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Agenda packet

San Carlos City Council
June 24, 2024

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Agenda packet
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June 24, 2024
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San Carlos City Council
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Text extracted from the city's file for reading and search. Open the original on cityofsancarlos.primegov.com. That file is the official record.

\\EgnyteDrive\epsys\Shared\Projects\Oakland\231000s\231112_San Carlos Annexation Fiscals\Club Drive\231112_Club Drive FIA Memo.docx Memorandum
2 44 Club Drive Annexation Fiscal Impact Analysis
Sub ject P r op er ty
The property, identified by parcel number 049-050-070, is 0.21 acres in size and includes a 1,400 square foot single-family residence. It is in Tax Rate Area (“TRA”) 053-010, adjacent to the City boundary on three sides. The Subject Property sits on the North side of Club Drive and has an assessed value of $327,400 in the latest published 2023 assessment roll.

Methodological Overview
This fiscal impact analysis considers whether the Subject Property, at annexation, can be expected to have a positive or negative overall effect on the City’s General Fund. It compares additional costs incurred by the City with additional public revenues generated by the property at annexation. The difference between the new revenues and added costs indicates whether the annexation is expected to generate an annual fiscal surplus (positive outcome) or an annual fiscal deficit (negative outcome). The analysis relies on San Carlos’s Fiscal Year 2023-2025 Budget, the most recent budget adopted by the City.

EPS uses several approaches to evaluate the General Fund costs and revenues based on the City’s budget. Table 2 and Table 3 show the primary revenue and expenditure categories and their estimating methodologies. The following descriptions provide detail about the estimating approach and factors:
• Service Population- “Service population” is used to determine current municipal cost per capita, acknowledging that employees who work but do not live in the City do not require City services to the same degree residents do. Table 4 shows the calculation of the City’s current service population, which forms the basis of the per-capita factors used to project service costs for the Subject Property.
• Average Revenue/Expenditure per Service Population - This approach estimates average revenues or expenditures across the City’s current service population and applies that average revenue or expenditure level to the Subject Property’s service population at annexation.
• Fixed vs. Variable Expenditures
- In calculating the estimates of General Fund
expenditures attributable to the property, a percentage variable factor has been applied. City departments operate with a degree of fixed overhead that will not increase as the City’s service population grows. See General Fund Expenditures Section for more detail on EPS methodology.
• Case Study - Case study approaches are used to calculate revenues that can be estimated using assumptions specific to the Subject Property. Case study estimates in this analysis include property tax, property tax in lieu of vehicle license fees, and transfer tax revenues. • Not Applicable/ Not Estimated - Some budget items are not estimated because they are not applicable or directly related to the annexation of the Subject Property, or because revenues are fees generated to the cost of specific City services.

Using these approaches, EPS presents two scenarios to highlight the potential fiscal impact of Subject Property annexation. The Existing scenario assumes annexation without a near-term sale and uses the current assessed valuation. The Property Sale scenario examines the potential fiscal

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February 15, 2024 Memorandum
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Table 2 General Fund Revenue Budget and Estimating Methodology Table 3 General Fund Expenditure Budget and Estimating Methodology General Fund
Revenue Categories
Fiscal Year
2024-25
Property Tax $18,612,000
Vehicl
e in Lieu $4,157,000
Property Transfer Tax $626,000 $0.55 per $1,000 of Value Charges for Current Services $4,994,550 $139 per Service Population Fines & Forfeitures $328,700 $9 per Service Population
Licenses & Permits $2,667,500 $74 per Service Population Franchise ["Other"] Tax $2,121,400 $59 per Service Population Transient Occupancy Tax $4,768,000
Busines
s Registration $1,316,600
Sales Tax $13,430,670
Other Revenue $914,800
PAMF Target Revenue $890,170
From Other Agencies $11,600
Use of Money and Property $3,034,700
Total General Fund Revenues [1] $57,873,690
[1] Does not include General Fund transfers or allocations.

Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Systems, Inc.

Estimating Factors
Tied to Citywide Assessed Value
Not Applicable (No Employees)
Not Applicable (No Hotel)
Not Estimated
Not Estimated
Not Estimated
Not Estimated
Not Estimated
Case Study Approach
General Fund
Expenditure Categories
Fiscal Year
2024-25
Gener
al Government $11,157,430 $47 per Service Population
Community Development $9,035,400 $63 per Service Population Public Safety $26,492,670 $554 per Service Population
Public Works $9,702,275 $203 per Service Population
Parks & Recreation $5,265,115 $110 per Service Population General Fund Expenditures [1] $61,652,890
[1] Does not include General Fund transfers or allocations.

Systems, Inc.

Estimating Factors
Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning

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February 15, 2024 Memorandum
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Fiscal Impact Analysis
This section provides a detailed overview of the key General Fund revenues and expenditures estimated by this analysis. The analysis relies on case study approaches to calculate fiscal impacts for major General Fund revenues such as property tax, while other revenues estimates rely on budget-based averages, including per-service population calculations.5 All municipal costs are calculated based on the City’s existing service population (residents and employees shown in Table 4, above) costs.

The results of this analysis are presented for both scenarios on an stabilized, annual basis in 2024 dollars, representing the ongoing revenues and expenditures to the City’s General Fund each year after annexation occurs. The analysis focuses on recurring municipal revenues and expenses accruing to the City General Fund as a direct result of annexation. One-time costs and revenues associated with related infrastructure improvements (e.g., sewer connection costs and fees) are not included in the fiscal analysis.6
General Fund Revenues
Estimating methods associated with fiscal revenues generated by the annexation are described below:
5 The Service Population of the Subject Property is estimated to be 2.48, per the Department of Finance's data on average Persons per Household in the City (see Appendix). No employment is assumed for this property.
6 Sewer service connection is anticipated to be revenue neutral for the City. Source: City Staff Email Communication, January 26, 2024.

Item Amount Source
Housing Units 12,318 CA D OF 2023
Occupied Households 11,863 CA DOF 2023
Persons per Household 2.48 CA DOF 2023
Population 29,496 CA DOF 2023
Jobs [1] 19,203 JobsEQ (2023 Q3)
Service Population [2] 35,897
[2] Service population is calculated by adding total residential population and one third Sources: US Census Bureau; JobsEQ; Economic & Planning Systems, Inc. of total employment.
[1] Reflects a 4-quarter moving average from the latest available date (2023 Q3)

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February 15, 2024 Memorandum
244 Club Drive Annexation Fiscal Impact Analysis Page 7 \\EgnyteDrive\epsys\Shared\Projects\Oakland\231000s\231112_San Carlos Annexation Fiscals\Club Drive\231112_Club Drive FIA Memo.docx • Property Tax - Property tax revenue is estimated by applying the anticipated City property tax rate to the assessed value associated with each analytic scenario. o The Existing scenario uses the current assessed value of $327,400 and assumes no additional renovations, sales, or valuation appeals. o The Property Sale scenario assumes a near-term sale of the property and uses an assessed valuation based on assumed market valuation of $1.8 million.7 Cur
rently, the County General Fund collects 28.8 percent of the base 1.0 percent property tax levy, with an additional 7.8 percent collected by the County Fire Protection Fund for fire service. Annexation would require the establishment of a property tax exchange agreement to allocate a portion of the County's existing share of property tax revenue to the City.

This analysis assumes the property tax exchange agreement for 244 Club Drive will be like agreements previously executed for properties in the same tax rate area (053-010). This includes transferring 100 percent of the County Fire Protection Share (approximately 7.8 percent of the 1.0 percent tax levy) and approximately 19 percent of County’s share (or approximately 5.5 percent of the 1.0 percent tax levy) to the City. In general, past agreements aim to approximate County and City property tax revenue shares elsewhere in San Carlos. Depending on the Scenario, the estimated property tax generation accruing to the City General Fund after annexation ranges from $440 to $2,400 annually, as shown in the Appendix.
• Property Tax In Lieu of Vehicle License Fees - In 2004, the State of California adjusted the method for sharing vehicle license fees (VLF) with local jurisdictions. Ultimately, state budget changes replaced the VLF with property tax, which grows proportionately with increasing assessed value of the City. Based on this framework, the two scenarios increase the City’s current assessed valuation marginally at annexation and will generate a proportional increase in in-lieu VLF revenues. Depending on the scenario, the estimated property tax in lieu of VLF associated with the annexation ranges from $80 to $450 annually, as shown in the Appendix.
• Property Transfer Tax - Property transfer tax revenues depend upon sales activity and are only calculated for the Property Sale scenario. The City receives real property transfer tax for any transacted property at a rate of $0.55 per $1,000 in value. In the Property sale scenario, the analysis assumes property turnover every 10 years.
8 General Fund property transfer tax
revenue estimated from annexation is $0 in the Existing scenario and nearly $100 annually in the Property Sale scenario.
• Other General Fund Revenues – Although property tax and related revenues are the largest sources for the General Fund, other taxes and fees attributable to the Subject Property also will generate new revenue after annexation. This analysis uses an average revenue approach derived from City budget documents to forecast charges for current services, fines and forfeitures, licenses and permits, and franchise tax revenues. To be 7 Based on Redfin transaction values of recent single-family homes in the City of San Carlos. 8 Turnover assumption reflects literature review and EPS professional judgment.

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February 15, 2024 Memorandum
244 Club Drive Annexation Fiscal Impact Analysis Page 8 \\EgnyteDrive\epsys\Shared\Projects\Oakland\231000s\231112_San Carlos Annexation Fiscals\Club Drive\231112_Club Drive FIA Memo.docx conservative, additional revenues that may be already captured in the City, such as sales tax, are not included.9 Other taxes such as transient occupancy and business registration are also not included in the analysis. Since the analysis focuses on providing estimates for ongoing, annual General Fund items, one-time taxes and fees also are excluded.

General Fund Expenditures
General Fund Expenditures are estimated in Appendix and total $1,200 annually. Given that the Subject Property has the same service population in both scenarios, the estimated City costs for providing services to the Subject Property are expected to be the same, regardless of whether the property sells or not.

This fiscal analysis estimates the costs attributable to population and employment growth by characterizing how expenses will change for each City department. For some departments, population and employment growth in the City will not dramatically alter operations. For example, administrative functions in the City are not likely to scale up significantly to accommodate new projects. Alternatively, departments that provide services directly to residents and businesses likely will increase their operations and associated costs to accommodate new service population.

It is important to note that a range of external factors may influence City responses to growth and cost effects in the future. Examples of factors that are beyond the control of the City and its departments that may act to magnify or reduce department costs over time include:
• Regional growth;
• Technology;
• State and federal policies; and
• Environmental factors.

This study does not speculate regarding the potential effects of such exogenous influences on the General Fund expense budget. The analysis focuses only on those factors attributable directly to the population growth generated by the Subject Property. The fiscal analysis model relies on a categorization of the likely budgetary response to population growth for each department. The anticipated response to growth is expressed for fiscal modeling purposes in terms of “fixed expenses” and “variable expenses” within the department budget.

The fixed expenses are the portion of a City department’s budget which is not affected by population and employment growth. Even a department which is anticipated to grow largely in step with the City’s service population likely would have some fixed cost. For example, in most cases each department has only one director’s position, which is a fixed expense for the department. While the department may increase staffing to accommodate growth, the department will not add another director.

The variable expenses of a department are those that do increase with growth. As the City’s populations expand, increased demand for services requires some departments to scale up their 9 Sales tax generation is determined by where purchases are being made. The annexation of the property is unlikely to change existing retail spending patterns.

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February 15, 2024 Memorandum
244 Club Drive Annexation Fiscal Impact Analysis Page 9 \\EgnyteDrive\epsys\Shared\Projects\Oakland\231000s\231112_San Carlos Annexation Fiscals\Club Drive\231112_Club Drive FIA Memo.docx operations to meet new demand. The analysis identifies the portion of a department’s budget that scales up as the variable share of the budget.

EPS uses a per-capita cost approach to estimate department costs attributable to new residents and workers based on the City’s expenditure budget. To determine the new General Fund expenditures attributable to the proposed project, the per-capita factors are multiplied by the projected increase in service population, as appropriate. The Appendix details the calculations of General Fund expenditures.

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APPENDIX
(C
alculation Tables)

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Table A-1: Summary of Fiscal Impact Analysis (Rounded) T
able A-2: Detailed Fiscal Impact Analysis Results ($2024) Item Existing Property Sale
City Revenue $1,200 $3,600
City Expenditures $2,400 $2,400
Net Impact on Annual City Budget ($1,200) $1,200
Systems, Inc.

Annual Impact ($2024)
Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Existing Property Sale
City General Fund Revenues
Property Tax $435 $2,394
Vehicle in Lieu $82 $450
Trans
fer Tax Not Applicable $99
Charges for Current Services $345 $345
Fines & Forfeitures $23 $23
Licenses & Permits $184 $184
Franchise ["Other"] Tax $147 $147
Total General Fund Revenues [1] $1,216 $3,642
City General Fund Expenditures
General Government $116 $116
Community Development $156 $156
Publi
c Safety $1,373 $1,373
Public Works $503 $503
Parks & Recreation $273 $273
Total GF Expenditures $2,420 $2,420
Net Annual Impact ($1,204) $1,222
Systems, Inc.

Annual Impact ($2024)FY 2024-25
Budget Categories
Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning

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Appendix A-3: Estimated Service Population of Subject Property A
ppendix A-4: General Fund Revenues for FY 2024/25 and Estimating Factors Item
Number of
Units Employment
Service
Population [2]
244 Club Drive 1.0 2.48 per Unit 0 2.48
[1] Department of Finance, 2023.
[
2] S
ervice population is calculated by adding total residential population and half of total employment.

It represents a measure of public service demand in which employees are given one-third the weight of residents because of more modest service demands. Service population for both scenarios ar e c
onsi
stent.

Source: Department of Finance.

Projected
Population [1]
General Fund
Revenue Categories
Fiscal Year
2024-25
Property Tax $18,612,000
Vehicle in Lieu $4,157,000
Proper
ty Transfer Tax $626,000 $0.55 per $1,000 of Value
Charges for Current Services $4,994,550 $139 per Service Population Fines & Forfeitures $328,700 $9 per Service Population
Licenses & Permits $2,667,500 $74 per Service Population Franchise ["Other"] Tax $2,121,400 $59 per Service Population Transient Occupancy Tax $4,768,000
Business Registration $1,316,600
Sales
Tax $13,430,670
Other Revenue $914,800
PAMF Target Revenue $890,170
From Other Agencies $11,600
Use of Money and Property $3,034,700
Total General Fund Revenues [1] $57,873,690
[1] Does not include General Fund transfers or allocations.

Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Systems, Inc.

Estimating Factors
Tied to Citywide Assessed Value
Not Applicable (No Employees)
Not Applicable (No Hotel)
Not Estimated
Not Estimated
Not Estimated
Not Estimated
Not Estimated
Case Study Approach

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Appendix A-5: Property Tax and In-Lieu of Vehicle License Fee (VLF) Estimation Item Existing Property Sale
Assessed Value [1] $327,384 $1,800,000
Property Tax Revenue Estimate
General Property Tax Levy 1.0% of Assessed Value $3,274 $18,000 Proposed City Share [2] 13.3% of General Property Tax Levy $435 $2,394 County General Fund 5.5% of General Property Tax Levy $180 $989 County Fire Protection 7.8% of General Property Tax Levy $255 $1,405 Property Tax In Lieu of VLF Estimate
Assessed Value [1] $327,384 $1,800,000
Existing Citywide Property Tax in-Lieu of VLF [3]
Project % of Citywide Assessed Value $16,612 Million Citywide AV [4] 0.002% 0.011% Net New Property Tax In Lieu of VLF $82 $450
[1] Based on assessed value published by the San Mateo County Tax Collector for 2023 for the Existing scenario and a Redfin estimat e of
recent sale transactions for single-family homes in the City of San Carlos for the Property Sale scenario. [2] B
ased on prior executed property-tax sharing agreements between the City and County for Tax Rate Area 053-010. [3] See Table A-4.
[4] 2023-24 Local Combined Assessment Roll Summaries.

S
ources: San Mateo County Tax Collector; San Mateo County Assessor's Office; City of San Carlos; Redfin, Economic & Planni ng S
ystems, Inc.

Assumption / Factor
Annual Impact ($2024)
$4,157,000

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Appendix A-6: Property Transfer Tax

Appendix A-7: Other General Fund Revenue Estimates

Appendix A-8: General Fund Expenditures for FY 2024/25 and Estimating Factors Item Existing Property Sale
Sale Value [1] $1,800,000
Annual Turnover Value 10.0% Turnover Rate [2] $180,000
Total Annual Property Transfer Tax $0.55 per $1,000 value $99 [1] Based on Redfin estimates of recent sale transactions for single-family homes in the City of San Carlos. [2] Assumes residential ownership real estate trades every 10 years on average.

Sources: Redfin; City of San Carlos; Economic & Planning Systems, Inc.

Assumption
Annual Impact ($2024)
Not Applicable
Other Select General FY 2024-25
Fund Revenues Budget
Charges for Current Services $4,994,550 $139.14 per service population $345 Fines & Forfeitures $328,700 $9.16 per service population $23 Licenses & Permits $2,667,500 $74.31 per service population $184 Franchise ["Other"] Tax $2,121,400 $59.10 per service population $147 Total General Fund Revenues $5,323,250 $699
[1] Estimated to be the same in both scenarios due to the consistent service population estimate.

Annual Total
($2024) [1]
Estimating Factors
Applied to Project Revenue
Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Systems, Inc.

General Fund
Expenditure Categories
Fiscal Year
2024-25

General Government $11,157,430 $47 per Service Population Community Development $9,035,400 $63 per Service Population Public Safety $26,492,670 $554 per Service Population
Public Works $9,702,275 $203 per Service Population
Parks & Recreation $5,265,115 $110 per Service Population General Fund Expenditures [1] $61,652,890
[1] Does not include General Fund transfers or allocations.

Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Systems, Inc.

Estimating Factors

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Appendix A-9: General Fund Expenditures for FY 2024/25 and Estimating Factors

General Fund
Expenditure Categories
Fiscal Year
2024-25
Percent Variable
Costs
Annual Total
($2024) [1]

General Government $11,157,430 15% $47 per S ervice Population $116 Community Development $9,035,400 25% $63 per Service Population $156 Public Safety $26,492,670 75% $554 per Service Population $1,373 Public Works $9,702,275 75% $203 per Service Population $503 Parks & Recreation $5,265,115 75% $110 per Service Population $273 General Fund Expenditures [2] $61,652,890 $2,420
[1] Estimated to be the same in both scenarios due to the consistent service population estimate. [2] Does not include General Fund transfers or allocations.

Sources: City of San Carlos Adopted Budget FY 2023-2025; Economic & Planning Systems, Inc.

Estimating Factors

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Evaluation for Applicability of a Categorical Exemption Under CEQA Section 15319 Annexation of Existing Facilities and Lots for Exempt Facilities, and Section 15303 New Construction or Conversion of Small Structures

244 Club Drive Lot Annexation into City of San Carlos
San Carlos, California

Introduction
The City of San Carlos (City) has received an application (PLN 2023-00099) to annex a 0.22- acre (9,754 square foot) parcel developed with a single-family residence from unincorporated San Mateo County (County) into the City of San Carlos. The proposed project includes abandoning the existing septic system on the parcel, installing a new City-required pump station within the parcel, and connecting the new pump station to the City of San Carlos’s sanitary sewer system. The project site is located at 244 Club Drive (APN 049-050-070) in the San Carlos hills, in the Devonshire area of unincorporated San Mateo County. Single-family homes are to the east and west side of the property and to the south across Club Drive. The project area is mainly surrounded by open space with hiking trails. The nearest major cross streets to the project site are Crestview Drive, approximately 0.58 mile west, and Beverly Drive, approximately 0.29 mile east (See Figure 1).

The annexation is considered a project under the California Environmental Quality Act (CEQA) and the City, acting as the Lead Agency under CEQA, must prepare an appropriate environmental evaluation of the potential project impacts as required by CEQA. The CEQA Guidelines include a list of classes of projects which have been determined not to have a significant effect on the environment and which are considered exempt from the provisions of CEQA. The Article 19 Categorical Exemptions of the CEQA Guidelines presents this list of classes of projects determined not to have a significant effect on the environment, and thus are declared to be categorically exempt from the requirement for the preparation of environmental documents.

As the Lead Agency, the City has prepared this categorical exemption documentation for the proposed project. This investigation documents the project’s ability to meet the conditions for CEQA exemptions described in Section 15319 Annexations of Existing Facilities and Lots for Exempt Facilities, and Section 15303(d) New Construction or Conversion of Small Structures.

The annexation from unincorporated San Mateo County into the City would be an action requiring approval from the San Mateo Local Agency Formation Commission (LAFCo). The San Mateo LAFCo is a State-mandated, independent agency with countywide jurisdiction over changes in organization and boundaries of cities and special districts including annexations, detachments, incorporations and formations. LAFCo is an independent commission with jurisdiction over the boundaries of the 20 cities, 22 independent special districts, and many of the 33 county-governed special districts serving San Mateo County.

The Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (CKH Act) establishes procedures for local government changes of organization, including city incorporations, annexations to a city or special district, and city and special district consolidations. LAFCos have numerous powers under the CKH Act, but those of primary

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244 Club Drive Lot Annexation into City of San Carlos
Evaluation for Categorical Exemption
February 13, 2024 Page 2
concern are the power to act on local agency boundary changes and to adopt spheres of influence for local agencies. Among the purposes of LAFCos are the discouragement of urban sprawl and the encouragement of the orderly formation and development of local agencies.

Local governments, property owners, and communities may seek approval of boundary changes from LAFCo by submitting an application to the LAFCo in the affected county. The CKH Act calls a single proposed change a change of organization. If two or more changes of organization are in one proposal – such as an area’s annexation to a city and detachment from a special district – It is called a reorganization.

An Annexation occurs when a city or district attaches, includes, or adds territory to its boundary.

A Detachment means the exclusion, deletion, or removal of territory from a city or district.

Detachment occurs when land is annexed to another agency that provides similar services. For an annexation application to be approved, the project must comply with the City’s Adopted Annexation Policies.

Project Description
Project Overview
The proposed project consists of the prezoning/annexation and General Plan Amendment of one parcel located at 244 Club Drive (APN 049-050-070), to the City. The subject parcel is located in unincorporated San Mateo County, but it is adjacent to the incorporated City to the west, east, and south and is within the City’s Sphere of Influence (SOI) (see Figure 2). The proposed project includes abandoning the existing septic system on the parcel, installing a new City-required pump station and sewer force main within the parcel, installing and connecting a new sewer service lateral to an existing 6” sewer main in Club Drive, and requesting to be detached from the County and be annexed into the City service boundary. The project site is developed with an existing single-family residence.

The project site is currently zoned R-1 (One-Family Residential District), S-71 (Devonshire Area Combining District), and DR (Design Review District) under San Mateo County’s Zoning Regulations. Upon annexation into the City the project site’s new zoning will be RS-3 (Single- Family, Low Density), with a General Plan designation of Single Family, Low Density (3 Dwelling Units, DUs/Acre). No new development is proposed with this project. Any additions to or remodeling of the existing residential home would be required to comply with the City development standards for residential districts. See Table 1 below for a summary of existing and proposed zoning and General Plan designations and utility service providers.

Site Characteristics
The subject parcel is approximately 9,754 square feet in size or 0.22 acre and is located in the unincorporated residential community of Devonshire in San Mateo County, in the northwestern part of the City. The project site is adjacent to incorporated City territory to the east, west, and south. The Devonshire area is characterized by single-family homes located within scenic, hilly terrain. The project site is developed with a single-family house (see Figure 1).

There are no waterways or wetland features on the parcel. The project site contains existing landscaped vegetation.

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244 Club Drive Lot Annexation into City of San Carlos
Evaluation for Categorical Exemption
February 13, 2024 Page 3
The parcel is not under a Land Conservation Act Contract (Williamson Act). The project site is mapped as Urban and Built-Up Land by the state Farmland Mapping and Monitoring Program.

Surrounding Land Uses and Zoning
This area is largely residential, located in the hills of northwest San Carlos. Adjacent land to the east, west, and south are part of the incorporated City, zoned RS-3 (Single-Family, Low Density), and each lot contains a single-family residence. To the west of the project site is a parcel containing a California Water Service water tank (zoned RS-3) that is also within the City (See Figure 3 City of San Carlos Zoning Designations).

As discussed above, the project site is currently zoned One-Family Residential District (R-1) under the County of San Mateo Zoning Regulations and following annexation will be zoned Single-Family, Low Density (RS-3), with a General Plan designation of Single Family, Low Density (3 DUs/Acre) under the City of San Carlos Zoning Code and General Plan (respectively). Both zoning districts are intended for low-density, single-family residential development. The change in zoning and general plan land use designation proposed with the annexation is compatible with the surrounding character of the community.

Driveway and Access
The project site has direct driveway access to Club Drive, a paved public road. Club Drive was constructed for the Devonshire Subdivision and was dedicated as a public street to the City.

Following implementation of the project, the street would remain public and maintained by the City (City of San Carlos DPW 2019).

Utilities
The project parcel must be annexed into the City in order to permanently connect to the sanitary sewer system available along Club Drive. The project proposal includes abandoning the existing septic system on the parcel, installing a new City-required pump station and sewer force main within the parcel, and installing, connecting a new sewer service lateral to an existing 6” sewer main in Club Drive, and requesting to be detached from the County and be annexed into the City service boundary. Following annexation, water and sanitary sewer services will continue to be provided by the City. Stormwater infrastructure is located on Club Drive and existing improvements to the project parcel already connect to the City of San Carlos storm drain system.

Public Services
The project site is currently served by the San Mateo County Fire Department and the San Mateo County Sheriff’s Office. Following annexation, fire service would be provided by the Redwood City Fire Department under contract with the City and law enforcement services by the San Carlos Police Bureau, staffed under contract by the San Mateo County Sheriff’s Office.

Any student population would continue to be served by the Belmont-Redwood Shores School District (Pre-K through 8
th grade) and the Sequoia Union High School District (9th -12th grades).

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244 Club Drive Lot Annexation into City of San Carlos
Evaluation for Categorical Exemption
February 13, 2024 Page 4
Ta
ble 1: Existing and Proposed Conditions
S an Mateo County
Existing Conditions
City of San Carlos
Proposed Conditions
General Plan Designation Medium Density Residential
(6.1-8.7 DUs/Ac)
Single Family, Low Density (3
DUs/Ac)
Zoning Designation R-1 (One-Family Residential
District), S-71 (Devonshir
e
A
rea Combining District, DR
(Design Review District)
Pre-Zoning RS-3 (Single-
Family, Low Density).

Water Provider California Water Service
Company
California Water Service
Company
Sanitary Sewer Provider Onsite septic system City of San Carlos Storm Drain System City of San Carlos City of San Carlos School Districts Belmont-Redwood Shores
School District and Sequoia
Union High School District
Belmont-Redwood Shores
School District and Sequoia
Union High School District
Solid Waste Recology San Mateo County Recology San Mateo County Zoni
ng Ordinance Consistency Analysis:

City of San Carlos Zoning Code (18.38.040) states:
"Developed Lots. Annexation of lots which contain a primary structure shall comply with the following standards:

1. The lots shall meet the minimum lot size and density standards of this title and Title 17.

S
ingle developed properties that meet all annexation policies, with the exception of m
inimum lot size requirements, may be considered for annexation; provided, that further subdivision of the land is prohibited through a recorded deed restriction acceptable to the City Attorney.

2. The lots shall be connected to the City’s sanitary sewer system or can be connected to the C
ity’s sewer to the satisfaction of the City Engineer pursuant to Title 13, Public Services.

3. The lots with existing properly functioning septic tank-drain field systems shall not be r
equired to connect to a newly installed sewer line until one of the following events occurs and at that time shall be required to connect:
a. Upon sale of the property that triggers an assessment of the County Tax Assessor; or
b. Upon determination by the San Mateo County Environmental Health Services Division that the existing septic system cannot function properly or cannot be
ex
panded to accommodate the use; and

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244 Club Drive Lot Annexation into City of San Carlos
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c. Failed septic systems shall not be replaced with another septic system. (Ord. 1438 § 4 (
Exh. A (part)), 2011)
Title 17 governs subdivisions and lists lot size requirements:

The parcel meets all annexation policies as described below in Table 2. Therefore, the project is consistent with the City’s Zoning Ordinance requirements.

General Plan Consistency Analysis:

The San Carlos 2030 General Plan addresses land use.

The City and LAFCo have established a SOI for San Carlos. The SOI represents the area that the City may consider for annexation during the next 20 years. The SOI of San Carlos includes three distinct unincorporated areas including the Devonshire Area containing Devonshire Canyon, an “island” within the city limit, and a 17-acre Devonshire area adjacent to Club Drive and the City of Belmont. For an annexation application to be approved, the project must comply with the City’s Adopted Annexation Policies.

The City has adopted residential annexation policies that apply to all residential annexations within the City’s SOI. These policies are designed to regulate annexation in an efficient and orderly manner and to ensure that areas annexed into the city are compatible with all City policies. Most significantly, the policies are designed to retain the neighborhood character of the annexed area and the existing city neighborhoods.

The project is consistent with relevant City of San Carlos General Plan policies regarding land use and annexation because:
• The project parcel is contiguous on three property lines to parcels located in the City ;
• The
project parcel is in the process of being prezoned RS-3, consistent with r
equirements of potential development on five lots or less; • Public utilities are available within Club Drive.
• The project parcel meets the density standards for developed lots listed in Chapter 17 of the C
ity of San Carlos Zoning Code;
• The project has been analyzed under the California Environmental Quality Act and found to be ex
empt.

Table 2: General Plan Compliance
General Plan Policy Project Compliance
Policy LU-4.1: To the extent not inconsistent with
this General Plan and until such time as the City
approves an Annexation Ordinance, the
annexation policies of the 1992 General Plan as
amended by the August 13, 2001 (Resolution
2001-115, Exhibit B) Amendment to the San
Carlos General Plan, shall apply to annexation
requests. Policies 4.2 through 4.10 below are the
Policy intent for the Annexation Ordinance.

See below:

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P
olicy LU-4.2: Annexation of all or portions of
unincorporated residential areas shall only be
permitted when public services and facilities
meeting City standards are available to the lands
proposed for inclusion in the city.

The project would be served by public services
and facilities meeting City standards.

Policy LU4.5: Annexation of the developed
parcels shall be in substantial compliance with the
following criteria:

See below:
a. The parcels are contiguous to parcels
located in the City of San Carlos a
nd
c
ontiguous to city streets.

The proposed project parcel is developed and
contiguous to a city street and parcels located in
the City of San Carlos.
b. The parcels are connected to the city’s
sanitary sewer system or can
be
c
onnected to the city’s sewer to the
s
atisfaction of the City Engineer.

The proposed project parcel can be connected to
the city’s sewer to the satisfaction of the City
Engineer.

Policy LU 4.6: Parcels proposed for annexation to
the City shall be prezoned.

The City is in the process of prezoning the parcel
RS-3 (Single-Family, Low Density), consistent
with the surrounding neighborhood as required by
Zoning Code Section 18.38.030.

Policy LU-4.7: Prior to annexation of parcels,
public services and facilities meeting City
standards shall be installed or provisions for their
installation shall have been made to the City
Engineer. Public services and utilities include:

See below:
a. Construction and acceptance of
improvements shall be completed prior to
i
ssuance of Building Permits or sewer
connections.

The parcel will be allowed to connect to the City’s
sanitary sewer system. The property owner will
install a new City-required pump station and
sewer force main within the parcel, install and
connect a new sewer service lateral to an existing
6” sewer main in Club Drive. The property owner
will obtain the necessary permits to connect to the
City’s sanitary sewer system.
b. Construction of streets meeting City
subdivision street standards from the
t
erminus of city streets currently meeting
City standards to and throughout the
s
ubdivision. Where possible and
appr
opriate and subject to environmental,
health and safety considerations, rural
road standards shall apply. Assessment
districts may be used by the developer for
installation of portions of the street whic
h
i
s the responsibility of the owner of
abutting unimproved lands at the time of
their development.

The project does not propose the construction of
streets.

Policy LU-4.8: Annexation of parcels shall be in
compliance with City General Plan policies.

The proposed annexation is in compliance with
General Plan policies as described above.

Policy LU-4.9: An environmental analysis under
the provisions of the California Environmental
This CE evaluation constitutes the City’s
environmental evaluation of the project under
CEQA.

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Quality Act and a fiscal impact analysis shall be
conducted.

Policy LU-4.10: Allow single existing developed
properties which meet all annexation policies, with
the exception of minimum lot size requirements, to
be considered for annexation and in no
circumstances shall such properties be allowed to
further subdivide.

The project site is a developed parcel with an
existing single-family residence. No new
development or further subdivision of land is
proposed, nor would be allowed.

Findings f
or a CEQA Categorical Exemption
Projects resulting in a physical change to the environment are subject to review under the California Environmental Quality Act (CEQA; Pub. Resources Code § 21000 et seq.) and the CEQA Guidelines (14 CCR §15000 et seq.).

For projects qualifying for categorical exemptions, CEQA allows the use of multiple exemptions, as applicable, for a project. The proposed single-family lot annexation is eligible for a categorical exemption under CEQA Guidelines Section 15319 (Class 19, Annexations of Existing Facilities and Lots for Exempt Facilities) which allows annexations of individual small parcels of the minimum size. The project is also eligible for a Class 3 categorical exemption for small facilities by Section 15303, New Construction or Conversion of Small Structures for the construction of a new pump station and force main and sanitary sewer line needed to connect to the Sanitary Sewer main in Club Drive. Project consistency with these CEQA Guidelines is described below.

Class 19, Annexations of Existing Facilities and Lots for Exempt Facilities CEQA Guidelines Per Section 15319:

Class 19 consists of only the following annexations:
(a) Annexations to a city or special district of areas containing existing public or priv ate
s
tructures developed to the density allowed by the current zoning or pre-zoning of either the gaining or losing governmental agency whichever is more restrictive, provided, how
ever, that the extension of utility services to the existing facilities would have a c
apacity to serve only the existing facilities.
(b) Annexations of individual small parcels of the minimum size for facilities exempted by Section 15303, New Construction or Conversion of Small Structures (Cal. Code Regs.

Ti
t. 14, § 15319
Project Consistency. The proposed project is an annexation of one individual parcel, measuring less than one acre. The site is developed with an existing single-family residence with no new proposed development. The proposed project would be consistent with the City’s pre-zoning designation of RS-3 (Single-Family, Low Density), the City’s General Plan Designation of Single Family, Low Density (3DUs/Ac). The project is also consistent with applicable requirements of the City of San Carlos Zoning Code Section 18.38.040 and all applicable General Plan Land Use policies related to annexation (see Tables 1 and 2). The site would be served by the City’s sanitary sewer system which has service capacity to serve this site. All other utility providers would remain the same (see Table 1). Therefore, the proposed project is eligible for a Class 19 CEQA Categorical Exemption.

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Class 3, New Construction or Conversion of Small Structures CEQA Guidelines Per Section 15303:

Class 3 consists of construction and location of limited numbers of new, small facilities or structures; installation of small new equipment and facilities in small structures; and the conversion of existing small structures from one use to another where only minor modifications are made in the exterior of the structure. The numbers of structures described in this section are the maximum allowable on any legal parcel. Examples of this exemption include but are not limited to:
(d) Water main, sewage, electrical, gas, and other utility extensions, including str eet
i
mprovements, of reasonable length to serve such construction.

Project Consistency. The proposed annexation includes abandoning the existing septic system on the parcel, installing a new City-required pump station and sewer force main within the parcel, and installing and connecting a new sewer service lateral to an existing 6” sewer main in Club Drive connection to the City of San Carlos sanitary sewer. The property owner would be responsible for obtaining relevant permits from the City for this utility work. The utility extension would be of reasonable length to serve the single-family residence. Therefore, the proposed project is eligible for a Class 3 CEQA Categorical Exemption.

Exceptions to CEQA Exemptions
Section 15300.2 lists the “exceptions” to CEQA exemptions, or situations in which a Categorical Exemption cannot be used for a project. These are:
(a
) Locat
ion. Classes 3, 4, 5, 6, and 11 are qualified by consideration of where the project is to be located – a project that is ordinarily insignificant in its impact on the environment may in a particularly sensitive environment be significant. Therefore, these classes are consider
ed to apply instances, except where the project may impact on an environmental r
esource of hazardous or critical concern where designated, precisely mapped, and of
ficially adopted pursuant to law by federal, state, or local agencies.

The proposed project is classified as a Class 3 Exemption, and is located within scenic, hilly terrain, in the northwestern part of the City. The project parcel is not located within a particularly sensitive environment. There are no resources of hazardous or critical concern located on or near the project parcel, as designated, mapped, and adopted pursuant to law by federal, state, or local agencies. Therefore, the proposed annexation is not subject to this exception. (b) C
umulative Impact. All exemptions for these classes are inapplicable when the cum
ulative impact of successive projects of the same type in the same place, over time is signif
icant.

The proposed project is an annexation of developed land and does not include any new development. The project would involve minor ground disturbing activities to install the new City- required pump station and service line to connect the annexed parcel to the City of San Carlos’s sanitary sewer system. The impact of this construction would be regulated through permits issued by the City and the construction would not have significant environmental impacts. While other individual parcels in this same area have been annexed in the past, and others will be annexed into the City in the future, the annexation does not have a cumulative impact that is significant over time. Therefore, the annexation would not contribute to cumulative impacts.

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244 Club Drive Lot Annexation into City of San Carlos
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(c) Significant Effect. A categorical exemption shall not be used for an activity where t
here is a reasonable possibility that the activity will have a significant effect on the envir
onment due to unusual circumstances.

The proposed project is typical of an annexation project and no unusual circumstances exist under the proposed project. The project would involve minor ground disturbing activities to install the new City-required pump station to connect the annexed parcel to the City of San Carlos’s sanitary sewer system. The proposed project would not have significant effects on the environment as the existing development on the parcel is consistent with City of San Carlos requirements and no new development is included with the project. The project parcel is contiguous with the City of San Carlos city limits, the City’s pre-zoning of the parcel indicates a single-family development intensity similar to the current San Mateo County zoning designation, and the annexation would not cause a boundary change of a public service provider.

The proposed annexation is consistent with City Zoning Ordinance and General Plan requirements for annexations. The project meets all other annexation policies and further subdivision of the land would be prohibited. Therefore, the project will not have a significant effect on the environment due to unusual circumstances. The proposed annexation is not subject to this exception.
(d)
S
cenic Highways. A categorical exemption shall not be used for a project which may r
esult to damage to scenic resources, including but not limited to, trees, historic buildings, r
ock outcroppings, or similar resources, within a highway officially designated as a st
ate scenic highway. This does not apply to improvements which are required as m
itigated by an adopted negative declaration or certified EIR.

The project would not affect scenic resources within an officially designated state scenic highway. The nearest officially designated state scenic highway is State Route 280, which is approximately 4,459 feet (0.84 mile) to the west of the project site and is not visible from or to the project site. Additionally, no development is proposed as part of this project. Therefore, the proposed annexation is not subject to this exception.
(e) H
azardous Waste Sites. A categorical exemption shall not be used for a project located on a site which is located on any list compiled pursuant to Section 65962.5 of the G
overnment Code.

The project is not located on a site included on a list compiled pursuant to Section 65962.5 of the Government Code. The nearest Cortese list site is Carlmont High School, located at 1400 Alameda De Las Pulgas, Belmont, approximately 0.39 mile north of the project site (DTSC 2024). However, according to the Cortese List, the site is classified as Inactive-Withdrawn. The project site is not within 5,000 feet of sites that require cleanup according to the State Water Resources Control Board (SWRCB 2019).
(f)
H
istorical Resources. A categorical exemption shall not be used for a project which m
ay cause a substantial adverse change in the significance of a historical resource.

The pr
oject consists of the annexation of one developed parcel with no new development. No known archaeological sites, artifacts, or features are known to be in or near the project site.

However, the project would involve ground disturbing activities to install a new City-required pump station to connect the annexed parcel to the City of San Carlos’s sanitary sewer system.

In the unlikely event that archeological or human remains are discovered during ground disturbing activities, the City will implement the following protocols:

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244 Club Drive Lot Annexation into City of San Carlos
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• Inadvertent Discovery of Archaeological Resources. The City shall retain a P
rofessional Archaeologist on an “on- call” basis during ground disturbing construction ac
tivities to review, identify and evaluate any inadvertent discoveries of archaeological resources. The Professional Archaeologist shall review and evaluate any discoveries to deter
mine if they are historical resource(s) and/or unique archaeological resources under the California Environmental Quality Act (CEQA).

If the Professional Archaeologist determines that any cultural resources exposed during c
onstruction constitute a historical resource and/or unique archaeological resource under
CEQA, he/she shall notify the City and other appropriate parties of the evaluation and r
ecommend measures to mitigate or avoid significant adverse changes to the ar
chaeological resource. The lead agency shall ensure that any adopted measures to m
itigate or avoid significant adverse changes are fully enforceable through permit c
onditions, agreements, or other measures, in accordance with California Public Resources Code Section 15064.5.
• Inadver
tent Discovery of Human Remains. In accordance with Section 7050.5, C
hapter 1492 of the California Health and Safety Code and Sections 5097.94, 5097.98 and 5097.99
of the Public Resources Code, if potential human remains are found, the l
ead agency (City of San Carlos) staff and the San Mateo County Coroner shall be i
mmediately notified of the discovery. The coroner would provide a determination r
egarding the nature of the remains within 48 hours of notification. No further excavation or
disturbance of the identified material, or any area reasonably suspected to overlie addi
tional remains, can occur until a determination has been made. If the County Coroner determines that the remains are, or are believed to be, of Native American anc
estry, the coroner would notify the Native American Heritage Commission within 24 hour
s. In accordance with California Public Resources Code, Section 5097.98, the N
ative American Heritage Commission must immediately notify those persons it believes to be the M
ost Likely Descendant from the deceased Native American. Within 48 hours of this notification, the Most Likely Descendant would recommend to the lead agency their preferred treatment of the remains and associated grave goods.

Findings:

Based on the above information, the proposed annexation is categorically exempt under CEQA Section 15319(a)(b), and Section 15303(d).

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Figure 1 Project Vicinity
244 Club Drive Lot Annexation into City of San Carlos
Source: Esri 2024

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Figure 2 San Carlos Sphere of Influence
244 Club Drive Lot Annexation into City of San Carlos
Project Location

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Project Site
Not to Scale
Source: City of San Carlos 2024, MIG 2024
Figure 3 City of San Carlos Zoning Designations
244 Club Drive Lot Annexation into City of San Carlos

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244 Club Drive Lot Annexation into City of San Carlos
Evaluation for Categorical Exemption
February 13, 2024 Page 14
References:

California Department of Toxic Substances Control. 2024. Hazardous Waste and Substances Site List (Cortese). https://dtsc.ca.gov/dtscs-cortese- list/#:~:text=The%20Hazardous%20Waste%20and%20Substances,of%20hazardous%20materi als%20release%20sites. Accessed January 2024.

CalTrans, 2019. Scenic Highway Mapping System.
http://www.dot.ca.gov/hq/LandArch/16_livability/scenic_highways/. Accessed January 2024.

City of San Carlos 2009. San Carlos 2030 General Plan.
http://www.cityofsancarlos.org/Home/ShowDocument?id=1105 City of San Carlos 2011. City of San Carlos Zoning Map
http://www.cityofsancarlos.org/Home/ShowDocument?id=656 City of San Carlos 2019. Municipal Code.
https://www.codepublishing.com/CA/SanCarlos/
City of San Carlos 2019. GIS City Map:
https://zoning.cityofsancarlos.org/ accessed January 2024.

San Mateo County 2019. GIS County Map:
http://maps.smcgov.org/GE_4_4_0_Html5Viewer_2_5_0_public/?viewer=raster. Accessed January 2024.

San Mateo County 2019. Zoning Regulations
https://planning.smcgov.org/sites/planning.smcgov.org/files/SMC_Zoning_Regulations.pdf State Water Resources Control Board, 2019. GeoTracker Database. https://geotracker.waterboards.ca.gov/ accessed August 26, 2019.

Report Preparers:

MIG, Inc.
2635 North 1st Street,
San Jose, CA 95134
Barbara Beard, Senior Project Manager
Rose Redlich, Analyst

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CITY OF SAN CARLOS

NOTICE OF PUBLIC HEARING
NOTICE IS HEREBY GIVEN THAT the San Carlos City Council will hold a Public Hearing in the Council Chambers, City Hall - 600 Elm Street, San Carlos at its Monday, June 24, 2024, 7:00 pm Regular Meeting for the purpose of hearing and considering all comments of all persons interested in or concerned with the application of Judy Farnsworth, property owner, for consideration of a ZONING DISTRICT BOUNDARY MAP AMENDMENT, GENERAL PLAN AMENDMENT, and AUTHORIZATION OF A PROPERTY TAX EXCHANGE pursuant to Chapters 18.34, 18.35, and 18.38 of the San Carlos Municipal Code (SCMC) to allow for the pre- zoning/annexation of one (1) developed, 9,754 square foot lot at 244 CLUB DRIVE (APN: 049- 050-070) currently located in the County of San Mateo. It is proposed to amend the General Plan to designate this property Single-Family (3 DU/Ac) and amend the Zoning Map to pre-zone this property as RS-3, Single Family. The Planning and Transportation Commission reviewed this application on April 1, 2024 and recommended City Council approval of both a General Plan Amendment and Zoning District Boundary Amendment.

Environmental Determination: This project has been determined to be exempt from the provisions of the California Environmental Quality Act (CEQA) Class 19 Categorical Exemption (Annexations of Existing Facilities and Lots for Exempt Facilities - CEQA Guidelines 15319) and Class 3 Categorical Exemption (New Construction or Conversion of Small Structures - CEQA Guidelines 15303), which exempts annexations of areas developed to the density allowed by the pre-zoning and minor improvements associated with connecting to the City sewer system.

Agenda: The agenda and relevant materials for this item will be available for viewing online:
www.cityofsancarlos.org/agenda; at the City Clerk’s Department in City Hall – 600 Elm Street; and at the San Carlos Library – 610 Elm Street, beginning Thursday, June 20, 2024. Details and instructions on how to observe the meeting and address the Council will be available on the agenda.

Questions and Comments: Questions regarding the project may be directed to Ralph Robinson, Associate Planner, at [email protected]. Comments may be sent via email to the City Clerk at [email protected] and the City Council at [email protected]; or mailed to the City Clerk at 600 Elm Street, San Carlos, CA 94070; or made in-person at the public hearing.

All persons interested in the above are hereby invited to participate in this Public Hearing and be heard. If you challenge this proposal in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the City Clerk prior to the public hearing.

Crystal Mui, City Clerk
Mailing Date:

Publication Date:

June 14, 2024
June 14, 2024
If you require translation of this notice, please contact the City Clerk’s Office at 650-802-4222

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San Mateo County San Mateo map

0.07 0 0.04 0.07 Miles This map is a user generated static output from an Internet mapping site and is for reference only. Data layers that appear on this map may or may not be accurate, current, or otherwise reliable.
1: 2,257
WGS_1984_Web_Mercator_Auxiliary_Sphere
© Latitude Geographics Group Ltd. THIS MAP IS NOT TO BE USED FOR NAVIGATION

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CITY COUNCIL

STAFF REPORT
MEETING DATE: June 24, 2024
ITEM TITLE: Discuss and Provide Direction on Current Rules and Process Related to Construction Time Limits and Associated Fines and Penalties.

RECOMMENDATION:

Staff recommends that the City Council receive an update on current rules and processes of the Construction Time Limit Ordinance and associated fines and penalties and provide direction to staff on potential updates.

FISCAL IMPLICATIONS:

There is no fiscal impact associated with receiving this report.

BACKGROUND:

San Carlos has experienced a large volume of construction projects over the last ten years. The increase in development has many positive benefits such as additional housing units, commercial space, environmental remediation, and improved property values. However, construction projects inevitably bring noise, loss of on-street parking, stress on neighbors, and wear and tear on roads and infrastructure. Projects that are not completed in a timely manner result in unnecessary delays of occupied housing units and anticipated revenue from completion of such projects.

In response to this issue, many communities, including Atherton, Belmont, Belvedere, Burlingame, Hillsborough, Ross, and San Bruno have adopted ordinances that establish a deadline for completion of construction projects based on valuation.

At its May 11, 2020 meeting, based upon input from the community and recommendations by staff, the San Carlos City Council adopted its own Construction Time Limit Ordinance. The following table of time limits was incorporated into the Ordinance:

Estimated Value of Construction Construction Time Limit (months) $200,000 to $1,000,000 18 months
$1,000,000 to $5,000,000 24 months
$5,000,000 to $10,000,000 30 months
$10,000,000 plus 36 months

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The following table of Extension Fees was incorporated into the Ordinance:

Fees for Additional Extension Extension Fees (% of Project Valuation) 1st 60-day extension 0.5%
2nd 60-day extension 1.0%
3rd 60-day extension 1.5%
Lastly, the following table of Construction Completion Penalties was also incorporated into the Ordinance:

Period of Time That Projects Remain
Incomplete Beyond Applicable Time Limits
Penalty (Percentage of total value of project)
30-day grace period $0
31st day through 60th day 0.01% per day
61st day through 120th day 0.015% per day
121st day and every day thereafter 0.02% per day
ANALYSIS:

There are many nuances and circumstances with each project, from large to small, that require staff to troubleshoot with the contractor and/or homeowner.

Local Utility Services.

The most common time delay for residential reconstruction projects, new homes, mixed-use/multi- residential, and large commercial projects is due to PG&E utility connect services. The typical timeline for utility services by PG&E ranges from 9 to 12 months for single-family projects, and up to four years (based on a mixed-use, multi-family project that was recently completed).

It is common for there to be 4-to-6-month lead times in order to have utilities disconnected for demolition projects. This information is indicative of the time delay impact utility providers may have on development projects.

COVID 19.

The Construction Time Limit Ordinance was adopted by the City Council in May of 2020, when COVID 19 was in its beginning stages. One of the most significant impacts of the pandemic on the construction industry has been project delays and cancellations. These delays were the result of supply chain disruptions, workforce shortages, and government restrictions on work. For instance, as the virus spread, many countries and states mandated lockdowns, leading to construction site closures and project delays.

Project Complexity.

Project complexity can be a factor that warrants consideration. Projects that are built on steep slopes require complex retaining wall systems that can require more time to build, thus impacting the timeline it takes to complete a given project. Section 15.60.050 (C) of the Construction Time Limit Ordinance allows discretionary authority to the Building Official to waive an extension fee in

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the event they find the complexity or size of the project requires a greater time than allotted.

Enforcement Since Adoption.

Since the adoption of the Construction Time Limit Ordinance, there have not been any projects requiring its implementation.

Currently, residential and commercial projects under construction have shown steady progress with regularly scheduled progress inspections. These projects have not risen to the need to apply the Construction Time Limit Ordinance. The large-scale projects currently under construction are expected to be completed within the 36-month timeline, and new residential projects are expected to be completed within the 24-month timeline. Regularly scheduled inspections are also taken into consideration in addition to the established timelines under this Ordinance. Staff will continue to respond to the City Council’s or community’s concerns associated with projects timelines and take appropriate steps as necessary.

ALTERNATIVES:

The alternatives available to the City Council include:

1. Provide direction to staff on updates to the Construction Time Limit Ordinance and associated fines and penalties; or

2. Provide direction to staff to maintain the current process; or

3. Provide staff with alternative direction.

Respectfully submitted by:

Christopher Valley, Building Official
Al Savay, Community Development Director
Approved for submission by:
_______________________
Jeff Maltbie, City Manager

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