify, and where possible, remove constraints to housing development. ▪Identify adequate sites that will be zoned and available within the Housing Element planning period – between 2023 and 2031 – to meet the City’s fair share of regional housing needs at all income levels.
▪Undergo review by HCD and be certified by HCD in compliance with State law.

Housing Element policies must be clear and well formulated to provide unambiguous direction for making decisions. The State requires that the goals, policies, and actions (i.e., programs) promote the following topic areas:
•Support the provision of adequate sites;
•Assist in the development of new units;
•Conserve and improve the existing housing stock;
•Preserve at-risk units;
•Remove or mitigate constraints to the production of housing; and, •Ensure equal housing opportunity.

Although the Housing Element must be responsive to the State’s statutory requirements, the San Carlos Preliminary Draft Housing Element is a local plan and reflects the vision and priorities of the community as expressed in the City’s General Plan and as received from the community throughout the update process.

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RHNA Methodology
One commonly asked question is how the RHNA is developed and assigned. The goal is to divide the Bay Area’s housing need of 441,176 new units among all Bay Area jurisdictions. The number of housing units to assign to each city and county is based on State requirements that the allocations be consistent with the development pattern set forth in Plan Bay Area 20501 and meet the following five objectives:

1.Increase housing supply and mix of housing types, tenure, and affordability in all cities and counties in an equitable manner.

2.Promote infill development and socio-economic equity, protect environmental and agricultural resources, encourage efficient development patterns and achieve greenhouse gas emission reduction target.

3.Promote improved intra-regional jobs-housing relationship, including balance between low-wage jobs and affordable housing.

4.Balance disproportionate household income distributions (more high-income RHNA to lower-income areas and vice-versa).

5.Affirmatively further fair housing. (Affirmatively Furthering Fair Housing seeks to combat housing discrimination, eliminate racial bias, undo historic patterns of segregation, and lift barriers that restrict access to foster inclusive communities and achieve racial equity, fair housing choice, and opportunity for all Californians.) Concerns stemming from proposed new development in the life science and biotechnology sectors in San Carlos’ east side have generated comments regarding whether San Carlos is providing enough housing. To that end, staff consulted with RSG to prepare a memo 2 on the impacts of new development on the city’s jobs/housing balance. One of the summary findings shows that San Carlos has produced enough housing to maintain a jobs/housing ratio of 1.46:1, which is considered a healthy balance by planning and community development organizations and assumes an average of 1.5 employed residents for every household. It is key to note that the RHNA assignments to each city and county in the Bay Area aim to achieve an overall regional balance rather than each city having its own intra-jurisdictional jobs/housing balance since not every employed person will live in same city or county where they work.

Based on the sites that have been identified to meet these housing needs, staff has identified the ability to accommodate a total of 3,595 new units (see Table 2 below).

Table 2. Total Unit Capacity Based on Pipeline Projects and Housing Sites City of San Carlos RHNA 2,735 Units
Additional Units (i.e., “buffer units”) 481 (30% of 1,602 below market rate units) Total Units to Plan For 3,216
Pending/Approved Projects in Pipeline 352
Projected Accessory Dwelling Units (ADUs) 203
Projected SB9 Units 160
*Multi-family Units 425
*Mixed-Use Units 2,455
TOTAL UNIT CAPACITY 3,595
(+379 more than 3,216; RHNA + buffer)
(+860 more than 2,735; baseline RHNA)
1 Plan Bay Area 2050 connects the elements of housing, the economy, transportation and the environment through 35 strategies that will make the Bay Area more equitable for all residents and more resilient in the face of unexpected challenges. https://www.planbayarea.org/finalplan2050
2 See Attachment 3, New Development Impacts on Jobs/Housing Balance

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*Based on upzoning (i.e., increased units/acre and building height) in San Carlos’ Mixed-Use and Multi-Family Zoning Districts.

To achieve the RHNA targets (and the total unit capacity), amendments are required to San Carlos’ Zoning Ordinance, which is a critical part of this Housing Element update and discussed further below.

In developing a strategy to accommodate San Carlos’ fair share of housing, staff and the consultant team worked with participants at community workshops where three big themes emerged:
•Place new housing units in existing residential neighborhoods where housing is already allowed under current zoning regulations.
•Focus most of the housing growth along major transit corridors next to everyday needs and services and in higher-density zoning districts that allow residential. •Amend the San Carlos Zoning Ordinance to increase densities (units/acre) and building heights to accommodate additional housing.

Preliminary Draft Housing Element
The Preliminary Draft Housing Element for the 2023-2031 planning period (Attachment 3) includes eight overall sections, which are outlined below. Almost all of these sections are mandatory requirements pursuant to State law and cannot be significantly altered. State law requirements for Housing Elements must include and discuss housing needs, housing constraints, housing resources, a review of the previous housing element progress, and fair housing. Altogether they form a background analysis, and, together with community input, they work together to develop a strategy or Housing Plan consisting of Goals, Policies, and Actions items to follow and implement over the next 8 years. Accordingly, Section 2: Housing Plan is a key part of the Housing Element, as it will guide decision making and City action over the next eight years.
1) Introduction
a. Overview of the Housing Element
b. Consistency with San Carlos’ General Plan
c. State Law Requirements for Housing Element
d. Process of Preparing the Housing Element
2) Housing Plan
a. Housing Goals, Policies, and Actions
3) Needs Assessment
a. Population and Employment Trends
b. Household Characteristics
c. Housing Stock Characteristics
d. Special Housing Needs
e. Energy Conservation Opportunities
f. At-Risk Housing Analysis
g. Projected Housing Need (RHNA)
4) Constraints to Housing Production
a. Non-Governmental Constraints

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b. Governmental Constraints
5) Housing Resources
a. Availability of Sites for Housing
b. Administrative and Financial Resources
6) Affirmatively Furthering Fair Housing
a. Primary Findings
b. Fair Housing Enforcement and Capacity
c. Integration and Segregation
d. Displacement Risk
e. Disproportionate Housing Needs
f. Fair Housing Issues, Contributing Factors, and Action Plan 7) Previous Housing Element Program Accomplishments
a. Previous Housing Element Program Accomplishments
b. Previous Housing Element Progress Toward Quantified Objectives 8) Appendix A: [Housing] Sites Inventory Table
Section 2, Housing Plan: Goals, Policies, and Actions (i.e., Programs) While Section 2 of the Housing Element contains eight (8) Goals, twenty (20) Policies, and thirty- five (35) Action items, staff has highlighted the following Actions that respond to community input and identify how San Carlos will meet its RHNA obligation.

Action HOU 3.1: Encourage concurrent production of on or offsite affordable housing in lieu of commercial/housing linkage fee payment.

Action HOU 3.3: Facilitate the Legalization and Construction of Accessory Dwelling Units (ADUs).

Review other cities best practices for “pre-approved” ADUs and expedited review.

Action HOU 3.7: No Net Loss. No jurisdiction shall reduce or require or permit the reduction of residential density for any parcel identified in the Housing Sites Inventory (inventory in Appendix A of Housing Element) unless consistent with the General Plan and that remaining sites in the Sites Inventory are adequate to accommodate the jurisdiction’s need. (State law requirement).

Action HOU 3.13: Reevaluate City Density Bonus Provisions that allow rental projects to add bonus market rate units at a ratio of 4:1 for each very-low income unit and 2:1 for each low-income unit. This program currently applies citywide to rental housing developments. Reevaluate to target particular areas rather than apply it uniformly throughout the City.

Action HOU 4.2: Zoning Ordinance Revisions. This action calls for increasing densities, heights, and number of stories, and inserting new minimum density standards into San Carlos’ multi-family and mixed-use zoning districts. (Note: San Carlos will not be able to meet its RHNA obligation without these changes.)

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In addition, this Action calls for:
✓Removal of the requirement for ground-floor non-residential uses along portions of El Camino Real and Old County Road, south of E. San Carlos Avenue. ✓Removal of minimum private open space requirement (e.g., decks, balconies; developers can choose to place these amenities in projects if they like; common open space areas and landscaping are still required).
✓100% residential projects in Mixed-Use zoning districts may follow the zero lot line setbacks provisions for Mixed Use projects (i.e., would no longer need to conform to RM- 59 standards).
✓Removal of guest parking requirement in all RM and Mixed-Use Zones. ✓Removal of side and rear building setbacks pertaining to the building wall containing living rooms, primary rooms, sleeping rooms, and walls containing windows. ✓Allowing multi-family residential in the P Zoning district as an accessory use to allowed uses such as religious facilities and schools.

Action HOU 4.4: Objectivity and Streamlining Development Regulations. Streamline the development review process by developing clear, objective standards in development regulations. With clear, objective standards for residential development, consider by-right approvals (i.e., no public hearing requirement).

Goal 7, Policies HOU 7.1 and Actions HOU-7.1 and HOU-7.2 relating to childcare development impact fee, by right childcare centers.

Civic Engagement and Public Comments
The planning process sought to engage many key audiences: the City Council Housing Subcommittee, Planning Commission, City Council, various other Commissions, a wide variety of stakeholders (local agencies and housing groups, community organizations, housing developers, and student groups, etc.), and the general public (residents of the community). Hundreds of residents, businesspeople, and other stakeholders participated across a series of activities.

Outreach and participation for this Housing Element update was different than previous years because much of the update process occurred during the COVID-19 pandemic. Meetings were promoted through website updates, social media posts, mailers, and flyers posted in public spaces to advertise and invite the community to virtual workshops. Service organizations were directly contacted to solicit participation in the program, and included organizations representing

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lower- and moderate-income households, seniors, and youth, among others. Through this robust outreach and engagement process, the strategies in the Housing Element were defined.

The City’s consultant, MIG, facilitated multiple virtual interactive community workshops that addressed housing-related issues as part of the Housing Element update process. The workshops included a presentation, live polling, virtual whiteboard recording to collect input from the participants, and an interactive discussion. City staff conducted robust community outreach to encourage maximum participation in the workshops and surveys that followed workshops. This included social media posts on Facebook, NextDoor, Instagram, and Twitter. Announcements about the project and workshop were made at public meetings including City Council, Planning Commission, Transportation & Circulation Commission, Economic Development Advisory Council, and Youth Advisory Council meetings. In addition, the workshops were promoted through the City’s Spotlight Newsletter, City Council Newsletter, Adult Community Center Newsletter, Chamber of Commerce Newsletters, and E-notify blasts. Grassroots efforts included booths at the San Carlos Farmer’s Market and flyers throughout the Downtown. Across all the workshops and surveys there were 370 stakeholders who participated. The images below are captured from the Introduction Section of the Preliminary Draft Housing Element and describe the number of workshops and study sessions held to date, including this study session and the upcoming study session with the City Council on September 26, 2022.

Table 4.1-1: Community Workshops and Surveys
Community
Workshop
Date / Date
Range Topic Number of
Participants
Survey #1
Mid-October to
December 7,
2020
Housing and
Environmental Safety 76
Workshop #1 November 30,
2020
Community Values,
Issues, and Concerns 65
Survey #2
January 11 –
February 12,
2021
Housing Priorities 75
Workshop #2 January 20, 2021 Values and Land Use
Strategies 75
Workshop #3 May 26, 2021 Housing Changes
and Solutions 37
Workshop #4 August 11, 2021
Housing Changes
and Zoning
Strategies
42 Table 4.1-2: Study Sessions
Study Sessions Date Topic
City Council Subcommittee Meetings August 20, 2020; November 5, 2020; February 10, 2021; September 1, 2021;
November 10, 2021; and March 15, 2021
Introduction to the Housing Element,
Community Input, Meeting the RHNA
and Housing Policies
Planning Commission Study Session October 19, 2020 Introduction to the Housing Element City Council Study Session September 27, 2021 Community Input and RHNA Planning Commission EIR Scoping
Session
January 12, 2022 Process Update and EIR Scoping

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Table 4.1-2: Study Sessions
Study Sessions Date Topic
City Council Subcommittee Meetings August 20, 2020; November 5, 2020; February 10, 2021; September 1, 2021;
November 10, 2021; March 15, 2021;
September 2022
Meeting the RHNA, Housing Policies,
and Public Review Draft Housing
Element
Planning Commission Study Session September 19, 2022 Public Review Draft Housing Element City Council Study Session September 26, 2022 Public Review Draft Housing Element A summary of community outreach and community input is provided within Attachment 1. Public comments received since the Preliminary Draft Housing Element was released on August 30, 2022 are found in Attachment 2.

Planning Commission Study Session, September 19, 2022

On Monday, September 19, 2022, staff held a study session with the Planning Commission to review the Preliminary Draft Housing Element. At the study sessions, the following comments were received:

Public Comments:
-Remove 1785 San Carlos Avenue (45,999 sq. ft. or 1.1-acre site) from the Housing Opportunities Sites list and keep it as RM-59 (59 units/acre) and do not upzone it to RM- 100 (100 units/acre). [Note: multiple emails received from property owners along Carmelita Drive in response to identifying 1785 San Carlos Avenue as a housing opportunity site).
-Describe how relaxing the private open space requirements per unit, removing ground floor non-residential requirement, and removing guest parking requirement allow for more units to be built within a project.
-Confirm if the City count SB9 units (i.e., duplex and additional primary homes on a single- family lot) towards the RHNA.

Planning Commission Comments:
-Describe the criteria used to identify housing opportunity sites (i.e., the sites in Appendix A of the Housing Element).
-Provide an estimate of how many projects are likely to use the density bonus provisions (e.g., and build taller structures than the 6-story maximum that would be permitted under proposed zoning changes).
-Determine the percentage or number of units within the housing opportunity sites that are located east of El Camino Real.
-Staff should emphasize and clarify the “transitional standards” in place for housing sites that are next to single-family residential zoning districts. -Can staff provide more information or estimate or range of statistics regarding what a project might end up with in terms of height, setbacks, or other concessions a developer may ask for when utilizing the provisions of the State and City Density Bonus. -The City should be careful not to place all the low-income rental developments in one cluster or area of the City; there should be more equal distribution of these projects should the City reevaluate the City Density Bonus to focus these projects in specific locations rather than allow them to occur uniformly citywide (i.e., proposed Action HOU 3.13:

Reevaluate City Density Bonus Provisions).

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Next Steps
Following City Council’s review and direction, staff will consider possible revisions to the Preliminary Draft Housing Element. The Draft Housing Element will then be submitted to HCD for its review.

The remaining steps towards Housing Element certification by the State include:
▪September 30, 2022: 30-day public comment period on the Preliminary Draft Housing Element ends
▪October 1 – October 15, 2022: potential revisions made to Draft Housing Element based on public comments, recommendations from the Planning Commission, and City Council direction
▪October 17, 2022 – Submit Draft Housing Element to the State Department of Housing and Community Development for its review and comments (HCD has up to 90 days to respond to the City with comments/findings)
▪Housing Element adoption:
oJanuary 2, 2023 – Planning Commission formal recommendation to the City Council
oJanuary 23, 2023 – City Council consideration of adoption ▪Housing Element Compliance Review (HCD has up to 60 days to review and respond on any subsequent drafts)
▪Return to Planning Commission and City Council with any substantive changes required by the State Department of Housing and Community Development, as necessary.

Schedule
The State requires all jurisdictions in the Bay Area to have an adopted Housing Element by January 31, 2023, with a 120-day grace period. Local jurisdictions that do not adopt a Housing Element that is found to be in compliance with State law by HCD within 120 calendar days of the due date must complete any required rezoning to meet the RHNA within one calendar year of the due date, which would include rezoning many sites to allow by-right residential development (not subject to CEQA review).

Staff anticipates formal adoption occurring in January 2023, followed by State certification thereafter and within the 120-day grace period.

Closing
Prior to presenting a Preliminary Draft Housing Element to the State Department of Housing and Community Development, staff would like to hear from the City Council if there is anything missing in the Housing Element prior to sending the draft to the State.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Receive the Preliminary Draft 2023-2031 Housing Element and provide staff with comments to consider prior to sending the document to the State Department of Housing and Community Development for review; or

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2. Provide staff with alternative direction
Respectfully submitted by:

Al Savay, Community Development Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager
ATTACHMENT(S):

1. Summary of Community Engagement and Outreach

2. Combined Public Comments on Prelim Draft Housing Element

3. New Development Impacts on Jobs Housing Balance – RSG

4. Preliminary Draft Housing Element August 30, 2022

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Summary of Community Engagement and
Outreach Comments through June 2022
As part of the Housing Element Update, the City of San Carlos launched a robust community outreach program to ensure the public and key stakeholders are aware, informed, and engaged throughout the entirety of the planning process. Five key audiences were identified including: the Council Subcommittee, Planning Commission, City Council, Stakeholders (local agencies and housing groups, community organizations, housing sponsors, and student groups, etc.), and the General Public (residents of the community).

The outreach process was largely virtual due to the limitations from COVID-19 pandemic. Community workshops, surveys, stakeholder meetings, and all other participation opportunities were promoted though website updates, social media posts, mailers, and flyers posted in public spaces. Specifically, this included social media posts on Facebook, NextDoor, Instagram, and Twitter. Announcements about the project and workshop were made at public meetings including City Council, Planning Commission, Transportation & Circulation Commission, Economic Development Advisory Council, and the Youth Advisory Council. In addition, the engagement events were promoted through the City’s Spotlight Newsletter, City Council Newsletter, Adult Community Center Newsletter, Chamber of Commerce Newsletters, and E-notify blasts. There were also some grassroots efforts such as booths at the San Carlos Farmer’s Market and flyers throughout the Downtown. Across all the workshops and surveys there were 370 stakeholders who participated.

In addition, service organizations were directly contacted to solicit participation in the program, and included organizations representing lower- and moderate-income households, seniors, and youth, among others. Through this robust outreach and engagement process, the strategies in the Housing Element were defined. Below is an overview of the various community engagement opportunities.

Community Workshops and Follow-up Surveys
Community
Workshop
Date / Date
Range
Topic Number of
Participants
Link to Summary Reports
Survey #1 Mid-October
to December
7, 2020
Housing and
Environmental
Safety
76 Summary of Survey #1
Workshop #1 November 30,
2020
Community Values,
Issues, and
Concerns
65 Summary of Workshop #1
Survey #2 January 11 –
February 12,
2021
75 Summary of Survey #1
Workshop #2 January 20,
2021
Values and Land
Use Strategies
75 Summary of Workshop #2
Workshop #3 May 26, 2021 Housing Changes
and Solutions
37 Summary of Workshop #3

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Workshop #4 August 11, 2021 Housing Changes
and Zoning
Strategies
42 Summary of Workshop #4
Stakeholder Interviews
•Chamber of Commerce
•San Carlos Parks and Recreation Department
•Parent Teacher Association (PTA) Coordinating Council
•San Carlos School District
Focus Groups
•Greater East San Carlos Organization (GESC)- January 19, 2021 •Harbor Industrial Area (HIA)- November 4, 2021
•Focus Group Meeting with Organizations that serve the Special Needs Community- June 13, 2022
Study Sessions and Subcommittee Meetings
•City Council Subcommittee Meeting #1- August 20, 2020
•Planning Commission Meeting- October 5, 2020
•City Council Subcommittee Meeting #2- November 5, 2020 •City Council Subcommittee Meeting #3- February 10, 2021 •City Council Subcommittee Meeting #4- September 1, 2021 •City Council Study Session- September 27, 2021
•City Council Subcommittee Meeting #5- November 10, 2021 •Planning Commission EIR Scoping Meeting- January 12, 2022 •Planning Commission Study Session – September 18, 2022 •City Council Study Session – September 26, 2022

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Exhibit A: Sample Outreach Materials

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Date: December 16, 2021 To: Al Savay, Community Development Director Lisa Porras, Planning Manager City of San Carlos From: Mark Sawicki, Director, RSG, Inc. Subject: New Development Impacts on Jobs/Housing Balance In conjunction with the City's recently adopted East Side Innovation District Vision Plan and in preparation of an updated General Plan Housing Element, City staff asked RSG to evaluate the impact of the City's new development activity in terms of job creation and housing demand. In particular, RSG sought to address the following questions: • Is the current estimate of job growth significantly greater than the existing General Plan projections? • Does the City's latest Regional Housing Needs Allocation account for new commercial development and the associated job creation and housing demand? • Is there a jobs/housing ratio that San Carlos should target to achieve a balance? How does the City's jobs/housing ratio compare to other neighboring Peninsula cities? • Does the City's current and projected jobs/housing ratio suggest any policy adjustments, such as converting existing commercial/industrial land uses to residential? Summary Findings • Existing and current proposed new development is within the 2030 General Plan buildout envelope. • The current estimate of projected jobs is also within the 2030 General Plan projection. • San Carlos has produced enough housing to maintain a jobs/housing ratio of about 1.46:1, which is considered a healthy balance by planning and community development organizations and assumes an average of 1.5 employed residents for every household. • San Carlos improved its jobs/housing ratio since the adoption of the current General Plan in 2009. • San Carlos jobs/housing ratio is equal or better than many other Peninsula cities. Through the regional Plan Bay Area and Regional Housing Needs Allocation (RHNA) process, ABAG/MTC apportions jobs and housing to Bay Area cities to achieve an overall regional balance. San Carlos is not expected or required to exceed its housing targets in order to keep the region in balance. • The jobs and housing demand from planned new commercial/industrial development in San Carlos does not significantly exceed the housing development targets proposed for the update of the Housing Element currently underway (which also exceed the mandated RHNA target from ABAG/MTC). Therefore, San Carlos is expected to generally maintain a healthy jobs/housing ratio. • Ultimately, if San Carlos can meet its RHNA target within existing residentially zoned land, there should be little need to re-zone commercial/industrial lands to either reduce job growth or increase housing production, in order to maintain a reasonably healthy jobs/housing balance.

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Al Savay and Lisa Porras City of San Carlos December 16, 2021 Page 2

I. Recap of 2009 General Plan Existing Conditions and Projected 2030 Buildout The City's long term planning document is the current General Plan adopted in 2009, which projected buildout in conformance with the Plan through the year 2030. The document included "Existing Conditions" information on industrial/commercial/office space, the number of jobs within the City, as well as the number of housing units. In San Carlos, 19% of its land is being used for industrial, commercial and office use, while 68% of its land is used for residential (88% of which is single family homes). Table 1 presents figures from the General Plan showing the existing (2008) and projected (2030) housing, population, jobs, and non-residential uses: Table 1: General Plan Housing, Population, and Non-Residential Growth Based on the foregoing existing conditions, the jobs/housing ratio1 in 2008 was 1.61:1. Based on the projections at the time, by 2030 San Carlos would have increased its jobs/housing ratio to 2.12:1. II. Current Buildout, Jobs, and Housing The current buildout in San Carlos is not significantly greater than the 2008 existing conditions in the General Plan. Although there has been new development, it has generally replaced older buildings without substantial net new space. The total commercial, office and industrial square footage in Table 1 for 2008 was about 9,181,000, compared with 9,339,453 today, as shown in Table 2 below. 1 The jobs/housing metric is a ratio between the number of jobs and the number of housing units in a given geographical area. It is a measure of community health related to housing availability. A jobs-to-housing balance ratio of 1.5 means there are six jobs for every four households. This is a recognized building industry and planning organizations as a healthy jobs/housing balance. This accounts for at least one full-time worker in most households, given that some members of the population are retired, some choose not to or cannot work, and some hold part-time jobs. The jobs-to-housing balance recognizes that in a modern economy, a simple ratio of one job to one household is inappropriate, since most households need more than one person in the workforce.

Existing
Conditions
(2008)
General
Plan (2030)
Change
(2008-2030)
% Change
(2008-2030)
Housing Units 11,960 13,396 1,436 12.0%
Population 28,857 32,303 3,446 11.9%
Jobs 19,288 28,453 9,165 47.5%
Jobs:Housing Ratio 1.61:1 2.12:1
Commercial Square Feet 2,084,557 2,808,587 724,030 34.7% Office Square Feet 904,423 1,476,429 572,006 63.2%
Industrial Square Feet 6,192,078 8,333,255 2,141,177 34.6% Total 9,181,05812,618,271 3,437,213 37.4%
Sources: San Carlos General Plan (Department of Finance, Economics Research Associates, DC&E)

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Al Savay and Lisa Porras City of San Carlos December 16, 2021 Page 3

Table 2: Current Non-Residential Buildout, Jobs, and Housing The number of current jobs in San Carlos has fallen from the level reported in 2008, likely due to the loss of larger employers Kelly-Moore and L3. Meanwhile the City has added more housing units during the same time frame. These figures are also shown in Table 2. The combination of these factors has led to a reduction in the jobs/housing ratio compared to both the 2008 existing conditions and 2030 General Plan projection. Based on the current figures above, the existing jobs/housing ratio is now at 1.46:1. III. New Development, Projected Jobs, and RHNA Housing Production Most new development proposed in San Carlos is in the East Side industrial and commercial districts, most of which is contemplated under the new East Side Innovation District Vision Plan. According to City staff, the amount of net new square feet of development exceeds 2.7 million square feet as shown in Table 3 below. By comparison, according to the projected buildout in Table 1 from the General Plan, the City was anticipating an additional 3.4 million square feet of net new commercial, office, and industrial development by 2030. Table 3: Proposed Development Square Footage

Total Buildout 9,339,453 square feet
Jobs 18,109
Housing Units 12,385
Jobs:Housing Ratio 1.46:1
Sources: Buildout- CoStar Analytics (2021), Jobs - 21 Elements (2020), Housing - Cal Dept of Finance (2020)
Proposed New Developments:

Existing
SF Existing Use
Proposed
Gross SF Proposed Use
Net New
SF
887 Industrial (Alexandria) 134,187Commercial/Industrial 528,520 Life Science 394,333 1091 Industrial 40,067Commercial/Industrial 138,710 Life Science 98,643 1030 Brittan Avenue (MBC Bio Labs) 0Vacant (Parking) 96,175Life Science 96,175 987 Commercial Street (Alexandria)610,907Commercial/Industrial1,520,774Life Science 909,867 888 Bransten Road (Black Mountain)57,068Commercial 211,000Life Science 153,932 800 Old County Road (Sobrato) 29,723Commercial 300,000Life Science 270,277 405 Industrial Road (Menlo Equities)16,445Public Storage 166,000Life Science 149,555 777 Industrial Road (Presidio) 44,000Car Sales/Repair 120,000Life Science 76,000 501 Industrial Road (Hotel) 26,000Construction Yard119,000Hotel - 188 keys93,000 1021 Howard Avenue 44,812Commercial/Industrial190,869Life Science 146,057 642 Quarry Road 80,038Industrial 410,092Life Science 330,054 Proposed 3,801,140 2,717,893

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Al Savay and Lisa Porras City of San Carlos December 16, 2021 Page 4

Based on an industry average2 400 square feet per job estimate for industrial, commercial and life science buildings, this new development could be expected to generate up to an additional 6,627 jobs in San Carlos. Assuming an average jobs per household of 1.5x, the City would need to produce 4,418 new housing units to accommodate the potential demand for local housing (assuming all employees seek to locate in San Carlos). The City has been given a RHNA target of 2,735 housing units for the 6th cycle covering the next 8 years. Through the Housing Element update process, the City is planning to accommodate an additional 481 units above RHNA, for a total planning target of 3,216. If the City can accommodate its Housing Element target production of 3,216 then, based on the estimated additional jobs generated from new development, the jobs/housing ratio would be projected to increase to 1.59:1. This still generally aligns with the target jobs/housing balance ratio of 1.5:1. IV. Jobs/Housing Ratio of Other Peninsula Cities The current jobs/housing ratio in San Mateo County is 1.52:1, according to the latest US Census data for 2019. Cities nearby San Carlos have the following jobs/housing ratios: Redwood City 2.20 San Mateo 1.48 Foster City 1.38 Belmont 0.57 In contrast, there are cities in Santa Clara County with significantly higher jobs/housing ratios including: Palo Alto 4.38 Santa Clara 2.58 MountainView 2.57 Cupertino 2.31 Sunnyvale 1.79 Countywide 1.66 V. Conclusion/Recommendation Based on the level of current commercial and residential development in San Carlos, the jobs/housing ratio is not currently "out of balance". If San Carlos is able to accommodate the amount of housing that is proposed for the updated Housing Element, there should not be a significant imbalance over the next RHNA cycle of eight years. Unless the City is unable to identify adequate sites and/or modify height, density, and other policies for residential development to accommodate its housing production target, then there should be no need to re-zone the existing relatively small percentage of land in the City that allows commercial, industrial and office use and development. 2 There is a wide range of benchmark metrics used to estimate the amount of square feet of space per employee. They vary from industry to industry as well as by type and size of firm within an industry. Based on actual commercial/industrial space in San Carlos and the actual number of jobs, the existing job density in San Carlos is currently over 500 square feet per employee. RSG has evaluated recent life science developments in the Bay Area and found a range of 165 to 642 sq ft per job, and an average that is slightly greater than 400 sq ft per job. This was also confirmed by the life science developer Alexandria Real Estate.

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San Carlos
2023-2031 Housing Element

DRAFT AUGUST 30, 2022

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TABLE OF CONTENTS
i GENERAL PLAN

Table of Contents

1. Introduction
Overview of the Housing Element ................................................ 1 Consistency with the San Carlos General Plan ............................ 2 State Law Requirements for Housing Element ............................ 2 Process of Preparing the Housing Element .................................. 3

2. Housing Plan
Housing Goals, Policies, and Actions .......................................... 11 Summary of Quantified Objectives .............................................. 34

3. Needs Assessment
Population and Employment Trends .......................................... 35 Household Characteristics ............................................................ 39 Housing Stock Characteristics ...................................................... 41 Special Housing Needs .................................................................. 44 Energy Conservation Opportunities............................................ 50 At-Risk Housing Analysis ............................................................. 50 Projected Housing Need (RHNA) ............................................... 53

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4. Constraints to Housing Production
Non-Governmental Constraints ................................................... 55 Governmental Constraints ............................................................. 60

5. Housing Resources
Availability of Sites of Housing .................................................... 95 Administrative and Financial Resources ................................... 123

6. Affirmatively Furthering Fair Housing
Primary Findings .......................................................................... 128 Fair Housing Enforcement and Capacity .................................. 131 Integration and Segregation ........................................................ 137 Displacement Risk ........................................................................ 177 Disproportionate Housing Needs ............................................... 179 Fair Housing Issues, Contributing Factors, and Action Plan . 196

7. Housing Element Program Accomplishments
Housing Element Program Accomplishments ......................... 205 Quantified Objectives ................................................................... 217

Appendix A: Sites Inventory Table

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Contents
1 Overview of the Housing Element
2 Consistency with the San Carlos General Plan
2 State Law Requirements for Housing Element
3 Process of Preparing the Housing Element

Overview of the Housing Element
All California cities and counties are required to have a Housing Element included in their General Plan, which establishes housing goals , policies, and actions in response to community housing conditions and needs. This Housing Element has been prepared t o respond to current and near -term future housing needs in San Carlos and also provide a framework for the community’s long term approach to addressing its housing needs. The Housing Element contains goals, updated
information, and strategies (policies and implementing actions) that the City is committed to undertaking.

Housing affordability in San Mateo County and in the Bay Area as a whole is a critical issue. San Carlos’s housing conditions are reflective of many area-wide and even nation -wide trends. Over the past thirty years, housing costs have skyrocketed out of proportion to many people’s ability to pay. In addition , interest rates, construction costs, and high land costs have all increased significantly. This has a number of implications as it becomes more difficult for employers to fill vacant jobs, workers must travel longer distances into and out of San Carlos and
surrounding areas to get to work, and many young people, families, longtime residents, and people with specialized housing needs cannot find housing they can afford or that meets their needs.

The Housing Element touches many aspects of community life.

This Housing Element builds upon the goals, policies, and implementing programs contained in the City’s 2015-2023 Housing Element and other City policies and practices to address

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housing needs in the community. The overall focus of the Housing Element is to enhance community life, character, and vitality through the provision of adequate housing opportunities for people at all income levels.

The Housing Element covers the planning period of January 31, 2023 through January 31, 2031.

Consistency with the San Carlos General
Plan
The San Carlos General Plan serves as the ‘constitution’ for development in the city. It is a long -range planning docu ment that describes goals, policies and actions to guide decision - making. All development -related decisions must be consistent with the General Plan, of which the Housing Element is but one part. If a development proposal is not consistent with a city’s General Plan, it must be revised or the plan itself must be amended. State law requires a community’s G eneral Plan to be internally consistent. This means that the Housing Element, although subject to special requirements and a different schedule of updates, must function as an integral part of the overall General Plan, with consistency between it and the other General Plan elements.

The 2023-2031 Housing Element was updated as part of a focused General Plan Update to address environmental safety, housing, and land use . All policies and actions in other General Plan elements were prepared to be consistent with the Housing Element. Land Use designations and densities in the Land Use Element were prepared to be consistent with this Housing Element and to accommo date San Carlos’ housing need for the 2023-2031 planning period.

The intent of the 2015-2023 Housing Element is to maintain the consistency of the Housing Element with the other General Plan Elements over time. Consistency modifications ensure that any potential impediments to implementation of the Housing
Element are addressed in the other elements of the General Plan.

State Law Requirements for Housing
Elements
State law requires each city and county to adopt a General Plan containing at certain topics (called “elements”), including a Housing Element. California State law provides more detailed requirements for the Housing Element than for any other General Plan element. This Housing Element responds to those
requirements, as well as conditions and policy directives unique to San Carlos.

Unlike the other mandatory General Plan elements, the Housing Element requires periodic updating and is subject to detailed statutory requirements and mandatory review by the State of California Department of Housing and Community
Development (HCD). According to State law, the Housing
Element must:
• Provide goals, policies, quantified objectives and
scheduled programs to preserve, i mprove and develop
housing.

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• Identify and analyze existing and projected housing needs for all economic segments of the community.
• Identify adequate sites that will be zoned and available within the Housing Element planning period — between
2023 and 2031 — to meet the City’s share of regional
housing needs at all income levels.
• Undertake HCD review of the Draft Housing Element and certification of the City’s adopted Housing Element in
compliance with State law.

State law establishes detailed content requirements for Housing Elements and a regional “fair share” approach to distributing housing needs throughout all communities in California, including the Bay Area. The law recognizes that in order for the private sector and non -profit housing developers to addr ess housing needs and demand, local governments must adopt land use plans and implement regulations that provide opportunities for, and do not unduly constrain, housing development.

The Housing Element must provide clear policies and direction for making decisions related to zoning, subdivision approval and capital improvements that relate to housing needs. The housing actions (i.e., programs) are intended to: (1) identify adequate residential sites available for a variety of housing types for all income levels; (2) focus on the provision of adequate housing to meet the needs of lower and moderate income households; (3) address potential governmental constraints to the maintenance, improvement and development of housing; (4) preserve and improve the conditio n of the existing affordable housing stock; and, (5) promote housing opportunities for all persons. Also in accordance with State law, the Housing Element must be
consistent and compatible with other elements (or sections) of the San Carlos 2030 General Plan.

Process of Preparing the Housing
Element
San Carlos’s history of extensive community involvement in local decision-making makes the community outreach process for the Housing Element update not only essential and highly desirable, but also a critical component of the work effort. The approach for the Housing Element update described below is consistent with State law contained in Government Code 65583(c)(7) — “The local government shall make a diligent effort to achieve public participation of all econo mic segments of the community in the development of the housing element, and the program shall describe this effort.” At its core, the Housing Element provides an opportunity to have a community conversation about how to collaboratively address local housing challenges, develop policies, and find solutions.

Engagement Process
The City’s housing engagement process was two -fold: a county- wide collaboration between all jurisdictions called Let’s Talk Housing and a city-specific engagement process.
21 Elements / Let’s Talk Housing
21 Elements is a multi -year, multi -phase collaboration between all San Mateo County jurisdictions, along with partner agencies and stakeholder organizations, that aims to support jurisdictions in developing, adopting, and implementin g local housing

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policies and programs. Let's Talk Housing is a collaborative effort between all 21 jurisdictions in San Mateo County focused on increasing awareness of and participation in the Housing Element update process.
21 Elements/Let’s Talk Housing organized a series of
countywide meetings about the Housing Element update and provided community members with an introduction of the
Housing Element update and why it matters. These meetings were attended by more than 1,000 community members. San Carlos was part of the April 13, 2021 introductory meeting .

Additionally, Let’s Talk Housing held an All About RHNA webinar and a countywide four -part webinar series to help educate and inform San Mateo County residents and
stakeholders on regional and local housing issues. The four -part series took place on Zoom in fall of 2021, focusing on the following topics and how they i ntersect with the Bay Area’s housing challenges and opportunities:
• Why Affordability Matters
• Housing and Racial Equity
• Housing in a Climate of Change
• Putting it All Together for a Better Future

The series included speaker presentations, audience Q&A, breakout sessions for connection and debrief discussions. The sessions were advertised and offered in Spanish, Mandarin , and Cantonese, though participation in non-English channels was limited.

Key themes that emerged included:
• Housing affordability is a public health issue: Where we live impacts our health, economic equity, environmental and racial justice
• The Three S’s: Supply, Stability and Subsidy: Increase housing supply, protect renters and vulnerable
households by providing stability, fill the gaps with
subsidies
• Implement strategies to promote climate-ready housing In addition to the discussions above, Let’s Talk Housing also sponsored four “listening sessions” with city and county staff and key stakeholders, that convened more than 30 groups . These stakeholders represented organizations that focused on:
• Building market-rate or affordable housing
• Addressing fair housing issues
• Advocating for affordable housing
• Providing housing services

San Carlos Housing-Element Focused Engagement
The Housing Elem ent is being updated in conjunction with the City’s Safety Element and amendments to the Land Use Element and other elements in support of the Housing Element. The public engagement program initiated for this consolidated effort sought to use people’s time efficiently, so that an outreach activity could inform more than one element. However, the emphasis has been housing and the Housing Element. The program’s approach focused on helping people understand how these plans can

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impact their community and daily lives, with less emphasis put on explaining the legislative requirements and planning jargon.

The engagement program leveraged a variety of outreach and engagement strategies, tools, and methods to inform, educate, and engage stakeholders throughout the pl anning process. The update was called “San Carlos 2040” to highlight the initiative.

The planning process sought to engage many key audiences: the City Council Housing Subcommittee, Planning Commission, City Council, various other Commissions, a wide vari ety of
stakeholders (local agencies and housing groups, community organizations, housing developers, and student groups, etc.), and the general public (residents of the community).

Hundreds of residents, businesspeople, and other stakeholders participated across a series of activities. Outreach and participation for this Housing Element update was different than previous years because much of the update process occurred during the COVID -19 pandemic. Meetings were promoted
through website updates, social media posts, mailers, and flyers posted in public spaces to advertise and invite the community to virtual workshops. Service organizations were directly contacted to solicit participation in the program, and included
organizations representing lo wer- and moderate -income households, seniors, and youth, among others. Through this robust outreach and engagement process, the strategies in the Housing Element were defined.

Stakeholder Interviews
At the outset of the engagement process, the City interv iewed participants who represent different constituencies in the community to get input on housing issues and potential
engagement strategies to reach the community. Stakeholders included the local Chamber of Commerce, the City’s Recreation Division, the PTA Coordinating Council, and the San Carlos School District.

Community Workshops and Follow-Up Surveys
MIG facilitated multiple virtual interactive community workshops that addressed housing -related issues as part of the Housing Element update process. The workshops included a presentation, live polling, virtual whiteboard recording to collect input from the participants, and an interactive discussion.

City staff conducted robust community outreach to encourage maximum participation in the works hops and surveys that followed workshops . This included social media posts on Facebook, NextDoor, Instagram, and Twitter. Announcements about the project and workshop were made at public meetings including City Council, Planning Commission, Transportation & Circulation Commission, Economic Development Advisory
Council, and the Youth Advisory Council. In addition, the workshops were promoted through the City’s Spotlight
Newsletter, City Council Newsletter, Adult Community Center Newsletter, Chamber of Commer ce Newsletters, and E -notify blasts. Grassroots efforts included booths at the San Carlos Farmer’s Market and flyers throughout the Downtown. Across all

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the workshops and surveys there were 370 stakeholders who participated.

Participants were invited to share housing and environmental safety ideas and concerns at all engagement activities. The first community survey focused on housing and environmental safety issues. The first workshop introduced the planning process for the Housing and Environmental Safety Elements and offered participants the opportunity to discuss housing concerns and ideas for solutions . A second survey launched just before the second workshop, which focused on defining key priorities to consider when defining where and how new housing might be built in San Carlos. The second workshop provided additional background information for the survey and the team introduced possible land use policy changes and strategies that would allow for additional housing to be constructed t hroughout the community.

The third workshop shared the estimated number of housing units that could be accommodated with existing zoning and policies, identified the anticipated housing shortfalls, and introduced new ideas and strategies to achieve housing targets.

The fourth workshop discussed and refined potential changes to accommodate San Carlos’ housing needs and collected input on possible zoning strategies for El Camino Real and other higher density residential areas.

Table 4.1-1: Community Workshops and Surveys
Community
Workshop
Date / Date
Range Topic Number of
Participants
Survey #1
Mid-October to
December 7,
2020
Housing and
Environmental Safety 76
Workshop #1 November 30,
2020
Community Values,
Issues, and Concerns 65
Survey #2
January 11 –
February 12,
2021
Housing Priorities 75
Workshop #2 January 20, 2021 Values and Land Use
Strategies 75
Workshop #3 May 26, 2021 Housing Changes
and Solutions 37
Workshop #4 August 11, 2021
Housing Changes
and Zoning
Strategies
42 Community and Focus Group Meetings
To engage the City’s active interest groups, the City met with an existing neighborhood group (Greater East San Carlos ; January 19, 2021), the Harbor Industrial Association (November 4, 2021) , and the Chamber of Commerce (January 18, 2022). City staff also presented an update on the Housing Element to the Economic Development Advisory Commission on September 22, 2020 and August 24, 2021 and presented to the Transportation and Circulation Commission on November 17, 2020 to describe the project, answer questions, and receive feedback.

The City also convened a focus group representing local service providers that represent persons with special needs (June 13, 2022). The focus group meeting included rep resentatives from a variety of community-based organizations. More than 25

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organizations were invited to participate. Organizations that participated included:
• Caminar – Project Ninety
• Catholic Charities
• City of San Carlos Adult/Senior Programs
• HIP Housing
• Housing Choices
• Housing Leadership Council of San Mateo County
• Project Sentinel
• Samaritan House
• San Carlos Elms
• Vista Center
At these meetings, the City shared information about the Housing Element Update process and solicited input on housing needs for various special needs groups.

City Council, Planning Commission, and Subcommittee Committee Study Sessions
The City held several study sessions with the City Council, Planning Commission, and City Council Housing Subcommittee to guide the direction of policy development and to provide additional opportunities for public input (Table 4.1-2).

Table 4.1-2: Study Sessions
Study Sessions Date Topic
City Council Subcommittee Meetings August 20, 2020; November 5, 2020; February 10, 2021; September 1, 2021;
November 10, 2021; and March 15, 2021
Introduction to the Housing Element,
Community Input, Meeting the RHNA and
Housing Policies
Planning Commission Study Session October 19, 2020 Introduction to the Housing Element City Council Study Session September 27, 2021 Community Input and RHNA Planning Commission EIR Scoping Session January 12, 2022 Process Update and EIR Scoping City Council Subcommittee Meetings August 20, 2020; November 5, 2020; February 10, 2021; September 1, 2021;
November 10, 2021; March 15, 2021;
September 2022
Meeting the RHNA, Housing Policies, and
Public Review Draft Housing Element
Planning Commission Study Session September 19, 2022 Public Review Draft Housing Element City Council Study Session September 26, 2022 Public Review Draft Housing Element

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Key Themes from Public Engagement
Key themes and recommended strategies that emerged from these engagement activities include:
• Coordination – The interdisciplinary nature of housing was a common theme, and the need to coordinate with
Caltrain, employers, and entities that provide supportive services and infrastructure for housing.
• Financial Partnerships – Recognizing the high cost
associated with affordable housing, partnerships were
identified as important, with an emphasis on
collaboration with nonprofits and the County to build
affordable housing.
• Decrease Greenhouse Gas Emissions (GHG) – Avoid
increasing greenhouse gas emissions and ensure that new buildings use energy -efficient appliances and renovate existing structures so that ga s-fueled furnaces, water heaters, or stoves are not used.
• Meeting the Housing Needs of Different Age Groups –
Create additional housing for seniors and provide
additional assisted living facilities , and at the same time recognize the housing needs of younger residents.
• Meeting the Housing Needs of Special Needs Groups –
Child care and developmental disabilities advocates
contributed information regarding the needs and
potential actions to support these special needs groups. • Increase Housing Options – Provide more housing
options ( apartments, condominiums, duplex , triplex,
etc.), housing characteristics (increase building heights, unit density, and compactness) and increase options for specific groups ( essential workers, local low-income
residents, seniors, and younger populations).
o Implications of Single -Family Zoning – Note the
historical injustices and inequities amplified and
perpetuated by single-family zoning and consider the
equity implications of preserving single-family
zoning. Address historic housing injustices with
support for diversity and inclusive housing . Include
housing as a buffer between single-family homes and
large buildings/development.
o Increase Accessory Dwelling Units (ADUs) – Build
new ADUs and encourage new development to
subsidize ADUs.
o Balance Jobs:Housing - Provide affordable housing in
balance with number of local low-income jobs.
o Renovate and Update Existing Units - Upgrade old
properties, renovate older apartments into affordable
housing, and c onvert unused office buildings into
housing.
o Increase Transit Oriented Development – Build new
housing along high -quality transit corridors.

Encourage use of public transportation.
o Increase Multi-Family Housing – Support a variety
of multi-family housing unit sizes and types such as
duplexes, triplexes, high -density multi -family
developments, and micro -units. Consider rezoning
east of the freeway for multi -unit. Encourage family - sized units. Support for higher building heights if
there was more BMR (below market rate) housing in
the development.

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o Ownership Opportunity – Promote diverse
ownership by prioritizing smaller development and
more opportunities for ownership.
• Increase Infrastructure Capacity – Expand and maintain the infrastructure capacity for water, waste, electricity, and transportation to support the new housing.
• Potential Scenarios – The planning team presented three potential land use scenarios that would accommodate
more housing than the current zoning would allow. The
community had a variety of questions regarding the
details and desires transparency regarding impact,
construction schedules, and design. In general,
participants favored six-story buildings at 75 ft. in height (i.e., support for higher heights was associated with the provision of more affordable housing) and transitioning buildings between districts.
• Diverse Opinions – While several participants supported the potential scenarios and overall housing growth,
participants noted the need for transparency and
compromise. Many suggested limiting building heights to 4-stories. Some suggested spreading growth in areas that have high densities and increasing multi -family and
mixed-use housing throughout San Carlos.

Comments fro m community workshops and correspondence
received during the update process have helped to identify housing needs and issues of concern in the community and possible strategies for the City to pursue in addressing housing needs.

How Public Comments Were Considered
Comments from community workshops and correspondence
received during the update process have helped to identify housing needs and issues of concern in the community and possible strategies for the City to pursue in addressing housing needs.

Public Review Draft Housing Element
The Draft Housing Element was posted on the City’s website, made available at City Hall, at the Community Development Department, and at the San Carlos Library . The City advertised the availability of the Draft Housing Element for public review through email notifications to the City’s distribution list and on the City’s social media outlets. The Draft Housing Element was available on August 30, 2022 for a 30-da y comment period.

During this time, an online comment form was available for the public to provide feedback on the Draft Element. The City scheduled two study session s for September 19, 2022 and September 26, 2022 to receive verbal comments from
Councilmembers, Commissioners, stakeholders, and the public.

Based on comments from the public, the City (consistent with AB 215) will take 10 business days to consider and incorporate public comments prior to submitting the Draft Housing Element to HCD.

The Draft Element, as revised, will remain available on the City’s website for additional public review and comment during the HCD review period. As revisions are made to respond to HCD comments, th is information will also be posted on the City’s website.

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Contents
11 Housing Goals, Policies, and Actions
34 Summary of Quantified Objectives

Housing Goals, Policies, and Actions
San Carlos’ mission is to provide high -quality services and facilities to its residents in an equitable, sustainable, transparent, responsive, and friendly manner to foster an inclusive, safe, and healthy community now and in the future.

San Carlos takes its mission to heart in developing and implementing its Housing Element. San Carlos is committe d to actively encouraging, supporting, and facilitating the creation of a safe, inclusive, diverse, and affordable supply of housing for all income levels. This includes implementing housing policies that expand and preserve its affordable housing stock, encourages greater access to housing, and minimize s the displacement of vulnerable residents. To that end, this Housing Element outlines an implementation plan through goals, policies, and
implementing actions. Goals are long -range, broad, and comprehensive targets. They may not necessarily be measurable nor achievable in the lifespan of this General Plan; rather, they describe an intention for the future outcome the community would like to achieve. Policies are focused and specific instructional guidelines and are resources to draw upon during the City’s decision-making process. The goals and policies are implemented through a series of housing actions. Actions identify specific programs the City will undertake toward putting each policy into action as a means to achieve goals.

The goals, policies, and actions were intentionally developed and written in response to identified housing needs in the community, constraints confronting the city, and resources

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available to address the housing needs. This Housing Element will guide San Carlos housing policy through the 2023 -2031 planning period. San Carlos’ housing goals, policies, and actions address the major housing needs identified by State law (Government Code §65583[c]):
• Identify adequate sites, with appropriate zoning and
development standards and services to accommodate the
locality’s share of the regional housing needs for each income level;
• Assist in the development of adequate housing to meet the needs of extremely low, very low, low, and moderate- income households;
• Address and, where possible, remove governmental
constraints to the maintenance, improvement, and
development of housing, including housing for people at all income levels, as well as housing for people with
disabilities;
• Preserve and improve the condition of the existing
affordable housing stock and preserve assisted (i.e.,
subsidized) housing developments at risk of conversi on to market-rate housing; and
• Promote equal housing opportunities for all people,
regardless of race, religion, sex, marital status, ancestry, national origin, color, familial status, or disability.

In addition, San Carlos’ two guiding principles supporti ng San Carlos’ mission statement for housing are:
• Housing in San Carlos supports an economically and
socially diverse population.
• Housing in San Carlos creates and supports vibrant
neighborhoods and a cohesive sense of community.

GOAL HOU-1: PRESERVATION AND

IMPROVEMENT OF THE QUALITY AND

LIVABILITY OF EXISTING HOUSING AND
NEIGHBORHOODS.

POLICIES
POLICY HOU-1.1
Existing Residential Neighborhoods. Preserve and improve the quality and livability of existing residential neighborhoods through neighborhood improvements and housing rehabilitation programs.

POLICY HOU-1.2
Lower Income Residents Displacement. Minimize potential displacement of existing lower income residents due to
increasing housing prices and rents.

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ACTIONS
ACTION HOU-1.1
Rental Inspection Program. Continue the Rental Inspection Program to preserve and improve existing housing stock and neighborhood quality.

Timeframe: Ongoing; a nnually conduct approximately 240 inspection visits
Responsible Agency: Building Division
Funding Sources: Community Development Department Budget

ACTION HOU-1.2
Residential Rehabilitation Programs.
• As CDBG funds are available through San Mateo County
Consortium, provide grants or loans to low and
moderate-income households for the rehabilitation of
residences. Examples of eligible repairs and
improvements include but are not limited to energy
efficiency and water conservation improvements,
removal of impediments and material barriers th at
obstruct accessibility, roofing, plumbing repairs, electrical repairs, exterior painting, window replacement , seismic and flooding safety repairs/adaptations, and climate
resiliency adaptations.
• Promote the availability of home repair services for low - income and special needs households available from
private agencies in the county.

Timeframe: Continue to participate in the San Mateo County Consortium; add information on home repair organizations to the City’s website in 2024, meet with affordable housing developers in 2024 to discuss rehabilitation opportunities.

Responsible Agency: Housing and Planning Divisions
Funding Sources: Community Development Department
Budget, CDBG, San Mateo County Consortium

ACTION HOU-1.3
Preservation of At -Risk Housing. Retention of subsidized (i.e., assisted) housing is a critical part of maintaining the supply of affordable housing in San Carlos. San Carlos will continue to monitor the affordability of existing deed -restricted units and coordinate with property owners to encourage the retention of affordability of these units. At this time, San Carlos has no units at-risk of converting to market rate in the next ten years; however, programs are included in the unforeseen event that affordable units become at -risk during or immediately following the Housing Element period.
• Annually monitor the affordability status of at-risk rental units.

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• Maintain and update the City’s list of nonprofit and
community-based organizations to contact regarding
possible ownership and management of the at -risk units if they are in imminent risk of conversion.
• In the event a project becomes at risk of converting to market-rate housing, work with property owners or other interested non -profit housing providers to preserve the units as affordable housing.

Timeframe: Ongoing
Responsible Agency: Economic Development and Housing
Divisions
Funding Sources: Community Development Department Budget

ACTION HOU-1.4
Code Enforcement. San Carlos encourages the maintenance and improvement of housing for all income levels through its Code Enforcement Program. The goal of code enforcement is to minimize deferred maintenance and eliminate health and safety problems.
• Continue to implement the Code Enforcement program to bring substandard housing units into compliance with
City building and property maintenance codes.
• Continue to refer eligible households to the available resources provided by nonprofits in the region , and as feasible conne ct with local volunteer groups for
rehabilitation support.
• Continue to evaluate staffing and funding to ensure
adequate resources for the Code Enforcement Program.

Timeframe: Ongoing
Responsible Agency: Building Division
Funding Sources: Community Development Department Budget

GOAL HOU-2: HIGH QUALITY, HIGHER-

DENSITY, MULTI-FAMILY HOUSING

LOCATED CLOSE TO TRANSIT, IN

DOWNTOWN, AND ALONG SAN CARLOS

AVENUE AND EL CAMINO REAL

POLICIES
POLICY HOU-2.1
Design Quality. Promote well-designed multi-family housing and mixed -use projects in the Downtown area and along San Carlos Avenue and El Camino Real.

POLICY HOU-2.2
Complete Streets. Promote development that supports the City’s Complete Streets Policy , Bicycle and Pedestrian Master Plan , and a pedestrian- and bicycle-friendly environment.

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ACTIONS
ACTION HOU-2.1
Small Lot Development Incentives—Citywide. As t aller and denser housing developments are constructed as a result of t he City Density Bonus and revisions to the Zoning Ordinance, determine whether a dditional incentives are necessary for the development of small and odd -shaped lots and/or lot
consolidation.

Timeframe: Ongoing; conduct a review to assess the City Density Bonus and density, height, and parking standards in the Zoning Ordinance in 2025; as needed identify additional incentives and present options to Council in 2026; review this action item on an annual basis to evaluate its effectiveness and make
recommendations as needed.

Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-2.2
Small Lot Development Incentives—Downtown. As part of the 2022-2024 Downtown Specific Plan project, identify new incentives for small lot developmen t. The program may include incentives for small lots such as:
• Increasing allowable zoning density
• Relaxed development standards (including parking
reductions for small lots)
• Streamlined permitting process
• City financial contributions, as well as other density bonuses, incentives and concessions that are otherwise required by State density bonus law for the provision of higher levels of affordable housing.

Timeframe: Adopt a new Downtown Specific Plan with small lot development incentives in 2025; review this action item on an annual basis to evaluate its effectiveness and make
recommendations as needed.

Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

GOAL HOU-3: ASSIST IN THE

DEVELOPMENT OF NEW HOUSING THAT IS
AFFORDABLE AT ALL INCOME LEVELS.

POLICIES
POLICY HOU-3.1
Housing Choices. Encourage a diversity of high-quality housing in various types, locations, and price ranges for present and future residents.

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POLICY HOU-3.2
Affordable Housing. Provide financial and technical assistance or referrals to facilitate the development of affordable housing.

POLICY HOU-3.3
Home Ownership. Encourage home ownership opportunities for households of all income levels.

POLICY HOU-3.4
Rental and Owner Housing Balance. Encourage a n even
distribution of rental and ownership properties throughout the city and ensure developers are aware of the City Density Bonus provisions that encourage rental housing developments.

POLICY HOU-3.5
Income Distribution of Lower Income Affordable Housing.

Encourage housing units affordable to extremely low, very low and low -income households, consistent with the identified regional housing need for San Carlos.

POLICY HOU-3.6
Housing Preferences. Provide housing policies and programs that give preferences, where allowable by law, to households with members who live or work in San Carlos or are employees of the City of San Carlos, and school, fire, and police districts that serve San Carlos.

ACTIONS
ACTION HOU-3.1
Funding Low, Very Low, and Extremely Low-Income and
Special Needs Housing. Continue to apply the
commercial/housing linkage fee to fund affordable housing and monitor fee amount to ensure it reflects market conditions .

Encourage concurrent production of on or off -site affordable housing, in lieu of fee payment. Collaborate with existing and new major employers to encourage the development and funding of more affordable housing . Monitor and pursue county, state, and federal funding programs and sources for the creation o f affordable housing. Offer financial and technical assistance for housing development projects for persons with special needs.

Timeframe: Ongoing; re-evaluate opportunities for construction in-lieu of fee payment in 2024 ; collaborate with city’s 10 large st employers at least every other year; monitor funding and pursue opportunities through county, state, and federal funding programs and sources; offer funding and technical assistance to projects as they are proposed.

Responsible Agency: Planning, Economic Development, and Housing Divisions
Funding Sources: Community Development Department
Budget, San Carlos Housing Authority, City of San Carlos BMR Funds

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ACITON HOU-3.2
Below Market Rate (BMR) Ordinance.
• Continue to implement the City’s Below Mar ket Rate
(BMR) Ordinance requirements for rental and ownership
development.
• Establish a process for granting priority permit processing status for approved housing projects that exceed the
City’s minimum BMR requirement.
• Evaluate the BMR Ordinance’s density bonuses,
incentives, and concessions to determine they continue to make the production of affordable housing feasible. As part of this process, consult with local non -profit
affordable housing developers to identify potential
revisions that would better support development of
affordable housing, and especially Low-Income Housing
Tax Credit financed housing. Revise as necessary.

Timeframe: Ongoing; establish priority permit processing in 2024; re -evaluate the BMR Ordinance in 2024 and update as needed
Responsible Agency: Planning, Economic Development , and Housing Divisions
Funding Sources: Community Development Department
Budget, San Carlos Housing Authority, City of San Carlos BMR Funds

ACITON HOU-3.3
Facilitate the Legalization and Construction of Accessory Dwelling Units (ADUs).
• Support the development of accessory dwelling units
during the planning period and as new State laws modify accessory dwelling unit requirements, update the City’s ordinance to comply.
• Collaborate with surrounding jurisdictions through the 21 Elements working group to determine best approach for
tracking affordability throughout the planning period.
• Encourage the legalization of unpermitted accessory
dwelling units to better ensure that they are safe and
habitable. As sunset date of San Carlos Municipal Code
Section 18.23.210(H) approaches, consider an extension, based on history of use of this provision and anticipated ongoing need.
• Work with other regional/agencies countywide
partnerships to identify potential funding sources for
ADU construction.
• Meet with three or four ADU builders to discuss needs and best practices. Review best practices from other cities for “pre-approved” ADUs and expedited review. Create
submittal materials with documentation to facilitate
expedited review. Update the City’s website and include

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links to “pre-approved” plans. Conduct ongoing outreach with community.
• Review and as new information is available, update
public education materials on accessory dwelling units, including planning and building requirements,
streamline processing, funding possibilities , and other resources.
• Encourage local agencies, districts, and utility providers to reduce hook -up or other fees to facilitate the
development of accessory dwelling units.

Timeframe: Ongoing; San Carlos Municipal Code Section

18.23.210(H) - 2028; work with 21 Elements – 2023; funding and pre-approved plans - 2024, all others - Ongoing
Responsible Agency: Planning and Building Divisions
Funding Sources: Community Development Department Budget

ACTION HOU-3.4
First-time Homebuyer Program s. Direct prospective first-time homebuyers to HEART or other County programs intended for first time homebuyers. Encourage the use of these programs though outreach and education. Maintain and provide
information on local BMR ownership units that are resold.

Timeframe: Ongoing; update information on the City’s webs ite at least annually
Responsible Agency: Economic Development and Housing
Divisions
Funding Sources: Community Development Department Budget

ACTION HOU-3.5
Rental Voucher Program.
• Continue to implement the BMR ordinance, which
specifies Housing Choice Voucher (Section 8) eligibility in the BMR program.
• Continue to work with the San Mateo County Department of Housing and nonprofit organizations to implement
Housing Choice Voucher Rental Assistance programs .

Continue to provide information on the Housing Choice
Voucher program, including new legal requirements
pursuant to SB 329, which prohibits housing
discrimination on the basis of source of income (including Housing Choice Vouchers).
• Continue to collaborate with other cities in San Mateo County, regional organizations, and/or nonprofit
organizations to evaluate and quantify potential
discrimination against Housing Choice Voucher users or
other rental assistance voucher programs. Cont inue to
develop and act upon measures to address these issues.

Timeframe: Ongoing; update the City’s website annually

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Responsible Agency: Economic Development and Housing
Divisions
Funding Sources: HUD

ACTION HOU-3.6
State Density Bonus Law Consistency.
• Monitor State legislation as changes are made to
Government Code §65915 ; update the City’s density bonus programs accordingly.

Timeframe: Ongoing; annually monitor State legislation and update the City’s ordinances as needed
Responsible Agency: Planning and Economic Development and Housing Divisions
Funding Sources: Community Development Department Budget

ACTION HOU-3.7
No Net Loss. Government Code §65863 states that no jurisdiction shall “reduce, or require, or permit the reduction of, the residential density for any parcel to, or allow development of any parcel at, a lower residential density, or allow development at a lower residential density than projected” for properties identified in the Housing Element sites inventory unless the jurisdiction makes written findings that the reduction is consistent with the General Plan, and that the remaining sites identified in the Housing Element are adequate to accommodate the jurisdiction’s need.
• Develop and maintain a sites inventory throughout the planning period.
• Evaluate residential development proposals for
consistency with goals and policies of the General Plan and the 2023 -2031 Housing Element sites inventory and
make written findings that any density reduction is
consistent with the General Plan and that the remainin g sites identified in the Housing Element are adequate to accommodate the RHNA by income level.
• If a proposed reduction of residential density will result in the residential sites inventory failing to accommodate the RHNA by income level, identify and mak e available
additional adequate sites to accommodate its share of
housing need by income level within 180 days of
approving the reduced density project.

Timeframe: Sites Inventory – 2023, All Others - Ongoing Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-3.8
Replacement of Units on Sites. Pursuant to Government Code §65583.2(g)(3), require the replacement of units affordable to the same or lower income level as a condition of any development on

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a nonvacant site identifi ed in the Housing Element consistent with those requirements set forth in Government Code
§65915(c)(3). Replacement requirements shall be required for sites identified in the inventory that currently have residential uses, or within the past five years have had residential uses that have been vacated or demolished, and:
• Were subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of low- or very low-income; or
• Subject to any other form of rent or price control through a public entity’s valid exercise of its police power; or • Occupied by low- or very low-income households
For the purpose of this program “previous five years” is based on the date the application for development was submitted.

Pursuant to Government Code §66300(d) (Chapter 654, Statutes of 2019 (SB 330)), the City shall not approve a housing development project that will require the demolition of residential dwelling units regardless of whether the parcel was listed in the inventory unless a) the project will create at least as many residential dwelling units as will be demolished, and b) certain affordability criteria are met.

Timeframe: Ongoing
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget ACTION HOU-3.9
Development on Nonvacant Sites . Promote residential
development on nonvacant sites by:
• Targeting nonvacant sites identified in the Housing
Element as priorities for fund allocation as funds are
available.
• Proactively outreaching to property owners with a survey on how the city can support redevelopment/new housing
efforts.

Timeframe: Consider adaptive reuse standards – 2026, All Others - Ongoing
Responsible Agency: Planning Division
Funding Sources: Departmental Budget

ACTION HOU-3.10
Anti-Displacement Strategies. Explore the following strategies to minimize resident displacement:
• Tenant protection policies
• Community land trust or a housing preservation fund
Timeframe: Complete analysis by 2026 and hold a hearing with City Council to adopt anti-displacement strategies

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Responsible Agency: Planning, Economic Developmen t, and Housing Divisions
Funding Sources: Community Development Department Budget

ACTION HOU-3.11
Access to Opportunity . Noting historical inequities
amplified/perpetuated by single family zoning, encourage small units in residential neighborhoods through development of ADUs, JADUs, and SB 9 units.
• See Action HOU -3.3 for specific measures to incentivize ADUs in San Carlos.
• Review the City’s Zoning Ordinance and Subdivision
Ordinance and implement updates as needed to provide
clarity and facilitate housing development under SB 9.

These include adopting updated definitions, use
regulations, development standards, and ministerial
processes based on the outcome of a complete SB 9
analysis. Staff anticipates bringing the ordinance to City Council by early 2023.

Timeframe: Bring SB 9 ordinance for consideration by City Council in Fall 2023. Production and affordability will be monitored every two years thereafter and alternative actions will be implemented if necessary to meet the RHNA.

Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget ACTION HOU-3.12
Reduce Costs Associated With The Development Of
Affordable and Special Needs Housing. Reduce or waive
development impact fees (as needed) to facilitate 100% affordable and special needs housing, including housing for extremely low- income and persons living with disabilities (including persons with developmental disabilities).

Timeframe: Ongoing
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU 3.13
Reevaluate the City Density Bonus Provisions. In 2022, the City amended its City Density Bonus program to allow rental projects to add bonus market rate units at a ratio of 4:1 for each very-low Income unit and 2:1 for each low -income unit that is included in a development project. This City Density Bonus program currently applies citywide to rental housing developments, where multi-units and mixed -use projects are a permitted land use. In conjunction with the Housing Element update to meet the RHNA, modifications to allowable density, building height, and number of stories are proposed (see Action HOU -4.2), and it is understood that the State Density Bonus allows developments to go beyond the City’s height limits to fit all the units to which the project is entitled by the bonus. Under this action, staff will evaluate the City Density Bonus biannually to review use and

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implementation of the revised City Density Bonus and, as needed, to identify if the City Density Bonus should be revised to target particular areas rather than apply the Bonus uniformly throughout the City, based on place and in areas that are least impactful.

Timeframe: Ongoing; conduct a review to assess the City Density Bonus based on place and present options to Council in 2024; reevaluate biannually thereafter.

Responsible Agency: Economic Development , Housing, and Planning Divisions
Funding Sources: Community Development Department Budget

GOAL HOU-4: REMOVE OR MITIGATE

GOVERNMENTAL CONSTRAINTS

INHIBITING THE PROVISION OF

ADEQUATE, AFFORDABLE HOUSING

THROUGHOUT SAN CARLOS
POLICY
POLICY HOU-4.1
Remove and/or mitigate potential governmental constraints to the provision of housing at all income levels.

ACTIONS
ACTION HOU-4.1
Adequate Sites to Meet Regional Fair Share of Housing
Growth. The 2009 General Plan and accompanying 2011 Zoning Ordinance allows a variety of housing types, with densities ranging from one to six units per acre in single-family zoning districts, up to 59 units per acre along San Carlos Avenue, and up to 50 units to the acre in downtown San Carlos. In support of this 6th cycle Housing Element update, the City:
• proposes to create a new multifamily residential zoning category allowing a net density of up to 100 units per acre and proposes to increase mixed use densities up to 120
units per acre, and
• developed a parcel-specific inventory of sites suitable for future residential development
The City will:
• Continue to provide appropriate land use designations and zoning districts consistent with regional housing
needs.
• Maintain an inventory of potential sites to provide to developers in conjunction with information on
development incentives for affordable units.

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• As part of the Housing Element annual reporting process, evaluate project development against the sites inventory to ensure compliance with Government Code §65863.
• Continue to pursue implementation of the General Plan through completion and adoption of implementing
zoning regulations and specific plans.
• Encourage senior housing and housing suitable for
persons with disabilities and other special needs
(including assisted living).

Timeframe: Ongoing
Responsible Party: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-4.2
Zoning Ordinance Revisions. Enact the following zoning
changes:
1) Create new zones; increase density, heights, number of stories; and provide minimum densities as shown in Table

4.2-1.
2) Remove requirement for ground floor nonresidential uses along portions of El Camino Real and Old County Road,
south of E. San Carlos Avenue.
3) Remove minimum private open space requirement for
residential in Mixed Use and Multi -unit zoning districts (retaining only the common/public open space requirement). 4) For residential only development, remove additional
required setbacks (i.e., removing requirement to follow RM-59 zoning setbacks) in Mixed Use zones (resulting in no setbacks in most conditions).
5) Remove guest parking in all RM and Mixed-Use zones.
6) Remove side and rear yard setback requirements for mixed use and multi -family housing developments , specifically pertaining to portions of the building wall containing living rooms, primary rooms, sleeping rooms, and walls containing windows.
7) Allow multi -family residential use in the Public (P) zoning district as an accessory use to allowed uses such as onsite religious institutions and schools.

Timeframe: January 2023
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

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Table 4.2-1: Summary of Proposed Zoning Changes
Zone Maximum Density
(du/ac)
Minimum Density
(du/ac) Building Height (feet) Building Stories (stories) Existing Proposed Existing Proposed Proposed Existing Proposed Existing Proposed MU-N MU-N-40 20 40 30 30-50
depending
on
distance
from RS
zone

50 4 4
MU-N MU-N-50 20 50 38 50 (40 adjacent to RS
zone)
4 4
MU-N MU-N-120 20 120 90 75 4 6
MU-DC MU-DC-100 50 100 75 50 4 4
MU-D MU-D-100 50 100 75 60 4 5
MU-D MU-D-120 50 120 90 75 4 6
MU-SC MU-SC-120 59 120 90 75 4 6
MU-NB MU-NB-120 50 120 90 75 4 6
MU-SB MU-SB-100 50 100 75 60 4 5
MU-SB MU-SB-120 50 120 90 75 4 6
RM-20 RM-20 20 20 15 35 35 3 3
RM-59 RM-59 59 59 45 50 50 4 4
-- RM-100 n/a 100 75 n/a 60 n/a 5
*Note: The City of San Carlos Zoning Ordinance does not have a minimum density requirement; with this update, a minimum density threshold is proposed.

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ACTION HOU-4.3
Outreach: New Development Standards. Prepare, publicize, and provide applicants and developers with materials highlighting the City’s revised zoning standards (Action HOU-4.2) intended to encourage the production of housing at all income levels.

Timeframe: New Zoning Standards’ Materials Preparation – 2023 Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-4.4
Objectivity and Streamlining in Development Regulations .

Reduce the cost of building housing through , streamlining and clear and objective standards in development regulations. • Review the Zoning Ordi nance and craft revisions that support objective design standards consistent with the Housing Accountability Act. Adoption of objective design standards will facilitate high -quality residential
development and compliance with State objectives.
• Revisit the Design Review Criteria to provide local
guidance on design and standards for by-right projects as allowed by state law, removing subjectivity from findings and approval processes.
• Identify ways to reduce the permitting time for residential projects (espec ially 100% affordable projects) through consideration of by -right approvals, reduced number of hearings, and objective design standards.
• To accommodate future SB 35 applications and inquiries, create and make available an informational packet that
explains SB 35 streamlining provisions in San Carlos and provides SB 35 eligibility information.

Timeframe: Objective Design Standards - citywide, by end of 2023; Objective Design Standards - within the Downtown Specific Plan boundary, by spring 2024; develop informational materials on SB 35 in 2025
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-4.5
Water and Sewer Service Providers.

Immediately upon adoption, deliver the Housing Element to all providers of sewer and water service serving San Carlos, in accordance with Government Code §65589.7.
• As the local sewer provider, establish procedures to grant priority sewer service to developments with units
affordable to lower-income households.

Timeframe: Within one month of the Housing Element adoption deliver the Housing Element to providers; establish priority policy for sewer provision in 2024

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Responsible Agency: Planning and Engineering Divisions
Funding Sources: Community Development Department Budget

GOAL HOU-5: ADEQUATE HOUSING FOR
SPECIAL NEEDS POPULATIONS.

POLICIES
POLICY HOU-5.1
Special Needs Population Housing. Promote the development and rehabilitation of housing to meet the needs of special needs groups, including seniors, persons with disabilities, the homeless, people with illnesses, people in need of mental health care, single parent families, large families, and others.

POLICY HOU-5.2
Single-Room Occupancy and Efficiency Apartments. Support the inclusion of Single Room Occupancy (SRO) units and
efficiency apartments in higher density neighborhoods and mixed-use areas.

POLICY HOU-5.3
Emergency Shelters, Transitional , and Supportive Housing .

Support programs to provide for a continuum of care for persons who are homeless including emergency shelters, transitional housing, and supportive housing.

POLICY HOU-5.4
Universal Design. Encourage the use of universal design principles to develop housing that is accessible to households with special needs.

POLICY HOU-5.5
Senior Housing. Provide for a variety of housing options and affordability levels for seniors, including independent living, assisted living, and nursing home care facilities, especially within walking distance of services and tran sit routes and in multi - family areas . Encourage senior housing that provides on -site recreational activities, medical care, and personal services that enhance the quality of life for residents.

POLICY HOU-5.6
Home Sharing. Support home sharing as a viable option to make efficient use of existing housing and as an alternative to building more housing in some areas to help address the housing needs of seniors, people living with disabilities, people at risk of homelessness, and homes with a female head of household.

ACTIONS
ACTION HOU-5.1

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Emergency Shelters, Supportive and Transitional Housing. • Implement standards contained in the Zoning Ordinance to accommodate the need for emergency shelters,
supportive housing, and transitional housing.
• Review and modify the Zoning Ordinance as needed to
comply with AB 101 requirements. AB 101 requires that
Low-Barrier Navigation Centers be allowed by right in
areas zoned for mixed -use and nonresidential zones
permitting (by right or conditionally) multi-family uses. • Review and modify the Zoning Ordinance as needed to
comply with AB 2162 requirements to allow for
modifications for required parking for units occupied by supportive housing residents that are located within one- half mile of a public transit stop.

Timeframe: Ongoing; review and amend the Zoning Ordinance in 2024
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-5.2
Large Rental Units and Supportive Services. Discuss with developers the ability to provide larger rental units appropriate for families with children, including the provision of supportive services.

Timeframe: Ongoing (as projects are proposed)
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-5.3
Residential Care Facilities and Group Homes. San Carlos encourages the development of residential care facilities and group homes. Consistent with State law, the City permits group homes with six or f ewer residents in all residential zoning districts by right.
• Amend the Zoning Ordinance code to allow group homes
with seven or more residents as a permitted use in all
zones that allow multi-unit or single-unit dwellings.
• Facilitate discussions with neig hborhoods and adjacent uses so that good neighbor relationships are fostered and impacts to adjacent uses are mitigated.
• Seek opportunities to assist nonprofit housing providers to acquire and/or rehabilitate residential housing for
group homes.

Timeframe: Amend the Zoning Ordinance in 2023; coordinate with neighborhoods and nonprofit housing providers on an ongoing basis

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Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-5.4
Special Needs Service Providers Contributions.
• On an annual basis, provide financial contributions to non-profit organizations and outside agencies that serve the housing needs of special needs households in and
around San Carlos. These organizations and agencies may include but are not limited to: The Center for
Independence of the Disabled (CID) , HIP Housing ,
Shelter Network, Samaritan House, CALL Primrose, San
Mateo County Children’s Fund , and HEART, among
others.
• Evaluate City contributions to outside agencies to assess whether to continue funding and/or adjust funding
amounts or to consider other agencies for funding,
particularly those organizations and agencies that
provide housing with support services for pers ons with disabilities. As part of the evaluation, require outside agencies receiving City contributions to submit annual
reports detailing how funds have been used and how
programs have benefited San Carlos residents.

Timeframe: Ongoing; provide contributions on an annual basis through the CDBG funding process
Responsible Agency: Economic Development and Housing
Divisions
Funding Sources: Community Development Department
Budget, CDBG

ACTION HOU-5.5
Revised Development Standards to Supp ort Special Needs Housing.
• Consider amending the Zoning Ordinance to clarify that development standards that allow for separate cooking
and/or bathroom facilities in home sharing programs ,
and universal design (including “visitability”) in all new residential development and significant remodeling
projects.
• Encourage the development of well -designed new
accessory dwelling units in existing neighborhoods by
implementing objective standards for the approval of
accessory units. Include an ADA accessible design option in pre-approved ADU plans.
• Encourage unhoused service or navigation centers to be located within or near SROs, transitional, and
or/supportive housing.

Timeframe: Ongoing; complete a study on zoning ne eds for home sharing and universal design and bring to City Council for consideration in 2025

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Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

ACTION HOU-5.6
Equal Access to City Services. Adopt an accessibility policy establishing standards and procedures for providing equal access to City services and programs to all residents, including persons with limited proficiency in English, and persons with disabilities.

Timeframe: Hold a hearing with City Council to consider the accessibility policy in 2024
Responsible Agency: Administration Division
Funding Sources: Administrative Services Budget

ACTION HOU-5.7
Community Governance. Conduct public meetings at suita ble times, accessible to persons with disabilities, and near public transit. Resources will be invested to provide interpretation and translation services when requested at public meetings.

Timeframe: Ongoing
Responsible Agency: City Clerk and Administration Division Funding Sources: Administrative Services Budget

GOAL HOU-6: ELIMINATE

DISCRIMINATION IN THE PROVISION OF

HOUSING AND AFFIRMATIVELY FUTHER
FAIR HOUSING.

POLICY
POLICY HOU-6.1
Fair Housing Law Enforcement and Discrimination
Complaints.
• Enforce fair housing laws to ensure that households
seeking housing are not discriminated against on the basis of race, color, religion, sex, disability, age, martial status, family composition, national origin, sexual orientation or other arbitrary factors, consistent with the Fair Housing Act.
• Refer discrimination complaints to the appropriate legal service, County, or State agency.
• Ensure that housing programs maximize choice and avoid unlawful discrimination.

ACTIONS
ACTION HOU-6.1

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Affirmatively Furthering Fair Housing. Fair housing laws prohibit housing discrimination based on race, color, religion, sex, or national origin. San Carlos has identified the following objectives/meaningful actions to affirmatively further fair housing (Table 4.2-2):

Table 4.2-2: Affirmatively Furthering Fair Housing Issues, Contributing Factors, and Actions Identified Fair Housing Issue
and Priority
(High, Medium, Low)
Contributing Factors Meaningful Actions
Insufficient and Inaccessible Housing
Options in High Opportunity Area
for people who identify with any
protected class [High]
• Location and type of affordable housing
• Lack of access to opportunity due to high
housing cost
• Lack of fair housing outreach and enforcement
• Availability of affordable housing
• Availability of affordable units in a range of
sizes.

The three identified fair housing issues are closely related, as such, the meaningful action items address all issues.
• Continue to support local agencies and organizations that provide fair housing services to San Carlos residents.

Timeframe: Annually through the San Mateo County Consortium, which distributes CBDG funding.
• Require non-discrimination clauses in rental agreements and deed restrictions for affordable housing. Timeframe: ongoing for each new and continued affordable housing rental agreement/deed restriction
• Promote public awareness of federal, State, and local regulations regarding equal access to housing. Provide
information to the public on various state and federal housing programs and fair housing law. Maintain referral information on the City’s website and at a variety of other locations such as community and senior centers, local social service offices, in City utility bills, and at other public locations including City Hall and the library. Add resources and information in Spanish and make available to the public. Continue to coordinate with other agencies and organizations, including 21 Elements, to identify other means of informing residents about fair housing laws.

Timeframe: four times per year as part of fair housing workshops by the Fair Housing Foundation and other housing related events. • Include a fair housing presentation in City Council meetings.

Continue to educate and train City staff regarding fair housing laws. As appropriate, partner with organizations such as Project Sentinel to provide resources. Timeframe: at least once every other year.

Protecting Existing Residents from
Displacement [Moderate]
• Due to economic pressures
• Availability of affordable housing
• Availability of affordable units in a range of
prices

Provide Access and Inclusion for
Persons with Disabilities
[Moderate]i
• Lack of supportive services for persons with
disabilities
• Lack of access to resources, such as schools,
transportation, and other in home or
community resources for persons with
disabilities

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Table 4.2-2: Affirmatively Furthering Fair Housing Issues, Contributing Factors, and Actions Identified Fair Housing Issue
and Priority
(High, Medium, Low)
Contributing Factors Meaningful Actions
• Implement an accessibility policy that establishes standards and procedures for providing equal access to City services and programs to all residents, including persons with limited proficiency in English, and persons with disabilities. Timeframe:

By 2024
• Ensure that all development applications are considered, reviewed, and approved without prejudice to the proposed residents, contingent on the development application’s
compliance with all entitlement requirements. Timeframe:

Ongoing
• Continue to use the Rental Inspection Program as a tool to monitor and address fair housing issues. Timeframe: Ongoing • Conduct public meetings at suitable times, accessible to persons with disabilities, and near public transit. Resources will be invested to provide interpretation and translation services when requested at public meetings. Timeframe: Ongoing
• Prioritize community and stakeholder engagement during controversial development decisions. Timeframe: Ongoing • Continue to educate landlords on fair housing law, reasonable accommodations and disability rights, including posting reasonable accommodations on the website and at prominent location near the permit counter. Timeframe: Ongoing
Related actions in this Housing Plan meet multiple needs, including affirmatively furthering fair housing, including:
• Action HOU-1.1: Rental Inspection Program
• Action HOU-1.2: Residential Rehabilitation Programs
• Action HOU-1.3: Preservation of At-Risk Rental Housing • Action HOU-3.1: Funding Low, Very Low-, and Extremely Low- Income and Special Needs Housing
• Action HOU-3.2: BMR Ordinance
• Action HOU-3-3: Accessory Dwelling Units
• Action HOU-3.4: First-Time Homebuyer Programs
• Action HOU-3.5: Rental Voucher Program
• Action HOU-3.10: Anti-Displacement Strategies

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Table 4.2-2: Affirmatively Furthering Fair Housing Issues, Contributing Factors, and Actions Identified Fair Housing Issue
and Priority
(High, Medium, Low)
Contributing Factors Meaningful Actions
• Action HOU-3.11: Access to Opportunity
• Action HOU-3.12: Affordable and Special Needs Incentives • Action HOU-4.1: Adequate Sites to Meet the RHNA
• Action HOU-4.2: Zoning Ordinance Revisions
• Action HOU-4.3: Outreach: New Development Standards
• Action HOU-5.2: Large Rental Units and Supportive Services • Action HOU-5.3: Residential Care Facilities and Group Homes • Action HOU-5.4: Special Needs Service Providers
Contributions
• Action HOU-5.5: Revised Development Standards to Support Special Needs Housing
• Action HOU-5.6: Equal Access to City Services
• Action HOU-5.7: Community Governance
• Action HOU-6.1: Fair Housing Law Enforcement and
Discrimination Complaints
• Action HOU-8.1: Partnership Programs
Timeframe: Identified in Table above for each Action
Responsible Agency: Economic Development , Housing, and Planning Divisions
Funding Sources: Community Development Department Budget

GOAL HOU-7: INCREASED ACCESS TO
CHILDCARE.

POLICY
Policy HOU-7.1
Access to Childcare. Increase access to childcare by including childcare facility siting opportunities and reducing regulatory and financial barriers to the creation and expansion of childcare facilities in San Carlos.

ACTIONS
ACTION HOU-7.1
Childcare development impact fee. Study and hold a hearing with City Council to consider e stablishing a childcare development impact fee for new nonresidential developments.

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Timeframe: Complete study and hold a hearing with City
Council by spring 2023
Responsible Agency: Economic Development and Housing
Divisions
Funding Sources: Community Development Department Budget ACTION HOU-7.2

Childcare Zoning.
• Allow by -right the siting and development of childcare centers and family childcare homes in all residential,
mixed-use, and other zones where residences are
permitted, for the convenience of families. Consider
modified zoning standards, modified review procedures,
and other incentives to facilitate childcare centers’
development.
• Encourage the inclusion of space for childcare in new housing developments, including affordable housing
developments, as feasible.
• Ensure that zoning code and permitting practices are
consistent wit h State law that prohibits use permits, business licenses, etc. for Large Family Child Care Homes. • In addition to the traffic impact fee exemption already provided, continue the discussion with decision makers
to consider potential incentives for developers to provide childcare facilities or services as part of new residential, commercial, and industrial developments, including but
not limited to: density bonuses, increases in floor area ratios, parking reduction, community benefits credit,
expedited entitlements, or other modifications to zoning regulations.

Timeframe: Complete study and hold a hearing with City
Council in 2025
Responsible Agency: Planning Division
Funding Sources: Community Development Department Budget

GOAL HOU-8: INCREASING COMMUNITY

PARTNERSHIPS AND PUBLIC EDUCATION
POLICY
POLICY HOU-8.1
Partnerships. Further housing opportunities, affordability, and access throughout San Carlos and the region by partnering with other jurisdictions, community organizations, and jurisdictions while educating San Carlos residents, business community, and service providers about housing issues and opportunities.

ACTIONS
ACTION HOU-8.1
Partnership Programs

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Continue to work with the following organizations, or other similar organizations, to incr ease housing opportunities in San Carlos:
• HIP Housing – home sharing programs including
potential owners and renters matching;
• 21 Elements – funding sources for low -, very low-, and extremely low - income housing, funding sources for
special needs housing; rental voucher discrimination
claims, among others; funding sources for ADU
construction or remodels and best practices to encourage ADUs
• San Mateo County Consortium
• San Mateo Department of Housin g – Section 8 housing
assistance
• HEART – first time home buyers programs
• Others as opportunities arise
Explore partnerships with housing operators, non -profit organizations, and developers to rehabilitate and convert existing market rate rental housing into affordable housing for extremely low, very low, low and moderate-income households.

Timeframe: Ongoing; discuss opportunities with developers that contact the City annually
Responsible Agency: Economic Development , Housing, and Planning Divisions
Funding Sources: Community Development Department Budget Summary of Quantified Objectives
Table 4.2-3 summarizes San Carlos’ quantified objectives for the 2023-2031 Housing Element planning period.
• The Construction Objective represents the City’s 2023- 2031 RHNA.
• The Rehabilitation Objective represents the objective for the Rental Inspection Program over the eight -year
planning period; of the 240 annual inspection visits,
approximately one -third (80 units) require a
correction/rehabilitation annually.
• The Conservation/Preservation objective refers to the preservation of the existing affordable housing stock
throughout the planning period (as listed in Table 4.3-8:

Below Market Rate Housing Inventory in the Housing
Needs Assessment chapter).

Table 4.2-3: Housing Element Quantified Objectives
Income Level
Total Extremely
Low
Very
Low Low Moderate Above
Moderate
Construction
Objective
(RHNA)
739 425 438 1,133 2,735
Rehabilitation
Objective 640 -- 640
At-Risk
Affordable
Housing Units
to Preserve
40 57 32 -- 137

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Contents
35 Population and Employment Trends
39 Household Characteristics
41 Housing Stock Characteristics
44 Special Housing Needs
50 Energy Conservation Opportunities
50 At-Risk Housing Analysis
53 Projected Housing Need (RHNA)

Population and Employment Trends
Housing needs are influenced by population and employment trends. This section provides a summary of current changes to the population size, age, and racial/ethnic composition , as well as current employment conditions of the City of San Carlos.

Current Population and Projected Population
Growth
Between 2010 and 2020, as reported by the California Department of Finance, the population of San Carlos grew approximately 6 percent, from 28,406 to 30,145 residents. Compared with the County of San Mateo , which experienced a 7.6 percent increase from 2010 to 2020, San Carlos’ growth rate was less . The Association of Bay Area Governments (ABAG) growth forecasts predict a steady increase in population through 2030. From 2020 to 2030, ABAG estimates that San Carlos’ population will grow by 12.5 percent, while countywide population is expected to increase by 10.4 percent ; however, both are forecasted to grow less from 2030 to 2040 than the previous decade (see Table 4.3-1).

In addition to population projections, several other demographic characteristics and trends inform housing needs. Among these characteristics are composition of age, rac e and ethnic ity, and employment.

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Table 4.3-1: Population and Projected Growth
Area 2010 2020 2030 2040 Change
2010-2020
Projected
Change
2020-2030
Projected
Change
2030-2040
San Carlos 28,406 30,145 33,915 35,250 6.1% 12.5% 3.9%
San Mateo County 718,451 773,244 853,260 916,590 7.6% 10.4% 7.4% Source: CA Department of Finance E-5 Population and Housing Estimates, ABAG Growth Forecasts (Plan Bay Area Projections 2040) Age
Population age distribution serves as an important indicator of housing needs because housing needs and preferences change as individuals or households grow older. Young families tend to focus more on cost and the ability to become first -time homebuyers. Table 4.3-2 shows the age distribution of San Carlos residents. In 2018, the 45-64 age group constituted the largest age group at approximately 30 percent, followed by the 20 -44 age group at 28 percent. Compared with 2010, persons between 45-64 age continued to be the largest age group at 31 percent followed by persons between 20 -44 at 30 percent maintaining its position as the second largest age group. The median age in the city is 42.2 years. Compared with the County (39.6 years) and the State (36.3 years), San Carlos’s population is older. Since the age group 20 - 44 is the second largest at 28 percent, the need for larger units, at a range of income levels young families grow is likely to increase.

Race and Ethnicity
Table 4.3-2 also shows the racial/ethnic distribution of population in San Carlos. White (75 percent) and Asian/ Pacific Islander (17 percent) residents make up most of the City’s population. Compared with the County of San Mateo, San Carlos has a higher percentage of White residents (75 percent compared to the County’s 51 percent) and lower percentage of
Asian/Pacific Islander residents (16 percent compared to 30 percent). Since 2010, the percentage of White residents and Asian/Pacific Islander residents have both increased by two percentage point s, while Black and Hispanic residents have decreased (0.6 and two percent, respectively).

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Table 4.3-2: Age, Race and Ethnicity, and Employment by Industry Demographic Profile 2010 2018
Age
0-19 7,070 (25%) 7,754 (26%)
20-44 8,462 (30%) 8,522 (28%)
45-64 8,827 (31%) 9,146 (30%)
65+ 4,047 (14%) 4,658 (16%)
Median Age 42.6 42.2
Race/Ethnicity
White (non-Hispanic) 21,830 (73%) 22,612 (75%)
Hispanic 3,283 (11%) 2,579 (9%)
Black 394 (1.3%) 205 (0.7%)
Asian/Pacific Islander 4,378 (15%) 4,992 (17%)
Other 1,234 (4%) 466 (1.5%)
Employment by Industry
Educational services, and health care and social assistance 2,852 (20%) 3,344 (21%) Retail trade 1,282 (9%) 1,001 (6%)
Manufacturing 1,657 (12%) 1,785 (11%)
Professional, scientific, and management, and administrative and waste management services 3,019 (21%) 3,837 (24%) Construction 593 (4%) 672 (4%)
Arts, entertainment, and recreation, and accommodation and food services 709 (5%) 716 (4%) Finance and insurance, and real estate and rental and leasing 1,192 (8%) 1,725 (11%) Other services, except public administration 577 (4%) 510 (3%) Transportation and warehousing, and utilities 286 (2%) 554 (3%) Public Administration 589 (4%) 493 (3%)
Wholesale Trade 482 (3%) 303 (2%)
Information 883 (6%) 1,174 (7%)

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Table 4.3-2: Age, Race and Ethnicity, and Employment by Industry Demographic Profile 2010 2018
Agriculture, forestry, fishing and hunting, and mining 0 (0%) 15 (0.1%) Source: US Census Bureau 2010, 2018 5-Year Estimates
Employment
Residents in San Carlos are primarily employed in professional, scientific, management, and administrative and waste
management services (24 percent), an d educational services, health care and social assistance (21 percent). The average salary for professional, scientific, and management, and administrative and waste management services jobs is $126,060 a year while those in and educational services, and health care and social assistance make, on average, $66,359. A large salary gap between the t wo major industries occurs in San Carlos. Employment characteristics are important as they have a direct relationship with income. In San Carlos, the industries in which most residents work have high median earning potential.

According to the 2017 Economi c Census prepared by the U.S.

Census Bureau, most (92 percent) employed residents work outside of San Carlos. In addition to the estimated 985 residents who live and work in San Carlos, over 13,000 workers commute into San Carlos for their jobs. Major empl oyers in San Carlos are outlined in Table 4.33.

Table 4.3-3: Top 10 Employers in San Carlos
Employer Number of
Employees
Percent of Total
City
Employment
Natera Inc. 486 2.9%
Pacific Gas & Electric Co. 269 1.6%
The Home Depot #0628 263 1.6%
Recology San Mateo County 240 1.5%
Check Point Software Tech Inc. 210 1.3%
Delta Star Inc. 208 1.3%
Joby Aero Inc. 170 1.0%
Atreca Inc. 162 1.0%
Thought Stream 154 0.9%
Trader Joe’s #174 125 0.8%
Top 10 Employers 2,287 13.8%
Source: City of San Carlos Comprehensive Annual Financial Report July 1, 2020 – June 30, 2021

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Household Characteristics
San Carlos household characteristics are summarized in Table

4.3-4. According to Census estimates, the number of households in San Carlos increased by 319 between 2010 and 2018 . At the same time, the population has increased by an estimated 1,700 people, indicating an overall increase in household size.

Housing tenure refers to the occupancy of a housing unit — whether the unit is owner-occupied or renter-occupied. Housing tenure is influenced by demographic factors (e.g., household income, composition, and age of the householder), as well as housing cost. Nearly three -quarters (72 percent) of San Carlos households own their homes.

Income
The median household income for San Carlos ($169,694 in 2018) is higher than the county of San Mateo median household income ($113,776). In San Carlos, on average, owner households have a significantly higher median income ($208,250) th an renter households ($91,250), a trend that is also reflected in San Mateo County, where owner median income is $140,665 and renter median income is $84,298.

The Census estimates that in San Carlos, 3 percent of residents live in poverty. The p overty threshold is set by the U.S. government to indicate the least amount of income a person or family needs to meet their basic needs . Poverty thresholds are established based on family size and are updated annual ly in relation to the Consumer Price Index, but do not vary geographically. In San Carlos, certain populations are much more likely to be living in poverty. For example, 24 percent of Black/African American residents, seven percent of Hispanic residents, and 11 percent of residents with less than a high school degree are living in poverty . The proportion of people living in poverty in San Carlos is lower than the county of San Mateo at large, where nearly 6 percent of residents live in poverty.

Because poverty threshold s do not differ based on geographic differences, a better measure to understand income disparities can be to identify various percentages compared to the median income for a particular area. For housing planning and funding purposes, the Department of Housi ng and Urban Development (HUD) uses five income categories to evaluate housing need based on the Area Median Income (AMI) for the county:
• Extremely Low-Income Households earn 0 -30 percent of AMI
• Very Low-Income Households earn 30-50 percent of AMI
• Low-Income Households earn 50-80 percent of AMI
• Moderate-Income Households earn 80 -100 percent of
AMI (HCD uses 80 to 120 percent)
• Above Moderate -Income Households earn over 100
percent of AMI (HCD uses over 120 percent)
The number and percentag e of residents within each of these categories is listed in Table 4.3-4. Nearly half (45 percent) of renter households are in the lower income categories (0 -80 percent AMI); 20 percent of owners are lower income.

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Table 4.3-4: Household Characteristic by Tenure
Household Characteristic Owner
Households
Renter
Households All Households
Number of Households1 8,148 (72%) 3,179 (28%) 11,327
Median Household Income1 $208,250 $91,250 $169,640
Household Income Categories2
Extremely Low Income (0-30% AMI) 500 (6%) 400 (12%) 900 (8%) Very Low Income (30-50% AMI) 470 (6%) 425 (13%) 895 (8%) Low Income (50-80% AMI) 610 (8%) 650 (20%) 1,260 (11%)
Moderate Income (80-100% AMI) 505 (6%) 395 (12%) 900 (8%) Above Moderate Income (100%+ AMI) 6030 (74%) 1,380 (42%) 7,410 (65%) Total number of projected Extremely Low-Income
Households (RHNA)2 N/A N/A 325
Overpayment
All Households Overpaying for Housing2 1,940 (24%) 1,225 (38%) 3,165 (28%) Lower Income Households Overpaying for Housing2 970 (61%) 1,080 (73%) 2,050 (67%) Note 1 Source: U.S. Census Bureau 2018 5-Year Estimates Note 2 Source: U.S. Department of Housing and Urban Development Comprehensive Housing Affordability Strategy (CHAS) Tables 2013-2017
Housing Overpayment
State and federal standards specify that households spending more than 30 percent of gross annual income on housing experience a housing cost burden. Housing cost burdens occur when housing costs increase faster than household income. When a household spends more than 30 percent of its income on housing costs, it has less disposable income for other necessities such as health care, childcare, and food.

In the event of unexpected circumstances such as loss of employment or health problems, lower-income households with a housing cost burden are more likely to become homeless or double up with oth er households. In San Carlos, 28 percent of households are overpaying for housing. The situation is much starker for lower income households, where 67 percent are overpaying for housing. Almost three -quarters (73 percent) of lower income renters are overpaying for housing, and 61 percent of lower income owners are overpaying for housing.

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Housing Stock Characteristics

Housing Stock
In 2020, the Department of Finance reported 12,385 housing units in San Carlos. Most of the City’s housing stock is made up of single-family attached and detached homes (72 percent) with the remaining 28 percent multi-family. Census data indicates that 0.2 percent of owner units and 3.1 percent of rental units are vacant.

San Carlos was developed as a community of single -family dwelling units and has primarily remained as such. Single-family structures make up 72 percent of the City’s housing stock, with multi-family comprising 28 percent.

Overcrowding
Overcrowding occurs when the relatively high cost of housing either forces a household to double -up with another household or live in a smaller housing unit to afford food and other basic needs. The current housing crisis resulting from an inventory shortage and high costs of housing also necessitates many families or individuals to share housing arrangements, leading to potential overcrowding. According to both California and federal standards, a housing unit is considered overcrowded if it is occupied by more than one person per room (excluding kitchens, bathrooms, an d halls). A standard of one person per room considers occupancy of the rooms that are generally not intended to be used as sleeping quarters , including living rooms and otherwise common areas) . The Census Bureau considers units with more than 1.5 occupants per room to be severely
overcrowded.

Table 4.3-5: Owner and Renter Housing Characteristic
Housing Characteristic Owner
Households
Renter
Households
All Housing
Units/
Households
Total Housing units

N/A N/A
12,385
Single-Family Detached 8,394 (68%)
Single-Family Attached 540 (4%)
Multi-Family Units 3,419 (28%)
Mobile Home/Other 32 (.26%)
Median Household Size 2.57
Total Households1 69% 27%
Vacancy Rate2 0.2% 3.1% 516 (4%)
Overcrowded Units1 86 142 228
Units Needing
Replacement/Rehabilitation3
N/A N/A 2
Median Housing Cost $1,624,5004 $2,2515 N/A
Sources:

1. US Census Bureau 2018 5-Year Estimates

2. 2020 CA Department of Finance E-5 Population and Housing Estimates

3. As reported by the San Carlos Building Department

4. CoreLogic June 2022

5. Census Bureau 2019 5-Year Estimates

In San Carlos, 2 percent of occupied housing units are
overcrowded. Of th ese, 37 percent are considered severely overcrowded. Overcrowding is more prevalent in rental units ( 6 percent) than owner occupied units ( 1 percent). Overcrowding disproportionally impacts low -income households and s evere overcrowding is more likely to be experienced by renter households than it is for homeowner households, which is the case in San Carlos.

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• 0%-30% of AMI: 0.0% overcrowded and 0.0% severely
overcrowded
• 31%-50% of AMI: 3.3% overcrowded and 0.0% severely
overcrowded
• 51%-80% of AMI: 3.2% overcrowded and 0.8% severely
overcrowded
• 81%-100% of AMI: 2.6% overcrowded and 3.2% severely
overcrowded
• Greater than 100% of AMI: 0.8% overcrowded and 0.4%
severely overcrowded
Overcrowding is more likely to affect Hispanic/Latinx (4.9 percent) and residents that identify as “other race” or multiple races (8.4 percent), compared to the citywide average of two percent. The desire for multi -generational living or living with extended family members can also create overcrowded
conditions due to a lack of affordable larger units within the City.

Multi-generational living tends to be most common in Hispanic and Asian cultures, indicating that it may be a contributing factor in higher rates of overcrowding for these groups. Coupled with lower income levels, cons traints related to immigration status, and discrimination can also make it difficult for multi - generational households to find appropriately sized, affordable housing.

Housing Condition
The age and condition of the housing stock in San Carlos is an indicator of potential rehabilitation needs. Commonly, housing over 30 years of age needs some form of major rehabilitation, such as a new roof, foundation work, plumbing, etc. The housing stock in San Carlos is aging, since a majority of the housing stock was built between 1940 and 1979 (73 percent). Only 27 percent of the City’s housing stock has been built since 1980 , indicating a potential need for rehabilitation. Four percent of occupied housing units in San Carlos have been identified as having substandard housing issues, which includes lacking or
insufficient amenities including plumbing , a kitchen , or bathroom. Based upon observations and experiences of the San Carlos Building Official, the City estimates that in 202 2, fewer than two housing units are in s evere need of replacement or substantial rehabilitation due to housing conditions.

While the City does not have funding to directly support home repair services, the City refers individuals to the Rebuilding Together Peninsula organization for renovation a nd repair services: http://rebuildingtogetherpeninsula.org. In addition, the City’s Code Enforcement is proactive in connecting various church groups, Boy Scouts, and other community groups such as the Lions Club and Kiwanis Clubs with homeowners in need.

Volunteers remove overgrown vegetation, remove trash and debris, and complete very minor repairs to structures for elderly residents.

Housing Cost
The cost of housing in a community is directly correlated to the number of housing problems and affordability issues. High housing costs can price low -income families out of the market, cause extreme cost burdens, or force households into

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overcrowded or substandard conditions. The San Carlos median home price in October 2021 based on information provided by CoreLogic, was $2,320,000. This was 24.9 percent higher than the median price in October 2020. The October 2021 median home price was $ 795,000 higher than the median home price in San Mateo County at large.

More than a quarter (28 percent) of San Carlos households are renters. There are limited sources that provide median or average rents for a specific geography. The Census estimates the median gross rent between 2015 and 2019 in San Carlo s was $2,251 per month. These estimates appear below current ( 2022) searches through search engines such as Zillow , Trulia, Zumper, etc .

Zumper.com provides a median rent by month for jurisdiction by unit type and reported an average rent of 3,300 in July 2022 for a studio apartment ($2,339 for one-bedroom units, $3,152 for two- bedroom units , $4,920 for three -bedroom units, and $5,500 for four-bedroom units ) in San Carlos . Table 4.3-6 shows that the HUD-determined f air market rents for San Mateo County .

Studios and larger units in San Carlos exceed the fair market rents identified by HUD.

Table 4.3-6: Fair Market Rents in San Mateo County
Year Efficiency One-Bedroom Two-Bedroom Three-Bedroom Four-Bedroom FY 2022 FMR $2,115 $2,631 $3,198 $4,111 $4,473
Source: FY2022 Fair Market Rents. U.S Department of Housing and Urban Development (HUD)

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Special Housing Needs
Housing Element law requires local governments to include an analysis of housing needs for residents in specific special needs groups and to identify resources available to address these needs.

Table 4.3-7: Special Needs Groups in San Carlos
Special Needs Category Count Percent
Persons with Disabilities 1,988 persons 7% of residents Persons with Developmental Disabilities1 123 persons 0.4% of residents Elderly (65+ years) 4,658 persons
2,773 households
15% of residents
24% of households
Large Households (5+ members) 697 households 6% of households Farmworkers 15 persons 0.1% of labor force
Female Headed Households 906 households 8% of households People Experiencing Homelessness 30 persons 0.001%
Note 1: Reflects the consumer count by ZIP Code (94070) as reported by the California Department of Development Services All Other Rows Source: US Census Bureau 2018 5-Year Estimates, California Department of Developmental Services (DDS) Persons with Disabil ities including Persons with
Developmental Disabilities
Persons with disabilities face housing access and safety challenges. Disabled people, in most cases, are of limited incomes and often receive Social Security income only. As such, most of their month ly income is often devoted to housing costs. In addition, disabled persons may face difficulty finding accessible housing (housing that is made accessible to people with disabilities through the positioning of appliances and fixtures, the heights of instal lations and cabinets, layout of unit to facilitate wheelchair movement, etc.) because of the limited number of such units. People with developmental disabilities have a disability that emerged before age 18, is expected to be lifelong, and is of sufficient severity to require a coordinated program of services and support in order to live successfully in the community. Developmental disabilities include intellectual disabilities, autism, Down syndrome, epilepsy, cerebral palsy, and other disabling conditions similar in their functional impact to an intellectual disability.

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Residents with Disabilities
Many San Carlos residents have disabilities that may prevent them from working, restrict their mobility, or make it difficult to care for themselves. There are 1,988 residents with disabilities in San Carlos, representing 7 percent of total residents. Many residents with disabilities are 75 years and older (41 percent). A total of 689 people with disabilities live in poverty representing (78 percent of those living in poverty, and) 2.3 percent of the total resident population.

Many factors limit the supply of housing available to households of persons with disabilities. In addition to the need for housing that is accessible or ADA -compliant, housing affordability is a key limitation as many persons with disabilities live on disability incomes or fixed income. Location of housing is also an important factor for many persons with disabilities, as they often rely upon public transportation to travel to necessary services and shops.

For those living in single -family homes, residents can benefit from accessibility improvements such as wider doorways and hallways, access ramps and railings, larger bathrooms with grab bars, lowered countertops, and other features common to “barrier free” housing. According to the State Department of Social Services, 3 residential care facilities with capacity to support 52 residents, and 11 residential care facilities for the elderly to support 237 residents, are located in San Carlos.

Residents with Developmental Disabilities
Under California’s Deve lopmental Disabilities Services Act and the U.S. Supreme Court’s 1999 decision in Olmstead v. L.C., people with developmental disabilities are entitled to receive community-based services that allow them to live in the least restrictive community setting. This shift to de-institutionalization has led to the closure of the most restrictive segregated settings and to the requirement that local jurisdictions in their Housing Elements assess and plan specifically for the housing needs of people with developmental disabilities who receive services from the Regional Center to live in their home community.

The State Department of Developmental Services (DDS) currently provides community -based services to persons with
developmental disabilities and their families through a statewide system of 21 regional centers. The Golden Gate Regional Center serves residents in San Carlos. The center is a private, non -profit community agency that contracts with local service providers to offer a wide range of services to individuals with developmental disabilities and their families. There are 123 residents with developmental disabilities in San Carlos (as represented by ZIP Code 94070) that receive services from the Golden Gate Regional Center, representing 0.41 percent of total residents. The following trends affect the housing needs of people with developmental disabilities in San Carlos and have been addressed in the Housing Plan:
• The Developmental Disabilities population in San
Carlos is growing faster than the general popula tion.

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The Regional Center reports an increase of 25 percent over the 98 San Carlos residents with developmental
disabilities who were reported in the last Housing
Element. During that same period, the city’s general
population grew by less than one percent. Seventy-one (56 percent) of San Carlos’s residents with developmental
disabilities are adults. Growth in the San Carlos adult population with developmental disabilities correlates
with a significant annual increase in the diagnosis of
autism that began in the mid-1980s and did not level out until after 2015. Many of the adults may desire housing outside the family home in the coming years.
• Decline in Licensed Care Facilities. The California
Department of Developmental Services reports that
between September 2015 and June 2021, San Mateo
County lost five percent of its supply of licensed care facilities for people with developmental disabilities
(including Community Care Facilities, Intermediate Care Facilities, and Skilled Nursing Facilities). This is reflected in the decline of San Carlos residents living in licensed care facilities since last reported in the 2015-2023 Housing Element. The greatest contributing factor to this l oss of supply is the high cost of housing making it more
financially beneficial for retiring owners to sell the
facilities as residences rather than as a business, thereby increasing the need for affordable housing options
coordinated with supportive services
• Longer Life Spans. Between September 2015 and June
2021, the California Department of Developmental
Services reports that the number of San Mateo County
residents with developmental disabilities age 62 and older grew by 33 percent. This is not due to migration of senior citizens with developmental disabilities to high -cost San Mateo County, but rather to well-documented gains in life span among people with developmental disabilities. With longer life expectancy, more adults with developmental
disabilities will outlive their parents and family members who are the single largest source of housing for adults with developmental disabilities in San Carlos. Longer life spans also slow the pace of resident turnover in the
county’s shrinking supply of licensed care facilities, which further reduces opportunities for people with
developmental disabilities to secure a space in a licensed care facility.
• Displacement. The California Department of
Developmental Services has documented a 12 percent
decline in the age group 42 to 51 and a 10 percent decline in the age group 52 to 61 in San Mateo County between
September 2015 and June 2021. Considering gains in life expectancy, this loss can reasonably be attributed to
displacement from the county because of the lack of
residential living options when an elderly parent
caregiver passes away or becomes unable to house and
care for the adult. Displacement takes a particular toll on adults with developmental disabilities who depend on

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familiarity with transit routes, shoppin g and services, as well as support from community -based services and
informal networks built up over years of living in San Carlos.
• Higher Rates of Physical Disabilities. People with
developmental disabilities are more likely than the
general population to have an accompanying physical
disability. Twenty -seven percent of San Mateo County
residents with developmental disabilities have limited
mobility, and 13 percent have a vision or hearing
impairment. The need for an accessible unit coupled with the need for coordinated supportive services compounds
the housing barriers faced by those with co -occurring
intellectual and physical disabilities.
• Ineligibility for Many Affordable Rental Units. Some
adults with developmental disabilities depend on
monthly income of around $1,000 from the Supplemental
Security Income (SSI) program, pricing them out of even the limited number of Extremely Low Income affordable
housing units in San Carlos. Those with employment tend to work part-time in the lowest paid jobs and also struggle to income -qualify for many of the affordable housing
units for rent in San Carlos.
• Transit-Dependent. Many adults with developmental
disabilities do not drive or own a car and rely on public transit as a means to integration in the larger community.

Provision of Housing for Persons with Disabilities
Accommodating a sufficient quantity and quality of housing for people with disabilities of any kind is a significant challenge in these times due to the lack of funding and complexity of housing and service needs involved. San Carlos supports the provision of housing for persons with disabilities and has provisions in the Zoning Ordinance to enable group housing through the
residential care facility process. The City also prioritizes supportive housing, a mix of unit sizes, locations near public transit, and housing for extremely low -income households to support the needs of persons with disabilities:
● Integration of housing for persons with disabilities in typical affordable housing helps affirmatively further fair housing for a group that has historically experienced no alternative to segregated living.
● Coordination of housing with o nsite supportive services provide a supported pathway for people with developmental disabilities to apply for and retain an affordable apartment and are as beneficial to a person with a developmental
disability as a physically modified unit is to a person with a mobility impairment.
● A mix of unit sizes at inclusive housing properties help address the needs of those who require live-in aides, want to live with roommates, or have children.
● Location near public transit helps accommodate the transit - dependency of most adults with developmental disabilities. ● Deeply affordable housing, targeting extremely low -income households, also supports housing choices for persons with developmental disabilities.

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The City has in place a reasonable accommodation procedure that complies with Section 504 of the Fair Housing
Amendments Act and other applicable local, state, and
federal laws to ensure equal opportunity and access for people with disabilities. The procedure accommodates
physical improvements, program flexi bility, and other
modifications or adjustments necessary to allow people with disabilities the same opportunity to housing, programs, and services as non-disabled people.

Elderly (65+ years)
Many senior-headed households have special needs due to their relatively low incomes, disabilities or limitations, and dependency needs. Specifically, many people aged 65 years and older live alone and may have difficulty maintaining their homes, are usually retired and living on a limited income, and are more likely to have high health care costs and rely on public transportation, especially those with disabilities. The limited income of many elderly persons often makes it difficult for them to find affordable housing.

There are 4,658 elderly residents in San Carlos, representing 16 percent of the population. Nearly one-quarter (24 percent) of San Carlos households are headed by elderly residents (2,773 households). Four percent of seniors (194 elderly res idents) live in poverty. In San Carlos, 878 people of all ages live in poverty (three percent of the total population).

Seniors with limited incomes may have difficulty finding affordable housing. The San Mateo County Housing Authority is responsible for the Housing Choice Voucher (Section 8) program in San Carlos. Priority is given to senior (62 years old or older), or disabled residents that meet the income guideline limits established by the federal government. Many local seniors reside in conventional single-family homes. Senior homeowners who need maintenance assistance can apply to Rebuilding Together Peninsula’s Safe at Home Minor Repair or National Rebuilding Day Programs, which provides free home repair and
modification to eligible low -income homeowners. Additionally, low-income, senior homeowners or renters who need free
accessibility modifications can apply to the Center for Independence of Individuals with Disabilities’ Housing
Accessibility Modification Program.

Large Households (5+ members)
Large households, defined by HCD as households containing five or more persons, have special housing needs due to the limited availability of adequately sized, affordable housing units. Larger units can be very expensive; as such, large households are often forced to reside in smaller, less expensive units or double-up with other families or extended family to save on housing costs, both of which may results in unit overcrowding.

In San Carlos, there are 697 large households (six percent of total households). The majority (86 percent) of these households own their homes (600 households) while 14 percent are renters. An estimated 1.5 percent of families living in poverty; it is estimated

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that none of these are large families. Action HOU-5.2 is included in the H ousing Plan to encourage the development of larger rental units.

Farmworkers
Due to the high cost of housing and low wages, a significant number of migrant farm workers have difficulty finding
affordable, safe, and sanitary housing. In San Carlos, 15 residents work in agriculture, forestry, fishing and hunting, and mining occupations, and can be assumed to be farmworkers. This represents only 0.09 percent of the workforce. Maps from the State of California Department of Conservation Farmland Mapping and Mon itoring Program show no farmland in San Carlos. Due to the low number of agricultural workers in the city, the housing needs of migrant and/or farm worker housing need can be met through general affordable housing programs.

Single-Parent, e.g., Female Headed Households
Single-parent households require special consideration and assistance because of the greater need for childcare, health care, and other services. In particular, female-headed households with children tend to have lower incomes and a greater n eed for affordable housing and accessible childcare and other supportive services. The relatively low incomes earned by female -headed households, combined with the increased need for supportive services, can severely limit housing options.

In San Carlos, 906 female-headed households represent 8 percent of total households. Of these, 58 percent own their home and 42 percent rent. A greater proportion of female -headed households are renters compared to the city as a whole (42 percent and 28 percent, respectiv ely). Of all households living in poverty, 0.8 percent (67 households) are female-headed households.

Providing housing opportunities for families in San Carlos is a challenging task. The primary need for female -headed
households is for more affordable hou sing and supportive services, including childcare. The City recognizes the importance of high -quality childcare and preschool programs to both residents and workers in our community. Programs HOU-7.1 and

7.2 further address this need.

People Experiencing Homelessness
Population estimates for people experiencing homelessness can be difficult to quantify. Census information is often unreliable due to the difficulty of efficiently counting a population without permanent residences. Given this impediment, a poi nt-in-time count is conducted throughout many jurisdictions in the country every other year during the last week in January. In 2019, 30 unsheltered individuals were identified in San Carlos during the point-in-time count, which is 3.3 percent of the total number of unsheltered individuals in San Mateo County. In 2017, 28 unsheltered individuals were counted in San Carlos.

No homeless count was conducted in 2021 due to the COVID -19 pandemic. Instead, a count was conducted in 2022. While the total unsheltered population of the county went up 21 percent, from 901 to 1,092, during the point -in-time count in January 2022 the

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homeless population in San Carlos decreased to 14 unhoused individuals.

There are no homeless shelters in the San Carlos; however, there are shelters and resources in cities nearby. The closest resources are in Redwood City about three miles away. Action HOU-5.1 is included in the Housing Plan to facilitate additional emergency and transitional housing in San Carlos through changes to the Zoning Ordinance.

Energy Conservation Opportunities
Energy-related housing costs can directly impact the affordability of housing. While California Building Code standards contain mandatory energy efficiency requirements for new development, the City and utility providers are also important resources to encourage and facilitate energy conservatio n and to help residents minimize energy-related expenses. Policies addressing climate change and energy conservation are integrated into the San Carlos General Plan, including ACTION EM-3.1: Implement Climate Action Plan measures to require tree planting. The City adopted a new Climate Mitigation and Adaptation Plan
(“CMAP”) on September 27, 2021 that will set greenhouse gas (GHG) reduction targets for 2030 and 2050 and identify strategies to meet the new targets and adapt to the impacts of climate change.

San Carlos residents have access to resources that support energy efficiency and renewable energy. The Bay Area Regional Energy Network (BAYREN) provides free energy evaluations that
connect owners with qualified contractors and rebates for energy upgrades. The HomeIntel program is a part of PG&E; this program provides customers with plans to reduce wasted energy in their homes. The Property Assessed Clean Energy Financing (PACE) program allows residents to borrow loans for energy upgrades, which are then paid back through property taxes.

There are also three programs to help residents utilize solar energy: Bay Area SunShares, LetsGoSolar, and PG&E Solar Education Opportunities.

San Mateo County and all 20 of its cities and towns form ed Peninsula Clean Energy, a community-controlled, not-for-profit, joint powers agency. Peninsula Clean Energy serv es all of San Mateo County with cleaner energy at low rates . Residents may enroll in a program drawing 50 percent of electricity from renewables, or for an additio nal fee, 100 percent of electricity from renewables.

At-Risk Housing Analysis
State housing law requires an inventory and analysis of government-assisted dwelling units eligible for conversion from lower income housing to market rate housing during the next ten years. Reasons for this conversion may include expiration of subsidies, mortgage pre -payments or pay -offs, and concurrent expiration of affordability restrictions.

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Table 4.3-8: Below Market Rate Housing Inventory
Address Affordable Units Unit Mix Building Type Expiration San Carlos Elms
707 Elm St 21 21 very low (12 Studio, 9 1BR) seniors Rent 2039 Trestle Apartments/ Transit Village
20 10 low (4 1BR, 6 2BR), 10 mod (4 1BR, 6 2BR) Rent 2074 333 El Camino Real
1001 Laurel St 17 5 low (2 Studio, 3 1BR), 12 moderate (7 1BR, 5 2BR) Own 2054* Laureola Oaks
907 East San Carlos Ave 16 16 low (4 1 BR, 6 2BR, 6 3BR) Rent 2040 Pacific Hacienda
Elm and Walnut St 13 7 low (7 1BR), 6 moderate (6 1BR) Own 2049* Cherry Street Apartments
1244 Cherry St 6 1 very low (1BR), 3 low (3 2BR), 2 mod (2 2BR) Rent Expired** Laurel Theatre Apartments
1500 Laurel St 4 4 low (2 Studio, 1BR, 2BR) Rent 2057
777 Walnut St 3 1 very low (1 BR), 2 low (2BR, 3BR) Own 2061* 641 Cedar St 2 1 very low (2BR), 1 low (2BR) Own 2055*
625 Cedar St 2 1 low (2BR), 1 moderate (2BR) Own 2043
977 Laurel 1 1 very low (1BR) Rent 2072
577 Laurel St 1 1 median (2BR) Rent 2049
1580 Laurel St 1 1 low (1BR) Rent 2068
409 Walnut St 1 1 low (BR) Rent 2041
Robbins Nest
717 Cedar St 6 6 low (Shared house) House 2049
Walnut Studios
817 Walnut St 23 23 very low (23 studio) Rent 2096
Total 137
* Affordability expiration date vary by unit. Affordability period restarts as unit is sold to a new BMR household. ** Restrictive Covenant has expired. In process for redevelopment (to be combined with the recently acquired lot next door) for additional affordable units and the introduction of a new Restrictive Covenant.

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Based on City records and information from the California Housing Partnership Corporation, in the next 10 years (202 3- 2033), no assisted housing developments in San Carlos are at risk of losing affordability. The Cherry Street Apartments covenant has expired; the City is working with HIP Housing who owns the property to develop a new affordable housing development that will combine 1244 Cherry Street with 1232 Cherry Street, which was recently acquired by the City, to create a new housing project with 34 total units, all affordable to low - income and below households.

Pursuant to Government Code Section 65863.11, the state maintains a list of “Entities Interested in Participating in California's First Right of Refusal Program” at
https://www.hcd.ca.gov/policy-research/docs/HPD-00-

01.xlsx. This list includes various entities working in San Mateo County and several entities interested in properties located in any county. If a development becomes at risk of conversion to market- rate housing, the City will maintain contact with local organizations and housing providers who may have an interest in acquiring at -risk units and will as sist other organizations in applying for funding to acquire at-risk units.

The City also has a significant number of affordable housing units in the pipeline, which will increase the local inventory by nearly 50 percent. Projects that are currently in the pipeline and are anticipated to be developed during the planning period include those that are in the entitlement process (e.g. , 1232 Cherry and 806 Alameda de las Pulgas), or have received a planning approval (e.g., 626 Walnut), or are under construction but have not received a Certificate of Occupancy/Final Inspection (e.g. , 1525 San Carlos Avenue):
• 1501 Cherry (3 very low- and 1 low-income unit)
• 560 El Camino Real (1 low- and 1 moderate-income unit) • 520 El Camino Real (1 moderate-income unit)
• 806 Alamed a De Las Pulgas (3 low -income and 7
moderate-income units)
• 626 Walnut (3 low- and 1 moderate-income unit)
• 1232 Cherry (35 lower-income units)
• 1240 El Camino Real (1 moderate-income unit)
• 1525 San Carlos (1 low- and 2 moderate-income units)
The City will co ntinue to monitor and track the affordability of these units, the majority of which result from the City’s Below Market Rate (BMR) Ordinance. The City requires all buyers of BMR units to sign a Resale Restriction Agreement along with other deed restrictions, as required by Zoning Ordinance Section

18.16.090.B. Deed restrictions are required as a condition of sale for all owner-occupied BMR units and include, but are not limited to, the City’s purchase option, resale restrictions, and procedures and policies regarding changes in title to ensure that owner - occupied BMR units remain affordable in perpetuity.

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Projected Housing Need (RHNA)
Housing Element law requires a quantification of each
jurisdiction’s share of the regional housing need as established in the plan prepared by the jurisdiction’s council of governments.

The California Department of Housing and Community
Development (HCD), in conjunction with the Association of Bay Area Governments (ABAG), determine a projected housing need for the Bay Area, i ncluding the counties of Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma. This share, known as the Regional Housing Needs Determination (RHND), is 441,176 new housing units for the 2023-2031 planning period throughout the ABAG region.

ABAG has, in turn, allocated this share among its constituent jurisdictions, distributing to each a Regional Housing Needs Allocation (RHNA) divided into income levels. The City of San Carlos has a RHNA of 2,735 housing units to accommodate in the housing element period. The income distribution is as shown in Table 4.3-9.

Table 4.3-9: Regional Housing Needs Allocation 2023-2031 Income Group % of County
AMI
Number of
Units
Allocated
Percent of
Total
Allocation
Very Low1 0-50% 739 27%
Low >50-80% 425 16%
Moderate >80-120% 438 16%
Above Moderate 120%+ 1,133 41%
Total --- 2, 735
Note 1: Pursuant to AB 2634, local jurisdictions are also required to project the housing needs of extremely low-income households (0-30% AMI). In estimating the number of extremely low-income households, a jurisdiction can use 50% of the very low-income allocation or apportion the very low-income figure based on Census data. Therefore, the City’s very low-income RHNA of 739 units can be split into 370 extremely low-income and 369 very low-income units.

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Contents
55 Non-Governmental Constraints
60 Governmental Constraints

Non-Governmental Constraints
The availability and cost of housing is strongly influenced by market factors over which local government has little or no control. State law requires that the housing element contain a general assessment of these constraints, which can serve as the basis for actions that local governments might take to offset their effects. The primary non -governmental constraints to the development of new hous ing are land costs, construction costs, and environmental constraints.

Development Costs
Price of Land
Land costs include acquisition and the cost of holding land throughout the development process. These costs can account for as much as half of the final sales prices of new homes in small developments or in areas where land is scarce. Land costs in single-family residential neighborhoods of San Carlos range from Government policies and regulations impact the price and availability of housing and the provision of affordable housing. Constraints include residential development standards, fees, and permitting procedures. Providing infrastructure and services also increases the cost of producing housing. Not every constraint to housing production is governmental.

Other constraints include the housing market and other non -governmental limitations. This chapter addresses governmental and non-governmental constraints as they relate to housing.

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$340,000 to $5.9 million per acre.1 The diminishing supply of land available for residential c onstruction, combined with increasing demand for such development, has served to keep the cost of land high and rising across the Bay Area . Among the variables affecting the cost of land are the size of lots, location and amenities, the availability and pr oximity of public services, its development potential, and the financing arrangement between the buyer and seller.

On behalf of 21 Elements, Century Urban
2 conducted an
independent countywide study of single -family land sales and multi-family land sales in the last three years, inclusive of both rental apartment and for -sale (condos/townhomes) units. For single-family land sales countywide, of parcels up to one acre in size, the land cost ranged between $582,000 to $8 million, with an average of $1,030,000 per unit. For multi-family land sales in San Mateo County, Century Urban’s report shows the average land cost is $1,000,000 for small multi-family and $10,000,000 for large multi-family properties, respectively, with an ultimate land cost of approximate ly $100,000 per unit for both small and large developments. In San Carlos, the study included four data points

1 A review of vacant residential land sales on Zillow.com on 8-20-2020 provided two vacant lots for sale within the City. Land costs were estimated from this sample and may not be representative of general land costs in the City. 2 Century Urban’s San Mateo and Santa Clara Counties Development Costs & San Mateo County Unit Mix Research, April 2022,
http://www.21elements.com/constraints
ranging from a land cost of $33,000 per unit to $333,000 per unit, with an average land cost of $222,000 per unit.

Cost of Construction
Construction cost is determined by the combined cost of labor and materials—these are the most significant cost components of developing residential units, and both of these costs have grown dramatically in recent years. According to data from the California Construction Cost Index, hard construction costs in California grew by 44 percent between 2014 and 2018, equivalent to an additional $80 per square foot.
3 Between 2020 and 2021
alone, construction costs increased 13.4 percent.

Construction costs are estimated to account for upwards of 60 percent of the production cost of a new home, especially for multi-unit residential buildings , which can require the use of more expensive materials, like steel, and need additional amenities such as parking structures.
4 Variations in the quality of
materials, type of amenities, labor costs, and the quality of building materials could result in higher or lower construction costs for a new home. Pre -fabricated factory built housing, with variation on the quality of materials and amenities, may also 3 Hayley Raetz, Teddy Forscher, Elizabeth Kneebone and Carolina Reid, The Hard Costs of Construction: Recent Trends in Labor and Materials Costs for Apartment Buildings in California, The Terner Center for Housing Innovation, University of California Berkel ey, March 2020, p.8,
http://ternercenter.berkeley.edu/uploads/Hard_Construction_Costs_March_ 2020.pdf
4 Ibid., Raetz et al, p.4.

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affect the final construction cost ( per square foot ) of a housing project.

The relative importance of labor versus materials is a function of the complexity of the construction job and the desired quality of the finished product. The price paid for material and labor at any one time will reflect short -term considerations of supply and demand. Future costs are difficult to predict given the cyclical fluctuations in demand and supply that in large part are created by fluctuations in the larger state and national economies. Such factors unilaterally impact construction in a region and therefore do not deter housing construction in any specific community more so than another.

An indicator of construction costs is Building Valuati on Data compiled by the International Code Council (ICC). The unit costs compiled by the ICC include structural, electrical, plumbing, and mechanical work, in addition to interior finish and normal site preparation. The data is national and does not consid er regional differences, nor does the data include the price of the land upon which the buildings are built. The August 2021 national averages for costs per square foot of apartment units and single -family homes are as follows:
• Type I or II, Multi-Family (Steel/Concrete): $79 to $203 per sq. ft.
• Type V (Wood Frame), Multi-Family: $137 to $142 per sq. ft. • Type V (Wood Frame), One- and Two-Family Dwelling: $148 to $158 per sq. ft.

The City's ability to mitigate high construction costs is limited without direct subsidies. Another factor related to construction cost is development density. With an increase in the number of units built in a project, overall costs generally decrease as builders can benefit from economies of scale. Throughout California, builders have remarked on high construction costs in 2021 and 2022, which are driven both by labor and materials costs.

Availability of Financing
The availability of capital to finance new residential development is a significant factor that can impact both the cost and supply of housing. Two types of capital are involved in the housing market:
1) capital used by developers for initial site preparation and construction and 2) capital for financing the purchase of units by homeowners and investors. Interest rates substantially impact home construction, purchase, and improvement costs. A
fluctuation in rates of just a few percentage points can make a dramatic difference in the annual income needed to qualify for a loan. In general, financing for new residential development is available at reasonable rates. However, economic fluctuations due to COVID- 19 have caused caution among lenders and may have lasting effects through this Housing Element planning period. And while interest rates are low, lenders are considering applicants much more closely than in the past, leading to credit tightening despite affordable interest rates.

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Competition for affordable housing funding also affects overall housing production. Affordable housing often relies on multiple sources of funding to complete projects. The Terner Center conducted a study on the cost to build low-income housing found that each additional funding source increases the cost to build.

Some properties use six or more funding sources to complete a project, each of which is becoming increasingly competitive and difficult to secure.
5 Low Income Housing Tax Credits (LIHTC)
represent the primary funding source for new affordable housing. Historically the 9% tax credit (which is designed to subsidize 70 percent of the project cost) has been extremely competitive. Affordable housing developers are indicating that 4% tax credits (designed to subsidize 30 percent of the project) are becoming increasingly competitive, resulting in a longer project timeline (up to two additional years, as they must apply multiple times before they are able to secure tax credits).

Government Code 65583(a)(6) Development Analysis.

Government Code section 65583(a)(6) requires an analysis of potential and actual nongovernmental constraints upon the maintenance, improvement, or development of housing for all income levels, including requests to develop housing at densities below those allowed and the length of time between receiv ing approval for housing development and submittal of an
application for building permit.

5 U.C. Berkeley, The Terner Center for Housing Innovation. The Costs of Affordable Housing Production: Insights from California’s 9% Low -Income Housing Tax Credit Program. March 30, 2020.

Requests for Lower Development Densities
San Carlos has an active housing market, with development occurring at a range of densities. For mid-sized projects where the maximum allowed densities would result in between seven units to approximately 12 units, most developers have in recent years opted to stay below seven units, providing six units instead thereby avoiding the City’s requirement that all residential developments of seven or more units set aside 15 percent of the units as below market rate housing. An estimated 90 percent of these mid-size projects over recent years were proposed at less than the max imum densities, generally to avoid triggering the requirements of the BMR Ordinance . In some instances, developers also indicated that parking minimums resulted in a reduction in density below the allowed maximum densities because surface parkin g space was limited, and it was too expensive to construct podium or underground parking.

Larger projects with a maximum allowable density that would yield 15 units or more generally maximize the allowable density and use the City’s Density Bonus Ordinance or the State Density Bonus Ordinance options, providing additional affordable units consistent with these Ordinances and the City’s BMR Ordinance.

In 2022, the City updated the BMR Ordinance to lower the threshold for constructing affordable units from a minimum of https://ternercenter.berkeley.edu/research-and-policy/development-costs- lihtc-9-percent-california/

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seven units to a minimum of five units for all ownership projects; the threshold for rental projects remain s at seven units. In addition, through the City’s efforts to support more housing in the community, Action HOU-4.2 implements Zoning Ordinance revisions which will include not only an increase in density for higher density residential neighborhoods and mixed -use areas, but also will institute a new minimum density requirement (approximately 75 percent of maximum density) to ensure anticipated housing densities are achieved.

Building Permit Timeframe
In San Carlos, the turnaround time between receiving entitlement approvals for a housing development and submittal of an application for building permit varies widely. Some applicants have plans complete in advance and submit the next day, while others take a few months. The majority of larger projects apply within two to three months after receiving entitlement approval.

A multi-family residential project with complex grading and drainage plans may take longer than usual to submit permits .

Also, d evelopers may struggle with feasibility analys es, financing, or negotiations with design professionals which are outside the control of the City.

Local Efforts to Remove Nongovernmental
Constraints
Government Code 65583(a)(6) also requires a review of local efforts to remove nongovernmental constraints that create a gap in the jurisdiction
’s ability to meet the RHNA by income
category. The primary non-governmental constraint is the overall cost of affordable housing development ( associated with both high land and development costs) in most parts of California . In general, constructing 100% affordable housing, especially for low and very -low income households , is not profitable to housing developers. Therefore, deed -restricted affordable units require subsidies beyond available density or financial incentives. This places the construction burden on non-profits and similar grant or tax -credit funded housing develop ers and may result in affordable projects that are not always dispersed throughout the region but are concentrated in limited areas with lower development costs. While the City can offer developer incentives such as expedited permit processing or fee deferrals, local funding sources do not exist to fully mitigate the high cost of development for affordable housing developments.

The City has two Housing Funds that can support affordable housing: the Housing Asset Fund (Housing Successor) and the Housing In -Lieu Fund. The Housing Asset Funds has an
approximate cash balance of $3 million in June 2022, which is fully encumbered to support f uture housing projects. The Housing In-Lieu Fund has an approximate cash balance of $12.4 million in June 2022, of which $3.6 million is encumbered. The main sources of this funding are commercial linkage fees and to a lesser extent Below Market Rate (BMR) in-lieu fees. These funds help support gap financing for affordable housing projects; however, the City’s ability to support projects is limited by available funds. For example, the Walnut Studios (817 Walnut) 100% affordable project was made possible by a sizeable

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investment of $7. 3 Million from the City of San Carlos, and a generous partnership with Charities Housing, the local nonprofit organization that developed the property and will continue to manage the 23-unit building. The City of San Carlos will continue to facilitate housing development by providing funding from both Housing Funds to support additional affordable housing (Action HOU-3.1).

Governmental Constraints
Although local governments have little influence on market factors such as interest rates and availability of funding for development, local governmental policies and regulations can affect both the amount of residential development that occurs and the affordability of housing. Since governmental actions can constrain development and affordability of housing, State law requires the Housing Element to “address and, where
appropriate and legally possible, remove governmental
constraints to the maintenance, improvement, and development of housing.”
Governmental constraints are policies, development regulations, standards, requirements, or other actions imposed by various levels of government upon land and housing ownership and development. Land use controls, building codes, processing procedures, and development fees are all factors that ma y hamper the maintenance, improvement, and/or development of housing. State and federal regulations such as those related to environmental protection, building codes, and other topics can also have significant and often adverse impacts on housing costs and availability. While constraints exist at all levels of government, this section emphasizes policies and regulations that can be mitigated by the City.

Land Use Controls
The City’s primary policies and regulations that affect residential development and housing affordability include the Envision 2030 General Pla n (adopted 2009) , Title 18 Zoning, and Title 17 Subdivisions. Table 4.4-1 summarizes the General Plan land use designations and the zoning districts that either allow by right or conditionally permit residential development, as of 2022.

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Table 4.4-1: Residential General Plan Land Use Designations and Zoning Districts General Plan Land Use Designations Density
(units/acre) Corresponding Zoning Districts
Single-Family 3 RS-3
Single-Family 6 RS-6
Multiple-Family, Low Density 20 RM-20
Multiple-Family, Medium Density 59 RM-59
Mixed Use, Medium Density 50 MU-DC Mixed-Use Downtown Core Mixed Use, Medium Density 50 MU-D Mixed-Use Downtown
Mixed Use, Medium Density 50 MU-SA Mixed-Use Station Area Mixed Use, Medium High Density 59 MU-SC Mixed-Use San Carlos Avenue Neighborhood Retail/Mixed Use, Medium Density 50 MU-NB Mixed-Use North Boulevard Mixed Use, Medium Density 50 MU-SB Mixed-Use South Boulevard Mixed Use, Low Density 20 MU-N Neighborhood Mixed Use
Sources: San Carlos Envision 2030 General Plan; Title 18 Zoning Ordinance.

Proposed General Plan and Zoning District Changes
In conjunction with the process of updating the Housing Element, the City proposes to increase allowed densities and heights to facilitate housing development in residential and mixed use areas. Table 4.4 -2 summarizes the proposed General Plan designations and corresponding zoning districts. As indicated in Action HOU -4.2, these new and revised zoning districts and General Plan designations are scheduled for adoption in January 2023.

Density Bonus
Chapter 18.17 of the Zoning Ordinance provides a variety of affordable housing incentives. Section 18.17.030 provides City incentives for BMR units and Section 18.17.040 provides for density bonuses consistent with State Density Bonus law (Government Code Section 65915). Section 18.17.030 (City Density Bonus) was comprehensively updated in 2022 to provide additional incentives for rental projects to provide affordable housing, exceeding the bonuses provided by the State Density Bonus law. Section 18.17.040 (State Density Bonus) was also updated in 2022 and is consistent with State law.

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Table 4.4-2: Proposed General Plan and Zoning Districts Residential and Mixed Use
General Plan Designations Zoning Districts
Single-Family, 3 du/ac RS-3
Single-Family, 6 du/ac RS-6
Multi-Family, 20 du/ac RM-20
Multi-Family, 59 du/ac RM-59
Multi-Family, 100 du/ac RM-100
Mixed Use, 40 du/ac MU-N-40
Mixed Use, 50 du/ac MU-N-50
Mixed Use, 100 du/ac MU-DC-100, MU-D-100, MU-SB-100
Mixed Use, 120 du/ac
MU-D-120, MU-SC-120, MU-NB-120, MU-SB-120, MU-N-
120

Action HOU-3.6 is included in the Housing Plan to monitor state legislation as changes are made to the State Density Bonus law and update as needed. Action HOU-3.2 is also included to continue to monitor the effectiveness of the City’s BMR Ordinance, including in centives inherent in the Ordinance such as density bonuses and update as needed.

Zoning Ordinance
The San Carlos Zoning Ordinance implements the General Plan by establishing standards and regulations for all development in San Carlos. Table 4.4-3 summarizes the housing types permitted by zon ing district . Each use is designated by a letter denoting whether the use is allowed (“P”), permitted with a conditional use permit (“C”), permitted with a minor use permit (“M”) or not allowed (“-“).

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Table 4.4-3 Permitted Land Uses by Zoning District
Land Uses RS-3 RS-6 RM-20 RM-
59/100
MU-
DC-
100
MU-
D-100/
120
MU-
NB-120
MU-
SC-120
MU-
MU-
SB-100/
120
MU-N-
40/50/12
0 Single-unit Dwelling P P - - - - - - - -
Multi-unit Dwelling - - P P P P P P P P
Small Lot Single-Unit
Development - C P C - - - - - -
Bungalow Court - C P C - - - - - -
Duplex P1 P1 P - - - - - - -
Townhouse Development - C P P - - - - - -
Accessory Dwelling Units P P P P P P P P P P
Emergency Shelter - - - - - - P - P -
Transitional/Supportive
Housing P P P P P P P P P P
Single Room Occupancy - - C C C C C C C C
Residential Care Facilities
General (+6 persons) - - M M - M - M - -
Limited (6 or less
persons) P P P P P P P P P P
Senior (for residents 60+
years of age) - - M M - M - M - -
“P” Permitted Use
“M” Minor Use Permit (Zoning Administrator)
“C” Conditional Use Permit (Planning Commission)
“- “ Use is not permitted
Note 1: Per SB 9
Source: San Carlos Zoning Ordinance, 2021.

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As of 2022, the Zoning Code provides for four residential zoning districts in San Carlos and six mixed -use zoning districts. The Zoning Ordinance also has a Planned Development (PD) District, which allows for deviation from development standards
provided the development is superior than what could be achieved under the zoning and that it be consistent with the General Plan and any applicable specific plan . Planned Developments require a development plan and standards to be reviewed by the Planning Commission and approved by the City Council.

Development Standards
Table 4.4-4 summarizes key development standards for the residential and mixed -use zoning districts. Development standards for housing can affect the ability of property owners to construct and m odify housing. Residential development
standards established in the Zoning Ordinance are designed to provide orderly development of the city and to protect and promote the health, safety, and welfare of local residents, as well as implement the policies of the General Plan.

Table 4.4-4: Residential Development Standards (2022)
Development
Standard RS-3 RS-6 RM-
20 RM-59 MU-DC MU-D MU-
SA
MU-
SC
MU-
NB/MU
-SB
MU-
N
Min. Lot Size (sq. ft.) 10,000 5,000 6,000 10,000 5,000 5,000 5,000 5,000 5,000 5,000 Min. Lot Width 75’ 40’ 60’ 100’ 50’ 50’ 50’ 50’ 50’ 50’ Corner Lots 75’ 60’ 70’ 100’ 50’ 50’ 50’ 50’ 50’ 50’
Density (units per
acre) 3 6 20 59 50 50 50 59 50 20
Setbacks (feet)
Front 20’
1st Story:
15’
2nd Story:
19’
15’ 15’
Varies depending on street frontage (5’-15’ min.)
All-residential development in MU districts must conform to RM-59 front setback standards.

Interior Side
1st Story:
10’
2nd Story:
14’
1st Story:
5’
2nd Story:
9’
First two stories:
5’
10’; thereafter
0’ min; 10’ min. abutting to RS district for all MU uses.

All-residential development in MU districts must conform to RM-59 front setback standards.

Street Side
1st Story:
10’
2nd Story:
14’
1st Story:

7.5’
2nd Story:

11.5’
10’ 10’ All-residential development in MU districts must conform to RM-59 front setback standards.

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Table 4.4-4: Residential Development Standards (2022)
Development
Standard RS-3 RS-6 RM-
20 RM-59 MU-DC MU-D MU-
SA
MU-
SC
MU-
NB/MU
-SB
MU-
N
Rear 20’ 15’ 15’ 15’
0 min; 30 min adjacent to RS district for all MU districts All-residential development in MU districts must conform to RM-59 front setback standards.

Height Limit 28’ 28’
35’
Max. 3
storie
s
50’
Max. 4
stories
Maximum: 50’
30’ along East San Carlos Ave in MU-N District,
30’ within 40’ of an RS District
40’ within 50’ of and RS District
Lot Coverage 25% (1) or
35% 50% 65% 75% N/A N/A N/A N/A N/A N/A
Maximum Floor Area
Ratio N/A N/A .75 2.0 2.5(2) 2.5(2) 2.5(2) 2.5(2) 2.5(2) 2.5(2) Source: San Carlos Zoning Ordinance, 2022
Notes:

1. 25% within H Overlay District

2. Max. FAR could be increased by .1 through a conditional use permit under conditions outlined in Zoning Ordinance Section 18.05.030.A

3. Residential-only development in MU districts must conform to RM-59 district setback standards.

Zoning Ordinance Amendments (January 2023)
The City’s standards for minimum lot sizes, setbacks, lot coverage, and floor area ratio were not identified as constraints to housing development. However, w hile the City’s zoning
regulations are not considered overly excessive and are on par with those being used by surrounding jurisdictions and to a great extent throughout San Mateo County, the City has identified significant changes that will further encourage housing and affordable housing development in the community in response to the City’s 2,735 RHNA requirement. In order to provide
additional opportunities to meet the City’s regional housing needs, the City initiated a comprehensive update to the Land Use Element and Zoning Ordinance in 2020 (culminating in 2023) , instituting new zoning districts and allowing significant increases in density, as well as new required minimum densities. Table 4.4- 5 summaries the changes, including new zoning districts, maximum densities, minimum densities, and height limits.

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Table 4.4-5: Proposed Changes to Zoning Densities and Heights (2023) Zone Maximum Density
(du/ac)
Minimum Density
(du/ac)
Building Height
(feet)
Building Stories
(stories)
Existing Proposed Existing Proposed Existing Proposed Existing Proposed Existing Proposed MU-N MU-N-40 20 40 n/a 30 30-50
depending
on
distance
from RS
zone

50 4 4
MU-N MU-N-50 20 50 n/a 38 50 (40
adjacent
to RS
zone)
4 4
MU-N MU-N-120 20 120 n/a 90 75 4 6
MU-DC MU-DC-100 50 100 n/a 75 50 4 4
MU-D MU-D-100 50 100 n/a 75 60 4 5
MU-D MU-D-120 50 120 n/a 90 75 4 6
MU-SC MU-SC-120 59 120 n/a 90 75 4 6
MU-NB MU-NB-120 50 120 n/a 90 75 4 6
MU-SB MU-SB-100 50 100 n/a 75 60 4 5
MU-SB MU-SB-120 50 120 n/a 90 75 4 6
RM-20 RM-20 20 20 n/a 15 35 35 3 3
RM-59 RM-59 59 59 n/a 45 50 50 4 4
-- RM-100 n/a 100 n/a 75 n/a 60 n/a 5

Another important change to the Zoning Ordinance is the elimination of the mixed- use requirement along portions of El Camino Real and Old County Road, south of E. San Carlos Avenue. Previously, all projects in mixed -use zoning districts were required to reserve a portion of the ground floor space for nonresidential uses. Eliminating this requirement, along with significant increases in height and density are anticipated to provide a significant incentive for housing development in San Carlos, where existing land prices are high and vacant land is rare. Action HOU-4.2 in the Housing Plan summarizes the Zoning Ordinance changes and timeline that the City proposes to address the housing crisis.

Parking Requirements
City parking standards for residential development are based on the type of residential land use and vary based upon the zoning

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district. Table 4.4-6 summarizes residential parking standards for the residential and mixed -use zoning districts. Less parking is required in mixed-use zoning districts and for affordable housing developments. These parking standards are generally consistent with other jurisdictions throughout San Mateo County.

Table 4.4-6: Residential Parking Standards (2022)
Mixed-Use Districts Required Spaces Additional Regulations Studio / 1-bedroom units 1 space per unit One covered space per unit. One additional guest parking space per 4 units in developments greater than 10 units. Two or more bedrooms 1.5 spaces per unit Residential Districts Required Spaces Additional Regulations Single-Unit Residential 2 spaces per unit RS-6 Districts require two covered parking, or one covered and one on 20 foot-wide driveway.

Accessory Dwelling Unit (ADU) 1 space per for each ADU (unless otherwise exempt per State ADU law) Affordable Housing Development (Moderate Income and Below [BMR]) Studio .75 spaces per unit One additional guest parking space per 4 units in developments greater than 10 units.

Number of total covered spaces shall equal number of units. Reductions pursuant to Affordable Housing Incentives granted to developments with at least 1 BMR unit 1- or 2-bedrooms 1 space per unit
3+ bedrooms 2 spaces per unit
Multi-Unit Residential
Studio 1 space per unit
1 covered space for each unit; 1 guest parking per two units 1- or 2-bedrooms 1.5 spaces per unit 3+ bedrooms 2 spaces per unit
Elderly and Long-Term Care 2 spaces for the owner-manager plus 1 for every 5 beds and 1 for each nonresident employee Group Residential 1 per bed plus 1 for every 10 beds
Residential Care, Limited None in addition to base requirement Residential Care, General and Senior 2 spaces for owner-manager plus 1 for every 5 beds and 1 for each nonresident use Single Room Occupancy 0.5 spaces per unit
Emergency Shelter 1 per 200 sq. ft. of floor area
Note: As part of the Housing Element update to reduce constraints on development, minimum guest parking requirements are proposed to be removed.

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In San Carlos, housing developers may instead pay an in-lieu fee to a parking exception fund for projects within an established parking assessment district. The City also allows for reduced parking, as outlined in Chapter 18.20.050 of the Zoning Ordinance (which can be used cumulatively as applicable). These reduction provisions include:
• Transportation Demand Management: The number of
required parking spaces for any project subject to
Chapter 18.25, Transportation Demand Management (i.e.,
multi-unit development with 10 or more units) , shall be reduced by twenty percent of the normally required
number of spaces.
• Transit Accessibility: For any land use except residential single-unit and duplex development, if any portion of the lot is located within one-quarter mile of a transit stop with regular, scheduled service during the weekday hours of
seven a.m. to nine a.m. and five p.m. to seven p.m., the number of required parking spaces may be reduced by 20
percent of the normally required number of spaces. This parking reduction does not apply in the mixed-use or the industrial arts districts because parking requirements for these districts already reflect transit accessibility.
• Motorcycle Parking: Motorcycle parking may substitute for up t o five percent of required automobile parking.

Each motorcycle space must be at least four feet wide and seven feet deep.
• Shared Parking: Where a shared parking facility serving more than one use will be provided, the total number of required parking space s may be reduced by up to forty
percent with Planning Commission approval of a
conditional use permit, if the Commission finds that:
o The peak hours of use will not overlap or coincide to the degree that peak demand for parking spaces from
all uses will be greater than the total supply of spaces; o The proposed shared parking provided will be
adequate to serve each use;
o A parking demand study prepared by an independent
traffic engineering professional approved by the City
supports the proposed reduction; and
o In the case of a shared parking facility that serves more than one property, a parking agreement has been
prepared consistent with the provisions of off -site
parking facilities.
• Other Parking Reductions: Required parking for any use may be reduced through Planning Commission approval
of a conditional use permit, accompanied by a parking
study showing reduced parking needs.

Parking costs are often absorbed into the sale or rental price of residential and commercial uses, thereby hiding the true cost of parking and encouraging driving. By unbundling parking, property owners can charge residents and tenants separately for leasing a parking space. Unbundled parking saves money for households that do not wish to park a vehicle. Residents recognize the cost of parking and can determine if it is a

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worthwhile expense, as opposed to it being incorporated into the overall price of renting or buying a home regardless of whether the resident owns a vehicle. San Carlos has adopted an ordinance that allows for residential p rojects with 10 or more units to unbundle parking with approval of a Minor Use Permit.

Proposed Parking Changes
While the parking requirements in San Carlos are typical of communities in San Mateo County, developers have indicated that minor modifications to existing standards would facilitate additional housing, including removing guest parking space requirements ( Action HOU-4.2). In addition, to further incentivize higher density housing and to ensure impediments are removed if they are identified, Actio n HOU-2.1 and Action HOU-2.2 is included in the Housing Element to continue to analyze parking standards and as needed pursue reduced
parking requirements and other measures such as reductions in parking for small lot projects to ensure feasibility.

Open Space Requirements
To enhance the living environment of multifamily residential and mixed-use neighborhoods, communities typically require
housing developments to have a certain amount of open space, comprised of private areas such as patios, fenced yards, or balconies; and common or public outdoor spaces. In San Carlos, both of the multifamily zoning districts and all of the mixed- use zoning districts are subject to a per square foot standard by unit for private open space, and a percentage of the overall development site for common open space. Once the amount of open space is calculated, San Carlos has minimum standards regulating dimensions, usability, and accessibility. These types of standards are fairly general in nature and similar to that required by surrounding communities. Additionally, San Carlos lists a reduction in the usable open space requirement as a type of concession and/or incentive to developments providing
affordable housing. Table 4.4-7 identifies the different open space requirements for residential and mixed-use zones.

Table 4.4-7: Open Space Standards for Multifamily Residential and Mixed-Use Open Space Type by District RM-20 RM-59 MU-DC, MU-D MU-SA, MU-SC, MU-NB,

MU-SB, MU-N
Minimum Private Open Space
(Sq Ft Per Unit) 150 100 100 150
Minimum Common Open Space
(Percent of Site Area) 15 101
Source: San Carlos Zoning Ordinance, 2021
Notes: 1. Applicable only to mixed-use and nonresidential development on lots > than 15,000 sq ft

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Proposed Open Space Changes
Overall, the requirements imposed by San Carlos for open space in multifamily residential and mixed -use neighborhoods are similar to surrounding communities. However, to further reduce constraints on housing development as densities are increased, the City is reducing open space requirements ( Action HOU-4.2).

Specifically, the City is proposing to eliminate the requirement for private open space and instead require only common/public open space. In mixed-use zoning districts, mixed-use projects that are located on lots of 15,000 square feet or more and all stan d- alone residential developments must provide 10 percent of the lot area as open space. This may be provided at grade, at podium levels, or on rooftops. In residential zones, the requirement for private open space in the RM-20 and RM-59 zoning districts will be removed, leaving only the common open space requirement.

The new RM-100 zone must provide 10 percent of the site area as common open space.

On-/Off-Site Improvements
Due to the built -out character of San Carlos, the City typically requires only minim al on -and off -site improvements as a condition of approval for new residential development. Most new housing development occurs on existing lots that are already served by necessary infrastructure. The City of San Carlos requires that developers complete c ertain minimum site improvements in conjunction with new housing development.

Required on-site improvements include grading and installation of water, sewer, storm drainage, storm drainage retention, gas, electricity and cable utilities. Required off -site improvements include curbs, gutters, sidewalks, sewer lateral, drainage structures, full street sections, and street lighting. The City also requires that developers install landscaping and irrigation systems when necessary.

The on- and off-site improvement standards imposed by the City are typical for most communities and do not pose unusual constraints for housing development. The community is entirely built-out and as such, new development is not required to complete vast infrastructure improvements. Con ditions of approval to complete on- and off-site improvements are provided to applicants in a timely manner and do not have a significant impact on project timing. While these improvements may
increase the cost of production, adequate sewer, water, and street infrastructure is a necessary component of a healthy and productive city.

Locally Adopted Ordinances
State law requires that cities include an analysis of any locally adopted ordinance that directly impacts the cost and supply of residential developme nt, such as inclusionary housing
ordinances and short-term rental ordinances.

Below Market Rate (BMR) Housing Program
To encourage the development of affordable housing throughout the City, San Carlos adopted Chapter 18.16 “Affordable Housing Programs” and Chapter 18.17 “Affordable Housing Incentives” into the San Carlos Zoning Code. Chapter 18.16 is an
"inclusionary housing" ordinance, which requires a specified

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share of new residential construction be affordable at below market rate (“BMR”) to households at lower - and moderate - income levels.

In 2021, the City Council directed an update to the BMR ordinance to actively encourage the creation of affordable housing at all income levels and to meet regional housing requirements. In 2022, the City adopted an update that supports affordable housing opportunities and is not a constraint to housing development. In sum, this update (1) adjusted the City density bonus to provide an additional incentive for developers, (2) increased inclusionary housing requirements for ownership units, and (3) extended affordability periods in perpetuity (previously 45 years for ownership units and 55 units for rental units). With this recent update, the affordability requirement for ownership projects is triggered for projects of five units or more (instead of seven) and requires 20 percent of the units to be affordable at low income (70% AMI). For rental projects, to retain development feasibility no changes were proposed—projects of seven units or more are required to provide 15 percent of the units as BMR units (with 10% very low and 5% low ), or projects can provide 15% very low income units (this alternative allows projects to achieve a greater density bonus through the State Density Bonus law).

These changes were comprehensively analyzed to ensure that they do not unduly constrain housing development. The City hired an economist to prepare financial pro formas reflecting the expected costs of new development, and compared those costs to the reven ues that could be generated from the projects given various mixes of market -rate and affordable housing. These pro formas were then analyzed to find a scenario that resulted in more affordable units and/or units at deeper income levels, while not inhibiting a developer’s return on investment to the point that such projects would no longer be feasible. With regard to ownership projects, the analysis revealed that there is room to both increase the proportion of units required and lower the income level required, while retaining financial feasibility. These changes further incentivize use of the State Density Bonus or the City’s density bonus.

Regarding rental projects, it was discovered that developments are already facing feasibility challenges with the curr ent requirement of 10% at very low income and 5% low income.

Rental developments are generally considered feasible when they are projected to achieve greater than a 5% yield on cost. Under the City’s current inclusionary requirements, a medium sized rental development is estimated to achieve a 4.9% yield on cost.

In an effort to determine the impact the City’s inclusionary requirement is having on rental developments, EPS also ran a scenario under which no requirement existed and a developer was not require d to build any affordable units. Under this scenario the estimated yield on cost increased to 5.2%, suggesting that the City’s inclusionary requirement plays a smaller impact on project feasibility than broader market conditions such as land, labor, and construction costs.

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As a result, the only change made to rental projects of the inclusionary ordinance is to add an additional option for developers to construct 15 percent of units at the very low-income level. A project that meets this alternative inclusio nary standard would be entitled to a 50 percent density bonus under State law, whereas a project that meets the City’s current inclusionary standard would only be entitled to a 32.5 percent bonus. The analysis as well as observed developer preferences demo nstrate the significant value of density bonus units. Technically this would already be allowed under the City’s current requirements, but highlighting the 15 percent very low-income option will help draw attention to the maximum State Density Bonus of 50 percent that projects are entitled to pursue.

The above inclusionary requirements are made much more
feasible by the existence of California’s State Density Bonus. The State Density Bonus Law mandates that cities provide an increase in the maximum density allowed by local zoning regulations for developments that include certain amounts of affordable housing units. For example, under the inclusionary level for ownership units of 20 percent at low income, a project would be entitled to a 35 percent density bonus, greatly increasing the profitability of the project.

However, even with the State Density Bonus many rental
developments in San Carlos face an upward battle in terms of feasibility. For this reason, the City adopted additional incentives through an improved City Density Bonus, specifically for rental developments. San Carlos previously implemented a City
Density Bonus Program, which granted one additional market - rate unit for every unit at low income or lower that is included in a project. This City Density Bonus was generally less favorable than the State Bonus and as a result is rarely utilized. However, the City has elected to increase this City Density Bonus for rental units to help improve their feasibility and produce more affordable units.

This amended City Density Bonus is a fixed bonus rate that exceeds the highest rates provided by the State, equivalent to 4:1 for each very low-income unit and 2:1 for each low income unit, and allowing all of the affordable base units to trigger bonus units rather than requiring the developer to select only one income level to apply. Under this program, a 100- unit rental project meeting the City’s current inclusionary ordinance would qualify for 50 bonus units as seen in Table 4.4-8 below:

Table 4.4-8: Example Density Bonus
100-Unit Rental
Project State Density Bonus City Density Bonus
Base Units 100 100
BMR Units 10 Very Low Income
5 Low Income
10 Very Low Income
5 Low Income
Bonus Units 33 50
Total Units 133 150

Developers that utilize the City Density Bonus would still be able to use certain provisions of the State Density Bonus. As a result, some may choose to utilize the City Bonus to obtain additional units and the State Bonus for concessions on height, parking, or other areas.

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In addition to the above changes, the City also decreased the threshold requiring that a BMR unit be built for ownership units from seven to five units. This aligns with the increased requirement that 20 percent of units be designated low income.

This was an important change as well, since projects are not always achieving maximum densities by building below this required threshold. Lowering the threshold (in addition to the City’s recent change to add minimum required densities) will address this issue. Th e threshold remains seven units for rental developments.

Building Codes and Enforcement
San Carlos implements the 2019 edition of the California Building Code, and 2019 edition of the California Green Building Standards Code. The City intends to adopt the 2022 California Building Code series (including the 2022 California Green Building Standards Code [ CALGreen]) in 2022, which will become effective January 1, 2023.

These codes establish standards and require inspections at various stages of construction to ensure code compliance and minimum health and safety standards. Although these standards and the time required for inspections increase housing
production costs and may impact the viability of rehabilitation of older properties, the codes are mandated for all jurisdictions in California and are necessary to ensure the safety of structures.

The City has adopted modifications to both the California Building Code and the California Green Buildings Standards Code. The California Building Code modificati ons include administrative and technical modifications that are related to fences and lattice, retaining walls, and construction methods for concrete structures. Modifications to the California Green Buildings Standards Code related to one - and two -family dwellings expand the code’s scope to include “Residential Reconstruction projects” in addition to new projects.

The City of San Carlos’s Building Division and the San Carlos Fire Department provide inspection and review to ensure all
development projects comply with Building Codes. Residents may register suspected code violations to the Building
Department for further investigation and inspection. The Building Department also maintains a shared agreement with the County of San Mateo to address these compla ints. Additional compliance checks are administered by the City’s Apartment Inspection Program to ensure proper maintenance and safety for occupants of residential units in San Carlos.

Zoning for a Variety of Housing Types
State housing element law requi res that jurisdictions facilitate and encourage a range of housing types for all economic segments of the community. The following paragraphs describe how the City makes provisions for a variety of housing types.

Multifamily Rental Housing
Multi-family de velopments are permitted by-right in the Residential Multifamily ( RM) and Mixed-Use ( MU) zoning districts. Stand-alone multi -family residential d evelopments

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located in mixed -use zon ing district s are subject to RM -59 development standards for building setbacks and the maximum allowed density permitted by the MU zoning district. Mixed-use developments (the integration of residential and commercial uses on one site) are allowed by -right in all MU z oning districts. As part of the Zoning Ordinance amendments ( Action HOU-4.2), stand-alone residential development will no longer require a Conditional Use Permit in some areas along El Camino Real and objective development standards (including modification s to required setbacks) will be crafted to allow developments to achieve maximum densities.

Housing for Agricultural Employees (permanent and seasonal) The Employee Housing Act (Government Code Section 17021.5 and 17021.6) requires that any employee housing occupied by six or fewer employees shall be considered a single-family structure within a residential land use and must be treated the same as a single-family dwelling of the same type in the same zon ing district. In addition, employee housing consisting of no more than 36 beds in a group quarters, or 12 units or separate rooms or spaces designed for use by a single-family or household, must be considered an agricultural land use and be treated the same as any other agricultural activity in the same zoning district.

The urban nature of development in the Bay Area is incongruous to agricultural uses. No zoning districts in San Carlos allow for agricultural uses (beyond community gardens).

The City
complies with State Health and Safety Code Sections 17021. 5, which concerns employee housing that serves six or fewer employees, which would include farmworkers.

Emergency Shelters
Government Code Section 65583 requires jurisdictions to permit emergency shelters without a Conditional Use Permit (CUP) or other discretionary permit in at least one zoning district with adequate capacity to serve the unsheltered population .

Emergency shelters are allowed without discretionary review in the Mixed Use North Boulevard (MU-NB) and Mixed Use South Boulevard (MU-SB) zoning districts. There are 6.2 acres of land designated MU-NB and 17.4 acres of land designated MU -SB.

These areas are located at the north and south gateways of the El Camino Real (State Route 82) corridor in San Carlos. Both zoning districts allow for a variety of uses and are located in close proximity to local services and transit. This zoning district has a number of underutilized properties as well as a mix of medium - sized buildings that could transition to reuse as homeless shelters.

Based on the size of the zoning districts identified, opportunities for adaptive reuse of existing buildings, and ready access to services and transportation, the zone has sufficient capacity to accommodate the City
’s homeless need in at least one year-round
shelter. ( In 2019, there were 30 homeless individuals in San Carlos, as reported by the San Mateo County One Day Homeless County and Survey.) San Carlos supports the distribution of emergency shelters and transitional housing in areas of the city where appropriate support services and facilities are available in close proximity.

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The development and management standards for emergency
shelters in the Zoning Ordinance (Section 18.23.110) were drafted to be consistent with State law. Specific provisions for emergency shelters in San Carlos specify:
• Number of Residents. The number of adult residents, not including staff, who may be housed on a lot that is smaller than one acre shall not exceed the number of persons that may be accommodated in any hospital, elderly and long-
term care facility, residential, transient occupancy, or similar facility allowed in the same district.
• Length of Occupancy. Occupancy by an individual or
family may not exceed one hundred eighty consecutive
days unless the management plan p rovides for longer
residency by those enrolled and regularly participating in a training or rehabilitation program.
• Outdoor Activities. All functions associated with the shelter, except for children’s play areas, outdoor
recreation areas, parking, and outdoor waiting must take place within the building proposed to house the shelter.

San Carlos City CouncilSeptember 26, 2022

San Carlos City Council
September 26, 2022