San Luis Obispo City Council
June 16, 2026

City Council
AGENDA

Tuesday, June 16, 2026, 5:30 p.m.

Council Chambers, 990 Palm Street, San Luis Obispo
Council meetings may be viewed remotely on Channel 20, the City’s YouTube Channel, and on the City’s website under the Public Meeting Agendas web page. Attendees of City Council or Advisory Body meetings are eligible to receive one hour of complimentary parking; restrictions apply, visit Parking for Public Meetings for more details.

INSTRUCTIONS FOR PUBLIC COMMENT:

Public Comment prior to the meeting (must be received 3 hours in advance of the meeting):

Mail - Delivered by the U.S. Postal Service. Address letters to the City Clerk's Office at 990 Palm Street, San Luis Obispo, California, 93401.

Email - Submit Public Comments via email to [email protected]. In the body of your email, please include the date of the meeting and the item number (if applicable). Emails will not be read aloud during the meeting.

Voicemail - Call (805) 781-7164 and leave a voicemail. Please state and spell your name, the agenda item number you are calling about, and leave your comment. Verbal comments must be limited to 3 minutes. Voicemails will not be played during the meeting. *All correspondence will be archived and distributed to councilmembers, however, submissions received after the deadline may not be processed until the following day.

Public Comment during the meeting:

Meetings are held in-person. To provide public comment during the meeting, you must be present at the meeting location.

Electronic Visual Aid Presentation. To conform with the City's Network Access and Use Policy, Chapter 1.3.8 of the Council Policies & Procedures Manual, members of the public who desire to utilize electronic visual aids to supplement their oral presentation must provide display-ready material to the City Clerk by 12:00 p.m. on the day of the meeting. Contact the City Clerk's Office at [email protected] or (805) 781-7114.

Pages

1. CLOSED SESSION (4:00 PM START)

1.a CALL TO ORDER
Mayor Erica A. Stewart will call the Closed Session of the San Luis Obispo City Council to order at 4:00 PM in the Council Hearing Room at City Hall, 990 Palm Street, San Luis Obispo.

1.b CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) and paragraph (1) of subdivision (e) of California Government Code Section 54956.9: No. of potential cases: One.

1.c CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) and paragraphs (2) and (3) of subdivision (e) of California Government Code Section 54956.9: No. of potential cases: One.[DC1.1] The facts and circumstances related to the exposure to litigation arise from allegations challenging the validity of the development impact fees and permitting and inspection fees invoiced to a non-residential project.

The allegations are set forth in greater detail in letters submitted by counsel for the developer dated April 7, 2026, and May 15, 2026, which are available for review upon request to the City Clerk.

1.d CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) and paragraphs (2) and (3) of subdivision (e) of California Government Code Section 54956.9: No. of potential cases: One.

The facts and circumstances related to the exposure to litigation arise from allegations related to the potential application of the City’s recent Mobile Home Park Rent Stabilization Ordinance amendments to existing long term leases. The facts and circumstances are set forth in greater detail in correspondence from a mobile home park resident advocate, as well as mobile home park owner representative and legal counsel for that park representative, received by the City Council, which are on file and available for review upon request to the City Clerk.

1.e CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Initiation of litigation pursuant to paragraph (4) of subdivision (d) of California Government Code Section 54956.9: No. of potential cases:

One.

1.f ADJOURNMENT
The Council will hold a Regular Meeting of the San Luis Obispo Council in the Council Chambers at City Hall, 990 Palm Street, San Luis Obispo.

2. CALL TO ORDER
Mayor Erica A. Stewart will call the Regular Meeting of the San Luis Obispo City Council to order.

3. PLEDGE OF ALLEGIANCE
Council Member Michelle Shoresman will lead the Council in the Pledge of Allegiance.

4. PRESENTATIONS

4.a JUNETEENTH PROCLAMATION
Mayor Stewart will present a proclamation declaring June 20, 2026 as Juneteenth.

4.b ADVISORY BODY RECOGNITION
Mayor Stewart will present a Certificate of Recognition to the following Advisory Body members who have completed two terms of service.

Robert Jorgenson - Planning Commission - April 1, 2018 through June 30, 2026
Tony Skapinsky - Citizen's Revenue Enhancement Oversight Commission - July 1, 2020 through June 30, 2026
Robin Kisinger - Mass Transportation Committee - April 1, 2018 - June 30, 2026

4.c CITY MANAGER REPORT
Receive a brief report from City Manager Whitney McDonald.

5. PUBLIC COMMENT PERIOD FOR ITEMS NOT ON THE AGENDA
The Council welcomes your input. State law does not allow the Council to discuss or take action on issues not on the agenda, except that members of the Council or staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights (Gov. Code sec. 54954.2). Staff may be asked to follow up on such items.

6. CONSENT AGENDA
Matters appearing on the Consent Calendar are expected to be noncontroversial and will be acted upon at one time. A member of the public may request the Council to pull an item for discussion. Pulled items shall be heard at the close of the Consent Agenda unless a majority of the Council chooses another time. The public may comment on any and all items on the Consent Agenda within the three-minute time limit.

Recommendation:

To approve Consent Calendar Items 6a to 6i.

6.a WAIVE READING IN FULL OF ALL RESOLUTIONS AND

ORDINANCES
Recommendation:

Waive reading of all resolutions and ordinances as appropriate.

6.b MINUTES REVIEW - JUNE 2, 2026 COUNCIL MINUTES 13
Recommendation:

Approve the minutes of the City Council meeting held on June 2, 2026.

6.c 2026 ANNUAL APPOINTMENTS TO CITY ADVISORY BODIES 21 Recommendation:

As recommended by the Council Liaison Subcommittees, make appointments to the City of San Luis Obispo’s Advisory Bodies and continue to recruit for any unfilled vacant positions.

6.d REVIEW OF APPLICATION TO DESIGNATE 207 BROAD STREET AS

A HISTORIC LANDMARK
25 Recommendation:

Adopt a draft Resolution entitled “Resolution by the City Council of the City of San Luis Obispo, California, designating the Property Located at 207 Broad Street as a Landmark Historic Resource, called the Gary Cully House and John Wilshusen Patio (Application No. HIST-0981- 2025),” as recommended by the Cultural Heritage Committee.

6.e AUTHORIZATION TO AWARD CALIFORNIA WATERLINE
REPLACEMENT (TAFT TO MILL), SPECIFICATION NO. 2000563
75 Recommendation:

Approve the project plans and special provisions for the California Waterline Replacement (Taft to Mill), Specification No. 2000563; and,

1. Award a construction contract to Specialty Construction in the amount of $1,986,673 for the California Waterline Replacement (Taft to Mill), Specification No. 2000563; and,

2. Authorize the City Engineer to issue Contract Change Orders up to the available project budget (Account 2000563), and up to any amended budget subsequently approved by the City
Manager per City Purchasing Policy approval thresholds; and

3. Find the action exempt from the California Environmental Quality Act.

4. 6.f ADOPT A RESOLUTION CALLING THE NOVEMBER 3, 2026

GENERAL MUNICIPAL ELECTION AND ADOPTING REGULATIONS
85 Recommendation:

Adopt a draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, calling for the holding of a General Municipal Election on Tuesday, November 3, 2026, for the election of certain Officers as required by the provisions of the City Charter, adopting regulations for Candidate Statements, and requesting the Board of Supervisors of the County of San Luis Obispo to consolidate a General Municipal Election with the Statewide General Election to be held on November 3, 2026, pursuant to Section 10403 of the Elections Code.”

6.g CONSIDERATION OF FUNDING PRIORITIES FOR THE DEI HIGH

IMPACT GRANT
93 Recommendation:

As recommended by the Human Relations Commission, approve the Diversity, Equity, and Inclusion High Impact Grant funding priorities for future grant cycles including, and starting with, Fiscal Year 2026-27.

6.h SAN LUIS OBISPO RAILROAD MUSEUM – AMENDED AND

RESTATED LEASE AGREEMENT
103
Recommendation:

Approve an Amended and Restated Lease Agreement between the City of San Luis Obispo and the San Luis Obispo Railroad Museum.

6.i AMENDMENT TO MANAGEMENT COMPENSATION RESOLUTION

FOR DEPARTMENT HEAD EMPLOYMENT CONTRACTS
127
Recommendation:

Adopt a draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving an amendment to the July 1, 2025, through June 30, 2028,
Unrepresented Management Compensation and Benefits
Resolution” authorizing the City Manager to negotiate and execute individual employment contracts with Department Heads, providing variations in one-time compensation and benefits within approved budgets and within the parameters established by the Resolution, subject to approval as to form by the City Attorney; and

1. Authorize the City Manager to execute an individual
employment contract with the Police Chief with recommended changes to compensation to address compaction that exceeds the proposed parameters established by the Resolution.

2. 7. PUBLIC HEARING AND BUSINESS ITEMS

7.a ADOPT THE MULTI-JURISDICTIONAL HAZARD MITIGATION PLAN (60 MINUTES)
207
Recommendation:

Adopt a draft Resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, Approving the County of San Luis Obispo Multi-Jurisdictional Hazard Mitigation Plan 2025 Update.”

7.b ADOPTION OF THE 2025 URBAN WATER MANAGEMENT PLAN,
2025 (30 MINUTES)
285
Recommendation:

Adopt a Resolution entitled “A Resolution of the Council of the City of San Luis Obispo, California, adopting the 2025 Urban Water Management Plan”;

1. Adopt a Resolution entitled “A Resolution of the Council of the City of San Luis Obispo, California, adopting the 2025 Water Shortage Contingency Plan”;

2. Receive and file the City’s 2026 Water Supply and Demand Assessment; and

3. Find that adoption of the 2025 Urban Water Management Plan and 2025 Water Shortage Contingency Plan is exempt from CEQA pursuant to State CEQA Guidelines Section 15282(v) and California Water Code Section 10652, and that receiving and filing the 2026 Water Supply and Demand Assessment is exempt pursuant to CEQA Guidelines Section 15061(b)(3).

4. 7.c ANNUAL UPDATE ON THE IMPLEMENTATION OF THE DIVERSITY, EQUITY, AND INCLUSION STRATEGIC PLAN (45 MINUTES)
479
Recommendation:

Receive and file the annual update on the implementation status of the Diversity, Equity, and Inclusion Strategic Plan.

7.d SOUTH STREET AND KING COURT CROSSING PROJECT
MODIFICATION, SPECIFICATION NO. 2001059 (30 MINUTES)
519
Recommendation:

Approve a modification to the South Street and King Court Crossing Project (Specification No. 2001059), authorizing installation of a standard traffic signal in lieu of a pedestrian hybrid beacon; and,

1. Authorize the City Engineer to approve modifications to project plans and specifications and approve associated construction Contract Change Orders as needed to facilitate project
modifications up to the available project budget and consistent with California Public Contract Code, including any
amendments authorized by the City Manager.

2. 8. LIAISON REPORTS AND COMMUNICATIONS
Not to exceed 15 minutes. Council Members report on subcommittee assignments, listed below, and other City activities. At this time, any Council Member or the City Manager may ask a question for clarification, make an announcement, or report briefly on their activities. In addition, subject to Council Policies and Procedures, they may provide a reference to staff or other resources for factual information, request staff to report back to the Council at a subsequent meeting concerning any matter or take action to direct staff to place a matter of business on a future agenda. (Gov. Code Sec. 54954.2) Mayor
Stewart
Vice Mayor
Francis
Council Member
Boswell
Council Member
Marx
Council Member
Shoresman
SLO Council of
Governments
Airport Land Use Community
Action
Partnership
Air Pollution
Control District
CP Campus
Planning
Committee
Regional
Economic Action
Coalition
Nacimiento Water
Project
SLO Climate
Coalition
County Water
Resources
Advisory
Committee
Downtown
Association
Board
CA Men’s
Colony Advisory
Committee
Zone 9 Advisory
Committee
Local Agency
Formation
Commission
Homeless
Services
Oversight
Committee
Performing Arts
Center
Commission
Integrated Waste
Management
Authority
SLO Regional
Transit Authority
Visit SLO
County Advisory
Committee
Central Coast
Clean Energy

9. ADJOURNMENT
The next Regular Meeting of the City Council will be held on July 21, 2026 at 5:30 p.m. in the Council Chambers at City Hall, 990 Palm Street, San Luis Obispo. The Regular Meeting of July 7, 2026 will be cancelled, as approved by Council on November 4, 2025 during their annual review of the 2026 meeting calendar.

LISTENING ASSISTIVE DEVICES for the hearing impaired - see the Clerk.

The City of San Luis Obispo wishes to make all of its public meetings accessible to the public. Upon request, this agenda will be made available in appropriate alternative formats to persons with disabilities. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should direct such request to the City Clerk’s Office at (805) 781-7114 at least 48 hours before the meeting, if possible. Telecommunications Device for the Deaf (805) 781-7410.

City Council meetings are televised live on Charter Channel 20 and the City's YouTube Channel: www.youtube.com/CityofSanLuisObispo. Agenda related writings or documents provided to the City Council are available for public inspection in the City Clerk’s Office located at 990 Palm Street, San Luis Obispo, California during normal business hours, and on the City’s website https://www.slocity.org/government/mayor-and-city-council/agendas-andminutes. Persons with questions concerning any agenda item may call the City Clerk’s Office at (805) 781-7114.

1 Council Minutes
June 2, 2026, 5:30 p.m.

Council Chambers, 990 Palm Street, San Luis Obispo
Council Members

Present:

Council Member Mike Boswell, Council Member Jan Marx,
Council Member Michelle Shoresman, Vice Mayor Emily
Francis, Mayor Erica A. Stewart
City Staff Present: City Manager Whitney McDonald, Christine Dietrick, City Attorney, Deputy City Clerk Sara Armas
_____________________________________________________________________

1. CALL TO ORDER
A Regular Meeting of the San Luis Obispo City Council was called to order on June 2, 2026 at 5:30 p.m. in the Council Chambers, 990 Palm Street, San Luis Obispo, by Mayor Stewart.

2. PLEDGE OF ALLEGIANCE
Council Member Marx led the Council in the Pledge of Allegiance.

3. PRESENTATIONS

3.a PRIDE MONTH PROCLAMATION
Mayor Stewart presented a Proclamation to Tobin Johnson, representing the NAACP LGBTQIA+ Committee, declaring June as Pride Month.

3.b CITY MANAGER REPORT
City Manager Whitney McDonald provided a report on upcoming projects.

4. PUBLIC COMMENT PERIOD FOR ITEMS NOT ON THE AGENDA
Public Comment:

Shawn Harris
Sharon Spatafora
Roberta Smith
--End of Public Comment--

2 5. CONSENT AGENDA
Public Comment:

Alec Lance
Desi Lance
Michael Leibovich
--End of Public Comment--
Motion By Council Member Marx
Second By Council Member Shoresman
To approve Consent Calendar Items 5a to 5k.

Ayes (5): Council Member Boswell, Council Member Marx, Council Member Shoresman, Vice Mayor Francis (recused on Item 5j, due to owning property near the project), and Mayor Stewart
CARRIED (5 to 0)

5.a WAIVE READING IN FULL OF ALL RESOLUTIONS AND ORDINANCES Waive reading of all resolutions and ordinances as appropriate.

5.b MINUTES REVIEW - MAY 19, 2026 COUNCIL MINUTES
Approve the minutes of the City Council meeting held on May 19, 2026.

5.c 2026 BIENNIAL REVIEW OF THE CITY’S CONFLICT OF INTEREST CODE
Direct the review of the City’s Conflict of Interest Code and the filing of a Biennial Notice with the City Clerk regarding such review, as required by the Political Reform Act.

5.d AUTHORIZE THE COLLECTION OF MULTI-DWELLING PROPERTY

FIRE AND LIFE SAFETY INSPECTION FEES
Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, authorizing the San Luis Obispo County Auditor to collect fees for 2025-26 Fire and Life Safety Inspections of Multi-Dwelling Properties containing three or more dwelling units on the Secured Property Tax Roll pursuant to California Government Code Section 54988.”

3 5.e 2026-27 ROAD MAINTENANCE RECOVERY ACT (SB1) FUNDING AND

PROJECTS
Adopt a draft Resolution entitled, “A Resolution Adopting a Project List for Fiscal Year 2026-27 funded by SB 1, The Road Repair and Accountability Act of 2017.”

5.f APPROVE A SIDE LETTER REGARDING PARAMEDIC COORDINATOR PAY TO THE JANUARY 1, 2024, THROUGH JUNE 30 2027

MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF SAN

LUIS OBISPO AND THE INTERNATIONAL ASSOCIATION OF
FIREFIGHTERS, LOCAL 3523
Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving a Side Letter to the January 1, 2024, through June 30, 2027 Memorandum of Understanding between the City of San Luis Obispo and The International Association of Firefighters, Local 3523” amending Article 13 – Paramedic Coordinator Pay.

5.g AUTHORIZATION TO AWARD ISLAY STREET SEWER REPLACEMENT, SPECIFICATION NO. 2000170

1. Approve the project plans and special provisions for the Islay Street Sewer Replacement, Specification No. 2000170; and,

2. Award a construction contract (Attachment A) to Souza Construction in the amount of $1,512,539 for the Islay Street Sewer Replacement, Specification No. 2000170; and,

3. Authorize the Finance Director to transfer $250,000 from the Storm Drains Annual Asset Maintenance Account (2090742) to the Islay Street Sewer Replacement Account (2000170); and,

4. Authorize the City Engineer to issue Contract Change Orders up to the available project budget, and up to any amended budget subsequently approved by the City Manager per City Purchasing Policy approval thresholds.

5. Find the action exempt from the California Environmental Quality Act.

5.h FIRE DEPARTMENT’S 2025 ANNUAL REPORT
The City Council receive and file the City of San Luis Obispo Fire Department’s 2025 Annual Report.

4 5.i ADOPT SLO TRANSIT’S FY 2025-26 PUBLIC TRANSPORTATION

AGENCY SAFETY PLAN AND AUTHORIZE EXECUTION OF REQUIRED

FEDERAL TRANSIT ADMINISTRATION CERTIFICATIONS AND

ASSURANCES

1. Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving San Luis Obispo (SLO) Transit’s Fiscal Year 2025-26 Public Transportation Agency Safety Plan”; and

2. Authorize SLO Transit’s Accountable Executive, the City Manager, to sign the FY 2025-26 Public Transportation Agency Safety Plan; and

3. Authorize the City Manager to execute the FY 2025-26 Certifications and Assurances.

5.j AUTHORIZATION TO ADVERTISE REQUEST FOR PROPOSAL FOR

SOUTH BROAD STREET CORRIDOR PLANNING AND
DEMONSTRATION PROJECT, SPEC. NO. 2001070
Vice Mayor Francis declared a conflict on this item due to owning property near the project and recused herself.

1. Authorize the advertisement of a Request for Proposals for design services for the South Broad Street Corridor Planning and Demonstration Project (Specification No. 2001070), in a final form approved by the City Engineer and City Attorney; and,

2. Authorize the City Manager to execute an agreement with the selected consulting firm; and,

3. Authorize the Finance Director to execute and amend purchase orders under the executed consultant agreement in an amount not to exceed the available project budget; and,

4. Authorize the Finance Director to appropriate the awarded Safe Streets for All (SS4A) grant funds to the South Broad Street Corridor project account (2001070).

5 5.k ADOPTION OF ORDINANCE NO. 1757 (2026 SERIES) AMENDING TITLES 5, 16, AND 17 OF THE MUNICIPAL CODE REGARDING

ACCESSORY DWELLING UNITS, JUNIOR ACCESSORY DWELLING

UNITS, URBAN LOT SPLITS, MOBILE HOMES, AND OTHER

CLARIFICATIONS AND CHANGES TO REGULATIONS
Adopt Ordinance No. 1757 (2026 Series) entitled, “An Ordinance of the City Council of the City of San Luis Obispo, California, amending Title 16 (Subdivision Regulations), Title 17 (Zoning Regulations), and Title 5 (Licenses, Permits, and Regulations) of the Municipal Code Regarding Accessory Dwelling Units, Junior Accessory Dwelling Units, Urban Lot Splits, Mobile Homes, and Other Clarifications and Changes to Regulations Associated with Housing, with an Exemption from Environmental Review (CEQA) (CODE-0149-2026)”.

6. PUBLIC HEARING AND BUSINESS ITEMS

6.a ADOPTION OF THE FY 2026-27 BUDGET SUPPLEMENT (120

MINUTES)
City Manager Whitney McDonald, Finance Director Emily Jackson, and Principal Budget Analyst Riley Kuhn provided an in-depth staff report and responded to Council questions.

Public Comments:

Stephen Barasch
Leslie Halls
Leeann Standish
Ermina Karim
Amy-Lynne Hilderbrand
---End of Public Comment---
Motion By Vice Mayor Francis
Second By Council Member Shoresman

1. Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving the Fiscal Year 2026-27 Budget” and approve the allocations as stated in the Budget Supplement document; and

2. Confirmed the cost recovery goals to be used in the FY 2026-27 user fee study; and

6 3. Received a status update on the San Luis Obispo Museum of Art’s (SLOMA) progress related to the City’s Phase 1 grant.

Ayes (5): Council Member Boswell, Council Member Marx, Council Member Shoresman, Vice Mayor Francis, and Mayor Stewart CARRIED (5 to 0)

6.b RECEIVE A PRESENTATION ON FEASIBILITY FOR ADVISORY BODY COMPENSATION (60 MINUTES)
Motion By Council Member Marx
Second By Council Member Shoresman

1. Received a report on the feasibility of implementing a pilot program compensating City Advisory Body Members; and

2. Adopted a draft Resolution amending the Advisory Body Handbook to add a Parking and Food Budget section; and

3. Continued the current system of monetary compensation for only Architectural Review Commission and Planning Commission Members as City employees.

Ayes (5): Council Member Boswell, Council Member Marx, Council Member Shoresman, Vice Mayor Francis, and Mayor Stewart CARRIED (5 to 0)

7. LIAISON REPORTS AND COMMUNICATIONS
Mayor Stewart
 Attended the SLO Food Bank Open House on May 30th
 Attended the quarterly Advisory Body Lunch on May 21st  Attended the Student-Community Liaison Committee Meeting on May 14th
 Attended the Whale Rock Commission on May 28th
 Spent time with one of the Laguna Middle School Community Service Project recipients on May 30th
 Attended the Greek Festival

7 Vice Mayor Francis
 Attended the City's Day of Welcome event for new City employees on May 20th
 Attended the Investment Oversight Committee meeting on May 21st  Attended the celebration of the third year of the SLO Tenants Union on May 31st
 Attended the quarterly Advisory Body Lunch on May 21st Council Member Boswell
 Attended the Community Action Partnership of San Luis Obispo County Meeting on May 21st
 Attended the SLO Food Bank Open House on May 30th
Council Member Marx
 Attended the Air Pollution Control District Meeting on May 20th.  Attended the Veterans Memorial Celebration on May 25th.  Will be attending the County Water Resources Advisory Committee on June 3rd.

Council Member Shoresman
 Attended the History Center of SLO event recognizing Mia Lawrence and the Semi-quincentennial on May 27th
 Attended the SLO Food Bank Open House on May 30th
 Attended the Community Services Awards at San Luis Obispo High School on May 31st

8. ADJOURNMENT
The meeting was adjourned at 9:25 p.m. The next Regular City Council Meeting is scheduled for June 16, 2026 at 5:30 p.m. in the Council Chambers at City Hall, 990 Palm Street, San Luis Obispo.
_________________________
APPROVED BY COUNCIL: XX/XX/202X

Item 6c
Department: Administration
Cost Center: 1021
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Sara Armas, Deputy City Clerk
SUBJECT: 2026 ANNUAL APPOINTMENTS TO CITY ADVISORY BODIES

RECOMMENDATION
As recommended by the Council Liaison Subcommittees, make appointments to the City of San Luis Obispo’s Advisory Bodies as set forth below and continue to recruit for any unfilled vacant positions.

POLICY CONTEXT
The Advisory Body Handbook outlines the recruitment procedures, membership requirements, and term limits for City Advisory Bodies. Also contained in the Advisory Body Handbook are the bylaws for all Advisory Bodies, some of which include additional membership requirements. Additionally, the Council Policies and Procedures Manual describes the “Appointment Procedures” and “Process” for Advisory Body appointments.

Recruitment and appointment recommendations were performed in conformance with all recruitment procedures, processes, and bylaws found in these resources.

California Government Code Section 54972, Local Appointments List (Maddy Act), requires that on or before December 31st of each year, each legislative body shall prepare an appointments list for their boards, commissions and committees whose members serve at the pleasure of the legislative body. This obligation was met and is on-going.

DISCUSSION
The City has a long history of involving its residents and community members in the business of City government. Holding a position on an Advisory Body provides an opportunity for those interested to participate in the governing of their community under guidelines and procedures established by Council. Following approval by City Council at the February 3, 2026 Regular Meeting, the City now conducts its annual recruitment to fill scheduled vacancies and make new appointments each June, with terms to commence on July 1st.

Item 6c
This year, the City recruited to fill 32 scheduled and unscheduled Advisory Body positions.

The recruitment was conducted between February 5, 2026 through March 29, 2026, and a total of 68 applications were received. Council Liaison Subcommittees reviewed applications and conducted interviews between April and May of 2026. The following recommendations will fill 29 positions across the Advisory Bodies.

Note that no vacancies or term conclusions currently exist for the Citizens’ Transportation Advisory Committee or the Investment Oversight Committee. Therefore, no recruitment was held for these Advisory Bodies during this annual recruitment.

Council Liaison Subcommittee Recommendations
Active Transportation Committee
Appoint Lea Brooks and Myesha Thomas to four-year terms commencing July 1, 2026, and expiring June 30, 2030. Additionally, appoint Aidan Wells to assume an unscheduled vacancy, commencing July 1, 2026, and expiring June 30, 2027.

Administrative Review Board
Appoint Linda Mielke to a three-year term commencing July 1, 2026, and expiring June 30, 2029.

Architectural Review Commission
Appoint Robert Arens and Charles Gerencser to four-year terms commencing July 1, 2026, and expiring June 30, 2030.

Citizens’ Revenue Enhancement Oversight Commission
Appoint Jason Brenneman, Vincent Morici, and Christopher Nelson to three-year terms commencing July 1, 2026, and expiring June 30, 2029.

Construction Board of Appeals
Appoint Kraig Crozier to a four-year term commencing July 1, 2026, and expiring June 30, 2030.

Cultural Heritage Committee
Appoint Benjamin Arrona and John Tischler to four-year terms commencing July 1, 2026, and expiring June 30, 2030. Additionally, appoint Mayank Singh to assume an unscheduled vacancy, commencing July 1, 2026, and expiring June 30, 2027.

Housing Authority Board
Appoint Nathan Rubinoff to assume the unscheduled vacancy for the citizen-at-large member, commencing July 1, 2026, and expiring June 30, 2027. Appoint Denise Martinez to assume the unscheduled vacancy for the Tenant Representative position, commencing July 1, 2026, and expiring June 30, 2027. Continue recruitment for the additional vacant citizen-at-large position.

Item 6c
Human Relations Commission
Appoint Catuih Campos to a four-year term commencing July 1, 2026, and expiring June 30, 2030.

Mass Transportation Committee
Appoint Audrey Lariz to the Alternate Representative position, a four-year term commencing July 1, 2026, and expiring June 30, 2030; and continue recruitment for the vacant Senior Representative position and unscheduled vacant Cal Poly Representative position.

Parks & Recreation Commission
Appoint Adam Stowe and Yukie Murphy to four-year terms commencing July 1, 2026, and expiring June 30, 2030. Additionally, appoint Lori Bishop to assume an unscheduled vacancy, commencing July 1, 2026, and expiring June 30, 2028.

Personnel Board
Appoint Chintan Desai to a four-year term commencing July 1, 2026, and expiring June 30, 2030.

Planning Commission
Appoint Juan Munoz-Morris and Mandi Pickens to four-year terms commencing July 1, 2026, and expiring June 30, 2030.

Promotional Coordinating Committee
Appoint Dan Fredman and Megan Souza to four-year terms commencing July 1, 2026, and expiring June 30, 2030.

Tourism Business Improvement Board
Appoint Lori Keller and Clint Pearce to four-year terms commencing July 1, 2026, and expiring June 30, 2030. Additionally, appoint Christopher Morgan to assume an unscheduled vacancy, commencing July 1, 2026, and expiring June 30, 2027.

Tree Committee
Appoint Gage Willey to a four-year term commencing July 1, 2026, and expiring June 30, 2030.

Public Engagement
Notices that the City was accepting applications for the above listed Advisory Bodies were posted on the City’s website and communicated via e-notification to City News subscribers; listed in the annual Local Appointments List (Maddy Act, Government Code Section 54972) on the City website and Information Kiosk outside City Hall; and distributed via City social media outlets.

Item 6c

ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Section 15378.

FISCAL IMPACT
Budgeted: Yes Budget Year: 2026-27
Funding Identified: Yes
Fiscal Analysis:

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $ $ $ $
State
Federal
Fees
Other:

Total $N/A $N/A $N/A $N/A
There is no fiscal impact for the appointment of the above Advisory Body members.

Administration of the process is considered in the City Clerk’s annual budget and compensation for Architectural Review Commission and Planning Commission is included in the adopted budget for the Community Development Department.

ALTERNATIVES
Council could make changes to the recommended appointments or direct staff to re-open recruitment for additional candidates.

ATTACHMENTS
All applications are available for public review by request in the Office of the City Clerk, which can be reached at (805) 781-7114.

Item 6d
Department: Community Development
Cost Center: 4003
For Agenda of: 6/16/2025
Placement: Consent
Estimated Time: N/A
FROM: Timmi Tway, Community Development Director
Prepared By: Eva Wynn, Assistant Planner
SUBJECT: REVIEW OF APPLICATION TO DESIGNATE 207 BROAD STREET AS A

HISTORIC LANDMARK

RECOMMENDATION
Adopt a draft Resolution entitled “Resolution by the City Council of the City of San Luis Obispo, California, designating the Property Located at 207 Broad Street as a Landmark Historic Resource, called the Gary Cully House and John Wilshusen Patio (Application No. HIST-0981-2025),” as recommended by the Cultural Heritage Committee. (Attachment A)

POLICY CONTEXT
The recommended action on this item is supported by historical preservation policies in Section 3.0 (Cultural Heritage) of the Conservation and Open Space Element of the City’s General Plan, including COSE Policy 3.3.1, Historic preservation, which provides that significant historic and architectural resources should be identified, preserved and rehabilitated. The recommended action is consistent with procedures and standards for listing of historic resources provided in the City’s Historic Preservation Ordinance §14.01.

DISCUSSION
Background
The property owners of 207 Broad Street, represented by James Papp, have requested that the property be designated as a Landmark in the City’s Inventory of Historic Resources, as the Gary Cully House and John Wilshusen Patio. The property is currently designated as a Local Register Resource (previously called Contributing1) which is a

1 Master List and Contributing List Resources – The Historic Preservation Ordinance ( §14.01) was updated by Council Ordinance No. 1753 (2025 Series) as part of phase 1 of the Historic Resources Inventory update project which included changes to historic designations. The updated ordinance was introduced December 2, 2025 and adopted January 13, 2026 (effective February 13, 2026). Master List properties are now designated as Landmark resources, and the category of “Local Register” was added in order to be able to recognize properties on the previous Contributing list which have individual significance. Upon adoption of the updated Historic Preservation Ordinance, all Contributing list properties were redesignated as “Local Register” properties pending completion of Phase 2 of the City’s

Item 6d
historic resource that is important locally for its architectural or historical significance or association with important persons or events in the City’s past, according to the criteria outlined in HPO § 14.01.060, and that retains sufficient integrity to convey its significance.

The applicant provided an evaluation of the property and its eligibility for Landmark status (Attachment B), prepared by James Papp, PhD, Historian and Architectural Historian.

A Landmark is a historic resource that
is of the greatest importance at the
local, regional, state, or national level,
in terms of age, architectural or
historical significance, rarity, or
association with important persons or
events in the city’s past, that meets
one or more of the criteria outlined in
HPO § 14.01.060 and that retains a
high degree of integrity. The
submitted evaluation requests the
historic status be elevated based on
the property’s association with a local
blacksmith, Gary Cully, and for the
architectural significance of the rear
patio crafted by John Wilshusen.

Both Gary Cully and John Wilshusen
made notable contributions to the Madonna Inn’s restaurant and office building between 1960 and 1962. Gary Cully also made notable contributions throughout the City and region, including the wave roof of the Santa Maria Airport and courtyard ironwork at 749 & 751 Higuera Street (Attachment B). The submitted application is further summarized and evaluated in the staff report prepared for the Cultural Heritage Committee’s April 27, 2026, Public Hearing.

Pursuant to §14.01.070 of the City’s HPO, the City Council, with a recommendation from the CHC, shall take an action on the application to designate or not designate the property as a Landmark.

Historic Resources Inventory update. The Local Register list will be reviewed in the Historic Resources Inventory update project for their qualification to remain on the Local Register, for possible redesignation to Landmark or Contributing (if in a district), or possible delisting.

Figure 1 - The Cully House
(Courtesy of James Papp)
Figure 2 - The John Wilshusen Patio
(Courtesy of James Papp)

Item 6d
Evaluation of Eligibility - Significance
In the City of San Luis Obispo, resources must meet at least one criterion set forth in §14.01.060 of the Historic Preservation Ordinance to be eligible for inclusion on the Inventory of Historic Resources and retain a sufficient or high level of integrity, depending on the designation type, as Local Register or Landmark. The significance criteria in §14.01.060 include Events, Persons, Architecture, and Information Potential. The HPO provides that the National Register Bulletin No. 15: How to Apply the National Register Criteria for Evaluation should be consulted when evaluating and determining significance of a property.

The Historic Evaluation (Attachment B) requests that the residence at 207 Broad Street be elevated to Landmark designation for its association with Gary Cully (Significance Criterion - Persons) and for the architectural significance of the patio that exhibits John Wilshusen’s masonry craftsmanship (Significance Criterion - Architecture). The evaluation states that Cully and Wilshusen were master craftsmen, regionally significant for their work on the Central Coast and in the City of San Luis Obispo (pg. 2, 42). The evaluation includes a description of the architectural style of 207 Broad Street, noting its embodiment of the Lutyensesque Revival which is a style of Tudor Revival developed by Sir Edwin Lutyens in the 19th Century which emphasized special geometry with blank wall space, clustering windows, and using shallow eaves (pg. 29).The evaluation does not state that the property is significant due to its association with any events that have made a significant contribution to local, state, or national cultural heritage or for the property’s potential to yield information important to the history of the area, state, or nation.

According to the HPO, a property that is eligible for Landmark designation by association must be among the most important resources at the local, regional, state, or national level in terms of their respective significance criteria. The submitted Evaluation (Attachment B) documents the work of Gary Cully on the Central Coast, compiling records and evidence of his work on the Madonna Inn, the Santa Maria Airport, and throughout the City of San Luis Obispo. Some of Cully’s work in the region has been removed and can only be seen in photographs, including the Madonna Inn’s weathervane, the wrought iron railing at 665 Marsh Street, and an iron door at 280 Higuera. Other pieces of his craftsmanship are still standing, such as the ironwork framing the courtyards at 749-751 Higuera Street.

Evaluation of Eligibility - Integrity
According to the HPO and consistent with the National Register Bulletin No. 15, integrity is defined as “the ability of a historic resource to convey its significance, typically evidenced by the retention of attributes that existed during a resource’s period of significance and including location, design, setting, materials, workmanship, feeling, and association” (HPO 14.01.020 (26)). The Historic Evaluation (Attachment B) provides an analysis of integrity indicating the location, setting, design, materials, and workmanship, are unchanged from the 1964-2007 period of significance for its association with Gary Cully; and the feeling and association are retained. The evaluation notes that the water

Item 6d
feature on the northern side of the Wilshusen patio was a later addition by another craftsperson, but the original segments of stonework retain its ability to communicate its significance (pg. 41). The majority of physical features present during Cully’s association with 207 Broad Street appear to be retained.

Previous Council or Advisory Body Action
On April 27, 2026, the Cultural Heritage Committee (CHC) considered this request and, by a vote of 5-1 (one seat is vacant), recommend the City Council elevate the property at 207 Broad Street, whose name is also recommended to be referred to as the "Gary Cully House and John Wilshusen Patio", to Landmark status in accordance with the City's Historic Preservation Ordinance based on the following findings:
a) The architectural significance of the exterior's Tudor Revival style, specifically described as Lutyensesque Revival, and distinctive brick veneer siding. b) The architectural significance of the exterior stonework on the patio, and potential significance of the steps leading to the property, crafted by John Wilshusen who notably contributed the renowned stonework at the Madonna Inn, another Landmark property in the City’s inventory. c) The property's association with Gary Cully, a local craftsman whose notable work includes the ironwork on the Madonna Inn, the parabolic wave roof at the Santa Maria Airport, and the ironwork framing the courtyard at 749 & 751 Higuera (Local Register Resource).

The majority of committee members agreed that the property’s associations, prominent architecture, and craftsmanship of the patio provide adequate justification to elevate the property to Landmark status. The motion to recommend City Council approve the Landmark request was passed on a 5-1 vote (Committee Member Blakely voting no).

During deliberation, Committee Member Blakely expressed concerns regarding the request to elevate the property to Landmark, particularly with the requirements that Landmarks are as among those of the greatest importance to the City. Member Blakely recognized that the property is locally important but argued that the resource is sufficiently recognized and protected as a Local Register Resource, and its associations and architecture do not justify elevating the property to Landmark status.

Public Engagement
Public notice of this hearing has been provided to owners and occupants of property near the subject site, and published in a widely circulated local newspaper, and hearing agendas for this meeting have been posted at City Hall, consistent with adopted notification procedures. Public notice was also previously provided for the Cultural Heritage Committee meeting of April 27, 2026.

ENVIRONMENTAL REVIEW
This project is categorically exempt from the provisions of the California Environmental Quality Act (CEQA). Inclusion of the subject properties on the City’s Inventory of Historic

Item 6d
Resources does not have the potential for causing a significant effect on the environment and so is covered by the general rule described in Section 15061 (b) (3) of the CEQA Guidelines.

FISCAL IMPACT
Budgeted: No Budget Year: 2025-26
Funding Identified: No
Fiscal Analysis:

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $ N/A $ $ $
State
Federal
Fees
Other:

Total $ N/A $0 $0 $0
Adding the property to the Inventory of Historic Resources will have no fiscal impacts.

Historic designation of property itself has no bearing on City fiscal resources.

ALTERNATIVES

1. Council could decline to designate the property as a Landmark in the Inventory of Historic Resources. This decision would require Council to adopt a resolution with the finding that the property is not considered to be among those resources of the greatest importance to the City or does not retain a high degree of integrity to justify elevating the property to Landmark status. If the property is not elevated to Landmark status, the property would remain in the Inventory as a Local Register Resource.

2. Continue consideration of the request for additional information or discussion.

This alternative would allow the City Council to request additional information to aid in determining whether the property should be designated as a Landmark.

ATTACHMENTS
A - Draft Resolution designating 207 Broad Street as a Landmark in the City’s Inventory of Historic Resources
B - Historic Resource Evaluation, The Cully House at 207 Broad Street (James Papp, PhD)

R ______
RESOLUTION NO. XXXX (2026 SERIES)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS

OBISPO, CALIFORNIA, DESIGNATING THE PROPERTY LOCATED AT 207 BROAD STREET AS A LANDMARK HISTORIC RESOURCE,

KNOWN AS THE GARY CULLY HOUSE AND JOHN WILSHUSEN PATIO
(APPLICATION NO. HIST-0981-2025)
WHEREAS, the applicants, Richard and Ginger Silva, filed an application on December 16, 2025, for review of the inclusion of the property at 207 Broad Street on the City’s List of Historic Resources as a Landmark; and
WHEREAS, the Cultural Heritage Committee of the City of San Luis Obispo conducted a public hearing in the Council Hearing Room of City Hall, 990 Palm Street, San Luis Obispo, California on April 27, 2026, and recommended that the City Council designate the property at 207 Broad Street as a Landmark Property on the City’s Inventory of Historic Resources; and
WHEREAS, the City Council of the City of San Luis Obispo conducted a public hearing on June 16, 2026, for the purpose of considering the request to designate the property on the Inventory of Historic Resources as a Landmark; and WHEREAS, notices of said public hearings were made at the time and in the manner required by law; and
WHEREAS, the City Council has duly considered all evidence, including the record of the Cultural Heritage Committee hearing and recommendation, and the evaluation and recommendation prepared by staff.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows:

SECTION 1. Findings. Based upon all the evidence, the City Council recognizes the property’s eligibility for Landmark Designation in accordance with the Historic Preservation Ordinance of the Municipal Code based on the following findings:
a) The architectural significance of the exterior's Tudor Revival style, specifically described as Lutyensesque Revival, and distinctive brick veneer siding. b) The architectural significance of the exterior stonework on the patio, and potential significance of the steps leading to the property, crafted by John Wilshusen who notably contributed the renowned stonework at the Madonna Inn, another Landmark property in the City’s inventory. c) The property's association with Gary Cully, a local craftsman whose notable work includes the ironwork on the Madonna Inn, the parabolic wave roof at the Santa Maria Airport, and the ironwork framing the courtyard at 749 & 751 Higuera Street (Local Register Resource).

Resolution No. XXXX (2026 Series) Page 2
R ______
SECTION 2. Environmental Determination. The project is categorically exempt from the provisions of the California Environmental Quality Act (CEQA). Inclusion of the subject property on the City’s Inventory of Historic Resources does not have the potential for causing a significant effect on the environment, and so is covered by the general rule described in 15061 (b) (3) of the CEQA Guidelines.

SECTION 3. Action. The City Council of the City of San Luis Obispo does hereby designate the property located at 207 Broad Street as a Landmark Resource, referred to as “The Gary Cully and John Wilshusen Patio”.

Upon motion of Council Member ___________, seconded by Council Member ___________, and on the following roll call vote:

AYES:

NOES:

ABSENT:

The foregoing resolution was adopted this _____ day of _______________ 2026. ___________________________
Mayor Erica A. Stewart
ATTEST:
______________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
______________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, on ______________________. ___________________________
Teresa Purrington
City Clerk

1 Landmark Application
The Gary Cully House and John Wilshusen Patio
207 Broad Street, San Luis Obispo
Summary Conclusion
The Cully House and Wilshusen Patio at 207 North Broad Street qualify as a San Luis Obispo Landmark as among the city’s rarest and most important historic resources in terms of

1. historic significance, for their association with an important person in the city’s past during his period of significance: master craftsman Gary Cully (1931–2022), a regionally important art and structural blacksmith and exponent of revival, Modernist, and Postmodernist metalwork, who formed part of the craftsman triumvirate with woodcarver Alexander Zeller and stonemason John Wilshusen that has made San Luis Obispo’s Madonna Inn world-renowned Attachment B Page 33 of 546
2 2. architectural significance, for the patio’s masonry by master craftsman John Wilshusen (1926–2003), whose stonework appears from Southern to Northern California but predominantly on the Central Coast and most prominently at Madonna Inn
The property has been on the Contributing List since 1998, presumably for the primary residence’s “Tudor Revival” or “Provincial” architecture (the DPR 523 gives both descriptions, the Historic Resources Inventory lists neither). In fact, it embodies the eaveless, more simply fenestrated, and spatially more geometric revival architecture innovated by Sir Edwin Lutyens in the late nineteenth century and popularized for the expanding American suburbs after World War I.

Landmarking—subject to the class biases of its society and society’s documentation—tends to honor architects rather than craftspeople. But National Register Criteria for Evaluation allow for the recognition of “the work of a famous architect or an unknown master craftsman.” In the case of the Cully House, the master craftsmen are known, and the purpose of this Landmarking is in part to seek documentation and recognition of their work. Both Wilshusen and Cully were instrumental in creating the SLO Landmark Madonna Inn, which, with National Historic Landmark Hearst Castle, is one of the two most renowned Central Coast monuments, yet their association with it is almost never mentioned. In addition, their work—and that of Madonna Inn woodcarver Alexander Zeller—appears throughout the region.

The period of significance of the Cully House and Wilshusen Patio extends through Gary Cully’s residence there from 1964 to 1977, when John Wilshusen, who worked with Cully on Madonna Inn, constructed the patio; to 2007, when Gary Cully’s son Brian constructed the dormer that Gary Cully had earlier designed for the house.

The integrity of the house and patio in location, setting, design, materials, workmanship, feeling, and association are excellent, fully retaining their ability to communicate their significance.

Submitted 11 December 2025 on behalf of Ginger and Richard Silva by James Papp, PhD | Historian and Architectural Historian, City & County of San Luis Obispo 964 Chorro Street, San Luis Obispo, CA 93401 | 805-470-0983 [email protected]
on behalf of Ginger and Richard Silva

3 Table of Contents
I. Summary Conclusion 1
II. Chronology: 207 Broad 4
Gary Cully 7
John Wilshusen 14
Alexander Zeller 18
III. Architectural Historical Context: Modernist Arches 24 IV. Architectural Historical Context: The Lutyensesque Revival House 29 V. Period of Significance 31
VI. Significance: Association with Gary Cully, Revival, Modern, and Postmodern 32 Master Craftsman of the Greatest Importance to the Region VII. Significance: John Wilshusen’s Late-Twentieth-Century Stonemasonry 39 Masterwork of Greatest Importance to the Region
VIII.Integrity 41
IX. Conclusion 42

4 Chronology: 207 North Broad
1922 Oct 2 George Anholm sells the property in the Venable Tract that will later include the lot at 207 Broad Street to Carlos Serrano and wife Clofes Quintana Serrano (“Sells Grazing Land,” San Luis Obispo Daily Telegram, 27 June 1922, p. 5).
1927 Aug 8 Carlos and Clofes Serrano sell the property that will contain 207 Broad to Clair Gore and wife Velma Jane Gore (“Deeds,” Daily Telegram, 16 Aug. 1927, p. 7).
1927 Sep 8 A note on a “residence, temp. & garage” building permit application for Clair Gore has a note “located out beyond Lyle Carpenter,” suggesting Carpenter has already built the house at 239 Broad.
1929 July 8 Clair and Velma Gore sell the future 207 Broad property to Merlyn F.

Carpenter and wife Bernice Carpenter (“Deeds,” Daily Telegram, 17 July 1929, p. 3).
1932 Aug 22 Lyle Carpenter, thirty years later a member of the County Board of Supervisors, submits applications to raze a garage and build a brick veneer garage with room above, further suggesting he has already built the 239 Broad property.
1936 July 27 Merlyn and Bernice Carpenter sell the 207 Broad property to Merlyn’s brother Lyle F. Carpenter and wife Olive Carpenter (Deed transfer, County Records Office, 27 July 1936 ).
1936 The house at 207 Broad Street is built for Lyle F. and Olive Carpenter by contractor George W. Bates, who is advertising architect-designed, custombuilt homes. It uses brick veneer from the Faulstich yard at 1124 Broad Street. Multiple properties are developed on the lot originally sold by George Anholm to the Serranos, and there is no evidence Lyle and Olive Carpenter ever live at 207 Broad. From 1938 and 1942, city directories and the 1940 US Census documents them living at 239 Broad (San Luis Obispo Building Permits Collection, Special Collections and Archives, Cal Poly San Luis Obispo).
1938–1940 Mr. and Mrs. W. P. MacQuiddy and daughter Charleen are living at 207 North Broad ("Children Enjoy Birthday Party at MacQuiddy Home,” TelegramTribune, 12 Aug. 1938, p. 2; “Contact Club Entertained,” Telegram-Tribune, 19 June 1940, p. 2).
1941–1942 Optometrist Frederick Fabrick and wife Elsie are living at 207 North Broad (“Mrs. Adda Coe Dies in SLO,” Telegram-Tribune, 13 Oct. 1941, p. 8; 1942 City Directory).
1949–1952 Southern Pacific brakeman Bert Willmirth and wife Nellouise M. Willmirth live at 207 North Broad (Telegram-Tribune: “AAUW Music Section to Discuss Ballet,” 11 J. 1949, p. 2; “AAUW Music Section,” 25 Feb. 1952, p. 2).

5 1953 Farm Credit Association field representative Peter Weber and wife Josephine Weber are living at 207 North Broad (“Vital News,” Telegram-Tribune, 22 Sep. 1956, p. 2).
1963 Mushroom farmer Jon Hudson Peterson and wife Susan Patitucci Peterson are living at 207 Broad (“Gaelic Welcome Extended to Babies Born Last Week,” Telegram-Tribune, 18 Mar 1963, p. 4).
1962–1964 207 Broad is put on the
market as a two-bedroom
custom-built brick home
(Telegram-Tribune, 4 Dec
1962–25 Jan 1963, right, and
27 Feb–6 Mar 1964, below).
1964 Gary Cully is living at 207 Broad (“Arrest Made in Car Theft,” TelegramTribune, 10 Apr 1964, p. 2). 1967 May 3 Jon Hudson Peterson and wife Susan Patitucci Peterson transfer 207 Broad Street to Gary Cully and wife Barbara Franklin Cully (County Land Records). 1973 Apr 5 The Planning and Building Department tries to resolve the matter of an illegal second story addition by Cully on the back of the house. The matter continues to an application expired by limitation 17 Jan. 1974, and it is unclear from the address file how it is resolved.
1977 Gary Cully and Barbara S. Franklin divorce in 1977. 1981 Cully lists his address as 945 Del Rio (“Public Notice,” Telegram-Tribune, 31 Dec. 1981, p. 18).
1983 Aug 13 The city issues a permit for grading and retaining wall constructed by Whitey’s Masonry, presumably the non-Wilshusen work in the front of the house.
1992 Fine handmade pottery is being advertised at 207 Broad, made by Brian Cully (“SLO Sat: 9 am,” Telegram-Tribune, 22 Aug 1992, p. E3). 1994 Barbara F. and Kristin M. Cully are doing business as Educational Advancement Technologies from 207 Broad (“Public Notices,” TelegramTribune, 9 Sep 1994, p. B9). 1998 Apr– 207 Broad is offered for sale for $375,000 (“SLO: Charming vintage brick June home, 4 bedroom, 2 bath,” classified ads, Telegram-Tribune, Apr 26–June 6)

6 Aug 18 The City Council adds 207 Broad to the Contributing List with other properties in an envisaged Anholm–Mount Pleasanton Square historic district (Council Resolution 8839, 1998 series).
2000 July 27 Property owner Emily J. Campbell receives a permit for new sheathing for reroofing. 2001 207 Broad, described as “charming and restored 4 bedroom, 1¾ bath brick home,” is put on the market for $485,000 (“207 North Broad,” Tribune, 21 July 2001, Real Estate Weekly, p. 40).
2007 Sep 21 Owner Bryce Prunty receives a permit for Brian Cully’s Cully Construction to install the street-facing dormer originally designed by Gary Cully. 2010 207 Broad is put on the market for $969,000 as “4 Bedrm/1 ba” (Tribune, 5 Nov 2010, E3).

7 Chronology: Gary Cully
1931 Apr 18 Gary Dean Cully is born in Texas to David L. and Lucille M. Cully, who soon after move to California.
1940 Apr 10 The US Census records the Cully family on West Avenue 43 in the Mount Washington area of Los Angeles and as having lived in Los Angeles at least since 1935 (Enumeration District 60-1139, sheet 8A). David Cully works as a bookkeeper for a wholesale grocer.
1950 Mar 2 According to the US Census, David Cully, a wholesale dairy products salesman, is living with his wife Lucille and three younger sons in Atascadero (Enumeration District 40-12, sheet 38). Various newspaper reports and advertisements through the 1940s and 1950s show the Cullys ranching in Santa Margarita (“For sale—Cow and calves. About six acres grain,” For Sale, 10 May 1944, p. 9), Atascadero (Tri-County Hereford Association, advertisement, Telegram-Tribune, 23 Jan. 1923, p. 12), and Adelaida (“No trespassing will be allowed on Cully ranch,” Notices, Telegram-Tribune, 16 June 1955, p. 20), as well as living at urban addresses in San Luis Obispo and Baywood.

Aug Gary Cully wins 3rd, registered palomino mares, four years and older, district fair (“Fine Horses Shown at Fair,” Telegram-Tribune, 29 Aug. 1950, p. 7). 1951 Gary Cully completes naval recruit training in San Diego (“SLO County Men in Service,” Telegram-Tribune, 10 Jan. 1951, p. 10).
1952 Cully serves as an airman on the aircraft carrier USS Antietam with his elder brother John, an aviation machinist’s mate (“Cully Brothers,” TelegramTribune, 6 May 1952, p. 14). 1958 Gary Cully, having served in the US Navy and attended Cal Poly, advertises hot and cold horseshoeing, his first documented step in becoming a leading art and architectural blacksmith in San Luis Obispo (“Farmer’s Column,” Telegram-Tribune, 18 Oct 1958, p. 10).
1959 Cully opens his blacksmith shop at 286 Higuera, which he will occupy till the building is condemned by the city in 1985. At the corner of Bianchi Lane and confluence of High and Pismo Streets, his nighttime work on the forge becomes a spectacle for generations of Obispans stopped at the traffic light. 1960 July 11 The city grants a permit for Madonna Inn’s half-million-dollar restaurantoffice building (“Madonna Issued Building Permit for Restaurant,” TelegramTribune, 11 July 1960, p. 2). A 17 Oct. photo in the Telegram-Tribune shows masonry and framing well advanced (“Barbecue for Employees, p. 14). The first event takes place 10 June 1961, and finish work continues into 1962.

Cully creates the wrought iron for the new building, including post and beam brackets, horseshoe andirons for the lobby, a fire screen for the Copper Café, door hardware, an arched trellis for the Venetian Room, and a monumental stagecoach and horses weathervane for the needle spire.

8 1964 Gary Cully is living at 207 Broad (“Arrest Made in Car Theft,” TelegramTribune, 10 Apr 1964, p. 2). Wife Barbara Cully will be an Atascadero Junior High School teacher for thirty-one years (Candice Reed, “Los Angeles Native Finds Home for Her Horses, Dogs in Santa Margarita,” Tribune, 13 Aug. 2016, LH 49). The Cully family will live in the house until 1998, raising a second generation of artists, including potter Brian and aerial photographer Dean.

9 1965 Cully is manufacturing “beautiful and artistic hand wrought ornamental iron” in porch columns, grilles, balconies, stairs, hand rails, fire escapes,” etc. (“Cully Manufacturing Company,” Grover City Press, 5 Feb 1965, p 5). 1966 Cully patents a barbecue (“Show
Features Tips for Homes,” Arroyo
Grande Valley Herald Recorder, 26
May 1966, p. 1).

Cully, of Art-In-Iron, collaborates
with John Ross, AIA on the San Luis
Obispo National Bank (now Wells
Fargo) at 665 Marsh, described as
“Early California Cash Box”
(Emmons Blake, “Printer’s Ink,”
Telegram-Tribune, 19 Nov 1966, p.
2). Cully’s contribution (right) is the
wrought iron railing around the
circular mezzanine, which has since
been replaced with something less
interesting. (Photograph by Larry
Jamison from “Doorway to Spain”
and “Spain Leaves Her Mark,” photo
essay in Telegram-Tribune Focus
section, 8 Aug. 1970, pp. 13 and 20.)
1969 Art-In-Iron is sufficiently well known that the new Iron Door Basque Restaurant at 280 Higuera advertises its location as next to it. The iron door is a Cully work.

Cully produces the ironwork for the new Spanish-Mediterranean-style Holiday Inn at Santa Maria (“Many Hands Worked on Facility,” Santa Maria Times, 30 May 1969, p. 8).

The 1971 opening of the Santa Maria Public Airport terminal, topped by the Observation Platform’s radiate parabolic wave roof, whose steel structure was engineered by Fred Schott and fashioned by Gary Cully

10 1971 Gary Cully becomes the sole bidder to attempt the steel framework for the wave-pattern and trapezoidal roof of the Santa Maria Public Airport terminal’s second-floor observation platform (previous page), designed by structural engineer Fred Schott (Brian Cully interview [15 Aug 2023]).

June Cully is doing business as Cully Manufacturing Company at 286 Higuera, with his home address 207 Broad Street (“Legal Notice,” Telegram-Tribune, 18 June 1971, p. 5).

July 20 A truckload of 80-foot-long radiate segmental arch beam assemblages fabricated by Cully for the Santa Maria Public Airport terminal’s Observation Platform roof makes front-page news in San Luis Obispo after it bumps a power pole outside Cully’s Higuera workshop and gets temporarily stuck (“Traffic Stopper,” Telegram-Tribune, 21 July 1971, p. 1; photo by Bruce Judson).
1972 Cully wins contract for 11-foot steel hairpin standards for San Luis Obispo’s downtown directional signs (“Downtown to Get New Style Signs,” TelegramTribune, 20 Apr 1972, p. 3). 1979 Creates the elaborate wrought iron gates, fences, and grilles for the transformation of John Ross’s Mid-Century Modern Lacterman’s (below, Telegram-Tribune, 29 Apr. 1959, p. 9) into the Postmodern Marshall’s and Magnuson’s (photographs next page).

11 The glass-walled, concrete-screened Ross design was replaced by artist Richard Yaco and architect Steve Puglisi’s forecourts screened with Gary Cully’s wrought iron. 1985 Cully collaborates on ironwork for Price Street Plaza, a new four-story commercial and office complex at Price Street and Price Canyon Road in Pismo Beach (“Price Street Plaza: A Slice of Ghirardelli Square,” Five Cities Times-Press-Recorder, 3 May 1985, pp. 9–10, advertisement p. 10) (photograph next page).

12 Ocean-view Price Street Plaza emphasizes outdoor spaces and railings The city’s condemnation of Cully’s smithy, and the reluctance of the county to let him reopen on Tank Farm Road near San Luis Obispo, becomes a cause célèbre (Telegram-Tribune: Dan Stephens, “Blacksmith Says Craft Being Banished to the Countryside,” pp. 1A–4A; “Find the ‘Smithy’ a Home,”, 31 Dec 1985, p. 10A; Robert C. Jones, MD, “Open-Minded Approach Needed for Blacksmith,” 23 Jan. 1986, p. 6B). Eventually, the county relents. 1989 Cully remains at his blacksmith shop in the 600 block of Tank Farm Road (“Police/Fire,” Telegram-Tribune, 8 Aug 1989, p. 5).
1998 Feb 8 Gary Cully’s sons, photographer Dean and potter Brian Cully, exhibit at the Ridiculous Dreams Art and Fashion Show at the Forum on Marsh Street, their first show noticed in the press (Michael Ray, “Fashion, Art Show Brings Dreams to Life,” 6 Feb 1998, p. B5).

Cully, working for Hoffman Associates, inspects rebar in 2000 (“Under Construction: Cal Poly Parking Structure, Tribune, 28 June 2000, p. B1). Photo by David Middlecamp.

13 2022 Gary Cully dies age 91.

Gary Cully in his 286
Higuera blacksmith shop,
December 1985. Photograph
by Tony Hertz, TelegramTribune.

14 Chronology: John Wilshusen
John Wilshusen’s obituary in the San Luis Obispo Tribune notes that he “was plagued with [paranoid schizophrenia] for most of his middle years. Life was not easy for him, and his family did not expect to see a change after this” (“John Wilshusen,” Tribune, 3 Oct. 2003, B2). He was diagnosed only after he moved to Idaho toward the end of his life, getting on “a program that worked for him, getting both his mind and spirituality back in balance […] like the ‘prodigal son’ who returned. His family and friends are happy to see him finish his life with dignity.” The following timeline should be understood within this context. 1926 Jan 7 John Arthur Wilshusen is born in Garden City, Kansas, the Finney County seat, to George and Lena Halpieu. George Wilshusen was born in Stafford County in 1903 and Lena Halpieu in Finney County in 1904 (1905 Kansas State Census). By the time John was born, the population of Garden City, founded with two houses in 1878, was about 5,000 (US Census 1920 and 1930).
1935–1936 During the Dustbowl, Finney County suffers severe wind erosion, and the Wilshusen family moves to California (“John A. Wilshusen,” Idaho State Journal, 6 Aug. 2003).
1937 The Wilshusen family arrives in Paso Robles (“Lena B. Cully,” TelegramTribune, 3 Jan. 1990, B-7). 1944 Jan 22 John Wilshusen, living in Garden City, Kansas, and working for the Watchtower Bible and Tract Society of New York, affiliated with the Jehovah’s Witnesses, registers for the draft. He is 5 feet 11 inches and 175 pounds (Draft Registration Card and Registrar’s Report, Local Board No. 1, Finney County, Kansas). His parents are living in Paso Robles, but John has moved back to Garden City, according to his obituary, to take care of his grandfather, “John Halpieu, the village blacksmith, for his grandmother and Aunt Nell, who needed a strong hand.” His grandparents and aunt were Jehovah’s Witnesses, as were his parents.
1946 July 26 George Wilshusen dies, age 42 (California, Death Index, 1940–1997, familysearch.org).

John Wilshusen marries Alice Smith (“John Wilshusen,” Tribune, 3 Oct. 2003). 1948 John and Alice Wilshusen are living at 544 Higuera Street, San Luis Obispo, at the birth of the first of their four children, Joyce (“Vital News,” Telegram, 2 Jan. 1848, p. 8).
1949 Oct 14 Son Jorge is born in San Luis Obispo.
1953 Alice Wilshusen files for divorce from John Wilshusen for extreme cruelty (“Vital News,” Telegram-Tribune, 30 oct. 1953, p. 2).
1954 Mar 15 Daughter Judy is born in San Luis Obispo (California, Birth index, 1905–1995, familysearch.org).
1956 Jan 11 Son James is born in San Luis Obispo.

15 1958 John and Alice Wilshusen live at 504 Vera Cruz Avenue, Santa Barbara (“A Four Generation Affair,” Santa Barbara News-Press, 25 Feb. 1958, p. A-13). 1960 Alice Wilshusen receives and interlocutory decree of divorce from John Wilshusen (“Divorces,” Santa Barbara News-Press, 20 May 1960, p. B-9). 1960 John Wilshusen commences as the stonemason for Madonna Inn’s restaurant-office building. The first Telegram-Tribune photograph of the interior, two days before the inaugural event, is of Wilshusen’s “huge stone fireplace,” with Paul Plantz, Phyllis Madonna, and Kenneth R. Holmes posing before it (“Designed for a King,” 8 June 1961, p. 6).
1966 John and Alice Wilshusen are living in Atascadero at the birth of a daughter (“Births,” Telegram-Tribune, 5 Oct. 1966, p. 26), who apparently does not survive. From 1966 through the 1980s, city directories show Alice Wilshusen living in Santa Barbara. The children move to Santa Barbara with her.

The Telegram-Tribune writes about and pictures a “giant fireplace and window seat” crafted by John Wilshusen of undersea jade found off the Monterey coast (“Porter Dove for Abalone, Found Jade,” Telegram-Tribune, 29 Jan. 1966, p. 2).

16 Ernest C. Porter with his Wilshusen fireplace; the dark stones are undersea jade from off the coast of Monterey (Telegram-Tribune, 29 Jan. 1966, p. 2) 1969–1970 John Wilshusen constructs the Cully House’s backyard wall, bench, steps, and towering outdoor fireplace (text interview, Kristin Cully, 4 Dec. 2025). 1989 John’s mother Lena dies at 85 in Paso Robles, where John and his brother Larry are also living (“Lena B. Cully,” Telegram-Tribune, 3 Jan. 1990, B-7). 1999 The Tribune describes and pictures work of Wilshusen and other craftsmen at Inn Paradiso, which Rochelle Harringer started renovating in 1995. (“Paradise Found: The Uniquely Styled Inn Paradiso Started As a Dream for Rochelle Harringer,” Tribune, California Dreaming 2002 pp. 45–49). “In her home, the stonework for the grandiose fireplace and throughout the house was crafted by John Wilshusen, the same artisan who set the stones for the Madonna Inn in San Luis Obispo. The master bathroom looks like a set from The Hobbit. A pile of stones forms the base of the toilet, which is topped by a hand-carved, burl wood seat. The water tank and pipes are hidden by more carved wood, creating the illusion that one pulls a tree branch to flush.

The sink is solid redwood, carved into a bowl. A sunken tub and shower are

17 made of the same stones as the toilet bowl, floor, and walls. ‘It feels like you’re taking a shower in a river,’ Harringer said” (p. 47). 2003 Aug 3 John Wilshusen dies at age 77 in American Falls, Idaho, near his son Jorge (“John Wilshusen”).

Left: John Wilshusen pictured
in his obituary; right: his
handprint at the top of the
cave-form former telephone
booth by the Venetian Room
at Madonna Inn

18 Chronology: Alexander Zeller
1908 Sep. 10 Alexander Zeller is born in Munich to Joseph Zeller, an artist specializing in Alpine landscapes, and Maria Zeller (USA Petition for Naturalization, form 2020—L-A, No. 53310).

Ca. 1910 Emigrates to Argentina with his family, where he receives his early education, later returning to Germany, according to a Telegram-Tribune profile (“Noted Wood Carver Commissioned for Special Work at Madonna Inn,” 15 Mar. 1961, p. 12).
1924 Apr. 6 At age 15, Alexander immigrates to America with his parents and younger sister Maria, arriving in New York from Hamburg on the S.S. Deutschland (USA Petition).
1924 May Arrives in Los Angeles (ibid.).
1930 Apr 9 US Census lists Joseph Zeller, 57, picture artist; Maria Zeller, 46; Alexander Zeller, 21, furniture woodcarver; and Maria Zeller, 19, picture artist, living in an owned house worth $20,000 with ADU renting at $20 per month at 3507 S. Flower St., Los Angeles (Enumeration District 19-7[1?]590, sheet 9-A).

Joseph Zeller will replace Alpine landscapes with similarly anodyne Yosemite landscapes in his oeuvre.
1936 Dec 18 Alexander Zeller petitions in Los Angeles for US citizenship (USA Petition). In a 15 Sep. 1936 declaration of intention for US citizenship, he lists his occupation as woodcarving and address as 856 S. Loma Street, Garvey Acres, El Monte (No. 66531)
1937 Mar 26 Zeller is naturalized as a US citizen (Oath of Allegiance, reverse of 1936 Dec 18 USA Petition).
1940 May 8 US Census lists Alexander Zeller living with his parents in an owned house on Franklin St. in San Juan Bautista and working as a statuary woodcarver (Enumeration District 35-10, sheet 4B.
1941 Oct 24 Alexander Zeller registers for the draft, address general delivery, San Juan Bautista and employer Bailey-Schmitz, a mattress manufacturing company at 2107 E. Seventh St., Los Angeles (serial no. 1650, order no. 698-A).

WWII Serves in the US Army as a private first class (gravestone, findagrave.com).

The Telegram-Tribune article cites 5 years of wartime service in the US Army (“Noted Wood Carver”).
1948 Oct 12 Joseph Zeller dies. His obituary mentions that he was also a woodcarver as well as painter and that his son Alexander carved the street signs of San Juan Bautista (“Joseph Zeller, San Juan Artist, Claimed by Death,” Hollister Advance, 15 Oct. 1948, p. 1). Over 75 years later, the town appears to have the same hand-carved street signs, whose abbreviation “Str.” echoes the German abbreviation for “Straße” (photograph next page).

19 1950 Apr 27 US Census lists Alexander Zeller with his mother and California-born wife Elfreda on
Washington St. in San Juan Bautista, working
as a woodcraftsman in private homes
(Enumeration district 32112, sheet 13).
1960 Zeller begins woodcarving work at Madonna
Inn, to continue for over two years
(“Unusual Front Door in Napa,” [Vallejo]
Times-Herald, 15 Aug. 1965, p. 19; Seward
Bartley, “Wood Carver Logs Another
Achievement,” [Hollister] Evening Free
Lance, 29 Mar. 1972, p. 1).
1961 Mar 15 The Telegram-Tribune profiles Zeller,
“renowned San Juan Bautista sculptor now
engaged in carving intricate designs on huge
wooden beams at Madonna Inn’s new
restaurant-office building.” It predicts his
work will take six months.

June 10First event takes place in the new building,
the Mission School Century Dinner in the
wine cellar (now Venetian Room), which
attracts 600 guests (“Century Dinner for
Mission to Bring over $20,000,” TelegramTribune, 13 June 1961, p. 16). Over the following weeks, other rooms open. Above: San Juan Bautista street sign, Google street view
Left: Zeller at Madonna Inn
Soon after, Alexander Zeller
dies—according to Madonna
Inn’s website: “Tragically, Mr.

Zeller fell ill shortly after the
Inn’s grand opening in 1961
and passed away before he
was able to finish all the pieces
intended for the property.

Rather than find another artist
to complete the work, Mr. and
Mrs. Madonna felt it most
respectful to display the work
unfinished—to the dear Mr.

20 Chips” (madonnainn.com/blog/2020/2/26/a-tribute-to-mr-chips [29 July 2025]).

In fact, Zeller falls out with Alex Madonna over the latter’s pressure to work faster, causing him to quit (interview with Brian Cully [15 Aug. 2023]; text interview with Kirstin Cully [4 Dec. 2025])—and lives another thirty years. 1972 While carving the Teledyne-McCormick-Selph corporate sign into a 21’x4.5’ redwood log, Zeller estimates he has trained over 200 woodcarvers (Seward Bartley). One of these, Capitola signmaker Gary Rhodes, wins third place out of one thousand entries for the national Signs of the Times contest (John McNicholas, “Former ‘Artistic Klutz’ Now Shows Some Signs of Success,” Santa Cruz Sentinel, 11 Apr. 1982, p. 5).
1975 May 19 Zeller touches up the “spectacular Alexander Zeller mural” on the north wall of the 1952 VFW building in San Juan Bautista, presumably painted around the time of the building’s construction.
1983 Now 74, Zeller carves the double street doors to the second story of the Landmark restored central tower of the Johnson Block at Chorro and Higuera

21 in San Luis Obispo (Nancy Lewis, “Renovation of Building Marked with Dedication,” Five Cities Times-Press-Recorder, 19 Aug. 1983). 1991 Jul 14 Alexander Zeller dies in San
Juan Bautista (gravestone and
Social Security Death Index).

Right: Street doors to second story of central
tower of Johnson Block, Chorro and Higuera,
carved by Alexander Zeller in 1983
Below: Alex Madonna (center) and visiting
Japanese dignitaries posing before Zeller’s
carved doors in the earliest TelegramTribune photo of Madonna Inn’s restaurantoffice building after its opening (“Distinguished Visitor,” 5 Sep. 1961, p. 1).

22 Alexander Zeller arrived from San Juan Bautista without his woodworking tools; Gary Cully forged new ones for him (Brian Cully interview [15 Aug. 2023]).

Zeller’s anthemion (honeysuckle) arches surrounding the ballroom dance floor of the Venetian Room. The anthemion is an ancient Greek motif, also used in Greek Revival architecture (notably the Fremont Theater). Wilshusen’s stonework is visible at left and Cully’s cut and hammered iron brackets at upper right.

23 Carved columns supporting trompe l’oeil arches in the Venetian Room bar demonstrate Alex Madonna’s adaptation to Alexander Zeller’s sudden departure in response to Madonna’s pressure to speed up his work.

24 III. Architectural Historical Context: Modernist Arches Architectural catenaries, parabolas, and near-catenaries and parabolas became the symbol of the jet age in buildings such as Eero Saarinen’s 1959–1962 TWA Flight Center at JFK (below, during construction) and Pereira and Luckman et al’s 1961 Theme Building at LAX (bottom, after its relighting by Walt Disney Imagineering). Where Streamline Moderne’s curves had pointed forward, the parabolas of Modernism pointed skyward.

The trend may have been set off with Saarinen’s Gateway Arch in St. Louis, not completed till 1965 but whose design was celebrated from its selection in the 1947–1948 competition.

Not that the Gateway Arch was mathematically precisely a catenary or that catenary arches were new. Robert Hooke, in the late seventeenth century, had proposed the catenary—both

25 formed and named for the shape of a chain (catena in Italian) hanging from two even points—as the ideal arch, once inverted, from the point of view of physics (Robert Osserman, “How the Gateway Arch Got Its Shape,” Nexus Network Journal, v. 12, No. 2, 1010, p. 169). As Sir Christopher Wren’s assistant in the rebuilding of London after the Great Fire, Hooke convinced Wren to use a near-catenary for the interior dome of St. Paul’s, to accommodate horizontal thrust at the base, the first use of such a structure (op cit., 170).

For the exterior dome, Wren employed a classic semi-sphere.

A parabolic arch, a vertical cross-section of a cone, is more pointed, less rounded than a catenary. I will use each term as shorthand for arches that may not be mathematically precise but give the general impression of the genre.

A brilliant example of a catenary arch both upturned and downturned in a wave pattern is the roof of architect Walter White’s 1954 Miles C. Bates House, Palm Springs (below).

Paul Revere Williams’ 1961 La Concha Motel in Las Vegas (now part of the city’s Neon Museum) thrust its lobby forward toward Las Vegas Boulevard with three parabolic arches (below, Google Street View). The preserved lobby is now part of the Neon Museum.

By the 1970s, parabolic and catenary arches had lost their novelty (if not their utility), and airline terminals in particular were focused no longer on communicating a futuristic vision of jet set romance for the elite. Instead, they were being expanded for the economical management of vast numbers of moving and waiting people, cars, and planes.

26 The Santa Maria Public Airport’s 1971 terminal is a transitional structure between the 1960s and 1970s decades with two aspirations to Jet Age style: a one-story curved concourse and central two-story observation platform roofed by five catenary arches, two pointing upwards and three down, in a radiate wave pattern.

The terminal was designed by D. Stewart Kerr, AIA, a 1932 graduate of the University of Minnesota School of Architecture, who had practiced in Los Angeles and moved to Santa Maria in 1960 when he became the principal architect for Allan Hancock College (“New Architectural Firm Formed in Santa Maria,” Santa Maria Times, 25 Jan. 1975, p. 7). His surviving buildings—classrooms, administration buildings, libraries, sheriff and fire stations—are functional and not very inspired. The observation deck roof at Santa Maria Public Airport is his most imaginative creation.

Fred Schott of San Luis Obispo was the structural engineer, and the only fabricator willing to attempt the girder system was Gary Cully (Brian Cully interview [15 Aug. 2023]). It required five arched structures, eighty feet long, that diminished toward one end, like a Renaissance perspective drawing. We know how they look, because when, on 20 July 1971, they were trucked out of Gary Cully’s Higuera Street blacksmith shop, the truck got stuck, and photographer Bruce Judson recorded the occasion for the Telegram-Tribune.

Parabolic wave pattern roofs are quite rare. The opposing parabolic arches of the TWA Flight Center and crossed ones of the Theme Building were more commonly used as a single arch, as in the Bates House on p. 23. Repetitive arches were more often catenary (Ushaped), as in Santa Maria architect Louis N. Crawford’s 1961 Anaheim Howard Johnson (below). this Mark Mills’ Fanshell Beach (O’Brien) House Louis N. Crawford’s 1961 Anaheim Howard Johnson opposite Disneyland (Google Street View)

27 Lyle George Landstrom’s 1958–1962 Terminal One, Minneapolis–St. Paul International Airport. The wave-pattern roof is angled and covers a simple rectangular building.

Street façade, Santa Maria Public Airport terminal, dominated by the radiate parabolic wave roof of the Observation Platform. The vertical curvature of the roof and horizontal curvature of the building created a dual challenge for fabrication. Gary Cully was the sole bidder.

28 Google Satellite view of Santa Maria Public Airport today. A one-story radiate extension has been built on the runway side

29 IV. Architectural Historical Context: The Lutyensesque Revival House Virginia McAlester in A Field Guide to American Houses, the only one of the 1970s–1980s popular American architecture guides still in print, lumps architecture from 1860 to 1900 under “Victorian Houses” and architecture from 1880 to 1940 (including both “Period Houses” and “Modern Houses”) under “Eclectic Houses”—none of which makes any sense on any level as a means of organization.

First, Queen Victoria ruled from 1837 to 1901. Second, she never ruled the United States, whose architecture has some intersections but many more departures from that of the British Empire, where “Victorian” also happens to be a spectacularly unuseful term for the plethora of contending and often conflicting styles that happened to linger, develop, or originate during her reign. Third, there is a substantial and inexplicable overlap in McAlester’s era dates. Fourth, “Eclectic” is as noncommittally meaningless a term as “Victorian”—particularly if it subsumes both “period” or revival architectures and Modernism (though two of her “Modern” categories, Prairie and “Craftsman” [historically called the California Bungalow] were highly revivalist: Prairie of a variety of styles and the California Bungalow specifically of Swiss and Japanese Shinto architecture.

From the late nineteenth century, in American contemporary usage, “Elizabethan" or “Tudor” were sometimes included in, sometimes distinguished from, Queen Anne. Henry Hobson Richardson’s 1875–1876 William Watts Sherman House in Newport, Rhode Island (below left), which is generally recognized as the first Queen Anne in America, is explicitly Tudor inside and out, with acute gables, jettying, high compound chimneys, half-timbering, and patterned-panel plaster ceilings. Frank Lloyd Wright designed his 1895 Nathan G.

Moore House as a post-Queen Anne Tudor Revival (below center) and in 1922 redesigned it (after a fire) as a Prairie School Tudor Revival (below right).

Tudor or Elizabethan Revival, in other words, is a set of references that can inhabit a variety of different styles over time.

Sir Edwin Lutyens designed his first country house, Crooksbury House, Farnham, Surrey, in 1888. Generally recognized as a Tudor Revival within the Arts and Crafts style, it eschewed the obvious gables and half-timbering for hip roofs and tile-hung walls (this latter effect had been reproduced in America as early as the Watts Sherman House with wood shingling). By the 1890s, Lutyens had moved beyond Arts and Crafts but firmly held to Tudor Revival, having developed his own signature of streamlining by clustering windows and emphasizing spatial geometry by clustering windows, leaving wall space blank, and using extremely shallow eaves (seen on the following page in Munstead Wood [1896] with Gertrude Jekyll–designed gardens).

30 Lutyens’ Elizabethanism had elements of actual sixteenth-century farmhouses (in contrast to the more elaborate manors and great houses that served other architects as models) but was streamlined, much as he streamlined his sources when he moved on to other styles in the early twentieth century.

In 1913 the British weekly Country Life produced an enormous folio of nearly six hundred photographs and drawings called Houses and Gardens by E. L. Lutyens, published in London, and the following year it was co-published by Scribner’s in New York. Hitting the market at the beginning of World War II, it had a delayed effect, but at toward the end of the war, suddenly the new building sections of American newspapers—which had been dominated by the robust structural and decorative elements, deep eaves, and indoor-outdoor spaces of the California Bungalow—were dominated by houses with no eaves, reduced windows, and dainty and elegant elements, porchless (for the first time in a century, since Greek Revival), and based on European and colonial models. This would be the architecture of the 1920s suburbs, suburbs that were (not accidentally, with their European and colonial referents) newly restricted by race, with the US Supreme Court’s ruling against racial zoning but in favor of racial covenants.

The eaveless Cully House—with
running bond brick veneer,
unlike the elaborate bonds and
diapering previously used in
Tudor Revivals; minimally halftimbered side gables; round-arch lychgate entry; tall but simple
chimney; and large, horizontallymuntined Streamline Moderne windows—shows the style’s
1930s evolution, moving toward
the generalized type McAlester
would dub “Minimal Traditional.”

31 Compare the elaborate
decorative detail of Wright’s
Moore House of 1922, whose
Prairie School descent from Louis
Sullivan allowed for such surface
richness. (Having a wealthy client
also helped.) The Cully House,
however, is from a latenineteenth-century
Lutyensesque streamlining
tradition adapted to the quickly
expanding suburbs and
influenced by the further
streamlining—or economizing—
of detail in the mid century.

32 V. Period of Significance
The Gary Cully House can be said to have three periods
of significance: as a Local Register Resource for its
embodiment of late Lutyensesque Revival architecture
with Tudor reference, for which it was presumably
added to the Contributing List, and as a potential
Landmark, for the greatest importance of its association with Gary Cully and for its John Wilshusen Patio.

The period of significance for the Cully House’s original architecture would typically be the date of construction, which appears to be 1936.

The period of significance of the Cully House’s
association with Gary Cully extends from his 1964–
1977 residence to 2007, when Gary Cully’s son Brian
constructed the dormer that Gary had earlier designed
for the house.

The period of significance for the Wilshusen Patio is its date of construction, circa 1969–1970.
(See Chronology for citations.)

33 VI. Significance: Association with Gary Cully, a Revival, Modern, and Postmodern Master Craftsman of the Greatest Importance to the Region Gary Cully went from advertising horse-shoeing in 1958 to collaborating on one of the two great monuments to building craft on the Central Coast—Madonna Inn—in 1960. His oeuvre ranged from the inn’s Heimatstil through Santa Maria Airport’s Modernism and Marshall’s Jeweler’s Postmodernism.

Though Santa Maria Airport processes 26,000–78,000 passengers yearly, the Swiss Revival, California Ranch, and National Park Service Rustic Madonna Inn is Cully’s destination work, its 110 guest rooms belying the thousands of visitors who stop to ogle the work of Cully, Wilshusen, and Zeller without ever knowing their names. Indeed, Wilshusen’s handprint on the ceiling of the former telephone booth cave is, as far as I know, the only signature for any of their work there, and Zeller is the only one mentioned in Madonna Inn’s online and print material, with the explanation for the interruption of his work that he died in the midst of it rather than that he walked out after Alex Madonna pressed him to work faster, with Zeller living and working on the Central Coast another thirty years.

Unfortunately, the removal of Cully’s huge weathervane (below, during installation [photographs provided by Kristin Cully]) means that Cully’s work is not as immediately obvious to the visitor as Wilshusen’s monumental exterior and interior masonry or Zeller’s doors, columns, trusses, and screens. But Cully’s work is everywhere.

34 Above: Cully’s cut, wrought, and hammered
brackets joining the beams of the Venetian
Room’s side aisles echo Zeller’s anthemion
designs.

At right: Cut and hammered crown and base
brackets on the plinth for Alexander Zeller’s
carved column
Above: Gary Cully’s son Brian and
granddaughter pose next to Gary Cully’s fleurde-lis ironwork on the entrance door below the porte cochère.

35 Above: John Wilshusen’s monumental
fireplace dominates the entrance lobby in
front of the Gold Rush Steak House.

Above: The fireplace andirons are forged by
Gary Cully out of horseshoes, recalling Cully’s
earliest blacksmithing: shoeing horses.

At right: Outside the famous men’s urinal of
Madonna Inn is a lesser know feature, John
Wilshusen’s handprint at the apex of the cave
that formerly housed a pay telephone.

Above: Cully’s fire screen near Alex Madonna’s
table in the Copper Cafe. The tabletops are
made of copper from Alex Madonna’s mine.

36 Cully’s cut, wrought, and hammered ironwork is superimposed on Zeller’s woodwork and framed by Wilshusen’s stonework. The harmony of Madonna Inn’s craftsmanship—its repetition of forms, congruence of natural materials, and expression of strength and permanence—is as notable an aesthetic statement as the disharmony of its pink palette (originally buff). Without the combination of gemütlichkeit craft and kitsch color, it is hard to see Madonna Inn having made such an impact on the California cultural landscape. (Phyllis Madonna is responsible for the color—possibly borrowed from her friend Marge Calkins, whose favorite color it was and who painted the Motel Inn pink, copying such pink Mission Revival luxury hotels as the Royal Hawaiian and Beverly Hills Hotel. Phyllis Madonna also designed the justly famous guestrooms. Her disruptive aesthetic may be demonstrated by having—between verses of “Silent Night” being caroled to her by a group including the author in 2024—cried out, “Yee-haw,” from her recliner.) By 1966 Cully was collaborating with John Ross, FAIA on the San Luis National Bank (below). A Mid-Century Modern Mission Revival of roof tile and arcades, without yet the meta-critique of traditional styles inherent in Postmodernist, its finest feature is the round atrium with spiral staircase, reminiscent of Frank Lloyd Wright’s 1948 V. C. Morris Giftshop in San Francisco. Cully fabricated the wrought iron balustrades: Modernist linearity with subtly interspersed traditionalist volutes
(sadly since replaced).

Cully’s radiate parabolic wave roof for the Santa Maria Public Airport—pure geometric Modernism, came five years later in 1971, and though Cully’s beams and segmental arches were not visible, they made the structure possible. (See illustrations on pp. 9–10 and 27–

37 28.) Such is the further anonymity of the structural craftsman upon whom architects rely in what was Cully’s most extraordinary accomplishment, one that only he was willing to undertake.

By 1979 Postmodernism was firmly established, and
Richard Yaco and Steve Puglisi’s redesign of John Ross’s uninspired, un-human Lacterman’s building of
manufactured parts. Yaco, Puglisi, and Cully played with spaces and materials, including canopies of stucco and
walls and arches of wrought iron (left, “New Looks,
Telegram-Tribune, 12 July 1979, p. B4). Cully’s finely
wrought ironwork frames the entry courtyards, a
departure from the typical retail glass wall fronting a Main Street sidewalk, creating a transparent version of the Mediterranean walled garden and the sort of
transitional space typical of newly popular shopping
malls. Within eight years of its creation, Yaco, Puglisi, and Cully’s redesign was added to San Luis Obispo’s
Contributing List in the Downtown Historic District, an extraordinary accolade, and the city’s Cultural Heritage Committee rightly rejected an application to delist it.

It is in many ways Cully’s most public work, seen by thousands of outdoor strollers and shoppers every day, who appreciate its elegance, human scale, and departure from pure utilitarian commercialism without knowing its artist or origin. As with the Madonna Inn’s collaboration of Wilshusen, Zeller, and Cully—stonemason, woodcarver, and blacksmith— the collaboration of Yaco, Puglisi, and Cully—artist, architect, and craftsman—produces an indelible impression.

The historic association of
the Cully House is not limited
to Cully’s residence in it. He
also left his mark on it as
designer and craftsman—not
only in its subtle rear
additions invisible to the
street, its Tudor-appropriate
street dormer, and his
recruitment of fellow master
craftsman John Wilshusen to
build the outdoor fireplace
and patio—but in his handforged utilitarian features,
including these horse and
hummingbird hose racks.

38 Marshall’s-Magnuson’s
Marshall’s jewelers and Magnuson’s clothing—a 1979
Postmodern redesign by artist Richard Yaco and yetunlicensed architect Steve Puglisi of a Mid-Century Modern store designed by John Ross, FAIA—employed Gary Cully’s wrought iron to frame the forecourts. A conceptual drawing in the 12 July 1979 Telegram-Tribune (B-4) shows Cully’s craft was integral to the project from the beginning. The building was added to the Contributing List only eight years after the redesign. With its listing recently reconfirmed by the CHC, it remains the only listed Postmodern in San Luis Obispo.

Puglisi (top) and Yaco
(bottom) in the late 1970s.

39 VII. Significance: John Wilshusen’s Late-Twentieth-Century Stonemasonry Masterwork of Greatest Importance to the Region
According to his 2003 obituary, Wilshusen was known as The Master Builder. Plagued by mental illness and buoyed by his Christian faith in private life, his public craft showed striving ambition controlled by a sense of unity and balance. His constructions soar yet remain grounded, the rubble masonry puzzled together rhythmically but with whimsical variations, including the great, impendent arch of Madonna Inn’s lobby fireplace, employing the boulders that Alex Madonna loved and that give Madonna Inn its National Park Service Rustic feel. His masonry’s strength, flair, and three-dimensionality readily distinguish it from more flat and ordinary additions around it.

Cully was in his late twenties, Zeller in his early fifties, and Wilshusen in his mid thirties when they started work on Madonna Inn, but I have not been able to find documentation of But even for an outdoor fireplace, stairs,
wall, and bench behind the suburban Cully
House, Wilshusen achieves a masterwork:
the effect of a random pile of rocks left by an
awesome act of God.

Wilshusen’s masonry work before then.

Stylistically, it appears to change less than
Cully’s over the decades with architectural
styles, and Madonna Inn is clearly his
masterpiece, due to the monumentality that
Alex Madonna sought in stone. Huge
chimneys are part of the original 1957
concept designed by Beverly Hills architect
Louis Gould (at left and right, topped by
chimneypots, in detail at left [James Papp,
San Luis Obispo County Architecture
{Charleston: Arcadia, 2023}, p. 38].

40 One wonders if he did not have the Jehovah’s Witnesses’ Watchtower in mind, traditionally represented in rusticated stone built on a stone outcrop with the motto “Rock of Ages:

Other Foundation Can No Man Lay.” The Cully chimney appears to rise from such an outcrop and dwarfs people, the patio, and even the part of the house it is connected to.

Wilshusen’s late work for Inn (p. 17) also achieves the sense of flow of naturally deposited rock and the
wonder of such a thing in a domestic setting. His
obituary mentions a building in Atascadero “where a set of footprints go up a wall and across the entrance.” I
have not been able to track this down. It also references masonry projects as far afield as Santa Barbara, Visalia, the Bay Area, and Los Angeles, including for the movie
star Robert Taylor—likely this fireplace (right) at
Taylor’s Mandeville Canyon ranch, incorporating stone
benches as at Madonna Inn and the Cully House.

There is much still to learn, and
this Landmark application for the
Wilshusen Patio is intended to be
the beginning of research on this
late-twentieth-century master
craftsman of the Central Coast
rather than the end.

Left: The inset bench of the
Wilshusen Patio, now topped with
wood for counter space but
reversible.
.

41 VIII. Integrity
The location of the Gary Cully House is unchanged since its 1964–2007 period of significance. Its design is also unchanged since that time. The suburban setting remains theme, as also the materials and their crucial workmanship. Hence feeling (the combination of the previous five material qualities) is perfectly intact, and association is unusually strong. Cully would immediately recognize it as the same house today.

The John Wilshusen Patio has had an addition by a lesser mason to the north side, which is reversible, and there is a reversible wood countertop balanced above the inset bench. A small water feature next to the bench also appears to be an addition by another hand.

Overall, however, location and setting are the same, design, materials, and workmanship have been added to but as reversible extensions rather than alterations, and feeling and association are strong.

Both house and patio retain the ability to convey their significance.

Above: The full patio as it appears today. Below left: Apparent addition of water feature by another hand. Below right: A second addition by another hand (Kristin Cully text interview, 4 Dec. 2025).

42 IX. Conclusion
The Gary Cully House and John Wilshusen patio qualify as a San Luis Obispo Landmark as among the city’s rarest and most important resources for their association with regionally significant master craftsman Gary Cully and for the work of regionally significant master craftsman John Wilshusen, two unsung figures who shaped the built environment of the Central Coast, including one of its two most famous monuments, Madonna Inn. The house and patio’s excellent integrity fully retains the ability to convey their historical and architectural significance.

Item 6e
Department: Public Works
Cost Center: 6004
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Aaron Floyd, Public Works & Utilities Director
Prepared By: Hai Nguyen, Senior Civil Engineer
Miguel Barcenas, Utilities Deputy Director / Engineering and Planning SUBJECT: AUTHORIZATION TO AWARD CALIFORNIA WATERLINE
REPLACEMENT (TAFT TO MILL), SPECIFICATION NO. 2000563

RECOMMENDATION

1. Approve the project plans and special provisions for the California Waterline Replacement (Taft to Mill), Specification No. 2000563; and,

2. Award a construction contract (Attachment A) to Specialty Construction in the amount of $1,986,673 for the California Waterline Replacement (Taft to Mill), Specification No. 2000563; and,

3. Authorize the City Engineer to issue Contract Change Orders up to the available project budget (Account 2000563), and up to any amended budget subsequently approved by the City Manager per City Purchasing Policy approval thresholds; and

4. Find the action exempt from the California Environmental Quality Act.

POLICY CONTEXT
On January 19, 2016, the City Council approved the Potable Water Distribution System Operations Plan, which identified this project as a high priority for the City.

On May 17, 2022, Council approved a Purchasing Policy Update to the Financial Management Manual (Resolution No. 11328), requiring Council authorization to award Public Works contracts exceeding $200,000.

DISCUSSION
Background
The City’s water distribution system is comprised of approximately 184 miles of pipe with diameters ranging in size from 4 inches to 30 inches. Some of these pipes have been identified as undersized or have surpassed their intended design life, which is typically around 50 years. As waterlines age, the frequency of breaks increases, leading to costly and disruptive repairs. These breaks can damage roadways, often requiring full-depth reconstruction and substantial costs to properly restore the pavement.

Item 6e
Project
The project plans and specifications include the replacement of 1,660 linear feet of water transmission main along California Boulevard. The critical 16-inch cast iron water transmission main, originally installed in the 1960s, will be replaced with 16-inch ductile iron pipe. Replacing these waterlines will result in lower costs to the City and reduced customer impacts associated with emergency repairs. By minimizing or eliminating emergency repairs, maintenance staff will have more time to focus on preventive maintenance, which in turn extends the service life of other water distribution assets.

In terms of project geography and scheduling, the site is in close proximity to the upcoming California and Taft Roundabout project. However, construction on the roundabout is anticipated to begin in the spring of 2027, ensuring no scheduling overlap as the waterline replacement work is expected to start in mid-July and be completed before the end of 2026.

With the design and coordination details finalized, staff proceeded to the bidding phase.

The California Waterline Replacement - Taft to Mill (Project), Specification No. 2000563, was advertised on April 16, 2026, with bids opened on May 14, 2026. Five bids were received and opened. Specialty Construction (Specialty) was the apparent low bidder with a bid of $1,986,673, which is $913,327 below the Engineer’s Estimate of $2,900,000. The Contractor’s references, license, and registration with the Department of Industrial Relations have been verified. Consequently, staff recommends that the project be awarded to Specialty as the lowest responsive and responsible bidder (Attachment A).

Bid Summary Bid Total
Engineer’s Estimate $2,900,000
R. Baker $2,594,500
John Madonna Construction $2,495,430
Hartzell General Contractor $2,076,930
Souza Construction $2,075,495
Specialty Construction $1,986,673
Previous Council or Advisory Body Action
This Project was identified in the 2025-27 Financial Plan that was approved by Council with a budget of $2,570,000.

Public Engagement
Public engagement was conducted during the initial identification of this project to be included in the 2025-27 Financial Plan. During construction, staff will proactively coordinate with and inform the public and Cal Poly about traffic control changes, access considerations, and other temporary impacts to help minimize disruptions. The contractor will be required to submit traffic control plans that minimize disruptions to the traveling

Item 6e
public, and the City will work closely with the contractor to minimize any impacts during the Cal Poly move-in period. The project will also be featured on the SLO in Motion Website to keep the community informed about the project, including construction updates, anticipated impacts, and responses to frequently asked questions.

To ensure direct communication, affected residents within the limits of work will be notified of upcoming construction via door hangers. These notices, designed in accordance with City standards, will be distributed to all properties adjacent to the work area and will clearly outline the project's start and end dates. Additionally, in areas where parking must be restricted, "No Parking" signs will be clearly posted at least 24 hours in advance of the work.

CONCURRENCE
This project was closely coordinated between the Public Works and the Utilities departments before and during the merger to create the current Public Works and Utilities Department.

ENVIRONMENTAL REVIEW
The project is categorically exempt from environmental review under Section 15302 Class 2(c) of the California Environmental Quality Act (CEQA) Guidelines (Replacement or Reconstruction) because the replacement of the water transmission mains would result in no expansion of capacity. Section 15302 Class 2(c) specifies that “Replacement or reconstruction of existing utility systems and/or facilities involving negligible or no expansion of capacity” is categorically exempt from environmental review. A Notice of Exemption will be filed through the Community Development Department.

FISCAL IMPACT
Budgeted: Yes Budget Year: 2025-2026
Funding Identified: Yes
Fiscal Analysis:

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund
State
Federal
Fees
Water Fund
(Project #
2000563)
$2,441,908 $2,441,908 $0 N/A
Total $2,441,908 $2,441,908 $0 N/A

Item 6e
California Waterline Replacement (2000563)
Construction Bid Total $1,986,673
Contingencies (23%) $445,235
Material Testing $9,500
Printing $500
Total Cost of Project $2,441,908
Current Project
Balance $2,441,908
Remaining Balance $0
Waterline improvements identified in this project are described in the 2025-27 Financial Plan. Funding is available in Project Account (2000563), which currently has an available balance of $2,441,908. This is sufficient to cover the water transmission main replacement contract of $1,986,673, leaving an adequate balance for project management and construction contingencies. Had the project bids aligned with the higher engineer's estimate that exceeded the project account budget by approximately $1 million, staff was prepared to recommend a funding transfer from the Water Fund's Undesignated Capital Account and/or Unassigned Working Capital to fully fund the project.

Utility improvement projects are generally associated with a higher level of construction cost uncertainty due to unknown subsurface conditions. Past water line replacement projects have shown that unforeseen utility conflicts and unexpected soil or groundwater conditions are commonly encountered during excavation, which can increase construction costs. These conditions can require additional excavation, trench stabilization or shoring, dewatering, potholing and hand excavation around existing utilities, and other field adjustments that are difficult to fully quantify during design.

Based on past experience and typical change orders encountered during similar utility projects, an additional $445,235 contingency has been included in the project budget.

This amount represents roughly 23% of the estimated construction cost, within the 20– 30% range typically applied to utility projects of this nature, which has historically been sufficient. Following project completion, any remaining water funds will be transferred to the Water Fund’s Undesignated Capital Account for future infrastructure improvements and maintenance work.

ALTERNATIVES
Reject all bids and readvertise the project. The City Council may choose to reject all bids and readvertise. This option increases the risk of unplanned costs from potential main failures and delays construction, creating a significant risk of scheduling overlap with the California and Taft Roundabout project.

ATTACHMENTS
A – Draft Agreement, Specification No. 2000563

AGREEMENT
THIS AGREEMENT, made on _____________, by and between the City of San Luis Obispo, a municipal corporation and charter city, San Luis Obispo County, California (hereinafter called the City) and SPECIALTY CONSTRUCTION, INC. (hereinafter called the Contractor).

WITNESSETH:

That the City and the Contractor for the consideration stated herein agree as follows:

ARTICLE 1, SCOPE OF WORK: The Contractor shall perform everything required to be performed, shall provide and furnish all of the labor, materials, necessary tools, expendable equipment, and all utility and transportation services required to complete all the work of construction of

CALIFORINA WATERLINE REPLACEMENT (TAFT TO MILL),
SPECIFICATION NO. 2000563
in strict compliance with the plans and specifications therefor, including any and all Addenda, adopted by the City, in strict compliance with the Contract Documents hereinafter enumerated.

It is agreed that said labor, materials, tools, equipment, and services shall be furnished and said work performed and completed under the direction and supervision and subject to the approval of the City or its authorized representatives.

ARTICLE II, CONTRACT PRICE: The City shall pay the Contractor as full consideration for the faithful performance of this Contract, subject to any additions or deductions as provided in the Contract Documents, the contract prices as follows:

Item Item Unit of Estimated Item Price Total
No. SS(1) Description Measure Quantity (in figures) (in figures) 1 7 TRAFFIC CONTROL PLAN AND
IMPLEMENTATION LS 1 $162,400.00  $162,400.00
2 77 TEMPORARY BYPASS SYSTEM LS 1 $125,000.00  $125,000.00 3 77 POTHOLING UTILITIES LS 1 $50,000.00  $50,000.00
4 84
REPLACE TRAFFIC STRIPING,
PAVEMENT MARKERS AND
PAINTED CURBS
LS 1 $12,500.00  $12,500.00
5 7 COMPLY WITH NIGHT WORK
PERMIT LS 1 $8,100.00  $8,100.00
6 7 COMPLY WITH OSHA LS 1 $10,750.00  $10,750.00
7 3 COMPLY WITH CALTRANS
ENCROACHMENT PERMIT LS 1 $5,800.00  $5,800.00
Docusign Envelope ID: B60FBFC2-6819-80F4-80D6-CE07CABDA86F

Item Item Unit of Estimated Item Price Total
No. SS(1) Description Measure Quantity (in figures) (in figures) 8 77 ABANDON WATERLINE, WATER
VALVES AND FACILITIES LS 1 $17,000.00  $17,000.00
9* 19 ROCK EXCAVATION CY 100 $75.00  $7,500.00
10 5,15 REPLACE MONUMENT AND
WELL EA 2 $3,150.00  $6,300.00
11  77
WATERLINE TIE IN AND
APPURTENANCES (DETAIL A,
SHEET 2)
LS  1  $17,400.00  $17,400.00
12  77
WATERLINE TIE IN AND
APPURTENANCES (DETAIL A,
SHEET 5)
LS  1  $43,300.00  $43,300.00
13  77
WATERLINE TIE IN AND
APPURTENANCES (DETAIL B,
SHEET 5)
LS  1  $24,000.00  $24,000.00
14  77  HIGH PRESSURE CONNECTION
(DETAIL C, SHEET 5)  EA  2  $26,500.00  $53,000.00
15  77  6" DIP STORM DRAIN  LF  60  $466.00  $27,960.00 16  77  12" X 12" PRECAST DI BOX  EA  2  $3,200.00  $6,400.00 17  77  8" HDPE DRAIN LINE  LF  300  $97.00  $29,100.00 18  77  DRAIN OUTLET (DETAIL D, SHT 2)  LS  1  $5,000.00  $5,000.00 19  77  DRAIN OUTLET (DETAIL E, SHT 2)  LS  1  $13,000.00  $13,000.00 20  77  16 INCH DIP WATERLINE  LF  1660  $550.00  $913,000.00 21  77  INSTALL 16" BUTTERFLY
ISOLATION VALVE  EA  2  $9,100.00  $18,200.00
22  77  PRECAST CONCRETE VAULT AND
EXPANSION JOINT  EA  2  $75,000.00  $150,000.00
23  77  TYPE 1 WATER SERVICE TIE IN  EA  1  $3,800.00  $3,800.00 24  77  TYPE 2 WATER SERVICE TIE IN  EA  5  $12,000.00  $60,000.00 25  77  TYPE 3 WATER SERVICE TIE IN  EA  1  $16,500.00  $16,500.00 26  77  TYPE 5 FIRE SERVICE TIE IN  EA  1  $19,000.00  $19,000.00 27 77  TYPE 6 FIRE SERVICE TIE IN  EA  2  $9,100.00  $18,200.00 28 77  REPLACE EXISTING WATER
METER BOX   EA  7  $1,700.00  $11,900.00
29 77  2" AIR/VAC RELEASE VALVE  EA  1  $14,000.00  $14,000.00 30 77  FIRE HYDRANT AND LATERAL  EA  2  $24,000.00  $48,000.00 31 82  BLUE FIRE HYDRANT MARKER  EA  2  $29.00  $58.00
32*  73  REPLACE CURB AND GUTTER  LF  65  $133.00  $8,645.00 33*  73  REPLACE SIDEWALK / DRIVEWAY
/ CURB RAMP  SQFT  390  $30.00  $11,700.00
Docusign Envelope ID: B60FBFC2-6819-80F4-80D6-CE07CABDA86F

Item Item Unit of Estimated Item Price Total
No. SS(1) Description Measure Quantity (in figures) (in figures) 34*  73  RESTORE BIKE PATH CURB AND
RAILING  LF  20  $258.00  $5,160.00
35 73
BIKE PATH PAVEMENT
RESTORATION PER ENG. STD.
7040
LS  1  $64,000.00  $64,000.00
(1) refers to section in the Standard Specifications, with modifications in the Special Provisions, that describe required work.
* Bid item exempt from Section 9-1.06B and 9-1.06C of the Standard Specifications. The unit price will not be adjusted regardless of the final bid item quantity.

BID TOTAL: $1,986,673.00
Payments are to be made to the Contractor in compliance with and subject to the provisions embodied in the documents made a part of this Contract.

If any dispute arises regarding the work or contract price, Contractor must follow the procedures in the contract documents, including the requirements on change order requests and dispute resolution.

ARTICLE III, COMPONENT PARTS OF THIS CONTRACT: The Contract consists of the following documents, all of which are as fully a part thereof as if herein set out in full, and if not attached, as if hereto attached:

1. Notice to Bidders and Information for Bidders

2. Standard Specifications and Engineering Standards

3. Special Provisions, any Addenda, Plans and Contract Change Orders

4. Caltrans Standard Specifications and Standard Plans 2024

5. Accepted Bid and Bid Bond

6. List of Subcontractors

7. Labor Code Section 1725.5 Statements

8. Bidder Acknowledgements

9. Qualifications

10. Noncollusion Declaration

11. Agreement and Bonds

12. Insurance Requirements and Forms
ARTICLE IV INDEMNIFICATION: The Contractor shall indemnify, defend with legal counsel approved by City, and hold harmless City, its officers, officials, employees and volunteers from and against all liability, loss, damage, expense, 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 the acts or omissions of Contractor, its employees, subcontractors, representatives, or agents, in bidding or performing the work or in failing to comply with any obligation of Contractor under this Agreement, except such loss or damage which is caused by the sole or active negligence or willful misconduct of the City. Should conflict of interest principles preclude a single legal counsel from representing both the City and the Contractor, or should the City otherwise find the Contractor’s legal counsel unacceptable, then the Contractor shall reimburse the Docusign Envelope ID: B60FBFC2-6819-80F4-80D6-CE07CABDA86F

City its costs of defense, including without limitation reasonable legal counsel fees, expert fees and all other costs and fees of litigation. The Contractor shall promptly pay any final judgment rendered against the City (and its officers, officials, employees and volunteers) with respect to claims determined by a trier of fact to have been the result of the Contractor’s acts or omissions in bidding or performing the work or in failing to comply with any obligation of Contractor under this Agreement. 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.

The Contractor obligations under this section apply regardless of whether such claim, charge, damage, demand, action, proceeding, loss, stop notice, cost, expense, judgment, civil fine or penalty, or liability was caused in part or contributed to by an Indemnitee.

However, without affecting the rights of the City under any provision of this agreement, the Contractor shall not be required to indemnify and hold harmless the City for liability attributable to the active negligence of City, provided such active negligence is determined by agreement between the parties or by the findings of a court of competent jurisdiction. In instances where the City is shown to have been actively negligent and where the City’s active negligence accounts for only a percentage of the liability involved, the obligation of the Contractor will be for that entire portion or percentage of liability not attributable to the active negligence of the City.

ARTICLE V: It is further expressly agreed by and between the parties hereto that should there be any conflict between the terms of this instrument and the bid of said Contractor, then this instrument shall control and nothing herein shall be considered as an acceptance of the said terms of said bid conflicting herewith.

ARTICLE VI LABOR CODE COMPLIANCE: This Agreement is subject to all applicable requirements of Chapter 1 of Part 7 of Division 2 of the Labor Code, including requirements pertaining to wages, working hours and workers’ compensation insurance, as further specified in the contract documents.

The project is subject to the prevailing wage requirements applicable to the locality in which the work is to be performed for each craft, classification or type of worker needed to perform the work, including employer payments for health and welfare, pension, vacation, apprenticeship and similar purposes. Copies of these prevailing rates are on file with the City and are available online at http://www.dir.ca.gov/DLSR.

City may not enter into the Agreement with a bidder without proof that the bidder and its subcontractors are registered with the DIR to perform public work pursuant to Labor Code section 1725.5, subject to limited legal exceptions.

Pursuant to Labor Code § 1861, by signing this Agreement, Contractor certifies as follows:
“I am aware of the provisions of Labor Code § 3700 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 I will comply with such provisions before commencing the performance of the work on this contract.” Docusign Envelope ID: B60FBFC2-6819-80F4-80D6-CE07CABDA86F

IN WITNESS WHEREOF, the parties to these presents have hereunto set their hands this year and date first above written.

APPROVED AS TO FORM CONTRACTOR:

SPECIALTY CONSTRUCTION, INC
______________________________
J. Christine Dietrick
City Attorney
_______________________________
Rudolph C. Bachmann
President

CITY OF SAN LUIS OBISPO
A Municipal Corporation
______________________________
Whitney McDonald, City Manager
________________________________
Jeffery W. Martin
Senior Vice President

Docusign Envelope ID: B60FBFC2-6819-80F4-80D6-CE07CABDA86F

Item 6f
Department: Administration
Cost Center: 1021
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Teresa Purrington, City Clerk
SUBJECT: ADOPT A RESOLUTION CALLING THE NOVEMBER 3, 2026 GENERAL

MUNICIPAL ELECTION AND ADOPTING REGULATIONS

RECOMMENDATION
Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, calling for the holding of a General Municipal Election on Tuesday, November 3, 2026, for the election of certain Officers as required by the provisions of the City Charter, adopting regulations for Candidate Statements, and requesting the Board of Supervisors of the County of San Luis Obispo to consolidate a General Municipal Election with the Statewide General Election to be held on November 3, 2026, pursuant to Section 10403 of the Elections Code.” (Attachment A)

POLICY CONTEXT
Section 302 of the City Charter and California Elections Code outline the process and timeline for municipal elections.

DISCUSSION
The City Council is being requested to adopt a Resolution (Attachment A) which will:

1. Call a General Municipal Election to be held on November 3, 2026, for the election of two (2) members of Council and the Mayor.

2. Set regulations for candidate statements.

3. Request consolidation of the election with the County and authorize the County Clerk/Elections Department to canvass the returns and provide other services relating to the conduct of the election.

Background
Calling the Election
Pursuant to Section 302 of the City Charter, the City’s General Municipal Election to fill elective offices shall be held on the first Tuesday, after the first Monday, in November of even-numbered years. November 3, 2026, is when the General Municipal Election is to be held. The California Election Code establishes procedures and requirements for conducting

Item 6f
a General Municipal Election. In addition, State Elections Code Section 13307 contains provisions related to the printing, distribution, and estimated costs of candidates' statements in the voter information guide.

Citywide Single Vote
The City Council is San Luis Obispo’s legislative body, made up of one elected Mayor and four elected Council Members. Every two years, voters elect the Mayor and two of the four Council Members.

Beginning with the November 3, 2026 election, Council Members will be elected using Citywide Single Vote, a simple and familiar approach where voters select one Council Member candidate and the top two vote-getters win. Many voters already vote this way, and this change ensures that every voter can participate in every Council Member election and support the candidate who best represents them from across the San Luis Obispo.

After careful evaluation of multiple options and public input, the City Council approved Citywide Single Vote as the best compromise for San Luis Obispo, aligning with the City’s broader efforts to create fair, inclusive and accessible local government.

Notably, the Mayoral election process remains unchanged. Voters already choose one candidate for Mayor, and that will remain the same.

Candidate Statements
The resolution calling the election authorizes the City Clerk and the County Clerk/Elections Department to conduct a consolidated election and establishes regulations for candidate statements in accordance with California Elections Code Section 13307. Under this section, the governing body of any local agency must adopt rules regarding materials prepared by candidates for municipal elections, including the costs associated with candidate statements. The resolution allows for the filing of a Candidate's Statement of Qualifications of no more than 200 words and specifies that candidates pay the costs for including the statements in the voter information guide. Each candidate who wishes to file a candidate’s statement will be required to pay a deposit1, at the time the statement is filed, to cover the cost of printing and handling. Pursuant to the Federal Voting Rights Act and California Elections Code 2, the County of San Luis Obispo is not subject to language requirements for minority groups, therefore, the County will only translate candidate statements to Spanish upon request and after the required fee is paid. The estimated deposit for printing a candidate's statement in the voter information guide is approximately $300 for English only and $700 for English and Spanish.

1 The estimated deposit amount is an approximation of the actual cost and may be significantly more or less than the estimate, depending on the actual number of candidates filing statements. Accordingly, the City Clerk is not bound by the estimate and will bill the candidate for additional actual expense or refund any excess amount paid depending on the final actual cost. 2The County of San Luis Obispo is below the required 20% threshold requiring full translation.

Item 6f
Requesting Consolidation
The Resolution requesting consolidation allows the City to combine its election with the statewide election and avoid duplication of printing and mailing of voter information guide, computer tabulation, precinct workers, and canvassing results. Other requirements, including issuing and accepting nomination papers and other legal advertising as is required by the City's Election Campaign Regulations, will be performed by the City Clerk. All filings, including Candidates' Statements of Qualifications, Statements of Economic Interests, and Campaign Disclosure Statements, will be administered through the City Clerk's Office.

Public Engagement
No public engagement was done for the calling of the election, as this is required by the City Charter and the California Elections Code. Legal ads will be placed regarding open seats and then again after the nomination period notifying the public about those who qualify to run for an open seat.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378.

FISCAL IMPACT
Budgeted: Yes Budget Year: 2026-27
Funding Identified: Yes
Fiscal Analysis:

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $80,000 $33,000 $ $
State
Federal
Fees
Other:

Total $80,000 $33,000 $ $
Funding for election-related activities is provided through the City Clerk’s cost center. For FY 2025–26, a total of $80,000 has been appropriated for this purpose. Staff recommends that the remaining $33,000 required to support election expenses be funded through yearend salary savings within the City Clerk’s cost center.

The County of San Luis Obispo Registrar of Voters has provided an estimate of $113,000 for the cost of the election in 2026. This estimate is based on currently known cost information. Due to legislative changes, along with typical fluctuations in voter activity and

Item 6f
jurisdictions going to election, actual costs may shift in either direction. The City will be billed actual election costs at the conclusion of the election.

ATTACHMENTS
A - Draft Resolution calling for the General Municipal Election to be held on Nov. 3, 2026

R ______
RESOLUTION NO. _______ (2026 SERIES)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS

OBISPO, CALIFORNIA, CALLING FOR THE HOLDING OF A GENERAL MUNICIPAL ELECTION ON TUESDAY, NOVEMBER 3, 2026, FOR THE

ELECTION OF CERTAIN OFFICERS AS REQUIRED BY THE

PROVISIONS OF THE CITY CHARTER, ADOPTING REGULATIONS

FOR CANDIDATE STATEMENTS, AND REQUESTING THE BOARD OF

SUPERVISORS OF THE COUNTY OF SAN LUIS OBISPO TO

CONSOLIDATE A GENERAL MUNICIPAL ELECTION WITH THE
STATEWIDE GENERAL ELECTION TO BE HELD ON NOVEMBER 3,
2026, PURSUANT TO § 10403 OF THE ELECTIONS CODE.

WHEREAS, under the provisions of the City of San Luis Obispo Charter (Charter), a General Municipal Election shall be held on November 3, 2026, for the election of Municipal Officers; and
WHEREAS, it is desirable that the general municipal election be consolidated with the Statewide General election to be held on the same date and that, within the city, the precincts, polling places, and election officers of the two elections be the same, and that the county election department of the County of San Luis Obispo canvass the returns of the General Municipal Election and that the election be held in all respects as if there were only one election.

WHEREAS, California Elections Code section 13307 provides the governing body of any local agency shall adopt regulations pertaining to materials prepared by any candidate for a municipal election, including costs of each candidate statement.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo, as follows:

SECTION 1. Recitals. The City Council hereby finds and determines that the foregoing recitals are true and correct.

SECTION 2. Elections. That pursuant to the requirements of the Charter, there is called and ordered to be held in the City of San Luis Obispo, California, on Tuesday, November 3, 2026, a General Municipal Election for the purpose of electing a Mayor for the full term of two years; and two Members of the City Council for the full term of four years.
a) That notice of the time and place of holding the election is given and the City Clerk is authorized, instructed, and directed to give further or additional notice of the election, in time, form and manner as required by law.

Resolution No. ______ (2026 Series) Page 2
R ______
SECTION 3. Candidate Statement. That pursuant to Elections Code Sections 13307 and 13308, each candidate for elective office may prepare a Candidate Statement of Qualification on an appropriate form provided by the City Clerk. a) The statement may include the name, age and occupation of the candidate and a brief description of no more than 200 words of the candidate’s education and qualifications expressed by the candidate themselves.
b) The statement shall not include party affiliation of the candidate, membership, or activity in partisan political organizations, and shall not in any way make reference to other candidates for the same office or to another candidate’s qualifications, character, or activities.
c) The statement shall be filed in digital form and submitted electronically to [email protected] at the time the candidate’s nomination papers are filed. d) Once filed with the City Clerk, the statement may be withdrawn, but not changed, during the period for filing nomination papers and until 5:00 p.m. of the next working day after the close of the nomination period. e) Pursuant to Elections Code Section 13313, the statement shall remain confidential until after the close of the nomination period and will be available for public examination for no less than 10 days after the close of nominations.

Any challenges to a statement must be made during this 10-day period. f) Pursuant to the Federal Voting Rights Act, the County of San Luis Obispo is not subject to language requirements for minority groups, therefore, the County will only translate candidate statements to Spanish upon request and after the required fee is paid. The County will print and mail sample ballots and candidates’ statements to all voters in English and, if requested, in Spanish. g) Each candidate who files a Candidate Statement of Qualifications will be required to pay an estimated deposit at the time the statement is filed to cover the cost of the printing and handling. The estimated deposit amount is an approximation of the actual cost and may be significantly more or less than the estimate, depending on the actual number of candidates filing statements.

Accordingly, the City Clerk is not bound by the estimate and will bill the candidate for additional actual expense or refund any excess amount paid depending on the final actual cost.
h) The City Clerk shall make this resolution available to each candidate or the candidate’s representative at the time nomination papers are issued.

SECTION 4. Consolidation. That the Board of Supervisors is requested to issue instructions to the County election department to take any and all steps necessary for the holding of the consolidated election.

Resolution No. ______ (2026 Series) Page 3
R ______
a) That the County election department is authorized to canvass the returns of the General Municipal Election. The election shall be held in all respects as if there were only one election, and only one form of ballot shall be used. The election will be held and conducted in accordance with the provisions of law regulating the statewide or special election.
b) That the City of San Luis Obispo recognizes that additional costs will be incurred by the County by reason of this consolidation and agrees to reimburse the County for any costs.
i) The City Council authorizes the City Clerk to act as the authorized representative of the City in the administration of said election and all reasonable and actual election expenses shall be paid by the City upon presentation of a properly submitted bill.
c) That the ballots to be used at the election shall be in form and content as required by law.
d) That the City Clerk is authorized, instructed, and directed to coordinate with the County of San Luis Obispo Registrar-Recorder/County Clerk to procure and furnish any and all official ballots, notices, printed matter and all supplies, equipment and paraphernalia that may be necessary in order to properly and lawfully conduct the election.
e) That the polls for the election shall be open at seven o’clock a.m. of the day of the election and shall remain open continuously from that time until eight o’clock p.m. of the same day when the polls shall be closed, pursuant to Election Code § 10242, except as provided in § 14401 of the Elections Code of the State of California.

SECTION 5. That in all particulars not recited in this resolution, the election shall be held and conducted as provided by law for holding municipal elections.

Resolution No. ______ (2026 Series) Page 4
R ______
SECTION 6. That the City Clerk shall certify the passage and adoption of this Resolution and enter it into the book of original Resolutions. a) The City Clerk is hereby directed to file a certified copy of this resolution with the Board of Supervisors and the Election Department of the County of San Luis Obispo.

Upon motion of Council Member ______________, seconded by Council Member ____________, and on the following roll call vote:

AYES:

NOES:

ABSENT:

The foregoing resolution was adopted this ______ day of __________, 2026. ___________________________
Mayor Erica A. Stewart
ATTEST:
______________________________
Teresa Purrington,
City Clerk
APPROVED AS TO FORM:
______________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, on ______________________. ___________________________
Teresa Purrington,
City Clerk

Item 6g
Department: Administration
Cost Center: 1010
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Samantha Vethavanam, Diversity, Equity, and Inclusion Admin Specialist SUBJECT: CONSIDERATION OF FUNDING PRIORITIES FOR THE DEI HIGH

IMPACT GRANT

RECOMMENDATION
As recommended by the Human Relations Commission, approve the Diversity, Equity, and Inclusion High Impact Grant funding priorities for future grant cycles including, and starting with, Fiscal Year 2026-27.

POLICY CONTEXT
The purpose of the Human Relations Commission (HRC) is to advise and make recommendations to the City Council and the City Manager which promote and advance inclusion, mutual understanding, respect, and equitable treatment to all San Luis Obispo community members. The Diversity, Equity, and Inclusion (DEI) High Impact Grant provides financial support to non-profit organizations for programs and projects that advance equity and inclusion in the City. This grant program advances the current DEI Major City Goal workplan by facilitating programs and initiatives to support diverse community engagement and representation and by increasing access and belonging for all community members.

DISCUSSION
Background
The DEI High Impact Grant was created in 2020 to enhance a sense of belonging for all people in the San Luis Obispo community and to support local projects, programs, or initiatives that contribute to creating a San Luis Obispo that is welcoming, inclusive, equitable, and safe. The funding initially focused on narrowing equity gaps that have disproportionately impacted historically marginalized communities.

City Council approved a total of $559,800 in DEI High Impact Grants between 2020 and 2023 using the original funding priorities and information from 2020. Between December 2023 and March 2024, the Office of DEI worked with the HRC to update and streamline the funding priorities and other information for the DEI High Impact Grant, including through a noticed Public Hearing in December 2023 to receive feedback from the public.

Item 6g
The City Council approved the funding allocations for that year based on the revised funding priorities on December 10, 2024.

On June 4, 2025, the Office of DEI brought said DEI High Impact Grant funding priorities and information back to the HRC to confirm and/or further revise them in advance of the next two funding cycles. The HRC made a few edits and approved the DEI High Impact Grant funding priorities and information document as amended at that same meeting.

Subsequently, on July 15, 2025, City Council approved the revised funding priorities and information. This approval was meant to extend to the 2026-27 grant cycle, in addition to the 2025-26 grant cycle, and the Office of DEI planned to bring back the funding priorities and information to the HRC and then to City Council every two years for approval and/or revision. The funding priorities and information document that was used for the last DEI High Impact Grant funding cycle is included as Attachment A.

However, due to several conversations and feedback from individuals involved in the grant making process, it was proposed to staff that the current DEI High Impact Grant recommendation process might be streamlined and improved with the implementation of more specified and separate funding priority areas, rather than the current general priority:
 Funding should primarily focus on advancing and implementing diversity, equity, and inclusion through innovative practices that seek to narrow equity gaps and address intractable, systemic, and structural issues.

Proposed New Funding Priorities
To be responsive to these suggestions, Office of DEI staff worked through a proposed set of priority areas that could be included under the DEI High Impact Grant. These proposed priority areas were created with current needs and past applications in mind.

Staff had internal discussions and went through rounds of revisions to determine a succinct set of four proposed priority areas that captured the community’s needs as it related to diversity, equity, inclusion, access, and belonging while remaining distinct from the Human Services Grant’s funding priorities.

On April 1, 2026, staff brought the proposed priority areas to the HRC for their feedback and approval during their regular meeting. The HRC provided edits to priorities #1 and #4 as well as edits to the introductory section and subsequently approved them as amended.

The HRC also decided not to rank the priorities. Attachment B includes the recommended DEI High Impact Grant priorities as approved by the HRC. These priorities include (not listed in any order of importance):
1) Advancing Belonging: Support projects that strengthen connection, build community resilience and cultural awareness, and promote the experience of belonging among community members across the City of San Luis Obispo.

Item 6g
2) Increasing Access: Invest in efforts that actively remove barriers and expand opportunities for all community members to engage in civic and community life across the City of San Luis Obispo.
3) Advancing Structural and Institutional Equity: Support organizations to build the long-term capacity for inclusion and belonging in the City of San Luis Obispo. 4) Improving Community Health and Wellbeing: Fund programs that improve quality of life for City residents and that address systemic barriers through access to wellness resources, education that builds awareness, and community support systems.

Attachment B also include examples under each priority that will be included on the Office of DEI website, within the section for the DEI High Impact Grant, so applicants have a clear understanding of what fits within each. These recommended priorities, if approved, would supersede and replace the singular, general priority listed above.

The addition of these priorities is the only change that is being proposed for the DEI High Impact Grant Notice of Funding Availability (NOFA), which will be open to the public in mid-July for the 2026-27 grant cycle. Potential applicants will also be able to learn more about the grant’s requirements, and new priorities (if approved) during one of two information sessions which will be held prior to the grant period opening. One information session will be held in person in the morning and the other virtually in the afternoon, to provide various options for potential applicants. The virtual session will also be recorded and uploaded the DEI High Impact Grant webpage. Nonprofits interested in applying will be required to review the recording of, or attend in person or virtually at, one of these information sessions. Additionally, technical assistance hours will be offered for those who have more specific questions.

Previous Council or Advisory Body Action
Council approved DEI High Impact Grant information and priorities for the 2025-26 funding cycle on July 15, 2025, as stated above.

Public Engagement
The regular meeting of the HRC held on April 1, 2026, during which the proposed funding priorities were presented, was a publicly noticed meeting where interested individuals were welcome to provide public comment on the proposal.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378.

Item 6g

FISCAL IMPACT
Budgeted: N/A Budget Year: 2026-27
Funding Identified: N/A
Fiscal Analysis:

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund N/A N/A $ $
State
Federal
Fees
Other:

Total N/A N/A $ $
There is no fiscal impact associated with the recommendation to approve the DEI High Impact Grant funding priorities.

ALTERNATIVES

1. The Council could revise and adopt different funding priorities. If Council decides to revise and adopt different funding priorities and information for the upcoming DEI High Impact Grant, staff would request specific guidance on final funding priorities during the Council meeting, since the NOFA is scheduled to be published on July 20th with information sessions held the week prior.

2. The Council could continue consideration of the funding priorities. If Council decides to continue consideration of the funding priorities for the upcoming DEI High Impact Grant, staff would request direction regarding additional information needed to make a decision. This may delay the timeline for posting the NOFA for the grant.

3. The Council could provide direction to the HRC to consider alternative changes to the funding priorities. If Council decides to provide direction to the HRC to amend the funding priorities, Council would need to continue consideration of the item and provide direction to the HRC. This may delay the timeline for posting the NOFA for the grant.

4. The Council could decide not to approve the funding priorities. If Council decides not to approve the funding priorities, staff would rely on the previously approved DEI High Impact Grant funding priority for the 2026-27 NOFA.

ATTACHMENTS
A - Current DEI High Impact Grant Funding Priorities and Information B - Proposed DEI High Impact Grant Funding Priorities

DEI High Impact Grant Revised Funding Priorities and Information DRAFT – 6/4/2025
Statement:

The DEI High Impact Grant provides financial support to non-profit organizations to enhance the sense of belonging for all people in the community of San Luis Obispo. This funding allocation is an effort to uplift and support local projects, programs, and initiatives that contribute to creating a San Luis Obispo that is welcoming, inclusive, equitable, and safe. The scope of equity and inclusion work is inherently broad and complex, and the funding seeks to support initiatives that show understanding of root cause issues and intractable problems, can demonstrate measurable success, and will contribute to some aspect of systemic change.

Funding Priorities:

Funding should primarily focus on advancing and implementing diversity, equity, and inclusion through innovative practices that seek to narrow equity gaps and address intractable, systemic, and structural issues.

Illustrative examples of systemic/structural issues include:

1. Availability of affordable housing development and access to housing.

2. Access to culturally and linguistically appropriate behavioral health services.

3. Impact of poverty and unemployment.

4. Diversity in government and governing institutions.

5. Racial and socio-economic disparities in the criminal justice system.

6. Environmental justice and equitable access to sustainable resources.

7. Equity in access and representation in decision-making processes and leadership roles.

8. Civic engagement related to voter representation and election education.

9. Diversity of employers and work programs.

Funding Examples:

DEI High Impact Grant funds can be used for innovative, new or existing projects, initiatives, and ongoing programs to reduce equity gaps and improve social justice initiatives for underserved and underrepresented communities in the City of San Luis Obispo.

Proposal may focus on specific underserved and underrepresented communities, but all projects, applications, and concepts must provide access to the entire City of San Luis Obispo community-at-large and contribute to a positive systemic/structural change.

Examples of previously funded activities include: (examples are illustrative and not ranked)
• Enhancing language access for Spanish-speaking community members in public historical exhibits.
• Expanding access to education and knowledge on social services programs by developing public how-to videos in English, Spanish, and Mixteco. • Creating cultural spaces for learning purposes to expand community building and belonging for all.
• Enhancing board leadership programs to include a diversity lens to create more inclusive governing bodies and government organizations. • Providing and enhancing ally or advocacy training programs designed to build community momentum and social justice.
• Public community art projects designed to uplift and bring social awareness of social cause issues impacting equity, communication, and stories of underserved and underrepresented communities.
• City-wide trainings and panel discussion events on sensitive topics that create awareness, equity, belonging, and challenges exclusive narratives.

Funding Requirements
1 Complete and submit a grant application (must include)

1.1 One-page DEI Statement that includes:

1.1.1 Applicant’s understanding and application of DEI concepts/values

1.1.2 Affirming language that creates access and a sense of belonging to all community members.

1.1.3 Explain how the proposal will advance DEI in the City of SLO.

1.2 One-page detailed budget for the proposal including how the total amount requested will be allocated.

1.3 Organizational chart (if joint application, all organizations must provide chart)

1.4 Document certifying Federal Tax-Exempt Status
2 Applicants must demonstrate core values of justice, equity, diversity and inclusion in their purpose/mission statement and daily operations and have been providing DEI-related initiatives or programs within SLO County for at least two (2) years prior to application. (The proposal can be for something new, but the recipient organization must have been operating locally for at least two [2] years.) 3 Grant recipients must enter into a contract with the City prior to receipt of DEI funds, the form of which can be found here: Download sample contract. 4 Grant recipients must complete periodic impact reports and provide them timely 5 Grant recipients must submit a final impact report at the end of project or at 12 months from start, whichever comes first. Grant recipients will be expected to return unused funds. Download sample report.

Funding Criteria
1 Applicants must be a registered 501(c)(3) non-profit organization, government or education entity, or faith-based organization
2 100% of the funded activities must occur in the City of San Luis Obispo. 3 Funded activities must primarily serve City residents. Applicants that provide services to neighboring communities, but also serve a significant number of City residents, will be considered.
4 Requests must be for programs or services with the ability to show measurable impact and success. New creative approaches that are rooted in best practices or evidence-based, as well as proven approaches, are highly encouraged. 5 Collaborations between one or more organizations or groups are welcome and encouraged. At least one organization in the partnership needs to be an eligible entity noted above.

Additional Funding Information
1 Single applicants’ minimum request of $5,000 and a maximum request of $20,000 2 For partner applications (two or more applicants) there is no minimum dollar amount request, but the maximum request is $40,000. A lead organization must be identified in the application. The lead organization must be an eligible entity and must act as the fiscal agent. All parties must enter into the contract. 3 A maximum of one (1) grant award is allowed per organization (or per partnership if a collaborative project)
4 Funding may be used for new (innovative) or existing projects, programs, concepts, or initiatives that have proven success and/or utilize best practices or innovative approaches. Funding may also be used for a one-time service that has long-lasting impacts.
5 Innovative projects, programs, concepts, and initiatives are highly encouraged. 6 Projects, programs, concepts, and initiatives that leverage existing or other funding sources to supplement proposal are highly encouraged.

Prohibited Use of Funds
1 Funds CANNOT be used for advancing, campaigning, advocating, promoting, or highlighting political entities, ballot measures/initiatives, or candidates. 2 Funds CANNOT be used for advancing, advocating, promoting, or highlighting religious causes, entities, individuals, or activities. Funding CANNOT be used for the purpose of disseminating religious information in any form. 3 Funds CANNOT be used for profit or personal gain.

Funding Decisions
The Human Relations Commission (HRC) will exercise discretion when developing funding recommendations.

The HRC will review, with support from the Office of Diversity, Equity, & Inclusion, all applications (that are completed, timely submitted, and meet the funding criteria) and develop funding recommendations based on the answers and attestations provided in each application. Recommendations will be presented to the City Council for approval.

Final funding decisions are at the sole discretion of the City Council.

Proposals will be evaluated for meeting an identified and defined intractable/systemic/structural problem or need, potential to succeed, ability to make a high impact, or advance systemic change, and for centering efforts to address inequities for underserved and underrepresented communities while serving all community members.

City of San Luis Obispo – DEI High Impact Grant: Proposed Funding Priorities Projects may focus on supporting specific underserved or underrepresented communities; however, all proposals must be open and available to all individuals without regard to the resident’s race, religion, sex, national origin, sexual orientation, age, or ability/disability.

The DEI High Impact Grant prioritizes innovation – encouraging creative, forward-thinking approaches that drive meaningful change and foster belonging across the City. Collaborative and partnership-based applications are highly encouraged, especially those that bring together community organizations and City residents to build sustainable and inclusive impacts. Funded projects should contribute positively to systemic or structural changes that strengthen inclusion and experiences of belonging across the City of San Luis Obispo.

1. Advancing Belonging
Support projects that strengthen connection, build community resilience and cultural awareness, and promote the experience of belonging among community members across the City of San Luis Obispo.

Examples:
 Initiatives that bring diverse groups together by reducing isolation through shared storytelling, arts, dialogue, and/or celebration.
 Programs that create inclusive public spaces or community traditions that reflect and welcome the City’s diversity.
 Cultural and community-building events that promote cross-cultural understanding and celebrate diverse identities.
 Efforts that increase representation in civic or public spaces, such as inclusive public art or storytelling projects that reflect the community.

2. Increasing Access
Invest in efforts that actively remove barriers and expand opportunities for all community members to engage in civic and community life across the City of San Luis Obispo.

Examples:
 Projects that increase access to community programs, boards, or events within the City, including but not limited to language access, transportation, outreach, and digital inclusion.
 Inclusive communications and outreach strategies that improve accessibility across languages and for people with abilities/disabilities.
 Digital equity initiatives that expand access to technology, broadband, and digital literacy.  Efforts that help residents better understand how to get involved in local decisionmaking, leadership opportunities, or civic processes.

3. Advancing Structural and Institutional Equity

Support organizations to build the long-term capacity for inclusion and belonging in the City of San Luis Obispo.

Examples:
 Trainings, workshops, or mentorship programs that grow inclusive leadership and organizational skills.
 Efforts that strengthen networks among community-based organizations, City departments, and residents.
 Equity evaluations and capacity-building within organizations to strengthen Diversity, Equity, and Inclusion practices, recruitment, and retention.  Community engagement trainings to ensure more inclusive public processes and decision-making.
 Data and evaluation projects that can improve disparities and outcomes by race, gender, ability/disability, or other identity markers.
 Workforce development programs that create career pathways, especially those that are centered around getting underrepresented groups into high-paying or growing sectors.

4. Improving Community Health and Wellbeing
Fund programs that improve quality of life for City residents that address systemic barriers through access to wellness resources, education that builds awareness, and community support systems.

Examples:
 Health equity projects, especially addressing social determinants of health (e.g., food and water access, transportation).
 Mental health and trauma-informed programs.
 Improving life skills, financial literacy, learning and education.

Note: The above funding priorities does not include housing or homelessness-related services, which are addressed through the City’s Human Services Grant program.

Item 6h
Department: Administration
Cost Center: 1005
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Robert Hill, Sustainability & Natural Resources Official SUBJECT: SAN LUIS OBISPO RAILROAD MUSEUM – AMENDED AND RESTATED

LEASE AGREEMENT

RECOMMENDATION
Approve an Amended and Restated Lease Agreement between the City of San Luis Obispo and the San Luis Obispo Railroad Museum.

POLICY CONTEXT
The City’s Financial Management Manual (Section 475-C) allows long-term leases of City property, as well as provisions for leases to non-profit organizations, where there is a clear link between the lease purpose and accomplishment of significant City goals, plans or policies and where there is a clear and measurable community benefit.

The City Council adopted a Community Partnership Policy by Resolution No. 8862 (1998 Series), with the stated goal to “encourage partnerships with non-profit organizations for the mutual benefit of both the City and the organizations.” The recommended action is in furtherance of the City’s Railroad District Plan (1998), which in turn is intended to implement General Plan policy and the City’s Historic Preservation Ordinance.

DISCUSSION
Background
The City of San Luis Obispo enjoys a long-standing public / private partnership with the San Luis Obispo Railroad Museum (SLORRM) that stretches back over 25 years. The relationship and nature of the partnership has supported a variety of activities associated with historic preservation, public education, and implementation of the City’s Railroad District Plan (1998). In particular, SLORRM has worked collaboratively with the City on the rehabilitation and tenant improvements to the historic 1894 Southern Pacific Freight Warehouse necessary to create, activate, and operate the Railroad Museum, as well as the “Railroad Walk of History” as identified in the Railroad District Plan (see Figures 15 and 16). In 2000, the City and SLORRM entered into a Lease Agreement for use of the Southern Pacific Freight Warehouse (2000 Lease Agreement),

Item 6h
This report seeks approval of an Amended and Restated Lease Agreement (Attachment A) in order to allow SLORRM the ability to continue to plan, invest, and implement renovations and improvements to the existing Railroad Museum, as well as the continued refurbishment and outdoor display of historic railroad-oriented artifacts, through the assurances that a longer-term lease can provide, as has been requested by SLORRM.

The Amended and Restated Lease Agreement extends the expiration of the lease term from 2040 to the year 2067, while also clarifying the conditions under which the outdoor display of artifacts can occur with City permission and coordination. The 2000 Lease Agreement included a term until 2040, along with automatic 15-year extension; however, SLORRM was not able to occupy the space until twelve years later while the building was being rehabilitated by the City. Thus, the logic behind the amended term is to include the automatic extension from the 2000 Lease Agreement plus the twelve years during which SLORRM was not able to utilize the space. There have been no other prior changes or amendments to the 2000 Lease.

In addition to the term, other proposed changes in the draft Amended and Restated Lease Agreement include the deletion of a paragraph pertaining to use of the Emily Street Encroachment Area, which has since been vacated by SLORRM. At the time of the 2000 Lease Agreement, it was anticipated that a regional transit facility might be located within the railroad square area, and that a portion of the Museum might be used as a break area for transit drivers. However, by the time the tenant improvements and Museum improvements were completed by SLORRM, it had been determined in coordination with the City that a portion of the Museum would not be needed as a transit facility; therefore, paragraphs 9c., 9d., 10c., 10d., and 11d. have been deleted from the draft Amended and Restated Lease Agreement. All other terms and conditions of the prior 2000 Lease Agreement (Exhibit B) are substantially similar, other than minor clerical items or to address consistency of defined terms.

SLORRM is an all-volunteer non-profit organization that has built a strong board, committee, and governance structure. They continue to assess their longer-term facility and operational needs that can be accomplished in the future as guided by their Development and Operations Plan (updated 2024). The Railroad Museum is open every Saturday and is also available for special events and occasions. SLORRM also maintains regular communications and educational opportunities.

Previous Council Action
On June 16, 1998, the City Council approved Resolution No. 8817 (1998 Series) adopting the Railroad District Plan, which set forth a vision and area plan for historic preservation, circulation improvements, and revitalization of the plan area, as well as adopting the environmental document for the plan.

On April 6, 1999, the City Council approved the acquisition of two properties from the Union Pacific Railroad Company (formerly Southern Pacific Railroad Company) one of which was known as the “Railroad Transportation Center” that included the historic 1894 Southern Pacific Freight House.

Item 6h
On August 15, 2000, the City Council approved the 2000 Lease Agreement with the San Luis Obispo Railroad Museum organization for the use of the City-owned Southern Pacific Freight House in order to create a Railroad Museum facility.

Public Engagement
The proposed Amended and Restated Lease Agreement is considered a matter of routine City business. Any member of the public may provide written or in-person comments before the City Council.

CONCURRENCE
The City’s Public Works Maintenance staff and the Community Development Department’s City Arborist have been briefed on the permission and coordination with staff pertaining to the use of the parking lot area for outdoor display railroad-oriented historic artifacts adjacent to the Museum (as related to landscaping, irrigation, trees) and have indicated their support.

ENVIRONMENTAL REVIEW
Entering into the Amended and Restated Lease Agreement with SLOMA is not considered a project (CEQA Guidelines § 15378).

FISCAL IMPACT
Budgeted: No Budget Year: 2025-26
Funding Identified: No
Fiscal Analysis
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund
State
Federal
Other:

Total N/A N/A
Entering into the Amended and Restated Lease Agreement with SLORRM has very modest fiscal implications in and of itself. The agreement with SLORRM retains the $1 annual lease payment and extends the termination date from December 31, 2040, to December 31, 2067. It will require only modest staff time from City Administration, Community Development, and the Public Works Maintenance Division to oversee the terms and conditions of the agreement.

Item 6h

ALTERNATIVES
The City Council could:

1. Approve the Amended and Restated Lease Agreement with amendments.

Council may direct any edits, changes, or clarifications.

2. Deny the Amended and Restated Lease Agreement, in which case the existing 2010 Lease Agreement will continue until 2040.

3. Continue the item with specific direction to staff to provide more information or make changes, or if more discussion time is required before taking action.

ATTACHMENTS
A – Draft Amended and Restated Lease Agreement
B – 2000 Lease Agreement

AMENDED AND RESTATED LEASE AGREEMENT BETWEEN THE

CITY OF SAN LUIS OBISPO AND THE SAN LUIS OBISPO RAILROAD

MUSEUM FOR USE OF CITY PROPERTY
This Amended and Restated Agreement (“Agreement”) for Use of City Property is made this _______________ 2026 (the “Effective Date”), by and between the City of San Luis Obispo, a municipal corporation and charter city (herein referred to as "City") and the San Luis Obispo Railroad Museum, a 501(c)(3) non-profit organization (herein referred to as "SLORRM") (collectively referred to as the “Parties”.)

RECITALS
WHEREAS, the City owns certain real property located at 1940 Santa Barbara Ave., San Luis Obispo, California, as depicted in Exhibit A (the “Property”), attached hereto and incorporated herein by this reference; and
WHEREAS, on August 30, 2000, the City leased to SLORRM a portion of the Property (the “Premises”) which has been extensively remodeled and improved to create the San Luis Obispo Railroad Museum (the “Museum”) (collectively, the “Lease”); and WHEREAS, on August 11, 2006, the City and SLORRM executed an Agreement Affecting Real Property and Permit for Temporary Encroachment Within the Public Right of Way the “Emily Street Encroachment Permit”) authorizing the temporary placement, display and encroachment of ballasts, railroad ties, rails, rail cars and appurtenances (the “improvements”) on the Emily Street right-of-way located adjacent and proximate to the Premises (the “Emily Street Encroachment Area”). The Emily Street Encroachment Permit was revocable upon ninety (90) days written notice from the City, which could be given at any time at the City’s sole option and discretion. On December 14, 2022, the City provided written notice to SLORRM that all improvements must be removed by and at the sole expense of SLORRM by October 1, 2023, and SLORRM has since vacated the Emily Street Encroachment Area; and WHEREAS, the Parties agree that SLORRM shall retain access to and use of City-owned property under a separate encroachment permit issued on August 11, 2006 (the “Santa Barbara Avenue Encroachment Permit”) authorizing temporary placement of ballast, railroad ties, and rails per approved plans, as well as display of railroad cars and appurtenances, as it relates to the work of SLORRM, in the encroachment area in the parking lot area of 1940 Santa Barbara Avenue (the “Santa Barbara Avenue Encroachment Area.”) The Parties agree that this has also been understood to apply to select landscape planting areas within the parking lot; and WHEREAS, by this Amended and Restated Lease Agreement, City and SLORRM desire to extend the term of SLORRM’s Lease of the Premises, authorize the placement and maintenance of railroad related historic artifacts in and about the Property and to establish mutual understandings between City and SLORRM regarding the use of the encroachment area following the termination of the Emily Street Encroachment Permit.

NOW THEREFORE, in consideration of their mutual promises, obligations, and covenants hereinafter contained, the parties hereto agree as follows:

TERMS

1. Intent of Agreement. SLORRM and City acknowledge and agree that it is the intent of this Agreement to provide a space for the development and operation of the Museum which is open to the public and that helps preserve and present for the general public’s awareness and enjoyment the railroad history of California and, specifically, the Central Coast.

2. Location of Property. Subject to the terms and conditions hereof, City hereby leases to SLORRM, and SLORRM hereby leases from City the real property and City-owned railroad facilities described and depicted in Exhibit A. City and SLORRM acknowledge that the demised Premises includes the old Southern Pacific Railroad freight house, adjoining landscape area on the Santa Barbara Street side of the building and that portion of the property reserved for eventual railroad track for display purposes. The demised Premises does not include any sidewalks or bikeways.

3. Installation of Railroad Historic Artifacts within Landscaping. In consideration of SLORRM vacating the Emily Street Encroachment Area, and subject to the existing Santa Barbara Avenue Encroachment Permit, SLORRM may place railroad related historic artifacts along the display track and within the landscaped areas identified by the shaded areas in Exhibit A. Removal and management of any trees or shrubbery in the landscaped areas to accommodate placement of artifacts shall be approved by the City on a case-bycase basis and carried out in coordination with City staff, with special consideration or irrigation or other site constraints. In considering any additional encroachment permit submitted pursuant to this paragraph 3, the Public Works Director shall consider the potential impact that such improvement has on the landscaping, irrigation systems, line of sight visibility, vehicular and/or pedestrian traffic and any other impacts to the City’s property or other potential health, safety or welfare concerns. SLORRM further agrees to comply with any and all building code, zoning or other rules, regulations or other requirements for such installation. SLORRM shall remove such artifacts at the written request of City and agrees to repair the affected landscape area to the same or better condition than prior to such installation and to the satisfaction of the City’s Public Works Director. SLORRM agrees to indemnify, defend and hold City harmless for any personal injury, including death, or property damage arising from or attributable to the installation or display, including City’s approval, of such railroad artifacts as authorized herein.

4. Operation of Railroad Museum. SLORRM agrees to continue to develop, operate, and maintain the Museum for the term of this Agreement consistent with the intent of this Agreement. The City hereby acknowledges that SLORRM currently operates the Museum in a manner that meets the intent of this Agreement. The City will have no obligation for development, maintenance and/or operation of the Museum, including any tenant improvements. Any costs incurred for development and operation of the museum shall be the sole responsibility of the SLORRM.

SLORRM agrees to provide City with annual progress reports describing SLORRM’s implementation of its Development and Operations Plan objectives, as may be amended and / or updated from time to time. SLORRM shall maintain in good standing its 501(c)3 non-profit status and shall maintain regular open hours of use at the Museum in accordance with the standards provided below at paragraph 15.

5. Term of Agreement. The term of this Agreement shall commence upon execution by both parties and shall automatically expire on December 31, 2067. Upon execution of this Agreement by both parties, the August 30, 2000 Lease between City and SLORRM shall be superseded in its entirety by this Agreement as of the Effective Date.

6. Termination of Agreement by City. The City reserves the right to terminate this Agreement by providing SLORRM six (6) months prior written notice of termination. In the event of early termination of this Agreement by the City without cause, the City shall have the option to buy out permanent improvements at the proportional rate of 50% of the actual construction costs if such termination occurs within ten (10) years of the Effective Date. In the event that such termination occurs after ten (10) years of the Effective Date, City shall not owe SLORRM anything for any of the costs of the permanent improvements. The above "buyout" provisions shall be in lieu of any other compensation, including but not limited to, relocation assistance.

7. Termination of Agreement by SLORRM. SLORRM may terminate this Agreement by notifying the City in writing six (6) months prior to termination. In the event that SLORRM chooses to exercise this option, all permanent improvements (excluding removable exhibits acquired and/or installed by SLORRM) shall revert to the City without any compensation whatsoever.

8. Relationship of Parties. Under this Agreement, the City shall be solely and exclusively a lessor, and SLORRM shall be solely and exclusively a lessee. SLORRM shall not be considered a partner, agent, officer or employee of the City. SLORRM's officers, members, affiliates, volunteers, employees and independent contractors shall not be considered agents, officers or employees of the City.

9. Rent. In recognition of the public benefits the SLORRM provides the community, the City agrees to lease the Premises to SLORRM for $1 per year, payable on the anniversary date of this Agreement each year.

10. Extent and Condition of Premises. SLORRM shall accept the Premises "as is". This Agreement shall not obligate the City to guarantee the suitability of Premises, the suitability of the Premises for the intended use by SLORRM, the duration that Premises may be safely occupied, or the availability of alternate facilities. Should any occurrence (such as fire, earthquake, flood or the need to repair or improve Premises by the City) necessitate closing the Premises, or a portion of Premises, to the public, SLORRM shall have no recourse to the City for any loss incurred.

11. Historic Freight House.
a. The SLORRM agrees to assume full responsibility for ensuring that the Historic Freight House facility and any other facility utilized by SLORRM, including any services provided by SLORRM, is compliant with all ADA requirements.

SLORRM acknowledges and agrees that its duty to indemnify, defend and hold City harmless pursuant to Section 20 below includes any claims alleging noncompliance with the ADA. Pursuant to California Civil Code section 1938, City hereby states that the Premises has not undergone an inspection by a Certified Access Specialist.
b. In addition to the interior space designated for museum purposes, SLORRM shall continue to provide bathroom facilities.

12. SLORRM Responsibility for Maintenance of Premises. SLORRM shall:
a. Provide all repair and replacement needed for any personal property installed or improvements constructed on the interior or exterior by SLORRM. b. Provide all graffiti removal from the outside of the building and on the railroad tracks and other improvements or artifacts installed by SLORRM. c. Provide all janitorial service needed.
d. Purchase and restock any consumable supplies needed in the day-to-day operation of the building, including janitorial supplies and light bulbs and lamps.

13. City Responsibility for Maintenance of Premises. The City shall:
a. Provide all repair and maintenance on the exterior of the building, except as noted in 12(a) and (b) above.
b. Provide all repair and replacement needed for any equipment installed or improvements constructed by the City on the interior or exterior. c. Provide all maintenance service needed for the grounds and landscape, except as noted in 12 above.

14. Cost of Operations. The SLORRM shall bear the entire cost of its operations on Premises, including but not limited to:
a. Paying all utility bills, including water, electricity, natural gas, cable television service, telephone and garbage (along with recycling) for indoor or on-the-track connections. City shall be responsible for outdoor connections including landscape irrigation and parking lot lighting.
b. Paying the cost of any maintenance for which SLORRM is responsible. c. Paying any taxes and fees related to its occupancy of the Premises, including all possessory interest taxes that may be imposed.

15. Minimum Hours of Operation. The SLORRM agrees to keep the museum open to the public for a minimum of six (6) hours per week, with preference being given to weekend hours. The hours of operation shall be re-evaluated by SLORRM and the City at the beginning of each calendar year and adjusted upward whenever possible given SLORRM volunteer resources. During public hours of operation all parts of the actual museum, including the proposed model railroad room, will be available to visitors, as appropriate.

The model railroad room shall be made available to the public. At SLORRM’s discretion, special events (such as guest lectures, speakers, and birthday parties) may be arranged at the museum up to twenty (20) times per year.

16. Alterations to Premises. The City shall be notified of and consider approval of any exterior alterations, or any interior structural alterations made to Premises, prior to their commencement in order for City to post any notices of non-responsibility. Approval of alterations, such as the installation of exterior displays associated with the museum within areas approved for such use, shall not be unreasonably withheld by the City. SLORRM shall comply with all applicable procedures of the City's Community Development Department, Building Division, Architectural Review Commission and Cultural Heritage Committee and all applicable building and health and safety codes in making any alterations to structural, electrical, plumbing, interior and/or exterior systems and finishes of Premises. During the term of this Agreement, SLORRM shall keep the Premises and every part thereof, free and clear of all mechanic’s liens, materialmen’s liens, and other liens for any work or labor done, services performed, or materials and appliances used or furnished for or in connection with any operation of SLORRM, any repair or alteration, or addition which SLORRM may make or permit to cause to be made, or to work or construction by, for, or permitted by SLORRM on or about the Property. SLORRM shall at all times promptly and fully pay and discharge any and all claims on which any such liens may or could be based, and shall indemnify City against such liens, claims of liens and suits or other procedures pertaining thereto.

17. Expansion of Museum Facilities. Should additional railroad related facilities become property of the City in the future, the City agrees to explore with the SLORRM the possibility of their incorporation into the railroad museum.

18. Labor Code Requirements. The SLORRM certifies that it is aware 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 it certifies that it will comply with such provisions throughout the term of this agreement.

19. Proof of Insurance. The SLORRM agrees to continue to comply with and provide proof of insurance in accordance with the requirements established by City and updated periodically from time to time. The City will provide 60 days’ notice of change in insurance requirements to SLORRM. Any subsequent insurance requirements of the City shall be incorporated into and made part of this agreement.

20. Indemnification. Except for the sole negligence of the City, SLORRM shall indemnify,

defend and hold harmless the City, its officials, officers, agents, and employees, and their successors and assigns (the “City Indemnitees”) from:
a. Any and all costs, liability, damage or expense, including reasonable attorney’s fees and costs, arising from any and all claims and demands which may be made against the City Indemnitees by reason of any injury or death of any person or corporation caused by any negligent act or omission of the SLORRM or of SLORRM employees, agents, guests or invitees;
b. Any and all costs, liability, damage or expense, including reasonable attorney’s fees and costs, arising from any and all claims and demands for damage to or destruction of the property of the City Indemnitees, occupied or used by or in the care, custody, or control of the SLORRM, caused by any negligent act or omission of the SLORRM under this agreement;
c. Any and all costs, liability, damage or expense, including reasonable attorney’s fees and costs, arising from any and all claims and demands which may be made against the City Indemnitees by reason of any injury to or death of or damage suffered or sustained by an employee or agent of the SLORRM under this agreement, however caused, excepting, any such claims or demands which are the result of the proven gross negligence or willful misconduct of the City, its officers, agents, or employees;
d. Any and all costs, liability, damage or expense, including reasonable attorney’s fees and costs, arising from any and all claims and demands which may be made against the City Indemnitees by reason of infringement or alleged infringement of any patent rights or claims caused by the use of any apparatus, appliance, or materials furnished by the SLORRM under this agreement; and e. Any and all costs, liability, damage or expense, including reasonable attorney’s fees and costs, arising from any and all claims and demands which may be made against the City Indemnitees by reason of SLORRM’s trespass into or misuse of property owned by Union Pacific Railroad, private owners, or any other entity other than the City; and
f. Any and all penalties imposed or damages sought on account of the violation of any law or regulation or of any term or condition of any permit, when said violation of any law or regulation or of any term or condition of any permit is due to negligence on the part of the SLORRM.

In the event City Indemnitees are made a party to any action, lawsuit or other adversarial proceeding arising from SLORRM’s performance of this Agreement, SLORRM shall provide a defense to City Indemnitees or at the City’s option, reimburse the City Indemnitees their costs of defense, including reasonable legal fees, incurred in defense of such claims.

The SLORRM shall pay and satisfy any judgment or decree that may be rendered against the City, its officers, agents, or employees in any such suit, action, or other legal proceeding, when same were due to negligence of the SLORRM.

21. Enforcement Costs and Attorney's Fees. The prevailing party in any action between the parties to this Agreement, brought to enforce the terms of this agreement, may recover from the other party its reasonable costs and attorney's fees in connection with such an action.

22. Non-Discrimination. There shall be no discrimination against or segregation of any person or group of persons on account of race, religion, sex, sexual orientation, national origin, age, or physical, mental or economic status in the construction, operation, lease, sublease, use, occupancy, tenure or enjoyment of the Premises or the improvements thereon, or any part thereof, and SLORRM, or any person claiming under or through it, shall not establish or permit any such practice of discrimination or segregation with reference to the construction of the Project Improvements, or the selection, location, number, use or occupancy of employees, contractors, subcontractors, laborers or materialmen, tenants, lessees, subtenants, sublessees, invitees or vendees of the Premises or the improvements thereon, or any part thereof.

SLORRM shall not restrict access or use of the Premises or the improvements thereon, or any portion thereof, on the basis of race, religion, sex, sexual orientation, national origin, age, or physical, mental or economic status of any person.

23. Assignment. SLORRM shall not assign this agreement to another party without the City's prior written consent, which may be denied at the City's sole discretion. Any such assignment made without City’s prior written consent shall be null and void.

24. Entirety and Integrity of Agreement; Amendments. This document represents the entire and integrated agreement between the City and SLORRM. This document supersedes and negates all prior negotiations, representations, agreements and amendments, either written or oral, regarding Premises and the operation of a railroad museum on Premises. Both parties also recognize that some issues may not have been anticipated or addressed herein, and that changes to the agreement may be warranted.

Any amendment, modification, or variation from the terms of this Agreement shall be in writing upon mutual consent of both Parties and shall be effective only upon approval by the City Attorney and the City Manager of the City of San Luis Obispo.

25. Notices. All official notices required under this Agreement shall be given in writing and submitted by certified mail, postage prepaid, and addressed as follows:

City: City Administration
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
SLORRM: President
San Luis Obispo Railroad Museum
1940 Santa Barbara Avenue
San Luis Obispo, CA 93401

Either Party may change the address to which notices are to be sent by notifying the other Party of the new address, in the manner set forth above.

26. Authority to Execute Agreement. Both City and SLORRM do covenant that each individual executing this agreement on behalf of each party is a person duly authorized and empowered to execute Agreements for such party.

27. Prevailing Wages – Notice. SLORRM shall be responsible for evaluating the applicability of any and all prevailing wage requirements in connection with the work to be done on the Premises. SLORRM agrees at its own expense to comply with any and all prevailing wage requirements which may be applicable to work associated with the restoration and maintenance of the Premises, and further SLORRM shall hold harmless, indemnify and defend City against any claims, damages, costs and/or liabilities arising out of or related to SLORRM's contracting for any improvements constructed by SLORRM on the Premises. SLORRM acknowledges and agrees that, (a) in compliance with section 1773 of the California Labor Code, the State of California Department of Industrial Relations has established prevailing hourly wage rates for each type of workman, (b) current wage rates may be obtained from the Division of Labor web site:
www.dir.ca.gov/DLSR/PWD, (c) the public improvements that are a part of a project are subject to compliance monitoring and enforcement by the Department of Industrial Relations, and (d) any contractors or subcontractors required to pay prevailing wage must be registered with the Department of Industrial Relations pursuant to Section 1725.5 of the California Labor Code.

28. Severability. If any term, provision, condition or covenant contained in this Agreement, or the application thereof to any person or circumstance, is determined to be, to any extent, illegal, invalid or unenforceable, or be held to be illegal, invalid or unenforceable by any court of competent jurisdiction under present or future laws, then the remainder of this Agreement, or the application of such term, provision, condition or covenant to persons or circumstances other than those as to which it is held illegal, invalid or unenforceable, shall not be affected thereby and all such remaining terms, provisions, conditions and covenants in this Agreement shall be deemed to be valid and enforceable, and in lieu of such clause or provision, there shall be added as a part of this Agreement a clause or provision as similar in terms to such illegal, invalid, or unenforceable clause or provision as may be possible and be legal, valid, and enforceable.

29. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument, binding on each signatory thereto.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date set forth above.

ATTEST: CITY OF SAN LUIS OBISPO:

Teresa Purrington
City Clerk
Date Erica A. Stewart
Mayor
Date
APPROVED AS TO FORM: LESSEE:

SAN LUIS OBISPO RAILROAD
MUSEUM
J. Christine Dietrick
City Attorney
Date Brad LaRose
President
Date

EXHIBIT A
Lease Area

City of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: June 16, 2026
TO: Mayor and Council
FROM: Nickole Domini, Human Resources Director
VIA: Whitney McDonald, City Manager
SUBJECT: ITEM #6i – AMENDMENT TO MANAGEMENT COMPENSATION

RESOLUTION FOR DEPARTMENT HEAD EMPLOYMENT CONTRACTS
Staff received the following questions regarding the proposed amendment to the Management Compensation Resolution authorizing the City Manager to negotiate and execute individual employment contracts with department heads. The questions are below with staff’s response shown in italics:
1) Without employment contracts existing at this time, what are the current rules/allowances for hiring bonuses, moving expenses, advanced vacation and sick time, and severance for newly hired department heads? Can these already be approved by the City Manager, and if so, what are the current limits?
On April 19, 2022, the Council approved a Recruitment, Referral, and Retention Incentive Program (updated version attached), that establishes guidelines and procedures for the eligibility, approval, and processing of recruitment, hiring, referral, and retention incentives for employees. The current policy provides the following incentives:
 One-Time Lump Sum Hiring Bonus: For positions deemed by the HR Director as hard-to-fill, up to $5,000 upon hire for regular and contract positions, with the exception of lateral Police Officers and Public Safety Dispatchers in the Police Department which is up to $16,000 over three (3) years.  Relocation Reimbursement: Up to $15,000 for department head positions and up to $10,000 for all other regular or contract positions.  Advanced Sick Leave: A one-time sick leave bank of up to 48 hours upon hire for a new department head.
 Accelerated Vacation Accrual: Year-for-year accelerated vacation accrual for completed public sector years of service for all regular or contract positions.  Advanced Vacation Leave: For lateral Police Officer and Public Safety Dispatchers only, up to forty (40) hours of vacation leave after six (6) months of employment, or at a different time as approved by the Police Chief. No advanced vacation leave is currently afforded to new department heads.

ITEM #6i – AMENDMENT TO MANAGEMENT COMPENSATION RESOLUTION Page 2  Severance: Severance is not part of this incentive program. Appointed Officials (City Manager and City Attorney) are currently the only positions in the City that may be offered severance pay as outlined in their employment contracts. a. Regarding moving expenses, will employees be reimbursed based on actual costs submitted with receipts, or is the relocation assistance provided as a flat amount? Additionally, is this benefit available to anyone relocating after hire, and does it apply to moves from outside the county, the region, or the state? What are the eligibility limits? The relocation incentive is reimbursement-based. Employees who are offered a relocation reimbursement incentive must submit receipts of actual expenses which are verified by Human Resources. The employee may be reimbursed up to the incentive amount offered. To be eligible, as documented in the Recruitment, Referral, and Retention Incentive Program, the employee must relocate their primary residence to San Luis Obispo County and must be moving from a location more than 50 miles away. 2) In the past, has the Council approved hiring bonuses or relocation expenses for new Department Head hires? Is there a requirement for the City Manager to report the terms of the contract to the City Council? If not, can this direction be added?
Staff is not aware of Council-approved lump-sum hiring bonuses being offered for new Department Head hires; however, lump-sum hiring bonuses have been used for other hard‑ to‑ fill classifications in accordance with the Recruitment, Referral, and Retention Incentive Program. Relocation reimbursement of up to $15,000 has previously been provided for Department Head hires.

A revision has been made to Exhibit B of the Amended Unrepresented Management Compensation Resolution (attached) to clarify that the City Manager will notify Council when an employment contract is entered into with a Department Head, and once a contract is executed, it will be added to the City website. Staff recommends adoption of this revised version of Exhibit B. 3) Can you please explain the difference in authority between the Resolutions approved by Council and each department head’s contract? It says that the Resolution is still the “primary governing document,” but it is not clear how that could be the case based on the description in the staff report.

The Resolution is the primary governing document that sets the boundaries of what can be offered to a Department Head in their employment contract. The employment contract applies the pre-approved rules up to the limits set by the Resolution, as outlined in Section S of Exhibit B of the Amended Unrepresented Management Compensation Resolution.

ITEM #6i – AMENDMENT TO MANAGEMENT COMPENSATION RESOLUTION Page 3 4) How were the limits to the negotiable benefits determined? If comparisons with other jurisdictions were collected, can those be shared to confirm that these amounts are comparable to similar cities and other local jurisdictions? To support the City’s ability to attract and retain highly qualified Department Heads, the proposed limits were established based on staff’s professional judgment and an understanding of the competitive environment for executive-level public sector positions. Although staff was not able to gather substantial regional or comparator agency data, the limits were designed to provide appropriate flexibility for the City Manager while maintaining defined financial parameters approved by the Council.

Some California Cities, such as Arroyo Grande, Burbank, Chico, and Pismo Beach, provide either employment contracts or similar incentives, specifically severance provisions, to their department head positions. Establishing these terms also provides clarity regarding the at-will nature of these positions and supports a transparent and consistent framework for executive employment. 5) On page 129, in regard to the Police Chief, the following appears:

Can you please explain what is meant by “excluding CalPERS retirement contributions”?
The total compensation differential between the Police Chief and the Deputy Police Chief excluded CalPERS retirement contributions as the percentage the City pays towards retirement differs based on retirement tier. Under the Public Employees' Pension Reform Act (PEPRA), employees are placed into different tiers based on their hire date. As a result, a subordinate in a “Classic” tier (such as 3% at 50) requires a significantly higher employer contribution than a newly hired Department Head in a “PEPRA” tier (such as 2.7% at 57). Including these retirement costs can make the compensation gap appear smaller than it truly is, or even suggest the subordinate is compensated at a higher level, solely due to the City’s higher Classic-tier pension obligation.

Attachments
A - Recruitment, Referral, and Retention Incentive Program B - Revised Exhibit B of the Amended Unrepresented Management Compensation Resolution

RECRUITMENT, REFERRAL, AND RETENTION INCENTIVE PROGRAM

PURPOSE
The purpose of the Recruitment, Referral, and Retention Incentive Program is to establish guidelines and procedures for the eligibility, approval, and processing of recruitment, hiring, referral, and retention incentives for applicants and employees.

POLICY
Pursuant to the City’s Compensation Philosophy, it is the policy of the City of San Luis Obispo to recruit and retain well-qualified employees who exemplify the City’s organizational values. To assist in recruitment and retention efforts, the following incentives have been identified as described in further detail below.

I. ACCELERATED VACATION ACCRUAL
Provide a year-for-year (1:1) accelerated vacation accrual for completed public sector years of service. For example, if an individual is extended a job offer after having five (5) years of public sector service, they will begin accruing vacation leave with the City of San Luis Obispo as if they have five (5) years of service.

To be eligible for service credit towards accelerated vacation accrual, the individual must:

1. Accept employment with the City of San Luis Obispo, and;

2. Fill a regular or contract position that is eligible for vacation accrual, and;

3. Have prior public sector work experience, and;

4. Provide details of prior public sector experience to Human Resources staff.

II. LUMP SUM HIRING INCENTIVE
Lump sum hiring incentives can be extended for regular or contract positions that are deemed hard to fill by the Director of Human Resources. The maximum value of the lump sum hiring incentive is $5,000 for regular and contract positions, with the exception of lateral Police Officers and lateral Public Safety Dispatchers in the Police Department, as described in further detail below.

To be eligible for the lump sum hiring incentive, the following shall apply:

1. The hiring manager shall seek approval from the Director of Human Resources in advance of extending a job offer, and;

2. The individual must fill a regular or contract position that is deemed difficult to fill by the Director of Human Resources, and;

3. The individual must be a selected candidate through the Employment Opportunity Program (EOP) or through external recruitment.

4. The department must have sufficient budget to pay for the incentive.

Recruitment, Referral, and Retention Incentive Program – Last Updated June 2026 2 Due to significant recruitment challenges for well-qualified employees in our Police Department, the hiring incentives specified below are designed in an effort to attract and retain the best possible Police Officers and Public Safety Dispatchers to serve the San Luis Obispo community.

Lateral Police Officer or Lateral Public Safety Dispatcher Lump Sum Hiring Incentive
Offer a lateral Police Officer or lateral Public Safety Dispatcher a signing incentive of up to $16,000 payable as follows:
• Up to $5,000 upon hire.
• Up to $1,000 upon successful completion of the Field Training Program. • Up to $5,000 upon successful completion of the 12-month probationary period. • Up to $5,000 paid upon successful completion of the third-year anniversary. • Grant up to forty (40) hours of vacation upon completion of the first six months of employment. The Police Chief has the discretion to grant the 40 hours of vacation leave at a different time on a case-by-case basis.

Note: A lateral Police Officer is someone who has a minimum of one year of recent law enforcement experience and meets the minimum requirements of the position. A lateral Public Safety Dispatcher is someone who has a minimum of one year of experience in dispatching for a public safety agency and meets the minimum requirements of the position.

The lump sum hiring incentives will be provided to eligible employees on their first paycheck, or as specified above. Employees who receive a lump sum hiring incentive are subject to the continued service requirement outlined below.

Continued Service Requirement
Regular Employees
Failure to continue in the City service for three years due to voluntary resignation will result in the need to repay a proportional amount of the hiring incentive. For example, an employee who receives a $3,000 hiring incentive and resigns after 24 months with the City, will be responsible for repaying the City $1,000 ($3,000 total incentive divided by 36 months times remaining months to fulfill three-year commitment).

The employee agrees that the Finance Department is authorized to make a deduction from the employee’s final payroll check for the appropriate amount of relocation and hiring incentive to be repaid. Employees who are terminated or released from probation are not required to repay the hiring incentive.

Contract Employees
Failure to continue in the City service for the term of the contract due to voluntary resignation will result in the need to repay a proportional amount of the hiring incentive.

For example, an employee with a two-year contract who receives a $3,000 hiring incentive and resigns after 12 months with the City will be responsible for repaying the City $1,500 ($3,000 total incentive divided by 24 months times remaining months to fulfill the two-year contract).

Recruitment, Referral, and Retention Incentive Program – Last Updated June 2026 3 The employee agrees that the Finance Department is authorized to make a deduction from the employee’s final payroll check for the appropriate amount of the hiring incentive to be repaid. Employees who are terminated or released from probation are not required to repay the hiring incentive.

III. REFERRAL INCENTIVES FOR EXISTING EMPLOYEES
To encourage employees to actively engage in the recruitment process, the City will pay a referral fee to existing employees who recruit a candidate for the City of San Luis Obispo employment in a regular or contract position who is hired for the position.

Exclusions

1. In order to avoid a conflict of interest, the following exclusions apply:
a. Appointed Officials and Department Heads are excluded from receiving a referral fee for any position.
b. Appointing authorities or supervisors who participate in the hiring decision are excluded from receiving a referral fee when referring applicants to the position for which they are recruiting.
c. Anyone who screens applications, serves on an interview panel, or otherwise participates in the selection and background investigation process are excluded from receiving a referral fee for the positions they were involved in recruiting.
d. Human Resources Department employees directly assigned to recruiting are excluded from receiving a referral fee.

2. Referring a current City employee will not result in a referral fee. This includes temporary and contract employees who are hired into a regular position, or an employee in a regular position who is promoted or transferred to another position through the EOP.

Referral Fee Application Submittal and Deadline

1. The Referral Fee Application is available in the Forms and Policies section on SharePoint.

2. Referral Fee Applications must be submitted no later than one month after the new employee’s hire date. It is the responsibility of the employee to ensure that the application is submitted by the deadline. Referral fee applications will be submitted to the Human Resources Department, which is charged with administering the program.

3. The Human Resources Department will track each application submitted.

Application Certification
The new employee will be contacted by Human Resources to certify that a City of San Luis Obispo employee recruited them.

If more than one employee indicates they referred the same new employee, the Human Resources Director shall determine to whom the referral fee shall be paid based on the applicant's indication of which employee actively recruited them.

Recruitment, Referral, and Retention Incentive Program – Last Updated June 2026 4 Prior to approving the Referral Fee Application, Human Resources staff will ensure none of the exclusions above apply.

Referral Fee Amount
After the referral fee application is approved and the new employee has started work, the referring employee shall receive $500 (or up to $1,500 for employees who refer a lateral Police Officer or Public Safety Dispatcher), less applicable taxes. Payments will be processed with the regular payroll check and will be reported as taxable income. The fee is not reported to CalPERS as special compensation.

Employees may make multiple referrals within the same calendar year. The second and subsequent approved referrals made by an employee in one calendar year will be paid at the amount of $1,000 less applicable taxes. Exception: Referrals for lateral police officer or dispatcher will remain at $1,500 for each referral. All other sections of this policy apply as described above.

Dispute Resolution
Any disputes arising from the Referral Fee section of this program may be appealed to the City Manager whose decision shall be final.

IV. RELOCATION REIMBURSEMENT
Relocation reimbursement is provided in an effort to ease the burden for candidates who accept employment with the City from out of the area and therefore face costs associated with the need to relocate. The City can reimburse relocation costs that are directly related to an employee’s relocation of 50 miles or more to San Luis Obispo County.

Eligibility Requirements
To be eligible for the relocation incentive, the applicant must:

1. Accept employment with the City of San Luis Obispo, and;

2. Relocate their primary residence to San Luis Obispo County, and;

3. Relocate a distance of 50 miles or more, and;

4. Fill a regular or contract position that is deemed difficult to fill by the Director of Human Resources.

Relocation Reimbursement Amount

1. Department Head positions. Total relocation benefits up to $15,000 (subject to applicable taxes).

2. All other regular or contract positions. Total relocation benefits up to $10,000 (subject to applicable taxes).

The reimbursement amount for each position will be determined by the hiring department and Human Resources and will be included in the new employee offer letter.

The department must have sufficient budget to pay for the incentive.

Recruitment, Referral, and Retention Incentive Program – Last Updated June 2026 5 Eligible Expenses
Eligible expenses are those incurred in the movement and relocation of a personal place of residence meeting the eligibility requirements outlined above including the following:

1. Movement of household goods. The costs associated with packing, loading, transporting, and unloading personal household goods.

2. In-transit expenses. Gas, food, and lodging during the actual move from the employee’s home at time of hire to their new temporary or permanent home in San Luis Obispo County.

3. Temporary living expenses. Hotel, motel, or other temporary lodging such as Airbnb or short-term rentals necessary to allow the employee to start work.

4. First month rent and/or deposits. Costs associated with securing a residence in San Luis Obispo County such as the first month rent and security deposits for the new residence; costs associated with terminating a lease or rental agreement.

5. Closing costs. Costs associated with the sale of the employee’s primary residence or purchase of a home in San Luis Obispo County.

6. Other eligible expenses as defined by the Internal Revenue Service (IRS) Instructions for Form 3903, Moving Expenses.

Continued Service Requirement
Failure to continue in the City service for three years, due to voluntary resignation, will result in the need to repay a proportional amount of the relocation reimbursement on a pay period basis. For example, if an employee resigns after one (1) year of employment with the City, they will be responsible for repaying approximately two thirds (2/3) of the reimbursed moving expenses.

The employee will sign an acknowledgment agreeing that the Finance Department is authorized to make a deduction from the employee's final payroll check for the appropriate amount of the relocation reimbursement to be repaid. If the final payroll check is not adequate to cover the amount owed, the City will invoice the employee under its standard accounts receivable process and full range of collection options, if needed, according to Section 631 of the City’s Financial Management Manual.

Employees who are terminated, released from probation, or discontinue employment due to death or permanent disability will not be required to repay the relocation reimbursement, and may not submit reimbursement requests after separating from employment.

Relocation Reimbursement Procedures
All authorized amounts described above will be documented in a new employee offer letter and the employee will sign acknowledging the benefits, potential tax consequences, and repayment requirements prior to starting work for the City. The City will not pay vendors directly for moving and relocation expenses.

The employee has up to one year after their hire date to claim their relocation reimbursement. If moving expenses are spread over several months, the employee may submit receipts in up to three separate requests, with a total of all requests not to exceed the authorized amount in the offer letter.

Recruitment, Referral, and Retention Incentive Program – Last Updated June 2026 6 Once determined, the employee shall submit a completed Moving Expense Request Form with itemized receipts and a copy of their offer letter to the Human Resources department for approval. Human Resources will forward the approved documents to Payroll or disapproval to the Director of Human Resources within five working days.

When a Moving Expense Request Form is not approved, an appeal may be made to the City Manager for a final decision.

All relocation reimbursements are considered taxable income for Federal income tax purposes. Moving and relocation expense reimbursements may or may not be considered taxable income for California income tax purposes depending on whether they are considered qualified or non-qualified, as prescribed by IRS tax code. Following submission of expense claims, Payroll will issue payment and deduct taxes accordingly.

V. STARTING SICK LEAVE BANK
The City Manager may authorize a one-time starting sick leave bank of up to 48 hours upon hire of a new Department Head. This will be documented in the new employee’s offer letter.

FUNDING SOURCE AND FUTURE CHANGES TO PROGRAM
The City Manager is authorized to make future administrative changes to this program in an effort to successfully attract and retain well-qualified employees. If there is a change to a monetary incentive, the department will be expected to cover the cost within departmental salary savings, or the City Manager can choose to move other funding as needed to support this program.

Amended Unrepresented Management Employees Resolution
Exhibit AB
Table of Contents
Exhibit A Sections
Section A Pay for Performance................................................................................. 3 Section B Medical, Dental, Vision ............................................................................. 3 Section C Health Flex Contribution ........................................................................... 3 Section D Life and Disability Insurance..................................................................... 5 Section E Retirement................................................................................................ 5 Section F Supplemental Retirement ......................................................................... 7 Section G Vacation ................................................................................................... 7 Section H Administrative Leave ................................................................................ 8 Section I Holidays.................................................................................................... 9 Section J Sick Leave.............................................................................................. 10 Section K Bereavement Leave ............................................................................... 11 Section L Workers’ Compensation Leave .............................................................. 11 Section M Temporary Upgrade Assignment............................................................ 12 Section N Bilingual Pay........................................................................................... 12 Section O Vehicle Assignment................................................................................ 12 Section P Uniform Allowance.................................................................................. 12 Section Q Payday ................................................................................................... 13 Section R Appointed Officials.................................................................................. 13 Section S Individual Employment Contracts for Department Heads ....................... 13 Appendix A Classifications ........................................................................................ 15 Section A Pay for Performance................................................................................. 3 Section B Medical, Dental, Vision ............................................................................. 3 Section C Health Flex Contribution ........................................................................... 3 Section D Life and Disability Insurance..................................................................... 5 Section E Retirement................................................................................................ 5 Section F Supplemental Retirement ......................................................................... 7 Section G Vacation ................................................................................................... 7 Section H Administrative Leave ................................................................................ 8 Section I Holidays.................................................................................................... 9

EXHIBIT “A”
Section J Sick Leave.............................................................................................. 10

EXHIBIT “AB”
Section A Pay for Performance
In 1996 the City Council established the Management Pay for Performance System for department heads and management employees. The system is designed to recognize and reward excellent performance by department heads and managers and to provide an incentive for continuous improvement and sustained high performance. Instead of step increases, the department heads and management employees move through their salary range solely according to accomplishment of objectives and job-related behavior. Further information about the Management Pay for Performance System is found in the Management Pay for Performance System Guide.

Section B Medical, Dental, Vision
The City shall establish and maintain medical, dental, and vision insurance plans for appointed officials, department heads, management employees and their dependents.

The City reserves the right to choose the method of insuring and plans to be offered.

Section C Health Flex Contribution
Employees electing medical coverage in the City’s plans shall receive a health flex contribution and shall purchase such coverage through the City’s Section 125 Plan “Cafeteria Plan.” To be eligible for the health flex contribution in a particular pay period, an employee must be paid for more than half of their regularly scheduled hours, unless the employee is on an approved FMLA/CFRA leave of absence or receiving temporary disability benefits through workers’ compensation. Less than full-time employees shall receive a prorated share of the City’s contribution.

The City will contribute directly to CalPERS, on behalf of each employee, the statutory minimum monthly employer contribution required under the Public Employee’s Medical and Hospital Care Act (PEMHCA), as set annually by CalPERS. For 2025, the PEMHCA minimum contribution is $158 per month. The City will provide a contribution through its cafeteria plan, which combined with the City's PEMHCA contribution, will equal the total health flex contribution in the amounts listed below.

The monthly health flex contribution is listed below, along with the updated contribution that will take effect the first paycheck in September 2025.

Level of Coverage 2025 Monthly
Contribution
Monthly
Contribution
Effective
September 2025
Employee Only $670 $735
Employee Only “Legacy” $790 $790
Employee Plus One $1,323 $1,470
Family $1,792 $1,911

EXHIBIT “AB”
Employees hired prior to September 1, 2008, who elect employee only medical coverage will receive the health flex contribution listed above for employee only “legacy” coverage until such amount is less than the Employee Only (non-Legacy) contribution amount. As of January 1, 2015, if an employee who is receiving Employee Only or Opt-out “legacy” coverage changes their level of coverage, they will be eligible to return to the “legacy” coverage in a future year.

If the premium cost for medical coverage is less than the health flex contribution, the employee shall not receive any unused health flex in the form of cash or purchase additional benefits.

Effective for the 2026, 2027, and 2028 premiums, the City’s total contribution for group medical coverage shall be increased by an amount equal to one-half of the average percentage change for family coverage in the CalPERS health plans available in San Luis Obispo County. In any event, the City’s contribution will not be decreased. For example:
if three plans were available and the year-to-year changes were +10%, +20%, and -6% respectively, the City’s contribution would be increased by 4% ((10% + 20% + -6%) ÷ 3 = 8% x 1/2). The employee only “legacy” amount will not adjust.

The City agrees to continue its health flex contribution or conditional opt-out amount as described below for one full pay period in the event that an employee has exhausted all paid time off, including paid leave donated through the catastrophic leave program, and leave approved under the federal Family and Medical Leave Act (FMLA) and the California Family Rights Act (CFRA). That is, the employee shall receive the regular City health flex contribution or conditional opt-out amount for the first full pay period following the pay period in which the employee's paid leave balances reach zero (0) and FMLA/CFRA leave has been exhausted. This continuation of the City health flex contribution is available once per rolling 12-month period, per employee.

Conditional Opt-out
Employees may receive a monthly opt-out incentive (Cash-in-Lieu) instead of the health flex contribution and medical coverage through the City’s medical plans if the following conditions are met:

1. The employee completes an attestation form during initial enrollment or during the annual open enrollment period;

2. The attestation form verifies that the employee and all individuals for whom the employee expects to claim a personal exemption deduction (Tax Family) have alternative minimum essential coverage;

3. Coverage in the individual market or individual coverage through Covered California does not meet the requirement of alternative minimum essential coverage for the employee and the employee’s Tax Family.

The monthly conditional opt-out (Cash-in-Lieu) incentives are:

Opt-out $200

EXHIBIT “AB”
“Legacy” Opt-out $790 (hired before September 1, 2008)
The Cash-in-Lieu shall be taxable income to the employee. The employee must notify the City within 30 days of the loss of alternative minimum essential coverage. The conditional opt-out payment shall no longer be payable if the employee and family members cease to be enrolled in alternative minimum essential coverage. The City will not pay Cash-in-Lieu if the City knows or has reason to know that the employee or an individual in the employee’s Tax Family does not have the required alternative coverage. The conditional opt-out incentive will cease as described above one full pay period after the employee exhausts unpaid leave or FMLA/CFRA, whichever is later.

Employees receiving the conditional opt-out amount will also be assessed $16.00 per month to be placed in the Retiree Health Insurance Account. This account will be used to fund the City's contribution toward retiree premiums and the City's costs for the Public Employees’ Contingency Reserve Fund and the Administrative Costs. However, there is no requirement that these funds be used exclusively for this purpose nor any guarantee that they will be sufficient to fund retiree health costs, although they will be used for negotiated employee benefits.

Dental and Vision Insurance/Dependent Coverage
Employee participation in the City's dental and vision plans is optional. Employees who elect coverage shall pay the dental and/or vision premium(s) by payroll deduction(s) on a pre-tax basis through the City’s Cafeteria Plan.

Section D Life and Disability Insurance
The City shall provide the following special insurance benefits:

1. Long-term disability insurance providing 66 2/3% of gross salary (maximum benefit $15,000 per month) to age 65 for any sickness or accident, subject to the exclusions in the long-term disability policy, after a 30-day waiting period.

The City is exploring the possibility of enrolling in State Disability Insurance or an alternative employee-funded enhanced disability program. If approved by a majority vote of management employees, the City will implement the program as soon as administratively possible.

2. In addition to $4,000 term life insurance purchased by the employee, the City provides a $100,000 term life insurance, including accidental death and dismemberment through the City’s Cafeteria Plan.

Section E Retirement
A. CalPERS Contracts. Non-sworn employees are classified as Miscellaneous. All employees work twelve (12) months per year.

1. “Classic Members First Tier” non-sworn and sworn employees hired before December 6, 2012.

EXHIBIT “AB”
The City agrees to provide the Public Employees' Retirement System’s (CalPERS)

2.7% at age 55 plan to all non-sworn employees and the 3% at 50 plan to all sworn employees. The 2.7% at 55 plan includes the following amendments: 1959 Survivor’s Benefit – Level Four, conversion of unused sick leave to additional retirement credit, one-year final compensation, Military Service Credit, and PreRetirement Optional Settlement 2 Death Benefit. The 3% at age 50 plan includes the following amendments: Post-Retirement Survivor Allowance, conversion of unused sick leave credit to additional retirement credit, 1959 Survivor’s BenefitLevel Four, one-year final compensation, Military Service Credit, and PreRetirement Optional Settlement 2 Death Benefit. Employees will pay the entire 8% (first tier miscellaneous) or 9% (safety) member contribution, as applicable. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a) for a total employee contribution of 11 or 12%, as applicable.

2. “Classic Members Second Tier” non-sworn and sworn employees hired on or after December 6, 2012.

The City agrees to provide the CalPERS 2% at 60 plan for non-sworn employees using the highest three-year average as final compensation. The second-tier formula for non-sworn employees will include the following amendments: 1959 Survivor’s Benefit – Level Four, conversion of unused sick leave to additional retirement credit, Military Service Credit, and Pre-Retirement Optional Settlement 2 Death Benefit. Employees hired under this plan will pay the full member contribution required under the plan, presently seven percent (7%).

For sworn “Classic Members” hired on or after December 6, 2012, the City will provide the CalPERS 3% at 55 plan for sworn Fire employees and 2% at 50 plan for sworn Police employees using the highest three-year average as final compensation. The second-tier formula for sworn employees will include the following amendments: Post Retirement Survivor Allowance, conversion of unused sick leave to additional retirement credit, the 1959 Survivor’s Benefit – Level Four, Military Service Credit, and Pre-Retirement Optional Settlement 2 Death Benefit.

Employees will pay the entire 7% (second tier miscellaneous) or 9% (safety) member contribution, as applicable. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a) for a total employee contribution of 10 or 12%, as applicable.

3. “New Members Third Tier” non-sworn and sworn employees hired after January 1, 2013. CalPERS determines who are “New Members” within the meaning of the California Public Employees’ Pension Reform Act (PEPRA).

The City will provide the CalPERS 2% at 62 plan for non-sworn employees and

2.7% at 57 plan for sworn employees, using the highest three-year average as final compensation.

EXHIBIT “AB”
Employees will pay 50% of total normal cost of the retirement benefit, as determined by CalPERS. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a).

Member contributions are made on a pre-tax basis as permitted under IRS Code Section 414(h)(2).

Section F Supplemental Retirement
The City shall contribute one percent (1%) of salary for department heads to a defined contribution supplemental retirement plan established in accordance with sections 401(a) and 501(a) of the Internal Revenue Code of 1986 and California Government Code sections 53215-53224. Department heads and managers are eligible to make elective contributions to this plan.

Section G Vacation
Vacation leave is governed by Section 2.36.440 of the Municipal Code, except that it may be taken after the completion of the sixth calendar month of service from the benefit date or earlier with department head, or their designee, authorization. Employees shall accrue vacation leave at the following rates for completed years of service with the City. Parttime employees will accrue a prorated amount of vacation leave.

Management Employees
Years of Completed
Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
Less than 5 years 12 days 96 hours
5 to less than 10 years 15 days 120 hours
10 to less than 20 years 18 days 144 hours
20+ years 20 days 160 hours
Appointed Officials & Department Heads
Years of Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
Less than 10 years 15 days 120 hours
10 to less than 20 years 18 days 144 hours
20+ years 20 days 160 hours
*One day is equivalent to eight (8) hours for a 40-hour per week position.

EXHIBIT “AB”
Employees are eligible for a year-for-year accelerated vacation accrual based on prior public sector and military experience. For example, if an employee has ten (10) years of public sector experience prior to working for the City of San Luis Obispo, their vacation accrual will be advanced by ten (10) years.

Vacation leave shall be accrued as earned biweekly. Vacation time balances shall not exceed twice the annual accrual rate. If an employee reaches the maximum at any time throughout the year, the employee will stop accruing vacation leave.

Vacation schedules for management employees shall be based upon the needs of the City and then, insofar as possible, upon the wishes of the employee.

Vacation Cash Out
Employees are eligible to request payment for up to forty (40) hours of unused vacation leave subject to following conditions:

1. The employee must make an irrevocable election in the month of December in the prior calendar year;

2. The cash out shall be issued in December of the year following the irrevocable election;

3. Employees must have eighty (80) hours of accrued vacation leave to be eligible for cash out at the time of the irrevocable election; and

4. Late irrevocable election forms will not be accepted, nor can they be changed after the established deadline.

Emergency Vacation Cash Out
Notwithstanding the requirement for an irrevocable election for the cash out of vacation for the upcoming calendar year, an employee may cash out vacation in an existing year, subject to the following conditions:

1. The employee may cash out no more than the forty (40) hours of vacation (including any cash out previously elected); and

2. The amount cashed out pursuant to this subdivision must be in whole-hour increments with a minimum cash out of twenty (20) hours and shall be subject to a twenty percent (20%) penalty. That is, if an employee cashes out 40 hours of emergency cash out, the penalty shall be 20% of the amount cashed out. For example, if an employee wishes to cash out forty (40) hours due to an emergency but failed to make an irrevocable election, the employee will receive the cash value of thirty-two (32) hours, but forty (40) hours will be removed from the employee’s accrued balance.

Vacation Accrual Cap Cash Out
If an employee reaches the annual accrual cap before December, the employee will be able to request vacation payment one additional time during the calendar year, in addition to the December cash out. However, no more than 40 hours of unused vacation leave will be paid out in any calendar year.

Section H Administrative Leave

EXHIBIT “AB”
Administrative leave provided to exempt management employees is paid time off in recognition of the extended work hours and the lack of eligibility for overtime compensation associated with their positions. Administrative leave is not accrued based on hours worked and is not compensable upon separation from the City.

Appointed officials and department heads shall be advanced 80 hours of administrative leave the pay period that January 1
st falls into.

Deputy directors and other positions, as designated by the department head, required to regularly work night meetings shall be advanced 64 hours of administrative leave the pay period that January 1st falls into.

Other management employees shall be advanced 48 hours of administrative leave the pay period that January 1st falls into.

Administrative leave hours shall be pro-rated on a pay period basis when an employee is appointed or leaves employment during the calendar year. The employee’s final check will be adjusted to reflect the pro-rated hours, however there is no provision to receive cash payment for unused administrative hours. Unused administration leave will not be carried over year-to-year but can be taken through December 31st of each year.

Appointed officials, department heads, and management employees are considered exempt from the overtime provisions of the Fair Labor Standards Act (FLSA) and not eligible for overtime payment. In general, management employees are expected to work the hours necessary to successfully carry out their duties and frequently must return to work or attend meetings and events outside their normal working hours. However, in the event a state of emergency is called for the City of San Luis Obispo by the City Council, County of San Luis Obispo, State of California, or Federal Government, employees can be paid at the rate of time-and-one-half for the hours worked in excess of forty (40) hours per week on activities related to disaster management and recovery that are reimbursable by state or federal funding. Approved employees can be similarly compensated when rendering aid to other agencies in an emergency declaration situation where overtime is reimbursable by the requesting agency upon approval by their Department Head or their designee.

Section I Holidays
Employees shall receive eleven (11) fixed plus two (2) floating holidays per year. The following days of each year are designated as paid holidays:
 January 1 – New Year’s Day
 Third Monday in January – Martin Luther King Jr. Day
 Third Monday in February – Presidents’ Day
 Last Monday in May – Memorial Day
 July 4 – Independence Day
 First Monday in September – Labor Day

EXHIBIT “AB”
 November 11 – Veteran’s Day
 Fourth Thursday in November – Thanksgiving Day
 Friday after Thanksgiving
 One half day before Christmas Day
 December 25 – Christmas Day
 One half day before New Year’s Day
 Two floating holidays
For employees who are not regularly scheduled to work on weekends, when a holiday falls on a Saturday, the preceding Friday shall be observed. When a holiday falls on a Sunday, the following Monday shall be observed. For employees on a compressed work schedule, when a holiday falls on the employee’s flex day, holiday hours must be observed on another scheduled workday within the same work week. A holiday shall be defined as eight (8) hours of paid time off for regular full-time employees and prorated for part-time employees.

The City reserves the right to close non-essential City services and offices on weekdays between the Christmas Day and New Year’s Eve holidays. Employees scheduled to work during this time in non-essential functions are required to use appropriate personal leave.

Essential City services and functions are determined at the discretion of the department head. The City will notify employees of the closure of non-essential City services and offices no later than October 31st of the same year in order to provide employees with ample time to plan accordingly.

The two floating holidays (16 hours) will be provided in a floating holiday leave bank the pay period that January 1st falls within and will be prorated on a pay period basis if an employee starts later in the year. Employees will have the ability to use floating holiday leave hours at any point during the calendar year. Unused floating holiday leave will not be carried over year-to-year but can be taken through December 31st of each year. If an employee terminates for any reason, having taken off hours in excess of their biweekly prorated share of the floating holiday, the value of the overage will be deducted from the employee’s final check; however, there is no provision to receive cash payment for unused floating holiday hours.

Section J Sick Leave
Sick leave is governed by Section 2.36.420 of the Municipal Code. An employee shall accrue sick leave with pay at the rate of twelve (12) days, or the prorated shift equivalent, per year of continuous service since the benefit date. An employee may take up to 48 hours per calendar year of sick leave if required to be away from the job to personally care for a member of their immediate family. A family member for this purpose is any relationship listed in Labor Code 245.5(C). However, if the family member is part of the employee’s household and is hospitalized, the employee may take up to 56 hours (rather than 48 hours) of sick leave per year to care for their family member. The employee shall submit written verification of such hospitalization.

EXHIBIT “AB”
The City maintains a separate Family and Medical Leave Administration Policy consistent with the City’s legal obligations to provide Family Medical Leave Act and California Family Rights Act, among other forms of leaves. This policy can be accessed in the Forms and Policies section on SharePoint.

Upon termination of employment by death or retirement, the employee or beneficiary may choose:

A. A payout of the employee’s accumulated sick leave balance based on years of service according to the following schedule; or
B. To convert the remaining employee’s sick leave balance to service credit in accordance with CalPERS regulations; or
C. A combination of these two options:
i. Death – 25%
ii. Retirement and actual commencement of CalPERS benefits:
a. After ten years of continuous employment – 10%
b. After twenty years of continuous employment – 15%
Section K Bereavement Leave
Bereavement Leave
At each employee’s option, sick leave or vacation leave may be used to be absent from duty due to the death of an employee’s family member as defined in Labor Code section 245.5(c), provided such leave as defined in this section shall not exceed five (5) days (no more than 40 hours) for each incident. The leave days may be taken non-consecutively as needed. The employee may be required to submit proof of relative's death before being granted sick leave pay. False information concerning the death or relationship may result in discipline up to and including termination.

Reproductive Loss Leave
Employees experiencing a miscarriage, failed adoption, failed surrogacy, stillbirth, or unsuccessful assisted reproduction are entitled to up to five (5) days (no more than 40 hours) of leave following the qualifying loss. The leave days may be taken nonconsecutively as needed. Employees may utilize sick leave or vacation leave to be paid during reproductive loss leave. To utilize this leave, the employee may confidentially report the qualifying event to whomever in their chain of command they feel most comfortable, including their supervisor, manager, or Human Resources.

Section L Workers’ Compensation Leave
An employee who is absent from duty because of on-the-job injury in accordance with State workers’ compensation law and is not eligible for disability payments under Labor Code Section 4850 shall be paid the difference between their base salary and the amount provided by workers’ compensation during the first ninety (90) business days of such temporary disability absence. Eligibility for workers’ compensation leave requires an accepted workers’ compensation claim.

EXHIBIT “AB”
If an employee is eligible for Total Temporary Disability benefits after exhausting 4850 or salary continuation as defined in the paragraph above, the employee will receive such payment directly from the City’s workers’ compensation administrator and will only be able to supplement one-third pay with accrued sick leave.

Section M Temporary Upgrade Assignment
For the purposes of this Section, a temporary upgrade assignment is the full-time assignment to a higher-level classification (with a higher salary). An employee assigned in writing by management to a temporary upgrade assignment shall receive temporary upgrade pay of no less than five percent (5%) or be placed at the bottom of the higher range, whichever is greater, but in no case more than the top salary of the higher range, in addition to their regular base rate commencing on the eleventh (11th) consecutive workday of the temporary upgrade assignment. In order to receive temporary upgrade pay, an employee must be working in the temporary upgrade assignment and may not have a leave of absence longer than two (2) consecutive weeks, unless otherwise approved.

The temporary upgrade assignment will be evaluated after three (3) and six (6) months.

If there is an operational need to have an employee work in the temporary upgrade assignment more than six (6) months, the temporary upgrade pay will be increased to at least the first step of the higher classification and/or up to an additional five percent (5%), for a total of at least ten percent (10%) special pay, upon the recommendation of the supervisor and approval of the department head.

Section N Bilingual Pay
Employees certified as bilingual in Spanish and assigned to use their Spanish speaking skills shall receive a bilingual payment of thirty-five ($35) dollars per pay period. Employees are eligible for this incentive the first full pay period following qualification. Additional languages may be approved by the City based upon demonstrated need. Regardless of certification and payment, all employees shall use any language skills they possess to the best of their ability.

Section O Vehicle Assignment
The Fire Chief and Police Chief will be provided a City vehicle for emergency response during off-duty time. Other department heads shall receive a car allowance of $236 per month, paid semi-monthly.

The use of a personal automobile for City business will be eligible for mileage reimbursement in accordance with standard City policy.

Section P Uniform Allowance

EXHIBIT “AB”
The Fire Chief, Deputy Fire Chief, and Fire Marshal shall receive $1,300 per year uniform allowance paid on a biweekly basis.

The Police Chief shall receive $1,300 per year uniform allowance issued in the amount of $650 on the first paycheck in December and June. New hires will receive a prorated amount on a biweekly basis. Uniform allowance will not be prorated upon separation from employment.

For “Classic Members” as defined by CalPERS, uniform allowance shall be reported to CalPERS as special compensation.

Section Q Payday
Payroll will be disbursed on a biweekly schedule. Payday will be every other Thursday.

This disbursement schedule is predicated upon normal working conditions and is subject to adjustment for cause beyond the City's control.

Section R Appointed Officials
The benefits outlined in this exhibit for department heads apply to appointed officials, except where they have been modified by City Council resolution.

Section S Individual Employment Contracts for Department Heads To enhance the City’s ability to recruit and retain high-level executive talent, the City Manager is authorized to negotiate and execute individual employment contracts for employees within the Department Head classifications, as determined by the City Manager to be appropriate and in the best interests of the City. The City Manager will notify the City Council when an employment contract is entered into with a Department Head, and once a contract is executed, it will be added to the City website. Individual employment contracts may vary from the standard provisions set forth in this Resolution, or may establish other provisions, without further approval of Council, including, but not limited to:
 One-Time Lump Sum Hiring Bonus: A one-time hiring bonus, not to exceed one (1) month’s base salary.
 Relocation Reimbursement: Total relocation reimbursement not to exceed $30,000.
 Leave Balances: Advanced vacation and/or sick leave credits upon hire, provided such credits do not exceed four (4) weeks.
 Separation: Specific severance terms and conditions with severance pay not to exceed four (4) months’ compensation.

However, individual employment contracts with Department Heads may not provide compensation (including base salary, ongoing pay incentives, deferred compensation, or health insurance contributions), allowances (including vehicle or technology allowances),

EXHIBIT “AB”
or any form of compensation that is reportable to CalPERS as special compensation, beyond what is otherwise authorized in this Resolution without Council approval.

Compensation or benefits negotiated under an individual employment contract must also be contained within the existing budget allocations previously approved by the City Council. Individual employment contracts shall be subject to review and approval as to form by the City Attorney. In the event of a conflict between the terms of an individual employment contract and the general provisions of this Resolution, the terms of the individual employment contract shall prevail for the specific employee covered by that contract.

EXHIBIT “AB”
Appendix A Classifications
Employees in the classifications listed below, in alphabetical order, are covered by this Exhibit.

Accountant
Active Transportation Manager
Assistant City Attorney I
Assistant City Attorney II
Assistant City Manager Community Services**
Budget Manager
Building Permit Services Supervisor
Business Analyst
Capital Improvement Program Administrative Manager
Chief Building Official
City Attorney***
City Biologist
City Clerk
City Manager***
Code Enforcement Supervisor
Construction Engineering Manager
Construction Engineering Manager Professional Engineer
Data Analyst
Deputy City Attorney II
Deputy City Attorney III
Deputy City Manager**
Deputy Director of Community Development Chief Building Official Deputy Director of Finance City Controller
Deputy Director of Public Works City Engineer
Deputy Director of Public Works Maintenance Operations
Deputy Director of Public Works Mobility Services
Deputy Director of Utilities Engineering and Planning
Deputy Director of Utilities Wastewater
Deputy Director of Utilities Water
Deputy Fire Chief*
Director of Community Development**
Director of Finance**
Director of Human Resources**
Director of Parks and Recreation**
Director of Public Works and Utilities**
Director of Utilities
Diversity Equity and Inclusion Manager
Economic Development Analyst
Economic Development and Tourism Manager
Emergency Manager
Facilities Maintenance Supervisor
Financial Analyst

EXHIBIT “AB”
Fire Chief*, **
Fire Marshal
Fleet Maintenance Supervisor
Golf Supervisor
Homelessness Response Manager
Human Resources Analyst
Human Resources Manager
Information Services Supervisor
Information Technology Manager
Laboratory Manager
Legal Analyst
Maintenance Superintendent
Maintenance Supervisor
Mobility Services Business Manager
Network Services Supervisor
Parking Enforcement Compliance Supervisor
Parking Operations Supervisor
Parking Program Manager
Parks Maintenance Supervisor
Payroll Analyst
Police Chief*, **
Police Public Affairs Manager
Policy and Project Manager
Principal Budget Analyst
Public Communications Manager
Recreation Manager
Recreation Supervisor
Risk and Benefits Manager
Safety Manager
Senior Accountant
Senior Business Analyst
Senior Civil Engineer
Senior Financial Analyst
Senior Human Resources Analyst
Senior Legal Analyst
Senior Payroll Analyst
Senior Planner
Solid Waste and Recycling Program Manager
Stormwater Program Manager
Streets Maintenance Supervisor
Supervising Building Inspector
Supervising Civil Engineer
Sustainability and Natural Resources Analyst
Sustainability and Natural Resources Official
Sustainability Manager
Technology Project Manager

EXHIBIT “AB”
Tourism and Community Promotions Manager
Transportation Manager
Transportation Manager Professional Engineer Traffic Engineer Utilities Business Manager
Utilities Special Projects Manager
Utilities Special Projects Manager Professional Engineer Wastewater Collection System Supervisor
Water Distribution System Supervisor
Water Resource Recovery Facility Supervisor
Water Resources Program Manager
Water Treatment Plant Supervisor
Whale Rock Reservoir Supervisor
*Denotes Sworn classifications
**Denotes Department Head Classifications
*** Denotes Appointed Officials

Item 6i
Department: Human Resources
Cost Center: 2007
For Agenda of: 6/16/2026
Placement: Consent
Estimated Time: N/A
FROM: Nickole Domini, Human Resources Director
Prepared By: Jeff Andrews, Human Resources Manager
SUBJECT: AMENDMENT TO MANAGEMENT COMPENSATION RESOLUTION FOR

DEPARTMENT HEAD EMPLOYMENT CONTRACTS

RECOMMENDATION

1. Adopt a draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving an amendment to the July 1, 2025, through June 30, 2028, Unrepresented Management Compensation and Benefits Resolution” authorizing the City Manager to negotiate and execute individual employment contracts with Department Heads, providing variations in one-time compensation and benefits within approved budgets and within the parameters established by the Resolution, subject to approval as to form by the City Attorney; (Attachment A )and

2. Authorize the City Manager to execute an individual employment contract with the Police Chief with recommended changes to compensation to address compaction that exceeds the proposed parameters established by the Resolution.

POLICY CONTEXT
The resolution to amend unrepresented management compensation is in alignment with Council adopted Labor Relations Objectives, the Compensation Philosophy, City Charter provisions (e.g., Section 701 “…department heads of the City shall be appointed by and may be removed by the City Manager”; Section 702: “After obtaining and considering the recommendations of the City Manager, the Council shall provide in a manner not inconsistent with this Charter, for the powers and duties of all officials and employees of the City.”; Section 703: “The City Manager shall be the administrative head of the government of the City. As such, the City Manager shall be responsible to the Council for the efficient implementation of its policy and effective administration of all the affairs of the City government that the office controls.”), and the City’s Personnel Rules and Regulations Section 2.36.050 providing that Department Heads are members of the unclassified service and subject to appointment based on merit and fitness and not otherwise subject to the employment procedures and other provisions of the Chapter

2.36.

Item 6i

DISCUSSION
Background
The City sets compensation and benefits for unrepresented management employees via a standing Unrepresented Management Compensation Resolution1(Resolution). To enhance the City’s ability to recruit and retain high-level executive talent in a competitive California labor market, staff recommend amending this Resolution to grant the City Manager express authority to enter into individual employment contracts with Department Heads.

The proposed amendment creates a two-tier framework for Department Head employment, compensation, and benefits:

1. The Resolution: Remains the primary governing document for pay and benefits for the unrepresented management classifications which include the department heads and appointed officials.

2. Individual Employment Contracts: Authorizes the City Manager to negotiate and execute individual employment contracts for the Department Head classifications that may vary from the Resolution's standard provisions by allowing limited, one-time compensation or benefits such as hiring bonuses of up to one month’s salary, relocation reimbursement up to $30,000, advanced vacation or sick leave credits upon hire not to exceed four (4) weeks, or severance terms not to exceed four (4) months’ compensation, all within the parameters established by the Resolution and within approved budget allocations. Ongoing changes to salary and benefits will not be adjusted unless authorized by Council.

The proposed amendment to the Resolution establishes three primary pillars of governance to modernize the City’s executive hiring and retention processes. First, it provides the City Manager with the express authority to negotiate and execute individual employment contracts across all Department Head classifications. Second, to ensure fiscal accountability, the amendment requires that any variations in compensation or benefits be contained within the existing Council-approved budget allocations. Finally, the process maintains legal oversight by requiring that individual employment contracts be reviewed and approved as to form by the City Attorney, ensuring full compliance with applicable state laws and municipal regulations.

By customizing Department Head employment contracts to the unique professional circumstances of highly qualified candidates, the City can ensure it remains agile and competitive not just in attracting talent, but in securing their long-term commitment to the organization’s strategic goals.

1 Unrepresented Management Compensation Resolution No. 11580 (2025 Series)

Item 6i
Current Situation to be Addressed
It is recommended that variations from the standard provisions of the draft Resolution be considered for the Police Chief to address the ongoing compensation compaction between the Police Chief and Deputy Police Chief classifications. Because this change involves adjustments to ongoing compensation and benefits rather than it being one-time in nature, it falls outside the proposed authority of the City Manager and therefore requires Council approval under the terms of the proposed Resolution.

At present, the differential between the two classifications (Police Chief and Deputy Police Chief) is 12.8% when comparing base salary, but only 2.2% when considering total compensation, excluding CalPERS retirement contributions which vary by incumbent.

Compensation differentials greater than 15% are considered optimal, differentials between 10% and 15% are considered acceptable but not ideal, and differentials under 10% are considered to be low and require additional review and attention.

The recommendation is for the Council to authorize the City Manager to increase the Citypaid deferred compensation contribution for the Police Chief from 1% to 3% of salary, and to extend the same educational benefits currently provided to Deputy Police Chiefs.

Specifically, this would include a biweekly payment of $400 for possession of a master’s degree. These adjustments help to begin to address the total compensation differential and increase it to approximately 7.4%, excluding CalPERS retirement contributions.

While this does not achieve an optimal differential, it represents meaningful progress and remains fiscally supportable. These revisions would be included in an employment contract between the City and the Police Chief as described above if Council approves the use of individual employment contracts for Department Heads.

Previous Council or Advisory Body Action
The City Council adopted the July 1, 2025, to June 30, 2028, Unrepresented Management Compensation Resolution on June 17, 2025. The Council also met with staff in closed session on April 21, 2026, to discuss addressing the Police Chief compaction.

Public Engagement
This report is on the consent agenda for June 16, 2026. The agenda and report will be posted seven days in advance of the meeting, and the public will have an opportunity to provide feedback during public comment in advance of the Council voting on the consent agenda.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act does not apply to the recommended action in this report, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378.

Item 6i

FISCAL IMPACT
Budgeted: Yes Budget Year: 2026-27
Funding Identified: Yes
Fiscal Analysis:

Funding
Sources
Total
Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
One-Time
Cost
General
Fund $19,885 $16,085 $3,770
State
Federal
Fees
Other:

Total $19,885 $16,085 $3,770
There is no direct fiscal impact for authorizing the City Manager to negotiate and execute individual employment contracts with Department Heads. However, if there is a variation in compensation and benefits, it must be supported by existing appropriations within the adopted budget.

The recommended ongoing compensation adjustment for the Police Chief results in an annual cost of $16,085 in FY 2026-27, with costs increasing in subsequent fiscal years because the recommended increase to deferred compensation is calculated as a percentage of salary. In addition, there is an estimated one-time cost of approximately $3,770 to implement these changes in the City’s Enterprise Resource Planning system.

ALTERNATIVES

1. Authorize the City Manager to enter into Employment Contracts with Department Heads using only the terms established in the existing Management Resolution. Under this alternative, the City Manager would not be permitted to authorize any variations in compensation or benefits for Department Heads, even when such adjustments fall within approved budgets, without obtaining prior Council approval.

2. Authorize the City Manager to enter into an Employment Contract with the Police Chief with modified terms. Under this alternative, the Council may choose to approve a different set of ongoing compensation or benefit changes for the Police Chief than those recommended, such as authorizing only the education incentive or only the deferred compensation adjustment or selecting another combination of modifications.

Item 6i

3. Authorize changes to the Police Chief’s compensation, but do not authorize the City Manager to enter into employment contracts with Department Heads. Under this alternative, the Resolution and Unrepresented Management Compensation and Benefits exhibit will need to be amended to add sections to address these specific compensation changes for only the Police Chief.

4. The Council may choose to maintain the status quo. Under this alternative, the City would continue its current practice of issuing offer letters for department head positions in accordance with the existing Management Compensation Resolution. Any requested deviations from the Resolution’s established compensation or benefit provisions would require separate Council consideration and approval.

ATTACHMENTS
A. Draft Resolution to Amend Unrepresented Management Compensation Resolution B. Exhibit A Current Unrepresented Management Compensation and Benefits C. Exhibit B Amended Unrepresented Management Compensation and Benefits D. Sample Department Head Employment Contract

R ______
RESOLUTION NO. _____ (2026 SERIES)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS

OBISPO, CALIFORNIA, APPROVING AN AMENDMENT TO THE JULY
1, 2025, THROUGH JUNE 30, 2028, UNREPRESENTED MANAGEMENT

COMPENSATION AND BENEFITS RESOLUTION
WHEREAS, on June 17, 2025, the City Council (“Council”) adopted Resolution No. 11580 (2025 Series), Unrepresented Management Compensation and Benefits Resolution (“Current Resolution”), attached hereto as Exhibit “A” and incorporated herein by this reference; and
WHEREAS, the Current Resolution outlines approved compensation and benefits for management level employees, including department heads; and WHEREAS, the Current Resolution does not provide for individual employment contracts for department heads; and
WHEREAS, Council has determined that it would be in the City’s best interest to enhance the City’s ability to recruit and retain highly qualified individuals as department heads by providing the flexibility to enter into individual employment contracts with department heads; and
WHEREAS, to accomplish this as efficiently as possible, Council has determined to provide the City Manager with the authority, without further approval by Council, to enter into individual employment contracts with current and prospective department heads, as determined to be appropriate by the City Manager, subject to the terms and parameters set forth in the Amended Unrepresented Management Compensation and Benefits Resolution (“Amended Resolution”), attached hereto as Exhibit “B” and incorporated herein by this reference.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows:

SECTION 1. The Amended Unrepresented Management Compensation and Benefits Resolution, attached hereto as Exhibit “B” and incorporated herein by this reference, to authorize the City Manager to enter into individual employment contracts with current and prospective department heads within the parameters established by the Amended Resolution, is hereby approved by the Council.

SECTION 2. Except as modified by the Amended Resolution, all terms and conditions of the Current Resolution (Resolution No. 11580 (2025 Series) remain as previously approved.

Resolution No. _____ (2026 Series) Page 2
R ______
SECTION 3. Amendments to compensation for Unrepresented Managers do not constitute a “Project” under CEQA Guidelines Sec. 15378.

Upon motion of Council Member ___________, seconded by Council Member ___________, and on the following roll call vote:

AYES:

NOES:

ABSENT:

The foregoing resolution was adopted this _____ day of _______________ 2026. ___________________________
Mayor Erica A. Stewart
ATTEST:
______________________
Teresa Purrington
City Clerk
APPROVED AS TO FORM:
______________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, on ______________________. ___________________________
Teresa Purrington
City Clerk

R 11579
RESOLUTION NO. 11580 (2025 SERIES)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS

OBISPO, CALIFORNIA, AMENDING MANAGEMENT COMPENSATION

FOR APPOINTED OFFICIALS, DEPARTMENT HEADS, AND

MANAGEMENT EMPLOYEES AND SUPERSEDING PREVIOUS

RESOLUTIONS IN CONFLICT
WHEREAS, the Unrepresented Management employees of the City of San Luis Obispo remain committed to providing high quality service to the community; and WHEREAS, the City Council is committed to providing competitive compensation to recruit and retain well qualified employees, as provided in the City’s adopted Labor Relations Objectives and Compensation Philosophy, while also considering the long-term financial sustainability of changes in compensation.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo, compensation and benefits for the Unrepresented Management group are revised as follows:

SECTION 1. The City agrees to increase the salaries of Unrepresented Management employees with cost-of-living adjustments effective on the following dates:
3% the first full pay period of July 2025, 3% the first full pay period of July 2026, and 3% the first full pay period of July 2027.

SECTION 2. The City shall continue to provide employees fringe benefits as set forth in Exhibit “A”, fully incorporated by reference.

SECTION 3. The Director of Finance shall adjust the appropriate accounts to reflect the compensation changes.

SECTION 4. This resolution shall be in effect from July 1, 2025, through June 30, 2028.

Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

Resolution No. 11579 (2025 Series) Page 2
R 11580
SECTION 5. Amendments to compensation and benefits for Unrepresented Management employees do not constitute a “ Project” under CEQA Guidelines Sec. 15378.

Upon motion of Council Member Francis, seconded by Council Member Boswell, and on the following roll call vote:

AYES: Council Member Boswell, Francis, Marx, Vice Mayor Shoresman, and Mayor Stewart
NOES: None
ABSENT: None
The foregoing resolution was adopted this 17th day of June 2025.

Mayor Erica A. Stewart
ATTEST:

Teresa Purrington
City Clerk
APPROVED AS TO FORM:

J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, on ______________________.

Teresa Purrington
City Clerk
Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9 6/ 25/ 2025 | 5: 03 PM PDT

Unrepresented Management Employees Resolution Exhibit A Table of Contents
Exhibit A Sections
Section A Pay for Performance ................................................................................. 2 Section B Medical, Dental, Vision ............................................................................. 2 Section C Health Flex Contribution ........................................................................... 2 Section D Life and Disability Insurance ..................................................................... 4 Section E Retirement ................................................................................................ 4 Section F Supplemental Retirement ......................................................................... 6 Section G Vacation ................................................................................................... 6 Section H Administrative Leave ................................................................................ 7 Section I Holidays .................................................................................................... 8 Section J Sick Leave ................................................................................................ 9 Section K Bereavement Leave ............................................................................... 10 Section L Workers’ Compensation Leave .............................................................. 10 Section M Temporary Upgrade Assignment ............................................................ 11 Section N Bilingual Pay ........................................................................................... 11 Section O Vehicle Assignment ................................................................................ 11 Section P Uniform Allowance .................................................................................. 11 Section Q Payday ................................................................................................... 12 Section R Appointed Officials .................................................................................. 12 Appendix A Classifications ........................................................................................ 13 Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
Section A Pay for Performance
In 1996 the City Council established the Management Pay for Performance System for department heads and management employees. The system is designed to recognize and reward excellent performance by department heads and managers and to provide an incentive for continuous improvement and sustained high performance. Instead of step increases, the department heads and management employees move through their salary range solely according to accomplishment of objectives and job-related behavior. Further information about the Management Pay for Performance System is found in the Management Pay for Performance System Guide.

Section B Medical, Dental, Vision
The City shall establish and maintain medical, dental, and vision insurance plans for appointed officials, department heads, management employees and their dependents.

The City reserves the right to choose the method of insuring and plans to be offered.

Section C Health Flex Contribution
Employees electing medical coverage in the City’s plans shall receive a health flex contribution and shall purchase such coverage through the City’s Section 125 Plan Cafeteria Plan.” To be eligible for the health flex contribution in a particular pay period, an employee must be paid for more than half of their regularly scheduled hours, unless the employee is on an approved FMLA/CFRA leave of absence or receiving temporary disability benefits through workers’ compensation. Less than full-time employees shall receive a prorated share of the City’s contribution.

The City will contribute directly to CalPERS, on behalf of each employee, the statutory minimum monthly employer contribution required under the Public Employee’s Medical and Hospital Care Act (PEMHCA), as set annually by CalPERS. For 2025, the PEMHCA minimum contribution is $158 per month. The City will provide a contribution through its cafeteria plan, which combined with the City's PEMHCA contribution, will equal the total health flex contribution in the amounts listed below.

The monthly health flex contribution is listed below, along with the updated contribution that will take effect the first paycheck in September 2025.

Level of Coverage 2025 Monthly
Contribution
Monthly
Contribution
Effective
September 2025
Employee Only $ 670 $ 735
Employee Only “Legacy” $ 790 $ 790
Employee Plus One $ 1,323 $ 1,470
Family $ 1,792 $ 1,911
Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
Employees hired prior to September 1, 2008, who elect employee only medical coverage will receive the health flex contribution listed above for employee only “legacy” coverage until such amount is less than the Employee Only (non-Legacy) contribution amount. As of January 1, 2015, if an employee who is receiving Employee Only or Opt-out “legacy” coverage changes their level of coverage, they will be eligible to return to the “legacy” coverage in a future year.

If the premium cost for medical coverage is less than the health flex contribution, the employee shall not receive any unused health flex in the form of cash or purchase additional benefits.

Effective for the 2026, 2027, and 2028 premiums, the City’s total contribution for group medical coverage shall be increased by an amount equal to one-half of the average percentage change for family coverage in the CalPERS health plans available in San Luis Obispo County. In any event, the City’s contribution will not be decreased. For example:
if three plans were available and the year-to-year changes were +10%, +20%, and -6% respectively, the City’s contribution would be increased by 4% ((10% + 20% + -6%) ÷ 3 = 8% x 1/2). The employee only “legacy” amount will not adjust. The City agrees tocontinue its health flex contribution or conditional opt-out amount as described below for one full pay period inthe event that an employee has exhausted all paid time off, including paid leave donated through the catastrophic leave program, and leave approved underthefederal Family and Medical LeaveAct (FMLA) and the California Family Rights Act (CFRA). That is, the employee shall receive the regular City health flex contribution or conditional opt-out amount forthe first full pay period following the pay period in which theemployee'spaid leave balances reach zero (0) and FMLA/CFRA leave has been exhausted. This continuation ofthe City health flexcontribution isavailable onceper rolling 12-month period, per employee. Conditional
Opt-out Employees
mayreceive amonthly opt-out incentive (Cash-in-Lieu) instead ofthe health flexcontribution and medical coverage through the City’ smedical plans ifthe following conditions aremet: 1.

The employee completesanattestation form during initial enrollment or during the annual open enrollment period; 2.

The attestation form verifies that the employee and all individuals for whom the employee expects toclaim apersonal exemption deduction (Tax Family) have alternative minimum essential coverage; 3.

Coverage inthe individual marketorindividual coverage through Covered California does not meet the requirement of alternative minimum essential coverage forthe employee andthe employee’sTax Family. The
monthly conditional opt-out (Cash- in-Lieu) incentives are: Optout $200 Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8- 8595C77C42B9

EXHIBIT “ A”
Legacy” Opt-out $ 790 (hired before September 1, 2008)
The Cash-in-Lieu shall be taxable income to the employee. The employee must notify the City within 30 days of the loss of alternative minimum essential coverage. The conditional opt-out payment shall no longer be payable if the employee and family members cease to be enrolled in alternative minimum essential coverage. The City will not pay Cash-in-Lieu if the City knows or has reason to know that the employee or an individual in the employee’s Tax Family does not have the required alternative coverage. The conditional opt-out incentive will cease as described above one full pay period after the employee exhausts unpaid leave or FMLA/CFRA, whichever is later.

Employees receiving the conditional opt-out amount will also be assessed $16.00 per month to be placed in the Retiree Health Insurance Account. This account will be used to fund the City's contribution toward retiree premiums and the City's costs for the Public Employees’ Contingency Reserve Fund and the Administrative Costs. However, there is no requirement that these funds be used exclusively for this purpose nor any guarantee that they will be sufficient to fund retiree health costs, although they will be used for negotiated employee benefits.

Dental and Vision Insurance/Dependent Coverage
Employee participation in the City's dental and vision plans is optional. Employees who elect coverage shall pay the dental and/or vision premium(s) by payroll deduction(s) on a pre-tax basis through the City’s Cafeteria Plan.

Section D Life and Disability Insurance
The City shall provide the following special insurance benefits:

1. Long-term disability insurance providing 66 2/3% of gross salary (maximum benefit $15,000 per month) to age 65 for any sickness or accident, subject to the exclusions in the long-term disability policy, after a 30-day waiting period.

The City is exploring the possibility of enrolling in State Disability Insurance or an alternative employee-funded enhanced disability program. If approved by a majority vote of management employees, the City will implement the program as soon as administratively possible.

2. In addition to $4,000 term life insurance purchased by the employee, the City provides a $ 100,000 term life insurance, including accidental death and dismemberment through the City’s Cafeteria Plan.

Section E Retirement
A. CalPERS Contracts. Non-sworn employees are classified as Miscellaneous. All employees work twelve (12) months per year.

1. “ Classic Members First Tier” non-sworn and sworn employees hired before December 6, 2012.

Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
The City agrees to provide the Public Employees' Retirement System’s (CalPERS)

2.7% at age 55 plan to all non-sworn employees and the 3% at 50 plan to all sworn employees. The 2.7% at 55 plan includes the following amendments: 1959 Survivor’s Benefit – Level Four, conversion of unused sick leave to additional retirement credit, one-year final compensation, Military Service Credit, and PreRetirement Optional Settlement 2 Death Benefit. The 3% at age 50 plan includes the following amendments: Post-Retirement Survivor Allowance, conversion of unused sick leave credit to additional retirement credit, 1959 Survivor’s BenefitLevel Four, one-year final compensation, Military Service Credit, and PreRetirement Optional Settlement 2 Death Benefit. Employees will pay the entire 8% first tier miscellaneous) or 9% ( safety) member contribution, as applicable. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a) for a total employee contribution of 11 or 12%, as applicable.

2. “ Classic Members Second Tier” non-sworn and sworn employees hired on or after December 6, 2012.

The City agrees to provide the CalPERS 2% at 60 plan for non-sworn employees using the highest three-year average as final compensation. The second-tier formula for non-sworn employees will include the following amendments: 1959 Survivor’s Benefit – Level Four, conversion of unused sick leave to additional retirement credit, Military Service Credit, and Pre-Retirement Optional Settlement 2 Death Benefit. Employees hired under this plan will pay the full member contribution required under the plan, presently seven percent (7%).

For sworn “Classic Members” hired on or after December 6, 2012, the City will provide the CalPERS 3% at 55 plan for sworn Fire employees and 2% at 50 plan for sworn Police employees using the highest three-year average as final compensation. The second-tier formula for sworn employees will include the following amendments: Post Retirement Survivor Allowance, conversion of unused sick leave to additional retirement credit, the 1959 Survivor’s Benefit – Level Four, Military Service Credit, and Pre-Retirement Optional Settlement 2 Death Benefit.

Employees will pay the entire 7% ( second tier miscellaneous) or 9% ( safety) member contribution, as applicable. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a) for a total employee contribution of 10 or 12%, as applicable.

3. “ New Members Third Tier” non-sworn and sworn employees hired after January 1, 2013. CalPERS determines who are “New Members” within the meaning of the California Public Employees’ Pension Reform Act (PEPRA).

The City will provide the CalPERS 2% at 62 plan for non-sworn employees and

2.7% at 57 plan for sworn employees, using the highest three-year average as final compensation.

Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
Employees will pay 50% of total normal cost of the retirement benefit, as determined by CalPERS. In addition, employees will pay 3% of the employer contribution as cost sharing under Government Code section 20516(a).

Member contributions are made on a pre-tax basis as permitted under IRS Code Section 414(h)(2).

Section F Supplemental Retirement
The City shall contribute one percent ( 1%) of salary for department heads to a defined contribution supplemental retirement plan established in accordance with sections 401(a) and 501(a) of the Internal Revenue Code of 1986 and California Government Code sections 53215-53224. Department heads and managers are eligible to make elective contributions to this plan.

Section G Vacation
Vacation leave is governed by Section 2.36.440 of the Municipal Code, except that it may be taken after the completion of the sixth calendar month of service from the benefit date or earlier with department head, or their designee, authorization. Employees shall accrue vacation leave at the following rates for completed years of service with the City. Parttime employees will accrue a prorated amount of vacation leave.

Management Employees
Years of Completed
Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
Less than 5 years 12 days 96 hours
5 to less than 10 years 15 days 120 hours
10 to less than 20 years 18 days 144 hours
20+ years 20 days 160 hours
Appointed Officials & Department Heads
Years of Service
Annual
Vacation
Accrual Days*
Annual
Vacation
Accrual Hours
Less than 10 years 15 days 120 hours
10 to less than 20 years 18 days 144 hours
20+ years 20 days 160 hours
One day is equivalent to eight (8) hours for a 40-hour per week position.

Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
Employees are eligible for a year-for-year accelerated vacation accrual based on prior public sector and military experience. For example, if an employee has ten (10) years of public sector experience prior to working for the City of San Luis Obispo, their vacation accrual will be advanced by ten (10) years.

Vacation leave shall be accrued as earned biweekly. Vacation time balances shall not exceed twice the annual accrual rate. If an employee reaches the maximum at any time throughout the year, the employee will stop accruing vacation leave.

Vacation schedules for management employees shall be based upon the needs of the City and then, insofar as possible, upon the wishes of the employee.

Vacation Cash Out
Employees are eligible to request payment for up to forty (40) hours of unused vacation leave subject to following conditions:

1. The employee must make an irrevocable election in the month of December in the prior calendar year;

2. The cash out shall be issued in December of the year following the irrevocable election;

3. Employees must have eighty (80) hours of accrued vacation leave to be eligible for cash out at the time of the irrevocable election; and

4. Late irrevocable election forms will not be accepted, nor can they be changed after the established deadline.

Emergency Vacation Cash Out
Notwithstanding the requirement for an irrevocable election for the cash out of vacation for the upcoming calendar year, an employee may cash out vacation in an existing year, subject to the following conditions:

1. The employee may cash out no more than the forty ( 40) hours of vacation including any cash out previously elected); and

2. The amount cashed out pursuant to this subdivision must be in whole-hour increments with a minimum cash out of twenty (20) hours and shall be subject to a twenty percent (20%) penalty. That is, if an employee cashes out 40 hours of emergency cash out, the penalty shall be 20% of the amount cashed out. For example, if an employee wishes to cash out forty (40) hours due to an emergency but failed to make an irrevocable election, the employee will receive the cash value of thirty-two (32) hours, but forty (40) hours will be removed from the employee’s accrued balance.

Vacation Accrual Cap Cash Out
If an employee reaches the annual accrual cap before December, the employee will be able to request vacation payment one additional time during the calendar year, in addition to the December cash out. However, no more than 40 hours of unused vacation leave will be paid out in any calendar year.

Section H Administrative Leave
Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
Administrative leave provided to exempt management employees is paid time off in recognition of the extended work hours and the lack of eligibility for overtime compensation associated with their positions. Administrative leave is not accrued based on hours worked and is not compensable upon separation from the City.

Appointed officials and department heads shall be advanced 80 hours of administrative leave the pay period that January 1st falls into.

Deputy directors and other positions, as designated by the department head, required to regularly work night meetings shall be advanced 64 hours of administrative leave the pay period that January 1st falls into.

Other management employees shall be advanced 48 hours of administrative leave the pay period that January 1st falls into.

Administrative leave hours shall be pro-rated on a pay period basis when an employee is appointed or leaves employment during the calendar year. The employee’s final check will be adjusted to reflect the pro-rated hours, however there is no provision to receive cash payment for unused administrative hours. Unused administration leave will not be carried over year-to-year but can be taken through December 31st of each year.

Appointed officials, department heads, and management employees are considered exempt from the overtime provisions of the Fair Labor Standards Act ( FLSA) and not eligible for overtime payment. In general, management employees are expected to work the hours necessary to successfully carry out their duties and frequently must return to work or attend meetings and events outside their normal working hours. However, in the event a state of emergency is called for the City of San Luis Obispo by the City Council, County of San Luis Obispo, State of California, or Federal Government, employees can be paid at the rate of time-and-one-half for the hours worked in excess of forty (40) hours per week on activities related to disaster management and recovery that are reimbursable by state or federal funding. Approved employees can be similarly compensated when rendering aid to other agencies in an emergency declaration situation where overtime is reimbursable by the requesting agency upon approval by their Department Head or their designee.

Section I Holidays
Employees shall receive eleven (11) fixed plus two (2) floating holidays per year. The following days of each year are designated as paid holidays:

January 1 – New Year’s Day
Third Monday in January – Martin Luther King Jr. Day
Third Monday in February – Presidents’ Day
Last Monday in May – Memorial Day
July 4 – Independence Day
First Monday in September – Labor Day
Docusign Envelope ID: 8E0F56C7- 19B1-46C3-84A8-8595C77C42B9

EXHIBIT “ A”
November 11 – Veteran’s Day
Fourth Thursday in November – Thanksgiving Day
Friday after Thanksgiving
One half day before Christmas Day
December 25 – Christmas Day
One half day before New Year’s Day
Two floating holidays
For employees who are not regularly scheduled to work on weekends, when a holiday falls on a Saturday, the preceding Friday shall be observed. When a holiday falls on a Sunday, the following Monday shall be observed. For employees on a compressed work schedule, when a holiday falls on the employee’s flex day, holiday hours must be observed on another scheduled workday within the same work week. A holiday shall be defined as eight (8) hours of paid time off for regular full-time employees and prorated for part-time employees.

The City reserves the right to close non-essential City services and offices on weekdays between the Christmas Day and New Year’s Eve holidays. Employees scheduled to work during this time in non-essential functions are required to use appropriate personal leave.

Essential City services and functions are determined at the discretion of the department head. The City will notify employees of the closure of non-essential City services and offices no later than October 31st of the same year in order to provide employees with ample time to plan accordingly.

The two floating holidays (16 hours) will be provided in a floating holiday leave bank the pay period that January 1st falls within and will be prorated on a pay period basis if an employee starts later in the year. Employees will have the ability to use floating holiday leave hours at any point during the calendar year. Unused floating holiday leave will not be carried over year-to-year but can be taken through December 31st of each year. If an employee terminates for any reason, having taken off hours in excess of their biweekly prorated share of the floating holiday, the value of the overage will be deducted from the employee’s final check; however, there is no provision to receive cash payment for unused floating holiday hours.

Section J Sick Leave
Sick leave is governed by Section 2.36.420 of the Municipal Code. An employee shall accrue sick leave with pay at the rate of twelve (12) days, or the prorated shift equivalent, per year of continuous service since the benefit date. An employee may take up to 48 hours per calendar year of sick leave if required to be away from the job to personally care for a member of their immediate family. A family member for this purpose is any relationship listed in Labor Code 245.5(C). However, if the family member is part of the employee’s household and is hospitalized, the employee may take up to 56 hours (rather than 48 hours) of sick leave per year to care for their family member. The employee shall submit written verification of such hospitalization.

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