San Luis Obispo City Council
October 6, 2026

City Council
AGENDA

Tuesday, October 6, 2026, 5:30 p.m.

Council Chambers, 990 Palm Street, San Luis Obispo
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Staff Agenda correspondence regarding questions from Council received after the staff reports are published will be posted by 1:00 PM on the day of the meeting.

Contact the City Clerk's Office with questions by emailing [email protected].

ONLINE PARTICIPATION:

Zoom: To join the Regular Meeting, click this link https://slocity.zoomgov.com/j/1651147794 on any computer or mobile device.

Telephone: Call 1-669-254-5252 and enter the Meeting’s ID #165 114 7794 to join by telephone audio only.

Public Comment during the meeting:

In person public comment:

Fill out a speaker card and give it to the City Clerk.

Online public comment:

Use the Zoom “raise your hand” button or telephone call in press *9 on your telephone (*6 to unmute/mute) when the comment period on your item of interest begins. You will be notified when you’ve been unmuted and it’s your turn to speak.:

Public Comment prior to the meeting (must be received 3 hours before the start of the meeting.

Correspondence received before the meeting will not be read aloud during the meeting):

Email - Submit to [email protected]. In the subject line, please include the date of the meeting and the item number (if applicable).

Mail - Address letters to the City Clerk's Office at 990 Palm Street, San Luis Obispo, California, 93401.

Voicemail - Call (805) 781-7164 and leave a voicemail. Please state and spell your name, the agenda item number, and leave your comment.
*All correspondence will be publicly archived and distributed to councilmembers; however, submissions received after the deadline may not be processed until the following day.

Pages

1. CLOSED SESSION (4:00 PM START)
Please click the link below to join the webinar to provide Public Comment on Closed Session items only.
https://slocity.zoomgov.com/j/1655366465
To join by telephone dial 1-669-254-5252
Webinar ID: 165 536 6465

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 of City Hall, 990 Palm Street, San Luis Obispo.

1.b PUBLIC COMMENT FOR CLOSED SESSION ITEMS ONLY
Public Comment will only be accepted for items listed on the Closed Session agenda.

1.c CONFERENCE WITH REAL PROPERTY NEGOTIATORS
Pursuant to Government Code §54956.8
Property: APN 001-013-002
Agency Negotiators:

Alejandra Celio, Brian Nelson, Kyle Anderson, Jennifer Rice, Luke Schwartz, Madeline Kacsinta, Aaron Floyd, Dietrick, Whitney McDonald
Negotiating Parties: KGR Enterprises
Under Negotiation: Price and terms of payment.

Property: APN 001-014-041
Agency Negotiators:

Alejandra Celio, Brian Nelson, Kyle Anderson, Jennifer Rice, Luke Schwartz, Madeline Kacsinta, Aaron Floyd, Christine Dietrick, Whitney McDonald
Negotiating Parties: Mr. Javob Feldman, Ms. Marilyn Miller Farmer Under Negotiation: Price and terms of payment.

1.d CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION
Pursuant to paragraph (1) of subdivision (d) of California Government Code Section 54956.9.

Name of case: Ray Hais v. City of San Luis Obispo, California Public Employment Relations Board, UPC No. LA-CE-1905-M

1.e ADJOURNMENT
The City Council will hold a Regular Meeting on October 6, 2026 at 5:30 PM 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
Vice Mayor Emily Francis will lead the Council in the Pledge of Allegiance.

4. PRESENTATIONS

4.a DOMESTIC VIOLENCE AWARENESS MONTH
Mayor Stewart will present a Proclamation declaring October as Domestic Violence Awareness Month.

4.b FIRE PREVENTION WEEK
Mayor Stewart will present a Proclamation declaring October 4 - 10, 2026 as Fire Prevention Week.

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 6l.

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 - AUGUST 27, 2026 AND SEPTEMBER 15, 2026

COUNCIL MINUTES
15 Recommendation:

Approve the minutes of the City Council meeting held on August 27, 2026 and September 15, 2026.

6.c COMMUNITY BIKESHARE PROGRAM – REQUEST FOR

PROPOSALS
25 Recommendation:

Authorize the release of a joint Request for Proposals (RFP) with California Polytechnic State University, San Luis Obispo (Cal Poly) for a public bikeshare program.

1. Authorize the City Manager to execute the Operator Agreement with the selected Operator. The Operator Agreement shall be in substantially the same form as set forth in Exhibit A to the RFP and to the satisfaction of the City Attorney.

2. Direct staff to return to Council with a proposed Service Level and License Agreement with the selected Operator.

3. 6.d ADDITIONAL FUNDING FOR LEGAL SERVICES AGREEMENTS WITH CIVICA LAW GROUP, APC, RELATED TO THE 1150 LAUREL

RECEIVERSHIP, AND WITH RICHARDS WATSON GERSHON

RELATED TO THE RIGHETTI HILLSIDE LITIGATION
83 Recommendation:

Approve $273,000 as the new not-to-exceed amount for the existing legal services agreement with Civica Law Group, APC, related to the 1150 Laurel receivership (a $50,000 increase).

1. Approve $220,000 as the new not-to-exceed amount for the existing legal services agreement with Richards Watson
Gershon for Righetti Hillside litigation (a $50,000 increase).

2. Authorize the City Attorney to execute any legal services agreement amendments necessitated by the approvals above.

3. 6.e ADVISORY BODY APPOINTMENT FOR AN UNSCHEDULED

VACANCY ON THE TOURISM BUSINESS IMPROVEMENT DISTRICT
BOARD
89 Recommendation:

Confirm the appointment of Carolina Ertani to the Tourism Business Improvement District Board (TBID) for the remainder of a vacated term expiring June 30, 2028.

6.f AUTHORIZATION TO APPLY FOR GRANT FUNDING THROUGH THE

CALTRANS SUSTAINABLE COMMUNITIES PLANNING GRANT

PROGRAM FOR PREPARATION OF A CITYWIDE SAFE ROUTES TO

SCHOOL PLAN
93 Recommendation:

Authorize staff to prepare and submit an application for the Caltrans Sustainable Communities grant program, including a request of up to $300,000 to fund preparation of a Citywide Safe Routes to School Plan; and,

1. Approve the use of up to $50,000 in Active Transportation Plan Implementation capital project account (Specification No. 2000608) funding as the required local match funds for this grant pursuit; and,

2. Authorize the Finance Director to appropriate grant funds and approve a budget amendment to reflect received grant funds, if awarded;

3. Authorize the City Manager and City Attorney, or their respective designees, to act as agents to conduct all
negotiations, execute and submit all grant documents including, but not limited to, applications, agreements, and payment requests which may be necessary for the completion of the aforementioned project; and,

4. Adopt a Draft Resolution entitled, “A Resolution of the City Council of San Luis Obispo, California, approving the
application for grant funding through the Caltrans Sustainable Communities Grant Program to fund preparation of a Citywide Safe Routes to School Plan.”

5. 6.g ADOPT A RESOLUTION OF INTENTION TO APPROVE A RENEWED FRANCHISE AGREEMENT WITH PHILLIPS 66 PIPELINE, LLC FOR

EXISTING PIPELINES LOCATED WITHIN THE CITY RIGHT-OF-WAY AND SET A PUBLIC HEARING FOR NOVEMBER 17, 2026
105
Recommendation:

Adopt a Draft Resolution of Intention entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, declaring the City’s intent to approve a Franchise Ordinance, superseding Ordinance 1709 (2022 Series), to allow Phillips 66 Pipeline LLC to operate and maintain pipelines for the
transportation of oil and other specified materials in the City of San Luis Obispo and setting a public hearing for November 17, 2026”; and

1. Authorize the Public Works and Utilities Director to execute the letter agreement memorializing the abandonment of the Phillips 66 proprietary pipeline.

2. 6.h 2026 EDWARD BYRNE MEMORIAL JUSTICE ASSISTANCE GRANT

PROGRAM APPLICATION
171
Recommendation:

Authorize the Police department to submit a grant application to the Bureau of Justice Assistance for the 2026 Edward Byrne Memorial Justice Assistance (JAG) grant in the amount of $18,020.

1. Authorize the City Manager and the Chief of Police to execute related grant documents and authorize the Finance Director to make the necessary budget adjustments upon the award of the grant.

2. 6.i ADVERTISE JOB ORDER CONTRACT FOR STREETS AND
SIDEWALK MAINTENANCE 2027, SPECIFICATION NO. 1000199
173
Recommendation:

Approve the Special Provisions for the Job Order Contract for Street and Sidewalk Maintenance 2027, Specification No. 1000199; and,

1. 2. Authorize staff to advertise for bids; and,
Authorize the City Manager to award the contract to the lowest responsive bidder.

3. 6.j SUPPORT COAST RAIL COORDINATING COUNCIL PILOT TRAIN SERVICE FOR 2028 OLYMPIC GAMES
177
Recommendation:

Adopt a Draft Resolution entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, supporting efforts by the San Luis Obispo Council of Governments and the Coast Rail Coordinating Council to develop and secure funding for a pilot passenger rail service connecting Los Angeles, San Luis Obispo, and the San Francisco Bay Area during the 2028 Olympic Games.”

6.k AUTHORIZATION TO REJECT AND RE-ADVERTISE THE
BROADBAND IMPLEMENTATION PROJECT – FFA, SPECIFICATION
NO. 2001063
185
Recommendation:

Reject all bids and authorize staff to re-advertise the Broadband Implementation Project – FFA, Specification No. 2001063, with a Base Bid and Additive Alternatives; and,

1. Authorize the City Engineer to approve the revised project plans and specifications for the Broadband Implementation Project – FFA (project), Specification 2001063 contingent upon CPUC approval of the requested project scope amendment; and,

2. Authorize the City Manager to award the construction contract, including the Base Bid and Additive Alternatives in priority order, if the lowest responsible bid is within the publicly disclosed construction award authority of $2,400,000 and the CPUC has approved the requested project scope amendment and extension of the grant completion deadline.

3. 6.l AUTHORIZATION OF A CHANGE ORDER FOR THE WASTEWATER

COLLECTIONS INFRASTRUCTURE RENEWAL STRATEGY AND

WASTEWATER FLOW MODEL
201
Recommendation:

Authorize a change order in the amount of $102,437 for the Wastewater Collections Infrastructure Renewal Strategy and associated Wastewater Flow Model

7. PUBLIC HEARING AND BUSINESS ITEMS

7.a 2025-26 ANNUAL REPORT OF THE TOURISM BUSINESS

IMPROVEMENT DISTRICT (TBID) AND ADOPTION OF A
RESOLUTION OF INTENTION TO CONTINUE THE TBID (30

MINUTES)
209
Recommendation:

As recommended by the Tourism Business Improvement
District (TBID) Board, receive and approve the TBID Board’s annual report for FY 2025-26; and

1. Adopt a Draft Resolution of Intention entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, declaring its intention to continue the San Luis Obispo Tourism Business Improvement District, to continue the basis for and to levy the assessment for the district, and to set a date for the Public Hearing on the district and the assessment for 2026-27.

2. 8. STUDY SESSION

8.a GRAND AVENUE PAVING PROJECT STUDY SESSION (90

MINUTES)
255
Recommendation:

1. Receive an update on the Grand Avenue Paving Project; and Provide feedback on the Preliminary Grand Avenue Paving Project Design Concepts.

2. 9. 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

10. ADJOURNMENT
The next Regular Meeting of the City Council will be held on October 20, 2026 at 5:30 p.m. in the Council Chambers at City Hall, 990 Palm Street, San Luis Obispo.

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
August 27, 2026, 12:00 p.m.

Council Hearing Room, 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, Teresa Purrington, City Clerk
_____________________________________________________________________

1. CALL TO ORDER
A Special Meeting of the San Luis Obispo City Council was called to order on August 27, 2026 at 12:00 p.m. at the Council Hearing room of City Hall, 990 Palm Street, San Luis Obispo, by Mayor Stewart.

2. PUBLIC COMMENT FOR ITEMS ON THE AGENDA ONLY
Public Comment:

None
--End of Public Comment--

3. CITY COUNCIL WORKSHOP

3.a STRATEGIC PLANNING PROCESS DISCUSSION
City Manager Whitney McDonald provided an in-depth staff report and responded to Council questions.

Public Comments:

None
---End of Public Comment---
ACTION: Council provided the following consensus direction:
 Confirmed support for the proposed structure of the strategic plan.  Agreed to use strategic plans from Berkeley, Alameda, and Pleasanton as primary models.

2  Concurred that the strategic plan should follow a four-year horizon.  Agreed to revisit the Mission, Vision, and Values after completion of the strategic planning process.
 Supported including a list of existing programs and developing key performance metrics as part of the plan.
 Directed staff to send postcards to both tenants and property owners.

4. ADJOURNMENT
The meeting was adjourned at 1:30 p.m. The next Regular Meeting of the City Council will be held on September 1, 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

1 Council Minutes
September 15, 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, Teresa Purrington, City Clerk
_____________________________________________________________________

1. CLOSED SESSION (5:00 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 5:00 p.m. in the Council Hearing Room of City Hall

1.b PUBLIC COMMENT FOR CLOSED SESSION ITEMS ONLY
Public Comments:

None
---End of Public Comment---

1.c CONFERENCE WITH LABOR NEGOTIATORS
ACTION: City Attorney Christine Dietrick reported that the Council met in Closed Session and no reportable action was taken.

1.d ADJOURNMENT
The City Council adjourned this portion of the Closed Session at 5:30 PM and continued the next Closed Session to the end of the Regular Meeting.

2. CALL TO ORDER
A Regular Meeting of the San Luis Obispo City Council was called to order on September 15, 2026 at 5:35 p.m. in the Council Chambers, 990 Palm Street, San Luis Obispo, by Mayor Stewart.

3. PLEDGE OF ALLEGIANCE

2 Council Member Shoresman led the Council in the Pledge of Allegiance.

4. PRESENTATIONS

4.a HISPANIC HERITAGE-LATINE MONTH
Mayor Stewart presented a Proclamation declaring September 15 - October 15, 2026 Hispanic-Latine Heritage Month. to Erica Ruvalcaba, on behalf of the Latino Outreach Council.

4.b NATIONAL ALCOHOL AND DRUG ADDICTION RECOVERY MONTH
Mayor Stewart presented a Proclamation declaring September 2026 National Alcohol and Drug Addiction Recovery Month to Amanda Torrente, on behalf of Sun Street Centers.

4.c CITY MANAGER REPORT
City Manager Whitney McDonald provided a report on upcoming projects.

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

Jenn Fields
Fitzgerald Kelly
--End of Public Comment--

6. CONSENT AGENDA
Public Comment:

Laura Albers - Item 6f
Item 6h
Chris Javine
Mike Stanton
Justin Kelton
Thomas Sherman
Cathy Sherman
Nate Otter
Kris Strommen
Nick Drake
Taylor Anderson
Crystal Weitcamp (Whitecamp)
Michelle Amesquit
Alyssa Wisberg
Serena Gennuso
Scott Springer
Terry Tatum
Jessica Otter
Suzanne Helmer
Chris Anderson
Jody Larson
Margaret Carmen
Betty Winholtz
Aidan Scott
--End of Public Comment--

1 Motion By Council Member Boswell
Second By Council Member Marx
To approve Consent Calendar Items 6a to 6h, including the amendment to the Resolution presented in the staff agenda correspondence.

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

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

6.b MINUTES REVIEW - SEPTEMBER 1, 2026 COUNCIL MINUTES
Approve the minutes of the City Council meeting held on September 1, 2026.

6.c BIENNIAL REVIEW AND AMENDMENTS TO THE CITY’S CONFLICT OF

INTEREST CODE
Adopt Resolution No. 11681 (2026 Series) entitled “A Resolution of the City Council of the City of San Luis Obispo, California, amending the City’s Conflict of Interest Code”, rescinding and replacing Resolution No. 11516 (2024 Series).

6.d APPROVE A HISTORIC PROPERTY PRESERVATION CONTRACT
(MILLS ACT) FOR THE LANDMARK HANS NISSEN AND LENA
PETERSON HANSEN HOUSE LOCATED AT 1110 BUCHON STREET
Adopt Resolution No. 11682 (2026 Series) entitled “Resolution of the City Council of the City of San Luis Obispo, California, approving a Historic Property Preservation Agreement between the City and the Owner of the Hans Nissen and Lena Peterson Hansen House at 1110 Buchon Street (Application No. HIST-0119-2026),” as recommended by the Cultural Heritage Committee.

6.e APPROVE A HISTORIC PROPERTY PRESERVATION CONTRACT
(MILLS ACT) FOR THE LANDMARK GEORGE AND CORDELIA
MCCABE HOUSE LOCATED AT 571 PISMO STREET
Adopt Resolution No. 11683 (2026 Series) entitled “A Resolution of the City Council of the City of San Luis Obispo, California, approving a Historic Property Preservation Agreement between the City and the Owners of the George and Cordelia McCabe House at 571 Pismo Street

2 (Application No. HIST-0313-2026),” as recommended by the Cultural Heritage Committee.

6.f COMMUNITY PARTNERSHIP AGREEMENTS WITH (1) THE
ENVIRONMENTAL CENTER OF SAN LUIS OBISPO AND (2) THE SAN

LUIS OBISPO CLIMATE COALITION

1. Approve a Community Partnership Agreement with The Environmental Center of San Luis Obispo; and

2. Approve a Community Partnership Agreement with The San Luis Obispo Climate Coalition; and

3. Authorize the City Manager to sign the Community Partnership Agreements in a final form satisfactory to the City Attorney.

6.g APPROPRIATE STORM PREPARATION AND RESPONSE FUNDING

1. Appropriate $1,100,000 in Capital Projects Reserve Funding to the Storm Response and Recovery Project Account to support storm preparation emergency projects; and,

2. Authorize the Finance Director to appropriate state grant funds for storm preparedness infrastructure upgrade and repair projects, pending confirmation of grant award and grant amount (expected to be $1,340,000); and,

3. Authorize the City Manager to execute state grant agreements in a final form approved by the City Engineer and City Attorney; and,

4. Authorize the City Manager to transfer a total aggregate amount not to exceed $500,000 from Completed Projects Funding to the Storm Response and Recovery and/or Storm Drains project accounts to support any unforeseen cost increases or state grant matching requirements associated with the delivery of storm preparedness capital projects; and,

5. Adopt Resolution No. 11684 (2026 Series) entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, Authorizing Appropriation of $1,100,000 from the Capital Projects Reserve Fund, as well as State Water Resources Control Board Grant Funding, to support Storm Preparedness Infrastructure Upgrades and Repairs.

6.h SUPPORT FOR THE CITY OF PASO ROBLES SUBMISSION OF A BID

ON THE SAN LUIS OBISPO COUNTY AMBULANCE SERVICES

CONTRACT

3 Adopt Resolution No. 11685 (2026 Series) entitled “A Resolution of the City Council of San Luis Obispo, California, Supporting the City of Paso Robles in Submitting a Bid for the County of San Luis Obispo’s Ambulance Services Contract.”

7. PUBLIC HEARING AND BUSINESS ITEMS

7.a TAX EQUITY AND FISCAL RESPONSIBILITY ACT (TEFRA) HEARING

REGARDING THE ISSUANCE OF A TAX-EXEMPT DEBT OBLIGATION
TO FINANCE CONSTRUCTION OF 60 AFFORDABLE HOUSING UNITS
FOR SENDERO APARTMENTS LOCATED AT 165 CESSNA COURT (30

MINUTES)
Housing Coordinator David Amini provided an in-depth staff report and responded to Council questions.

Public Comments:

None
---End of Public Comment---
Motion By Council Member Shoresman
Second By Vice Mayor Francis

1. Conduct a public hearing under the Tax Equity and Fiscal Responsibility Act (“TEFRA”) of 1982 and pursuant to the requirements of the Internal Revenue Code of 1986 (the “Code”); and

2. Adopt Resolution No 11686 ( 2026 Series) entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, approving the issuance of Revenue Bonds by the California Municipal Finance Authority in an aggregate principal amount not to exceed $15,000,000 for the purpose of financing or refinancing the acquisition, construction, improvement, and equipping of Sendero Apartments and certain other matters relating thereto” allowing the issuance of Bonds by the California Municipal Finance Authority (“CMFA”) for the benefit of C&C Development Co., LLC (the “Sponsor”), on behalf of Avila Ranch, L.P., a California limited partnership, or an ownership entity to be created by the Sponsor or an affiliate of the Sponsor (such limited partnership or other ownership entity, the “Borrower”), to provide for the financing of Sendero Apartments (the “Project”); such adoption is solely for the purposes of satisfying the requirements of TEFRA, the Code, and California Government Code Section 6500, et seq.

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

7.b AMENDMENT TO COUNCIL’S POLICIES AND PROCEDURES
CHAPTER 5 – COUNCIL/STAFF RELATIONSHIP AND CHAPTER 7 –
CONFIDENTIALITY (30 MINUTES)
Motion By Vice Mayor Francis
Second By Council Member Shoresman
Adopt Resolution No. 11687 (2026 Series) approving amendments to the Council Policies and Procedures Chapter 5 Council/Staff Relationship and Chapter 7 – Confidentiality with the changes in the staff agenda correspondence and adding a designated Grand Jury representative to Section 5.3.4.2.

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

8. LIAISON REPORTS AND COMMUNICATIONS
Mayor Stewart
 9/2 Attended RTA Meeting
 9/2 Attended IBEW Labor/Management Dinner and Presentation  9/3 Spoke with CalPoly Journalism Students
 9/4 Attended Laguna Middle School First of the Friday Speaker Series  9/7 Attended Great Labor Day Gathering in Atascadero Park  9/9 Attended Visit SLO CAL Touchbase with Vice Mayor Francis  9/10 Attended Regional REACH Roundtable and tour of Vandenberg Space Force Base
 9/10 Attended Build a Better SLO Ann Arbor & City of SB climate and housing;
 9/11 Attended CRCC Policy Meeting
 9/11 Spoke at the Day of Remembrance hosted at Fire Station 1

5  9/12 Attended SLO CASA
Vice Mayor Francis
 9/10 Attended Build a Better SLO
 9/10 Attended SCLC meeting
 9/11 Attended the Day of Remembrance hosted at Fire Station 1  9/12Attended the Butterfly Ball
Council Member Boswell
 9/10 Attended Build a Better SLO
 9/3 Attended the Land Conservancy Reception
 9/2 - Met with Executive Director of SLO Climate Coalition Council Member Marx
 9/1 Attended the Air Pollution Control District (APCD) meeting  9/3 Attended the Land Conservancy Reception
 9/10 Attended SCLC meeting
Council Member Shoresman
 9/3 Attended the Land Conservancy Reception
 9/9 Integrated Waste Management Authority meeting
 9/10 Attended Build a Better SLO
 9/12 Attended SLO CASA

9. CLOSED SESSION (CONTINUED)

9.a CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION
ACTION: City Manager Whitney McDonald reported that the Council met in Closed Session regarding Existing Litigation as noted on the agenda.

The Council on a motion by Council Member Marx second by Council Member Boswell voted 5-0 provided authorization to defend the City iin the listed matter, represented by Liebert Cassidy Whitmore.

6 10. ADJOURNMENT
The meeting was adjourned at 8:55 p.m. The next Regular City Council Meeting is scheduled for October 6, 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

City of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: October 6, 2026
TO: Mayor and Council
FROM: Greg Hermann, Deputy City Manager
Prepared By: Chris Read, Sustainability Manager
VIA: Whitney McDonald, City Manager
SUBJECT: ITEM #6C – 2026 COMMUNITY BIKESHARE PROGRAM – REQUEST

FOR PROPOSALS
Staff received the following questions regarding the draft community bikeshare request for proposals. The questions are below with staff’s response shown in italics:

1. Will there be a clause in any final agreement that includes the ability for the city to “opt out” of the agreement if the selected vendor does not meet certain performance metrics or requirements? For example, I could see a requirement to ensure maintenance requirements are met, availability of bikes across the service area or that bikes are left in appropriate, agreed upon locations?
Yes. The Operator Agreement (RFP Exhibit A, Section 17) allows the City or Cal Poly to terminate the agreement at any time, for any reason, with or without cause, by giving written notice. The Operator would then have 90 days to remove all equipment and restore City property to its original condition. Section G.2 of the RFP also allows termination if the Operator breaches the Operator Agreement or the Service Level and License Agreement.

The specific performance standards mentioned in the question will be defined in the City's Service Level and License Agreement. These include (but are not limited to) maintenance, bike availability across the service area, and proper parking. RFP Section C requires that agreement includes escalation procedures, response timelines, and enforcement mechanisms for improperly parked bikes, customer complaints, and vendor non-performance. The Operator must also submit quarterly reports tracking performance against those standards (RFP Section B.18). Because the City's Service Level and License Agreement will come back to Council for approval, Council will have the chance to review those metrics and consequences before the program launches.

ITEM #6C – 2026 COMMUNITY BIKESHARE REQUEST FOR PROPOSALS Page 2

2. Can you please explain what the “minimum age requirements, helmet use programs, and/or speed governance in sensitive areas” terms mean on page 32 of the packet?
The terms are defined as follows:
 “Minimum Age Requirements” set the youngest age at which someone can register and ride. Bikeshare systems commonly require riders to be 18.  “Helmet Use Programs” encourage riders to wear helmets. Examples include free or discounted helmets for system users, helmet giveaway events, and in-app reminders or incentives.
 “Speed Governance in Sensitive Areas” refers to the use of GPS to automatically reduce a bike's top assisted speed in designated zones, such as parks or on busy multi-use paths.

3. The RFP also allows bidders to provide “functional equivalent” proposals should they be able to provide sufficient justification for an alternative approach. Can you explain what this means?
If a bidder believes a particular RFP requirement is not feasible, could have unintended consequences, or is not the best approach, the bidder may propose an alternative that achieves the same goal. The bidder must explain and justify the alternative (RFP Section B and Section H, Alternative Proposals). For example, a bidder could propose virtual docks instead of physical docks, or a different approach to rider safety than the examples listed.

This flexibility is intentional. Staff's research after the 2024 RFP found that prescriptive requirements limited the number of viable bids. Any alternative still must meet the program's goals and objectives. There are two checks to make sure these approaches are aligned with the City’s expectations: 1) consistency with objectives will be assessed by the review committee, and 2) the final terms would be set in the Service Level and License Agreement, which requires Council approval.

4. Does the Office of Sustainability and Natural Resources Office still have the capacity to manage this project through launch given the upcoming staff transitions?
The Office of Sustainability and Natural Resources (SNR) would lead the project through launch, including procurement, contracting, and outreach. SNR has a dedicated College Corps Fellow for this work and is in the process of hiring a limited-term contract position to backfill office capacity during a staff member’s planned leave. SNR has allocated sufficient time to effectively run the procurement, contracting, and additional outreach efforts and will also use a teambased approach with other City departments as needed given the transitions.

ITEM #6C – 2026 COMMUNITY BIKESHARE REQUEST FOR PROPOSALS Page 3 After launch, the Public Works Active Transportation Manager would serve as the City's liaison to the Operator, with support from SNR staff. The Operator is contractually responsible for running a self-sufficient program, including handling all user requests and equipment issues. In the operational phase of the project, impacts on Citywide staff capacity are expected to be minimal. Staff in peer cities with similar programs report spending about one hour a week or less once their programs were running.

5. Right now, the language states in the RFP and the staff report: Proposals that establish a commitment to utilize local labor and businesses for maintenance and repair support are encouraged. Is it possible to change this language to require the use of local labor and businesses for maintenance and repair of equipment, if available? Rather than just “encouraging” local labor use?
The 2026 RFP includes an expectation for a local presence with flexibility on timing. Under Section B.14 (Organizational Development), each bidder must describe where its team and office/warehouse space will be located, and how those resources will be located within San Luis Obispo County (and ideally in the City) over time. Bidders must also identify their local operations team and qualifications (RFP Section H, Qualifications).

In the proposed draft RFP language, Operators are not immediately required to have a local team and facility. A new operator entering a small market like San Luis Obispo may need to launch with support from an existing regional operation and then build local staff and facilities as ridership grows. Requiring a fully local workforce from the start could make the program financially unworkable for bidders and reduce the number of viable proposals. Instead, the RFP asks each bidder to show its path to a local presence, and proposals will be evaluated on that plan.

The language in Section B.16 encouraging the use of local labor and businesses for maintenance and repair works the same way. It rewards bidders who commit to local labor while leaving room for operators who rely on their own trained technicians for specialized e-bike and battery work, especially in the early stages of the program. If Council would like firmer commitments, staff could set specific milestones for establishing local staff and facilities in the City's Service Level and License Agreement, which will come back to Council for approval. However, Staff recommends weighing these additional requirements with potential impacts to program feasibility.

ITEM #6C – 2026 COMMUNITY BIKESHARE REQUEST FOR PROPOSALS Page 4

6. In the previous RFP, I believe that inclusion of way-finding signage was a required element. In this RFP, it is only preferred or encouraged? Why did we not keep that requirement in this RFP, when it was requested by the ATC in the last RFP?
In 2024, the ATC recommended including wayfinding signage as an evaluative criterion in the additional points section, and the 2024 RFP listed it among the optional elements eligible for additional evaluation points rather than as a requirement. The 2026 RFP keeps that same approach: wayfinding signage remains one of the Additional Bikeshare System Elements that can earn bidders additional points. The RFP also requires the Operator to provide a real-time public map showing the location and status of every bike and station (RFP Section B.11), which serves a similar purpose for riders.

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Department: Administration
Cost Center: 1005
For Agenda of: 10/6/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Chris Read, Sustainability Manager
Jennifer Rice, Active Transportation Manager
SUBJECT: COMMUNITY BIKESHARE PROGRAM – REQUEST FOR PROPOSALS

RECOMMENDATION

1. Authorize the release of a joint Request for Proposals (RFP) with California Polytechnic State University, San Luis Obispo (Cal Poly) for a public bikeshare program.

2. Authorize the City Manager to execute the Operator Agreement with the selected Operator. The Operator Agreement shall be in substantially the same form as set forth in Exhibit A to the RFP and to the satisfaction of the City Attorney.

3. Direct staff to return to Council with a proposed Service Level and License Agreement with the selected Operator.

REPORT-IN-BRIEF
Over the course of the last decade, there have been numerous Council actions and adopted plan documents that call for the City to launch a bikeshare program. A bikeshare program is a public transportation service that provides a network of shared bicycles, parked at stations throughout a city, which users can rent for short trips and return to any station within the system, typically accessed and paid for through a mobile app or website.

A bikeshare program has previously been identified by City plans as a way to promote active transportation, increase connectivity between the City and Cal Poly, support new mobility options, cut climate emissions, reduce air pollution, and contribute to economic vibrancy.

This report summarizes the history of bikeshare initiatives in the City, including the Request for Proposals (RFP) issued in 2024 that ultimately concluded without a selected vendor. Since that time, staff have identified several changes to the 2024 RFP that would create a more competitive bidding environment while supporting the same program performance characteristics. Proposed changes include increased flexibility for vendors to propose system characteristics that ensure financial viability; creating “on ramps” for program expansion to other communities; and allowing for vendors to propose “virtual docks” (as described below in the “Proposed Updates to RFP Requirements” section) as an acceptable docking solution. The City also identified several areas for overall

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improvement in the previous RFP and have added an increased focus on safety and additional protections for vendor non-performance.

Should Council approve the release of the RFP and authorize staff to select a vendor, staff would return to Council in early 2027 to seek approval of a Service Level and License Agreement with the chosen vendor (the RFP process is described in detail in the “Bikeshare RFP Process” section, below). The Service Level and License Agreement would set the specific operating conditions (e.g., dock locations, number of bikes in service, session costs, etc.) and standards that the vendor would commit to (e.g., percentage of bikes in service and available at a given time, frequency of bike and station inspections, preventative maintenance plans, safety plans, complaint resolution timeliness, and the cadence and form of regular reporting on high-level key performance indicators). It would also identify the terms and conditions for granting the vendor a license to install bike stations on City-owned property and public right-of-way, as well as approval of initial stations, consistent with siting requirements described in the “Bikeshare RFP Rating Criteria”, below. Cal Poly would have a separate Service Level and License Agreement with the Operator.

POLICY CONTEXT
Staff’s recommendation is in direct support of the City’s General Plan Circulation Element Objective 1.7.1.1, which identifies a target mode split of 20% of trips by bicycle, and Circulation Element Program 4.2.1, which states that “The City shall evaluate a bikeshare program in coordination with Cal Poly and other educational institutions.” Pursuing bikeshare is also a recommended action featured in numerous planning documents, including the City's first Climate Action Plan (2012, pg. 30), Downtown Concept Plan (2017, pg. 82), Climate Action Plan Update (2020, pg. 48), Active Transportation Plan (2021, pg. 28), 2023-25 Climate Action Work Plan (2022, pg. 34), Access and Parking Management Plan (2023, pg. 39), Economic Development Strategic Plan (2023, pg. 19), and Transit Innovation Study (2024, pg. 34). In addition, assessing and/or launching a bikeshare system has been a Major City Goal work program task across three Financial Plans since 2019 and staff’s recommendation in this agenda report is a continuation of Major City Goal Task 4.3.i from the 2023-25 Financial Plan (pg. 60).

DISCUSSION
Background
Over the course of the last decade, there have been numerous Council actions and adopted plan documents that call for the City to launch a bikeshare program to promote active transportation, increase connectivity between the City and Cal Poly, support equitable mobility, decrease transportation costs, cut climate emissions, reduce air pollution, and support economic vibrancy.1

1 The 2024 Bikeshare RFP Council Agenda Report includes citations to research that illustrates potential benefits of bikeshare programs to commuters while supporting goals related to community vibrancy and economic development, equity, and transportation mode shift. For more information, see packet page 125 at https://opengov.slocity.org/WebLink/DocView.aspx?id=192012&dbid=0&repo=CityClerk&cr=1.

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In 2023, staff led an assessment into the feasibility of launching a bikeshare program, following direction from Major City Goal task 4.3.i in the 2023-25 Financial Plan to "reassess the viability of launching a citywide bikeshare system." This marked the second time the City had considered bikeshare; the first attempt ended in a decision to pause efforts in 2020 in deference to the City’s response to the COVID-19 pandemic.

Staff determined a bikeshare program to be feasible in 2023 for several reasons:
advancements in the bikeshare industry, the City's progress implementing priority active transportation infrastructure (especially along corridors where bikeshare docks are expected to be located), a strong partnership and shared vision with Cal Poly, comparative research with neighboring peer cities, and the availability of staff resources in the Office of Sustainability and Natural Resources to support the launch of a bikeshare program. Based on this assessment, Council approved the release of a Request for Proposals (RFP) in 2024 for a no-cost bikeshare program (in exchange for the City and Cal Poly licensing public space to a private vendor).

The RFP was released in May 2024, but unexpected changes in prospective vendors' operational and business models meant the process did not result in a successful vendor selection. Since then, staff have conducted informational interviews with vendors to better understand typical operating models and identify ways to refine the RFP scope for a more competitive process. Staff also researched successful bikeshare programs elsewhere and believe that re-issuing a modified RFP would likely lead to a successful bid.

Proposed Updates to RFP Requirements
Based on this research, staff suggest several changes to the 2024 RFP to ensure an effective bid environment. These changes are summarized below; the relevant section in the RFP (Attachment A) is cross-referenced in parentheses:

1. Introduce more flexibility to achieve the City’s objectives. Replace prescriptive system requirements (e.g., the system shall have a specific number of bikes available when the program begins operations) with a focus on operational characteristics (e.g., the bidder should propose and justify a system size that achieves the City’s mobility and safety objectives) to allow the vendor to propose creative ways to run a viable business that achieves the City’s goals related to system performance, character, and safety (RFP Section B).

2. Include "virtual docks" as an acceptable docking solution. A virtual dock is a designated parking area, typically marked with paint and signage, that the bikeshare app recognizes as a valid place to end a ride. Advances in GPS technology now allow operators to confirm a bike's location with a high degree of precision, which makes this possible. Virtual docks can keep a program orderly without the cost and disruption of physical stations, such as trenching for electrical service or anchoring equipment into sidewalks (RFP Section B.1). In most virtual dock systems, a rider cannot end a trip until the bike is

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inside a designated area, so the rental stays active if the bike is left elsewhere.

Virtual docks may raise concerns about bikes being left in unsafe locations.

The RFP addresses this in several ways. First, all docking areas, physical or virtual, must be approved by the City or Cal Poly and must minimize bike litter and address ADA accessibility (RFP Section B.5). Second, the Operator must promptly remove any bike left on a sidewalk or elsewhere in the public rightof-way, without relying on City or Cal Poly staff to resolve the issue (RFP Section B.20). Third, bidders must describe their virtual docking area design, parking-verification technology, and process for handling improperly docked bikes, and proposals will be scored in part on how well they address nuisance parking (RFP Section H). Finally, the Service Level and License Agreements will set specific response timelines, escalation procedures, and enforcement mechanisms for improperly parked bikes (RFP Section C). The City and Cal Poly can hold the selected Operator to these commitments through those agreements.

3. Make program expansion easier. Request that bidders include provisions for allowing regional agencies to access the same terms and conditions of the bikeshare system via a cooperative purchasing agreement or similar “piggyback” style contract language. (RFP Section B.3)

4. Directly address safety. Safety emerged as a key concern throughout 2026 bikeshare outreach events. The RFP addresses safety both for bikeshare riders and for others who share the public right-of-way, particularly pedestrians. Bidders must describe how they will operate their program in alignment with the City's Vision Zero goal (RFP Section B.4). This builds on safety requirements carried over from the 2024 RFP, including limiting all bikes to Class 1 e-bike speeds and equipping them with lights that turn on automatically whenever the bike is in use (RFP Section B.1).

Bidders must also propose a broader public safety approach, which may include rider education, minimum age requirements, helmet programs, and speed controls in sensitive areas (RFP Section B.20). To protect pedestrians, docking areas must address ADA accessibility (RFP Section B.5). The Operator must also promptly remove any bike left on a sidewalk or elsewhere in the public right-of-way, so that the path of travel is maintained and pedestrians are not forced to walk around bikes or into the roadway (RFP Section B.20). Proposals will be scored in part on how well they address public safety and nuisance parking (RFP Section H). The Service Level and License Agreement will set response timelines and enforcement mechanisms for improperly parked bikes (RFP Section C). Rider safety and e-bike regulations are discussed further in the E-Bike Safety and Vision Zero section of this report.

5. Add additional protections for non-performance. Add more explicit escalation

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procedures, response timelines, and enforcement mechanisms related to improperly parked bicycles, customer complaints, and vendor nonperformance. (RFP Section C) The City and Campus Foundations for a Bikeshare Program The 2024 Council Agenda Report included an overview of the conditions in 2024 that supported program success, including an evolution of the bikeshare market, observed success in peer cities, improved bikeshare equipment, improved active transportation infrastructure, increased staff capacity, and partnership with Cal Poly. Since that report, these assumptions have generally held to be true with new conditions highlighted below:

1. Improving Bike Infrastructure: A bikeshare system would complement the City and Cal Poly’s investment in pedestrian and bicycle facilities, and further support bicycling as a convenient and effective mode of low-carbon transportation. If this RFP results in a successful procurement, the City would aim to launch the program in Spring of 2027. The program would benefit from the significant progress in advancing bikeway infrastructure between the downtown and Cal Poly area where bikeshare infrastructure is expected to be concentrated. Some of these active transportation infrastructure improvements include:
a. Railroad Safety Trail and Bridge (Pepper to Phillips): Completed b. Protected Bike Lanes Downtown on Higuera and Marsh: Completed c. Cerro Romauldo Neighborhood Greenway: Completed
d. North Chorro Neighborhood Greenway: Completed
e. Toro and Mill Street Neighborhood Greenways: Completed f. Bike lane on Highland (near Cuesta to Santa Rosa): Completed g. Resealing of Railroad Safety Trail along California Blvd (Taft to Foothill):

Completed
h. Grand Ave Roadway Sealing bikeway improvements: pilot installed 2024, permanent improvements expected in 2027
i. Intersection improvements at Foothill and California: Construction start expected 2028
j. Foothill Complete Streets Project: Community outreach underway and construction planned as early as Summer 2028

2. Staff Capacity in Office of Sustainability and Natural Resources to Support Bikeshare: As noted in the 2024 Council Agenda Report, the Active Transportation Committee (ATC) and City Council previously provided strategic direction for Public Works staff to focus on delivering priority Active Transportation Plan (ATP) capital improvement projects. In response, the Office of Sustainability and Natural Resources (“SNR”) has taken the lead on bikeshare and has continued to lead on bikeshare through present. Should the 2026 RFP yield a successful bid, SNR will continue to lead as project manager until operations begin, at which time burdens on staff time reduce significantly.

Anticipated inputs from Public Works staff during pre-launch include supporting

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committee and City Council presentation/s, participating in the vendor selection process, and providing input on bikeshare stakeholder engagement, bike specifications, docking locations and signage/communications materials. After the program launch, Public Works staff would serve as the lead City liaison to the bikeshare program operator, with SNR staff assisting Public Works through regular updates and interventions where changes may be needed. As the operator will be contractually obligated to operate a self-sufficient program with limited inputs or support from City staff, including directly managing all user requests and equipment issues, this impact is estimated to be minimal. Staff from peer cities with similarly structured bikeshare programs found that once their programs were operational, post-launch, City staff time spent on the program reduced to one hour a week or less.

Partnership with Cal Poly: Cal Poly representatives support including the university in a prospective bikeshare system. A bikeshare program fulfills Cal Poly’s Campus Master Plan and Climate Action Plan recommendations to support a bicycle program.

Implementing an accessible bikeshare is consistent with Cal Poly’s investment in pedestrian and bicycle facilities and further encourages bicycling as a convenient and effective mode of transportation in and around the campus environment. Cal Poly was an active partner to the City during the development of the 2024 RFP and signed on to an MOU (Attachment B), which articulates each organization’s roles and responsibilities in procurement and ongoing coordination of the program and remains applicable to this procurement effort.

Bikeshare RFP Process
Staff's recommendation is for Council to authorize the release of a joint RFP with Cal Poly for a public bikeshare program and, should the RFP process be successful, to authorize the City Manager to execute the Operator Agreement, which is a three-way agreement between the City, Cal Poly, and the preferred vendor (Operator). The Operator Agreement establishes the general terms of the relationship among the three parties. If Council approves moving forward with the RFP, City and Cal Poly staff would work collaboratively to review proposals, conduct interviews, and identify a preferred vendor.

If a vendor is selected and the Operator Agreement is executed, the next step would be to coordinate with the Operator on Service Level and License Agreements, which will provide explicit detail about how the program will be implemented, including the process for station selection and placement, identification of proposed stations for City and Cal Poly approval, characteristics of bicycles, deployment of bicycles, safety measures, local workforce, pricing, and other considerations that may arise. The City and Cal Poly would each have their own Service Level and License Agreement with the Operator. The development of those agreements would be supported by additional outreach, and the agreement between the City and the Operator would require Council approval.

Should the City and/or Cal Poly be unable to reach an agreed-upon Service Level and License Agreement with the Operator, the Operator Agreement would terminate with respect to that party, and that party could withdraw from the project. Staff anticipates

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returning to Council in early 2027 for review and approval of the City's Service Level and License Agreement. Figure 1 illustrates the RFP process.

Figure 1. Bikeshare RFP Process
Bikeshare RFP Rating Criteria
The matrix below summarizes key specifications in the draft Request for Proposals (RFP).

The full set of criteria is located at Section B of the attached draft RFP (Attachment A):

Criteria Preferred Specifications (as defined in RFP)
System Type The City of San Luis Obispo and Cal Poly (referred to as the “Agencies”) request a physical and/or virtual dock-based, electric pedal-assist Bikeshare System using Class 1 speed ebikes with front and rear lights that run automatically and continuously while in use. Equipment must be durable.

Operators may propose alternative system models, including pedal bike systems, that meet these objectives.

System Scale &
Expansion
The System must offer enough bikes and stations to be a reliable, on-demand option for residents, employees, students, and visitors. The Operator should be prepared to plan and fund future growth, including cooperative agreements extending service to regional agencies and a process for private parties to request station installation at their sites.

1. RFP Release (October
7, 2026)
The RFP is released
pending Council approval

2. Vendor Selection
(October - December
2026)
City and Cal Poly select a
preferred vendor, enter into
the Operator Agreement,
and begin work on the
Service Level and License
Agreements

3. SLLA to Council
(February-April 2027)
If City staff and the
Operator agree to Service
Level and License
Agreement terms and
conditions, the SLLA goes
to Council for approval

4. Launch
(May-June 2027)
If Council approves, the
team deploys and operates
the program

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Criteria Preferred Specifications (as defined in RFP)
Stations & Site
Infrastructure
The Operator shall propose station locations in coordination with the Agencies, minimizing bike litter and ensuring compliance with ADA requirements. Infrastructure must be easily
relocatable and be quick to install or remove. Sites must be fully restored when stations are removed, with no damage or
attachment points left behind; stations on sidewalks or other pedestrian areas require full restoration by the Operator. All sites shall be approved by the local Agency (either the City or Cal Poly, depending on location) and special attention will be given to avoid conflicts (e.g., allowing downtown business owners to request or decline station locations in front of their stores, not siting stations in existing on-street parking in the downtown core, etc.).

Equity
Considerations
Proposals should describe strategies to make the Bikeshare System accessible to disadvantaged communities and those who have historically faced barriers to active transportation, including reduced pricing for low-income community members.

Proposals should also describe bicycle type options for riders with mobility challenges.

Maintenance and
Repair
Maintenance and repair responsibilities cover all hardware and software components. The Operator must implement a regular inspection, maintenance, repair, and replacement schedule that keeps the System in continuous compliance with the Service Level and License Agreement, including timely cleaning, graffiti removal, and debris removal. Sustainability, battery safety, and battery recycling plans are important to the Agencies, and use of local labor and businesses is encouraged.

Public Safety The Operator must promote safe, lawful operation of the shared bicycles, keep them in safe working condition, and align System operation with the City’s Vision Zero Safe Streets Action Plan for zero transportation-related fatalities. The Operator must promptly remove bicycles obstructing sidewalks or the public right-of-way and provide the Agencies a means to move locked bikes during emergencies. Proposals should address outreach, minimum age requirements, helmet-use programs, and/or
speed governance in sensitive areas, as well as approaches to minimize theft and vandalism and identify responsibility, handling, and any law enforcement involvement for such
incidents.

Business
Operations &
Finance
All costs, including installation, maintenance, capital, operating, marketing, and staffing, are the Operator’s sole responsibility, with no financial obligation to the Agencies; the Operator retains all revenue and must demonstrate financial sustainability.

Proposals should describe the organizational structure, staffing, and office/warehouse presence needed to run the System. The Operator must submit quarterly management reports tracking

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Criteria Preferred Specifications (as defined in RFP)
agreed-upon key performance indicators and business/financial metrics, an annual public report, and maintain business, accounting, and customer service records available to the Agencies for inspection.

Transit Integration Bonus points are available for proposals that describe the bikeshare system’s geographic and/or operational integration with public transit.

E-Bike Safety and Vision Zero as it relates to a Bikeshare Program The growing popularity of e-bikes and other electric mobility devices, including electric scooters, electric motorcycles and mopeds, and other motorized personal transportation devices, has expanded access to sustainable transportation while also creating new safety and enforcement challenges.

Like many communities, San Luis Obispo has experienced increased reports of unsafe or reckless riding, excessive speeds, conflicts with pedestrians, and other safety concerns. It is important to distinguish between the e-bikes that would be included in the City’s bikeshare program (that are legal for use on bicycle facilities) and other devices that may resemble bicycles or scooters but are classified and regulated differently under the California Vehicle Code because of their motor power and speed capabilities.

A bikeshare program provides the City with an opportunity to expand access to e-bikes in a manner that is consistent with applicable laws, regulations, and City policies. The bikeshare model also creates an opportunity to provide users with clear information about safe and responsible riding practices. Because users must register to access a bikeshare system, the Operator can use registration as an important point of contact for education, safety information, and disclosure of applicable rules and requirements. This creates an opportunity to reinforce responsible riding behavior before and during use of the system.

The “Bikeshare RFP Rating Criteria” section above provides safety characteristics that would lead to safe program operations. The RFP also requires the selected operator to provide a comprehensive approach to public safety. Potential strategies include user education and outreach, minimum age requirements, programs that promote or facilitate helmet use, and speed-management technology or controls in areas where lower speeds are appropriate. The RFP also allows bidders to provide “functional equivalent” proposals should they be able to provide sufficient justification for an alternative approach.

The City continues to prioritize education and enforcement related to e-bike and motorized device safety, consistent with recommendations in the Vision Zero Safe Streets Action Plan. The City's Roll and Stroll Resource Hub provides educational materials on e-bike safety, and staff will continue to expand outreach through City-led communications and partnerships with organizations such as Bike SLO County, the SLO Bicycle Club, SLO Rideshare, San Luis Obispo County Public Health, and the San Luis Coastal Unified School District.

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Previous Council or Advisory Body Action
Since 2012, Council has adopted numerous plans that direct staff to evaluate the feasibility of a bikeshare program. The full list of the Council actions to adopt these plans and the associated links to the adopting agenda reports are included in the July 16, 2026 Active Transportation Committee Agenda Report.
2 For brevity, this section only includes
previous actions that considered bikeshare program operation outside of a strategic plan or financial plan adoption.

City Council

1. On October 1, 2019, City Council held a study session on the topic of shared bike systems. Council provided direction to staff to continue with development of a citywide docked electric pedal-assist bikeshare program.

2. On December 8, 2020, City Council directed staff to pause the bikeshare effort and instead monitor the industry for any favorable change, a decision guided by the ATC recommendation on November 19, 2020. Additional decision-making factors were that the marketplace for bikeshare declined considerably in 2020-21 due to the COVID-19 pandemic, and that results from a San Luis Obispo Rapid Bikeshare Assessment produced by Alta Planning + Design indicated that it would be difficult to launch a bikeshare program without significant City investment and staff resources.

3. On May 7, 2024, Council voted unanimously to release the bikeshare RFP as described in this report. At the conclusion of the RFP process, staff communicated to Council via email of the decision to not select a vendor and committed to monitoring the bikeshare market in case conditions changed that could lead to a favorable outcome.

Advisory Bodies:

1. On November 19, 2020, the Active Transportation Committee (ATC) heard an agenda item on Bike Share Services. The recommendation from the ATC was to “not pursue shared micro mobility at this time but to continue monitoring it in cities similar to San Luis Obispo including partnering with Cal Poly (if there is interest) to survey interest and demand in San Luis Obispo.” The ATC also recommended removing bikeshare from the Major City Goals for FY 2021-23 and stated their preference for the City to focus staffing and financial resources on implementing the highest-priority bicycle and pedestrian infrastructure projects before committing significant resources to bikeshare.

2. On November 3, 2022, the Active Transportation Committee received a presentation from staff on the 2023-2027 Climate Action Plan Work Program. The ATC’s feedback was generally supportive of the CAP Work Program but noted that

2 https://pub-slocity.escribemeetings.com/filestream.ashx?DocumentId=25596

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the primary focus of Public Works Mobility Services staff should be to prioritize implementation of Tier 1 Active Transportation Network projects before consideration of advancing bikeshare.

3. On April 10, 2024, the Promotional Coordinating Committee (PCC) received a presentation on the issuance of a joint RFP with Cal Poly for a public bikeshare program. The PCC unanimously voted to recommend to City Council to authorize the release of an RFP for a bikeshare system.

4. On April 11, 2024, the Active Transportation Committee received a presentation on the issuance of a joint RFP with Cal Poly for a public bikeshare program. The ATC unanimously voted to recommend to City Council to authorize the release of an RFP for a bikeshare system. The ATC also provided feedback that was incorporated into the 2024 RFP including requirements for Class 1 e-bikes, for front and back lights to run automatically and continuously during bike operation, and to include wayfinding signage as an evaluative criterion in the additional points section.

5. On July 8, 2026, the Mass Transportation Committee (MTC) received a presentation on the issuance of an updated RFP for a public bikeshare program.

The MTC unanimously voted to recommend to City Council to authorize the release of an RFP for a bikeshare system.

6. On July 16, 2026, the Active Transportation Committee (ATC) received a presentation on the issuance of an updated RFP for a public bikeshare program.

The ATC unanimously voted to recommend to City Council to authorize the release of an RFP for a bikeshare system.

7. On September 9, 2026, the Promotional Coordinating Committee (PCC) received a presentation on the issuance of an updated RFP for a public bikeshare program and unanimously voted to recommend to City Council to authorize the release of an RFP for a bikeshare system.

Public Engagement
Bikeshare has been repeatedly affirmed as a City work effort and has been routinely prioritized by community members during outreach events, including at the 2022 Connected Community Stakeholder Forum, the 2022 CAP Community Climate Party, and the wide range of outreach that was conducted ahead of the 2024 RFP Release.3 Because both the stakeholder landscape and several program details have changed since the 2024 outreach effort, staff conducted a new round of engagement in 2026. This included the 2026 Climate Action Plan Stakeholder Roundtables, a meeting with Downtown SLO staff, a presentation to the SLO Chamber of Commerce's Legislative

3 For a full account of the outreach conducted ahead of releasing the 2024 RFP, see:
https://opengov.slocity.org/WebLink/DocView.aspx?id=192012&dbid=0&repo=CityClerk

Item 6c
Action Committee, two open-house events focused on downtown businesses, and a project landing page with information about the potential program. Staff also presented to the Mass Transportation Committee, the Active Transportation Committee, and the Promotional Coordinating Committee. All three advisory bodies unanimously recommended that Council release the bikeshare RFP, and each provided a wide range of feedback with recurring questions about program safety and improperly parked bicycles, including bikes left in inappropriate locations or blocking the public right-of-way.

Pending a successful procurement process, staff would work with the selected operator to conduct additional community outreach to inform the community and key stakeholders of the program and seek feedback on the selection of bikeshare docking locations and other program components, as well as lead a communitywide promotion and education campaign.

CONCURRENCE
Public Works and the Office of Sustainability and Natural Resources have collaborated closely on the development of a bikeshare program and concur with the contents of this report and the associated RFP. Cal Poly staff have reviewed and approved the RFP and concur with staff's recommendation.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to releasing the RFP as these actions do not constitute a "project" under CEQA guidelines sec. 15378.

Launching a bikeshare system, including the installation of docking stations and signs, qualifies for an exemption under CEQA guidelines section 15301 (Existing Facilities).

Section 15301 exempts projects for the operation, repair, maintenance, permitting, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features involving negligible or no expansion of existing or former use.

Section 15301 (c) specifically identifies existing highways and streets, sidewalks, gutters, bicycle and pedestrian trails, and similar facilities (this includes road grading for the purpose of public safety), and other alterations such as the addition of bicycle facilities, including but not limited to bicycle parking, bicycle-share facilities and bicycle lanes, transit improvements such as bus lanes, pedestrian crossings, street trees, and other similar alterations that do not create additional automobile lanes as examples of appropriate improvements that can qualify for this exemption.

Additionally, the project would be exempt under CEQA Section 15304 (Minor Alterations to Land) which exempts minor trenching where surface is restored; 15305 (Minor Alterations in Land Use Limitations) which exempts issuance of minor encroachment permits; and 15311 (Accessory Structures) which exempts on-premise signs.

Item 6c

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
State
Federal
Fees
Other:

Total N/A
Staff proposes issuing an RFP for a system operator that will run a bikeshare program in the City of San Luis Obispo and on Cal Poly campus at no direct cost to either organization.

Pending Council approval, the Office of Sustainability and Natural Resources (SNR) would provide the staffing resources required from the City to launch the program including managing procurement and contracting, supporting community outreach, and coordinating input from City departments and community stakeholders. The Public Works Active Transportation Manager would serve as the staff contact and liaison to the chosen operator once the bikeshare program is operational, with assistance from SNR staff. From procurement through operations, a bikeshare program would be delivered and operated with existing budgeted resources and staffing.

ALTERNATIVES

1. Approve staff's direction with changes to the RFP. If Council directs edits to the RFP, staff requests that they be detailed and specific. Any changes to the RFP would need to be evaluated and approved by Cal Poly. If Council elects this alternative, staff requests that Council specify a scope of acceptable final terms to dictate these additional negotiations with Cal Poly.

2. Direct staff to delay release of the RFP. If Council provides this direction staff requests that they provide feedback on what circumstances would need to change prior to being ready to implement a bikeshare program.

3. Direct staff to not release the RFP and cease evaluation of a bikeshare program.

This alternative would be inconsistent with adopted plans and policies.

ATTACHMENTS
A - Draft 2026 Bikeshare Request for Proposals
B - Bikeshare MOU with Cal Poly (2024)

The City of San Luis Obispo is committed to including disabled persons in all of our services, programs and activities.

Telecommunications Device for the Deaf (805) 781-7410.

Notice Requesting Proposals / Qualifications for a
City of San Luis Obispo and Cal Poly Bikeshare System
The City of San Luis Obispo and Cal Poly San Luis Obispo are requesting sealed proposals for a Bikeshare System.

All firms interested in receiving further correspondence regarding this Request for Proposals (RFP) will be required to complete a free registration using BidSync (https://www.bidsync.com/bidsync-appweb/vendor/register/Login.xhtml). All proposals must be received via BidSync by the Department of Finance at or before October 28, 2026, when they will be opened electronically via BidSync on the proposal end date and time.

The preferred method for bid submission is electronic via BidSync. However, if you wish to submit a paper copy, please submit it in a sealed envelope to the Department of Finance, City of San Luis Obispo, 990 Palm Street, San Luis Obispo, CA, 93401.

An optional pre-proposal conference will be held on October 14, 2026 at 2:00 PM Pacific Time, to answer any questions that the prospective proposers may have regarding the City's request for proposals. The pre-proposal can be accessed at:
https://teams.microsoft.com/meet/264539927392591?p=ZKIQ32oa3wNbCKljkv Meeting ID: 264 539 927 392 591
Passcode: Hq7rC6vZ
Prospective bidders may also email clarifying questions to [email protected] through 5:00 PM Pacific Time on October 15, 2026. The written questions and pre-proposal questions, along with City answers will be posted on October 16, 2026, as an RFP supplement. No further clarifying questions will be accepted after October 15, 2026.

Project packages and additional information may be obtained at the City’s BidSync website at www.BidSync.com. Please contact Chris Read ([email protected]) with any questions.

For technical help with BidSync please contact BidSync tech support at 800-990-9339.

TABLE OF CONTENTS
A. INTRODUCTION......................................................................................................................................... 1 B. SCOPE OF WORK ....................................................................................................................................... 1 C. SERVICE LEVEL AND LICENSE AGREEMENTS............................................................................................. 5 D. PROJECT SCHEDULE.................................................................................................................................. 5 E. PROJECT BUDGET...................................................................................................................................... 6 F. GENERAL TERMS AND CONDITIONS ......................................................................................................... 6 G. SPECIAL TERMS AND CONDITIONS........................................................................................................... 7 H. PROPOSAL CONTENT ................................................................................................................................ 8 I. PROPOSAL SUBMITTAL FORM ................................................................................................................. 13 EXHIBIT A: FORM OF OPERATOR AGREEMENT........................................................................................... 17 EXHIBIT B-1: CITY’S INSURANCE REQUIREMENTS....................................................................................... 26 EXHIBIT B-2: CSU INSURANCE REQUIREMENTS.......................................................................................... 28

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A. INTRODUCTION
The City of San Luis Obispo (“City”) and California Polytechnic State University San Luis Obispo (“Cal Poly”) are inviting applications from full-service, qualified applicants (“Operators”) to provide a Shared Bicycle (“Bikeshare”) System for the City and Cal Poly. The specifications detailed herein are intended to obtain applications outlining a plan by qualified applicants to develop, implement, and manage a Bikeshare System for a specified initial period, with an option to extend beyond this period with mutual consent.

The City and Cal Poly (collectively the “Agencies”) intend to select a single Operator through this competitive Request for Proposals (RFP) process.

San Luis Obispo naturally lends itself to bicycle transportation, given its temperate climate, picturesque setting, and compact urban form, which all contribute to the bikeability of the area, with over sixteen percent of people in the City commuting to work via bicycle (City Transportation Survey, 2019). To further increase access to bicycling as a viable mode of transportation, the Agencies seek to implement a Bikeshare System to enhance multimodal mobility for its residents, students, employees, and visitors.

A Bikeshare System would achieve City and Cal Poly policies. The Circulation Element of the City’s General Plan, Active Transportation Plan, and Climate Action Plan recommend the exploration of a shared bicycle program to increase mobility options, decrease transportation costs, and reduce air pollution and greenhouse gas emissions. Similar recommendations and desired outcomes exist in Cal Poly’s Campus Master Plan and Climate Action Plan. Implementing an accessible Bikeshare System also complements the City and Cal Poly’s investment in pedestrian and bicycle facilities, and further supports bicycling as a convenient and effective mode of low-carbon transportation.

B. SCOPE OF WORK
The Agencies seek the delivery of a dependable and accessible Bikeshare System that is compatible with the unique character of San Luis Obispo. The selected Operator will be responsible for all aspects of an integrated Bikeshare System. The selected Operator will receive general direction from the Agencies but will be expected to perform all technical tasks and other analyses necessary to complete the proposed scope of work. The Operator will ensure that the Bikeshare System will best serve San Luis Obispo and Cal Poly by collaborating closely with agency staff and community stakeholders. The selected Operator should be prepared to enter into “Service Level and License Agreements” with the Agencies, which are contracts mentioned throughout Section B and further described in Section C of this RFP.

Proposals shall provide a scope of work for development and operation of a System that meets the general specifications outlined below. If, in a proposer’s experience or expertise, a required component is deemed infeasible, has the potential for unintended consequences, or is otherwise not recommended, the bidder may propose a functionally equivalent alternative. System specifications are as follows:

1. System Type. The Agencies’ vision is for a dock-based (virtual and/or physical) electric pedal-assist Bikeshare System. The System shall operate year-round and be available 24 hours a day, seven days a week. All materials and equipment shall have a long expected useful life and high durability.

The Agencies request that all bikeshare bicycles do not exceed Class 1 e-bike speed thresholds and include front and back lights that automatically light and continuously operate while the bike is in use. Proposals may suggest other system models, including systems with pedal bicycles, if they achieve the overall objective of this project.

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2. System Scale. The system should have enough bikes and stations to be a reliable, on-demand mobility option for residents, employees, students, and visitors. The system scale must support a zero-cost to the Agencies operational model, wherein the Agencies are flexible on the number of bikes and docks necessary for the system to operate successfully. Subsequent additions to the System may be phased at different intervals over time. The selected Operator should be capable of, responsible for, and highly motivated to plan and implement expansion of the System in the future as interest and funding permits.

3. System Expansion. The Operator is encouraged to create access to regional agencies to the same terms and conditions of the Bikeshare System via a cooperative purchasing agreement or similar “piggyback” style contract language. The Operator is also encouraged to propose a straightforward process wherein private parties can request, and if necessary, pay a prenegotiated fee for a Bikeshare System docking station to be installed at their site/s.

4. System Safety. The Operator shall describe how the system can be operated in alignment with the City’s Vision Zero Plan for zero transportation related fatalities.

5. Stations. The Operator shall propose a plan for identifying, deploying, and maintaining bike station areas, and shall coordinate final locations with Agencies. The stations should minimize the impact of “bike litter” and address ADA accessibility concerns. Station infrastructure should be easily moveable and require minimal time to install and/or remove. The selected Operator will ensure that all sites are fully restored to the satisfaction of the Agencies whenever stations are installed and/or removed. No damage or attachment points should be left behind. Stations located on sidewalks or other pedestrian areas require full restoration. All proposed locations shall require explicit approval by the relevant Agency.

6. Customer Service. The Operator will be responsible for creating and managing responsive and friendly customer service standards and procedures. All physical System structures shall contain a conspicuously posted telephone number, directing to the Operator’s customer service operations to which the public may direct complaints and comments, and instructions for filing a complaint. This customer service system must be available to those that have and have not registered for the Bikeshare System. The Operator shall provide a timely response to any such complaints. The Operator shall provide a shared database in which the Agencies can communicate complaints from the public, the City, and Cal Poly, in which the Operator can report the resolution of such complaints. Operator shall collect customer email addresses during registration, and send at minimum one electronic survey, designed by the Agencies, per year to bikeshare users. Across all customer service procedures, the Operator shall take the lead in resolving the issue and minimize involvement from the Agencies.

7. Equity Considerations. Proposals shall describe proposed strategies to make the Bikeshare System accessible to all community members, ensuring that access is provided for users in disadvantaged communities and for persons that typically have experienced barriers to active transportation.

Strategies that improve access for low-income communities, such as providing reduced pricing to those who qualify, are desired. If applicable, proposals shall describe options for bicycles that serve the needs of those with mobility challenges.

8. Fee Collection. Operator shall set a fare structure in collaboration with the Agencies that:
a. Describes the proposed payment system and subscription types (i.e., hourly, daily, monthly, annually; low-income rates; student memberships; corporate passes, etc.).

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b. Documents all payment methods accepted by the System. c. Documents how late fees, out of station fees, and other penalty-based fees (e.g., for bikes improperly parked or not returned) will be assessed.

9. Costs. All costs associated with the System, including but not limited to installation, maintenance, capital, operating, marketing, and staffing, shall be the sole responsibility of the Operator.

Operator must provide sufficient documentation to demonstrate the financial sustainability of the System. The Agencies will have no financial obligation associated with the System for the duration of the contract period.

10. Revenue. All revenues, including membership fees, use fees, and revenue from other sources, shall be collected by the Operator.

11. Registration. Operator shall design, maintain, and host a Bikeshare System website or app that promotes the program and allows users to register, submit credit card data, and execute a user agreement. The digital platform shall display correctly on all major web browsers and mobile devices/formats. After registration, members should be able to immediately access a bike. The Operator’s digital platform and mobile application (if applicable) must meet the Agencies’ Information and Communication Technology (ICT) review requirements.

12. Real-Time Communication. As part of its digital platform, the Operator shall offer a public-facing real-time map location and status of each bicycle and docking area throughout the service area.

Operator shall use the General Bikeshare Feed Specification (GBFS), a standardized data feed for Bikeshare System availability. Map interfaces that enable trip planning with address inputs, directions, and transit information are encouraged.

13. Branding, Marketing, Community Outreach, Public Relations, and Customer Service. Operator will oversee branding, marketing, membership sales, community outreach, and public relations. Use of name, trademarks, or logos of the Agencies shall be subject to the terms and conditions and any applicable requirements for a license from the City or Cal Poly. If possible, the Bikeshare System’s tangible assets will be branded with the Sustainable SLO mark. Sustainable SLO is a Citywide branding effort that represents the collective actions taken by the City and community to reduce climate pollution and adapt to climate change.

14. Organizational Development. Operators must already have, or design and set up a business organization that can complete all tasks in this scope of work. This will include any office and warehouse setup, staffing, administrative and office systems, risk management, legal compliance (including preparation of all waivers, legal disclaimers, etc.), accounting and reporting systems, policy manuals, user rules and regulations, payroll, Human Resources systems, and other activities and systems as needed. Operators shall describe where their team and office/warehouse space will be located and are expected to describe how these resources will be located within the County of San Luis Obispo, and ideally in the City, over time.

15. System Balancing. The Operator will maintain a balanced system with minimal likelihood that customers encounter empty or full stations. The Operator shall continuously and predictably redistribute bicycles to provide consistent availability of bikes throughout the service area.

16. Maintenance and Repair. Maintenance and repair responsibilities apply to all hardware and software components of the System. The Operator will be responsible for developing and

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implementing a regular inspection, maintenance, and repair and/or replacement schedule that keeps the System in continuous compliance with agreed upon Service Level and License Agreement terms, conditions, and service standards. These activities shall include inspecting, cleaning, and removing graffiti from System structures on a timely basis, as well as removal of debris in and around the System components and structures. Sustainability, battery safety, and battery recycling plans are important to the Agencies. Proposals that establish a commitment to utilize local labor and businesses for maintenance and repair support are encouraged.

17. Regular Operations Review. The Operator will routinely review periodic reports, maps, and data, as well as ridership, fee structure, and trip and route data. Operator shall develop recommendations that promote System usage, promote closer coordination with potential or existing partners, and reduce or eliminate any operating deficits. Any such recommendations will be circulated among the Agencies and any recommendations that result in stations that are added, removed, or amended, shall require Agency approval subject to the negotiated terms in the Service Level and License Agreements.

18. Reporting. At regular, periodic, and appropriate intervals, Operator shall submit reports that track Key Performance Indicators as agreed upon in the Service Level and License Agreements. In their proposal, Operators must prepare a matrix that presents and summarizes other periodic reports that the Operator will submit for external and internal audiences. These reports shall include at a minimum a quarterly management report for the Agencies that monitors Key Performance Indicators against agreed upon standards, as well as business/financial metrics. An annual report available to the public and interested stakeholders will also be required.

19. Records. Operator shall maintain additional business related, accounting and customer servicerelated records and make them available to the Agencies on appropriate notice for inspection and auditing.

20. Public Safety. Operator will be required to promote safe and lawful operation of the shared bicycles, as well as ensure that the bicycles are maintained in safe working condition. Operator is required to promptly remove bicycles left on sidewalks or elsewhere within the public right of way, and shall proactively avoid any City and Cal Poly staff involvement in remedying these issues.

In times of emergencies, however, the Operator should be prepared to provide the Agencies with codes or other means to move locked bikes. Operator shall provide a broad approach to protecting public safety that could include helmet programs, outreach and education, minimum age requirements, and/or speed governance bike controls to reduce speeds in sensitive areas.

21. Theft and Vandalism. The Operator shall minimize opportunities for theft and vandalism.

Operator shall propose a process for responding to instances of theft and/or vandalism, how these incidents are handled, and how law enforcement may be involved.

22. Secure Financial Transactions. The Operator shall provide complete secure financial transactions with data input at the web page or by cell phone. Financial data must be held securely in a manner that complies with all applicable federal, state, and local privacy and data protection laws, rules, regulations, and directives, and is only accessible to authorized personnel. The Operator must ensure that its security policy is enforced, report any breaches to the Agencies as soon as practicable, and develop a corrective plan to prevent future breaches. The method for protecting financial data, usernames, and addresses, must be Payment Card Industry (PCI) compliant.

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Neither the City nor Cal Poly will be bound by or responsible to comply with any General Data Protection Regulation (GDPR) requirements.

23. Open Data. The Operator shall provide open content data that will allow third party developers to provide applications to assist users in finding bicycles and stations, and comparing travel and usage information. This data shall be anonymized.

The Agencies also acknowledge the creativity and experience that Operators will bring to a Bikeshare System in San Luis Obispo and encourage Operators to propose system elements above and beyond the minimum standards established in this RFP. There are additional evaluative points available for these optional elements as described in Section H. Additional elements include:
 Integration with the transit system (geographically and/or operationally)  Investment in wayfinding signage and/or other methods for riders to easily locate docking stations on the go
 Ways to refer consumers to local bicycle shops for long-term rentals and gear (retail sales)  Information about how the Operator mitigates the environmental impact/s of its services including greenhouse gas emissions, amount of waste generated, water and energy use, and other areas related to the Operator’s products and services.

Additionally, City staff are aware of a vacancy of a small storefront at 1055 Osos Street in the heart of downtown. While not a mandatory requirement of this RFP, bidders are invited to propose uses of that space as a bikeshare hub.

C. SERVICE LEVEL AND LICENSE AGREEMENTS
Upon selection of an Operator, the Agencies and the Operator will execute the “Form of Operator Agreement” provided as Exhibit A, which will incorporate by reference this RFP and therefore dictate the minimum components of Service Level and License Agreements (SLLA). An SLLA will be developed in collaboration with each of the Agencies to establish the specific standards that the Operator will commit to in operationalizing the proposed scope items described above including system equipment, system size, dock locations, etc. Each SLLA will also establish the terms and conditions under which each Agency will license the public land and public right-of-way to the Operator and will also include protections to the Agenciesincluding indemnification to the Agencies from all claims related to the Bikeshare System, as well as escalation procedures, response timelines, and enforcement mechanisms related to improperly parked bicycles, customer complaints, and vendor non-performance. As part of each SLLA, the Operator shall provide the waiver to be signed by all System users releasing the Agencies from all claims, in a form satisfactory to the Agencies.

D. PROJECT SCHEDULE
Operator shall propose a project schedule that includes all steps necessary to reach a launch date, as well as subsequent milestones. The schedule shall include pre-launch activities such as site planning, permitting, community outreach and engagement, education, and other applicable tasks. A detailed schedule will be finalized in cooperation between the Agencies and Operator during Service Level and License Agreement negotiations.

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E. PROJECT BUDGET
As referenced in Section B “Scope of Work”, all costs associated with the system, including but not limited to capital, operating, marketing, and staffing, shall be the sole responsibility of the Operator. The Agencies will have no financial obligation associated with the System for the duration of the contract period.

F. GENERAL TERMS AND CONDITIONS

PROPOSAL REQUIREMENTS

1. Requirement to Meet All Provisions. Each individual or firm submitting a proposal (bidder) shall meet all the terms and conditions of the Request for Proposals (RFP) project package. By virtue of its proposal submittal, the bidder acknowledges agreement with and acceptance of all provisions of the RFP specifications.

2. Proposal Submittal. Each proposal must be submitted on the form(s) provided in the specifications and accompanied by any other required submittals or supplemental materials. Proposal documents shall be submitted electronically via BidSync. However, if you can’t submit electronically, please send your bid copy in a sealed envelope to the Department of Finance, City of San Luis Obispo, 990 Palm Street, San Luis Obispo, CA, 93401. To guard against premature opening, the proposal should be clearly labeled with the proposal title, project number, name of bidder, and date and time of proposal opening. No FAX submittals will be accepted.

3. Insurance Certificate. Each proposal must include a certificate of insurance showing:
a. The insurance carrier and its A.M. Best rating.
b. Scope of coverage and limits.
c. Deductibles and self-insured retention.

The purpose of this submittal is to generally assess the adequacy of the bidder’s insurance coverage during proposal evaluation; as discussed below, endorsements are not required until contract award. The City’s insurance requirements are detailed in Exhibit B-1 and Cal Poly’s insurance requirements are detailed in Exhibit B-2.

4. Proposal Withdrawal and Opening. A bidder may withdraw its proposal, without prejudice prior to the time specified for the proposal opening, by submitting a written request to the Director of Finance for its withdrawal, in which event the proposal will be returned to the bidder unopened.

No proposal received after the time specified or at any place other than that stated in the “Notice Inviting Bids/Requesting Proposals” will be considered. All proposals will be opened and declared publicly. Bidders or their representatives are invited to be present at the opening of the proposals.

5. Submittal of One Proposal Only. No individual or business entity of any kind shall be allowed to make or file, or to be interested as the primary submitter in more than one proposal, except an alternative proposal when specifically requested; however, an individual or business entity that has submitted a sub-proposal to a bidder submitting a proposal, or who has quoted prices on materials to such bidder, is not thereby disqualified from submitting a sub-proposal or from quoting prices to other bidders submitting proposals.

6. Communications. All timely requests for information submitted in writing will receive a written response from the City or Cal Poly. Telephone communications with City staff are not encouraged

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but will be permitted. However, any such oral communication shall not be binding on the City or Cal Poly.

CONTRACT AWARD AND EXECUTION

7. Proposal Retention and Award. The City and Cal Poly reserve the right to retain all proposals for a period of 60 days for examination and comparison. The City and Cal Poly also reserve the right to waive non-substantial irregularities in any proposal, to reject any or all proposals, to reject or delete one part of a proposal and accept the other, except to the extent that proposals are qualified by specific limitations. See the “special terms and conditions” in Sections G and H of these specifications for proposal evaluation and contract award criteria.

8. Competency and Responsibility of Bidder. The City and Cal Poly reserve full discretion to determine the competence and responsibility, professionally and/or financially, of bidders.

Bidders will provide, in a timely manner, all information that the City or Cal Poly deems necessary to make such a decision.

9. Contract Requirement. The bidder to whom award is made (Operator) shall execute a written contract with the City and/or Cal Poly within twenty (20) calendar days after notice of the award.

The contract shall be made in the form adopted by the Agencies and incorporated in these specifications.

CONTRACT PERFORMANCE

10. The Agencies’ contract terms and conditions that Operator will be expected to execute and be bound by, are attached hereto as Exhibit A.

G. SPECIAL TERMS AND CONDITIONS

1. Contract Award. Subject to the reservations set forth in Section F (General Terms and Conditions) of these specifications, the contract will be awarded based on the evaluative criteria set forth in this Request for Proposals.

2. Contract Term. The contract term is three years from the commissioning date of the Bikeshare System. If the Operator breaches the contract or Service Level and License Agreements, the Agencies may terminate the contract based on the mutually agreed upon terms and conditions of these agreements. Bidders may propose alternative contract terms if doing so would increase the viability of the Bikeshare System. Should a bidder propose an alternative term, they must provide justification for their proposal.

3. Contract Extension. The term of the contract may be extended by mutual consent for additional three-year terms in perpetuity.

4. Non-Exclusive Contract. The City and Cal Poly reserve the right to obtain the services described in this RFP, as well as any supplemental items, from other vendors during the contract term.

5. Unrestrictive Brand Names. Any manufacturer's names, trade names, brand names or catalog numbers used in the specifications are for the purpose of describing and establishing general

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quality levels. Such references are not intended to be restrictive. Proposals will be considered for any brand that meets or exceeds the quality of the specifications given for any item. In the event an alternate brand name is proposed, supplemental documentation shall be provided demonstrating that the alternate brand name meets or exceeds the requirements specified herein. The burden of proof as to the suitability of any proposed alternatives is upon the proposer, and the City and Cal Poly shall be the sole judges in making this determination.

6. Start and Completion of Work. Work on the Service Level and License Agreements shall begin immediately after Operator Agreement execution. System commissioning shall begin immediately after Service Level and License Agreement execution and be operational within 6 months, unless otherwise negotiated with Agencies by mutual agreement.

7. Submittal of References. Each proposer shall submit a statement of qualifications and references on the form provided in the RFP package.

8. Statement of Contract Disqualifications. Each proposer shall submit a statement regarding any past governmental agency bidding or contract disqualifications on the form provided in the RFP package.

H. PROPOSAL CONTENT

1. Proposal Content. Please provide the information requested below. Any omission may be cause for rejection of proposal. Proposal length should only be as long as required to be responsive to the RFP. Proposals should not exceed 20 pages (not including attachments and supplemental materials) and should not include generic marketing materials.

Submittal Forms. Please sign and complete the following forms:
a. Proposal submittal summary form.
b. Certificate of insurance.
c. References from at least three firms or jurisdictions for whom Operator provided similar services.
d. Statement of past contract disqualification.

Project Approach.
a. Provide a narrative that describes the Operator’s vision and approach to this project.

Narratives should describe how the project aligns with the Scope of Work outlined in Section B, and should specifically include:
 Operator’s proposed bicycle specification including a description of the weight, materials, number of gears, tire size, braking system, light system, reflective elements, bell, locking mechanism, cargo storage, accessibility, ability to tackle hills and non-flat terrain, and other relevant bike elements.  Physical docking station design, power needs, installation and removal needs, footprint, and any other relevant information.
 Virtual docking area design, parking-verification technology, installation and removal needs, footprint, and any other relevant information.  Map of the conceptual program area and methodology for determining locations.  Timeline and approach to rollout, including plan for a single or phased launch.

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 Customer service approach including how the Operator will accommodate and/or work with the City's current services.
 The process for when bikes are inappropriately docked, when a user wants to return a bike to full docking station and/or rent a bike from an empty station.  Operator’s approach to fiscal sustainability including the Operator’s organizational financial health and the approach to long term system financial health.
b. Provide a scope and schedule that includes all tasks, sub-tasks, dates, and deliverables. c. Describe any assumptions critical to development to Operator’s response which may impact scope or timeline.
d. If the Operator proposes a functionally equivalent alternative approach to a standard requested by the Agencies, provide justification for the proposal.

Qualifications. Provide a brief background of Operator’s business(es) and general areas of expertise. Describe experience with public sector Bikeshare programs. Identify the roles that individual team members will serve over the course of the project, including the local operations team, and describe their qualifications including years of service with current firm, and resumes as appropriate. If Operator will subcontract portions of the work, list subcontractors to be used.

Contracts and Terms.
a. Please provide a preliminary draft of a Service Level and License Agreement that would apply to the proposed Bikeshare System in San Luis Obispo. b. The Agencies desire to begin work soon after selecting the preferred Operator and expects the Operator to execute the Agencies’ contract and all of the terms therein, as set forth in Exhibit A. To expedite the contracting process, each submittal shall include requested redlined changes to terms and conditions contained in this RFP, if necessary.

Additional changes not requested with proposer’s submittal will not be considered.

Please be advised that the Operator’s requested changes to the Agencies’ terms and conditions will be considered when scoring and determining the competency and responsibility of the proposer.

2. Proposal Evaluation and Selection. Proposals will be evaluated by a review committee comprised of City staff, Cal Poly personnel, and/or nonprofit partners. The committee will evaluate proposals based on the table below:

Criteria Points
Responsiveness 35
The proposal demonstrates that the Operator meets all requirements set forth in this RFP and supplies all necessary forms, attachments, and documentation. The narrative section addresses all specifications contained in Section B Scope of Work.

Operational Experience 25
Operator demonstrates successes in planning, launching, operating, and maintaining Bikeshare Systems with municipal or other public sector partners. Operator has experience launching and marketing a new system and hitting growth targets, operating an effective customer service model, and maintaining a System in a state of good repair. This criterion will take into account the experience of the assigned project manager and other key team members, as well as references from public agency bikeshare partners.

Financial and Technical Capacity 25

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Criteria Points
Operator demonstrates the financial capacity to self-fund the bicycle share system and proposes a business model that minimizes costs and enables steady future expansion. Operator details a data-driven approach to monitor System success and improve over time. Operator demonstrates that the Operator will fulfill the data privacy and other technology requirements specified in this RFP and demonstrates expertise in user interface (UI) and user experience (UX).

Community Values 15
Proposal demonstrates an understanding of the San Luis Obispo community and culture.

Operator has experience facilitating community engagement to inform Bikeshare Systems. The proposed approach addresses local concerns including diversity, equity and inclusion, public safety, nuisance parking, and aesthetics.

Additional Bikeshare System Elements 10
Operator may, at its optional discretion, provide services, capacity, and strategies above and beyond the minimum standards established in this RFP. Additional points will be awarded for the Additional Bikeshare System Elements specified in Section B Scope of Work.

The Committee may choose to select the three (3) highest ranked applicants to be interviewed. If so, the short-listed Operators will be notified by the City of the date, time and place for their interviews and any other pertinent information. The project manager, key staff, and a bicycle must be present at interview. Within a reasonable period of time after the last interview, the Committee shall select the successful applicant based on qualifications and performance at the interview. After evaluating the proposals and discussing them further with the finalists or the tentatively selected Operator, the City reserves the right to further negotiate the proposed work and/or method, approach, and schedule.

Given the $0 nature of the RFP, contract award will not be based on price, but on a combination of factors as determined to be in the best interest of the Agencies.

3. Proposal Review and Award Schedule. The following is an outline of the anticipated schedule for proposal review and contract award:
a. Issue RFP October 7, 2026
b. Pre-Proposal Conference (optional) October 14, 2026
c. Written question deadline October 15, 2026
d. Receive proposals October 28, 2026
e. Complete proposal evaluations November 3, 2026
f. Complete interviews and finalize recommendation November 17, 2026 g. Execute Operator Agreement December 4, 2026
h. Start work on the SLLA December 4, 2026
i. City Council meeting to approve SLLA (tentative) March 2027 j. Bikeshare System Launch (tentative) Spring 2027
Please note that the award schedule mentioned above is to initiate the first phase of work, which is to collaboratively develop the Service Level and License Agreements. The Agencies will seek SLLA approval from their respective decision makers. Upon approval, the Operator can begin physical work required to operate the system.

4. Pre-Proposal Conference. An optional pre-proposal conference will be held at the following location, date, and time to answer any questions that prospective bidders may have regarding this RFP:

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October 14, 2026; 2:00PM Pacific Time
https://teams.microsoft.com/meet/264539927392591?p=ZKIQ32oa3wNbCKljkv Meeting ID: 264 539 927 392 591
Passcode: Hq7rC6vZ
Prospective bidders may also email clarifying questions to [email protected] through 5:00 PM Pacific Time on October 15, 2026. The written questions and pre-proposal questions, along with City answers will be posted on October 16, 2026 as an RFP supplement. No further clarifying questions will be accepted after October 15, 2026.

5. Release of Reports and Information. Any reports, information, data, or other material given to, prepared by, or assembled by the Operator as part of the work or services under these specifications shall be the property of the City and Cal Poly and shall not be made available to any individual or organization by the Operator without the prior written approval of the City or Cal Poly.

6. Copies of Reports and Information. If the City or Cal Poly requests additional copies of reports, drawings, specifications, or any other material in addition to what the Operator is required to furnish in limited quantities as part of the work or services under these specifications, the Operator shall provide such additional copies as are requested.

7. Required Deliverable Products. The Operator will be required to provide:
k. One electronic submission of all final documents in .pdf file format. If you wish to file a paper copy, please submit it in sealed envelope to the address provided in the RFP. l. Corresponding computer files compatible with the following programs whenever possible unless otherwise directed by the project manager:

Word Processing: MS Word
Spreadsheets: MS Excel
Desktop Publishing: InDesign
Virtual Models: Sketch Up
Digital Maps: Geodatabase shape files in State Plan Coordinate System as specified by City GIS staff
m. City and Cal Poly staff will review any documents or materials provided by the Operator and, where necessary, the Operator will be required to respond to staff comments and make such changes as deemed appropriate.

8. Alternative Proposals. The proposer may submit an alternative proposal (or proposals) that it believes will also meet the City's and Cal Poly’s project objectives but in a functionally equivalent way. In this case, the proposer must provide a satisfactory justification for the alternative proposal.

9. Attendance at Meetings and Hearings. As part of the work scope, the Operator will participate in regular team meetings to give updates; coordinate, participate in, and provide collateral materials for public agency meetings including City Council meetings and campus leadership meetings as requested, and acquire necessary information as appropriate to complete the scope of work.

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10. Accuracy of Specifications. The specifications for this project are believed by the City and Cal Poly to be accurate and to contain no affirmative misrepresentation or any concealment of fact.

Bidders are cautioned to undertake an independent analysis of any test results in the specifications, as City does not guaranty the accuracy of its interpretation of test results contained in the specifications package. In preparing its proposal, the bidder and all subcontractors named in its proposal shall bear sole responsibility for proposal preparation errors resulting from any misstatements or omissions in the plans and specifications that could easily have been ascertained by examining either the project site or accurate test data in the City's and Cal Poly’s possession. Although the effect of ambiguities or defects in the plans and specifications will be as determined by law, any patent ambiguity or defect shall give rise to a duty of bidder to inquire prior to proposal submittal. Failure to so inquire shall cause any such ambiguity or defect to be construed against the bidder. An ambiguity or defect shall be considered patent if it is of such a nature that the bidder, assuming reasonable skill, ability, and diligence on its part, knew or should have known of the existence of the ambiguity or defect. Furthermore, failure of the bidder or subcontractors to notify City and/or Cal Poly in writing of specification or plan defects or ambiguities prior to proposal submittal shall waive any right to assert said defects or ambiguities subsequent to submittal of the proposal.

To the extent that these specifications constitute performance specifications, the City and Cal Poly shall not be liable for costs incurred by the successful bidder to achieve the project’s objective or standard beyond the amounts provided there for in the proposal.

In the event that, after awarding the contract, any dispute arises as a result of any actual or alleged ambiguity or defect in the plans and/or specifications, or any other matter whatsoever, Operator shall immediately notify the City and Cal Poly in writing, and the Operator and all subcontractors shall continue to perform, irrespective of whether or not the ambiguity or defect is major, material, minor or trivial, and irrespective of whether or not a change order, time extension, or additional compensation has been granted by City or Cal Poly. Failure to provide the hereinbefore described written notice within one (1) working day of Operator's becoming aware of the facts giving rise to the dispute shall constitute a waiver of the right to assert the causative role of the defect or ambiguity in the plans or specifications concerning the dispute.

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I. PROPOSAL SUBMITTAL FORM
The undersigned declares that she or he:
 Has carefully examined this RFP including all exhibits, which is hereby made a part of this proposal.
 Is thoroughly familiar with its contents.
 Is authorized to represent the proposing firm.
 Agrees to perform the work as set forth in this proposal. ☐ Certificate of insurance attached; insurance company’s A.M. Best rating: __________________.

Firm Name and Address
Contact Phone
Signature of Authorized Representative
Date

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REFERENCES
Number of years engaged in providing the services included within the scope of the specifications under the present business name: .

Describe fully the last three contracts performed by your firm that demonstrate your ability to provide the services included with the scope of the specifications. Ideally the references would be municipal or public agencies that partnered with your firm in launching a Bikeshare System. Attach additional pages if required. The City reserves the right to contact each of the references listed for additional information regarding your firm's qualifications.

Reference No. 1:

Agency Name
Contact Name
Telephone & Email
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome.

Reference No. 2:

Agency Name
Contact Name
Telephone & Email
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome.

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Reference No. 3
Agency Name
Contact Name
Telephone & Email
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome.

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STATEMENT OF PAST CONTRACT DISQUALIFICATIONS
The proposer shall state whether it or any of its officers or employees who have a proprietary interest in it, has ever been disqualified, removed, or otherwise prevented from bidding on, or completing a federal, state, or local government project because of the violation of law, a safety regulation, or for any other reason, including but not limited to financial difficulties, project delays, or disputes regarding work or product quality, and if so to explain the circumstances.  Do you have any disqualification as described in the above paragraph to declare? Yes ☐ No ☐
 If yes, explain the circumstances.

Executed on at _______________________________________ under penalty of perjury of the laws of the State of California, that the foregoing is true and correct. ______________________________________
Signature of Authorized Proposer Representative

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EXHIBIT A: FORM OF OPERATOR AGREEMENT

1. Parties: [Name of contractor] shall be referred to herein as “Contractor.” The City of San Luis Obispo (the “City”) and California Polytechnic State University San Luis Obispo, as agent of the California State University system (“CSU”) are collectively referred to as “Agencies” and “Agency” refers to a single entity therein. “Premises” refers collectively to the properties owned by CSU and by the City and utilized by Contractor under the terms of this Contract.

2. Term: The term of this Contract shall be from the date this Contract is made and entered until three (3) years from the date of commissioning of the Bikeshare System by Contractor. Parties agree to memorialize in writing the date of commissioning in a future document.

3. Incorporation by Reference: The Notice Requesting Proposals for a City of San Luis Obispo Bikeshare System and Contractor’s proposal dated [date] are hereby incorporated in and made a part of this Contract, attached as Exhibit 1.

4. Commencement of Work: Contractor shall not commence work under the Contract until Contractor has received a fully executed Contract and been given written approval to proceed, which shall be contingent upon execution of a Service Level and License Agreement. Any work performed by Contractor prior to the date of approval shall be considered as having been performed at Contractor’s own risk and as a volunteer.

5. Contract Alterations & Integration: No alteration or variation of the Contract shall be valid unless made in writing and signed by the Parties hereto, and no oral understanding or agreement not incorporated in writing in the Contract shall be binding on any of the Parties hereto.

6. Severability: Contractor and Agencies agree that if any provision of this Contract is found to be illegal or unenforceable, such term or provision shall be deemed stricken and the remainder of the Contract shall remain in full force and effect. Any Party having knowledge of such term or provision shall promptly inform the others of its presumed non-applicability of such provision.

Should the illegal or unenforceable provision be a material or essential term of the Contract, the Contract shall be terminated in a manner commensurate with the interests of all Parties, to the maximum extent reasonable.

7. Independent Status: Contractor and its employees and agents, and approved subcontractors, in the performance of this Contract, shall act in an independent capacity and not as officers, employees or agents of the Agencies or the State of California. While Contractor may be required by this Contract to carry Worker’s Compensation Insurance, in no event shall Contractor and its employees and agents be entitled to unemployment or workers’ compensation benefits from the Agencies.

8. Licenses and Permits: At all times during the term of this Contract, Contractor shall have in full force and effect, all licenses required of it by law for the performance of the Services described in this Contract. The Contractor shall procure all permits and licenses, pay all charges and fees, and give all notices necessary under this Contract.

9. Public and Employee Safety: Whenever Contractor’s operations on the property owned by the Agencies create a condition hazardous to the public or Agency employees, it shall, at its expense and without cost to the Agencies, furnish, erect, and maintain such fences, temporary railings, barricades, lights, signs and other devices and take such other protective measures as are necessary to prevent accidents, damage, or injury to the public and Agency employees.

10. Compliance with Law: The Contractor shall keep itself informed of and shall observe and comply with all applicable State and Federal laws and regulations, and county and City of San Luis Obispo ordinances, regulations and adopted codes, which in any manner affect those employed by Contractor or in any way affect the performance of the Services pursuant to this Contract. The Agencies, and their officers and employees, shall not be liable at law or in equity occasioned by

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failure of the Contractor to comply with this Section. Failure to comply with local ordinances may result in monetary fines and cancellation of this Contract.

11. Governing Law: Any action arising out of this Contract shall be brought in the Superior Court of San Luis Obispo County, California, regardless of where else venue may lie. The validity, interpretation, construction and performance of this Contract, and all acts and transactions pursuant hereto and the rights and obligations of the Parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to principles of conflicts of law.

12. Contractor's Power and Authority: Contractor warrants it has full power and authority to enter into this Contract and will hold Agencies harmless from and against any loss, cost, liability, and expense (including reasonable attorney fees) arising out of any breach of this warranty. Further, Contractor shall not enter into any arrangement, agreement or contract with any third party that might abridge any rights of the Agencies under this Contract.

13. Assignments: Contractor shall not assign or subcontract the services contemplated by this Contract, either in whole or in part, without prior written consent from both Agencies.

14. Waiver of Rights: Any action or inaction by Agencies or the failure of Agencies on any occasion to enforce any right or provision of this Contract shall not be a waiver by Agencies of their rights hereunder and shall not prevent Agencies from enforcing such provision or right on any future occasion. Agencies’ rights and remedies provided in this Contract shall not be exclusive and are in addition to any other rights and remedies provided by law.

15. Time: Time is of the essence in the performance of this Contract.

16. Entire Contract: This Contract sets forth the entire agreement between the Parties with respect to the subject matter hereof and shall govern the respective duties and obligations of each Party.

17. Termination: The Agencies, or either of them, may at any time, for any reason, with or without cause, terminate this Contract, or any portion hereof, by serving upon the Contractor written notice of termination. Upon receipt of said notice, the Contractor shall remove or cause to be removed all facilities and other improvements installed by Contractor, and restore Agencies’ property to the condition in which it existed prior to Agencies’ commencement of services under this Contract, within ninety (90) days of the notice of termination. If the Contractor and either Agency are unable to negotiate a Service Level and License Agreement within a reasonable time, as determined in the sole discretion of that Agency, this Contract shall terminate as to that Agency only and shall remain in full force and effect between the Contractor and the other Agency. If neither Agency is able to negotiate a Service Level and License Agreement with the Contractor, this Contract shall terminate in its entirety.

18. Warranty: Contractor warrants that:
a. deliverables and services furnished hereunder will conform to the requirements of this Contract (including, without limitation, all descriptions, specifications, and drawings identified in the Statement of Work, if any), and
b. the deliverables will be free from defects in materials and workmanship. Where the Parties have agreed to design specifications in the Statement of Work directly or by reference, Contractor warrants the deliverables shall provide all functionality required thereby.

19. Safety and Accident Prevention: In performing work under this Contract on Agency premises, Contractor shall conform to all specific safety requirements contained in this Contract or as required by law or regulation. Contractor shall take all additional precautions as the Agencies may reasonably require for safety and accident prevention purposes. Contractor’s violation of such rules and requirements, unless promptly corrected, shall constitute a material breach of this Contract.

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20. Alterations to Premises: Written approval is required by the respective Agency prior to commencement of any alterations or improvements made to its property. Contractor shall comply with applicable rules and regulations of the City’s Municipal Code and procedures set forth by the City’s Community Development Department and all applicable building codes in making any approved alterations or improvements.

21. Responsibility for Damage. Contractor shall maintain the Premises in substantially the same condition as existed immediately prior to execution of this Contract. Upon termination of this Contract, Contractor shall return the Premises to its original condition, except for ordinary wear and tear and alterations approved by the Agencies pursuant to the “Alterations to Premises” section of this Contract. If the Premises is damaged resulting from Contractor’s use of and operations on the Premises, it shall be repaired and restored at the Contractor’s expense to its original condition, except for the circumstances expressly identified in this Section.

22. Insurance Requirements: The Contractor shall not commence Work until it has obtained all the insurance required in this Contract, and such insurance has been approved by the Agencies. a. Policies and Coverage.
i. The Contractor shall obtain and maintain the policies and coverages as set forth in Exhibits B-1 and B-2.
ii. The Contractor also may be required to obtain other Insurance by agreement between the Agencies and the Contractor.
b. Verification of Coverage.
i. The Contractor shall submit original certificates of insurance and endorsements to the policies of insurance required by the Contract to the Agencies as evidence of the insurance coverage. Renewal certifications and endorsements shall be timely filed by the Contractor for all coverage until the Work is accepted as complete. The Agencies reserve the right to require the Contractor to furnish the Trustees complete, certified copies of all required insurance policies. c. Insurance Provisions.
i. Nothing in these insurance provisions shall be deemed to alter the indemnification provisions in this Contract. The insurance policies shall contain, or be endorsed to contain, the following provisions.

1. For the general and automobile liability policies, the City of San Luis Obispo, the State of California, the Trustees of the California State University, the University, the officers, employees, representatives, volunteers, and agents of all above-named entities are to be covered as additional insureds.

2. For any claims related to the Work, the Contractor’s insurance coverage shall be primary insurance as respects the City of San Luis Obispo, the State of California, the Trustees of the California State University, the University, their officers, employees, representatives, volunteers, and agents. Any insurance or self-insurance maintained by the State of California, the Trustees of the California State University, the University, their officers, employees, representatives, volunteers, and agents shall be in excess of the Contractor’s insurance and shall not contribute with it.

3. Each insurance policy required by this section shall state that coverage shall not be canceled by either the Contractor or the insurance carrier, except after thirty (30) Days prior written notice by certified mail, return receipt requested, has been given to the Agencies.

4. The City of San Luis Obispo, the State of California, the Trustees of the

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California State University, the University, their officers, employees, representatives, volunteers, and agents shall not by reason of their inclusion as additional insureds incur liability to the insurance carriers for payment of premiums for such insurance.
d. Acceptability of Insurers. Insurers shall be licensed by the State of California to transact insurance and shall hold a current A.M. Best’s rating of A:VII, or shall be a carrier otherwise acceptable to the University.
e. Subcontractor’s Insurance. Contractor shall ensure that its subcontractors (approved by Agencies pursuant to Section 13 of this Contract) are covered by insurance of the types required by this Contract, and that the amount of insurance for each subcontractor is appropriate for that subcontractor’s Work. Contractor shall not allow any subcontractor to commence Work on its subcontract until the insurance has been obtained, and approved by the Agencies.
f. Miscellaneous.
i. Any deductible under any policy of insurance required in this Contract shall be Contractor’s liability.
ii. Acceptance of certificates of insurance by the Agencies shall not limit the Contractor’s liability under the Contract.
iii. If the Agencies are damaged by the failure of Contractor to provide or maintain the required insurance, the Contractor shall pay the Agencies for all such damages.
iv. The Contractor’s obligations to obtain and maintain all required insurance are non-delegable duties under this Contract.

23. General Indemnity: To the fullest extent permitted by law (including, but not limited to California Civil Code Sections 2782 and 2782.8), Contractor shall indemnify, defend, and hold harmless the City of San Luis Obispo and its elected officials, officers, employees, volunteers, and agents, and the State of California, Board of Trustees of the California State University, CSU, and its officers, agents and employees (the “Indemnitees”) from any and all causes of actions, claims, liabilities, obligations, judgments, damages or expenses, including reasonable attorney’s fees and costs, claimed by anyone by reason of injury or death of persons, or damage or destruction of property, including property of Contractor arising out of Contractor’s performance or failure to perform its obligations under this Agreement or out of operations conducted by Contractor. The Contractor shall require all System users to sign a waiver prior to System use, releasing the Indemnitees from all claims, in a form satisfactory to the Agencies. In the event Indemnitees are made a party to any action, lawsuit or other adversarial proceeding arising from Contractor’s performance of or failure to perform this Contract, Contractor shall provide a defense to the Indemnitees or at the Indemnitees’ option, reimburse the Indemnitees their costs of defense, including reasonable legal fees, incurred in defense of such claims.

24. Use of Data: Contractor shall not utilize any non-public information it may receive by reason of this Contract, for pecuniary gain not contemplated by this Contract, regardless whether Contractor is or is not under contract at the time such gain is realized. Agency specific information obtained by Contractor in the course of Contractor’s performance of this Contract is the property of respective Agency, and shall not be used in any manner by Contractor unless authorized in writing by the respective Agency.

25. Confidentiality of Data
a. Contractor acknowledges the privacy rights of individuals to their personal information that are expressed in the Information Practices Act (California Civil Code Section 1798 et seq.) and in California Constitution Article 1, Section 1. Contractor shall maintain the privacy of personal information and protected data as confidential information.

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Contractor shall not use, disclose, or release confidential information contained in Agency records without full compliance with applicable state and federal privacy laws, and this Contract. Contractor further acknowledges and agrees to comply with Federal privacy laws, such as the Gramm-Leach-Bliley Act (Title 15, United States Code, Sections 6801(b) and 6805(b)(2)) applicable to financial transactions, and the Family Educational Rights and Privacy Act (Title 20, United States Code, Section 1232) applicable to student education records and information from student education records. Contractor shall maintain the privacy of confidential information and shall be financially responsible for any notifications to affected persons (after prompt consultation with Agencies) whose personal information is disclosed by any security breach relating to confidential information resulting from Contractor’s or its personnel’s acts or omissions. Further, If so requested by the Agencies, Contractor shall be administratively responsible for providing such notification in the most expedient time possible consistent with the methods prescribed in California Civil Code 1798.29 and 1798.82. b. Contractor further agrees that all financial, statistical, personal, technical and other data and information relating to Agencies’ operations designated “confidential” by Agencies, and not otherwise subject to disclosure under the California Public Records Act, and made available to Contractor to perform this Contract or which become available to Contractor while performing this Contract, shall be protected by Contractor using the same level of care it takes to protect its own information of a similar nature, but in no event less than reasonable care. If required by a court of competent jurisdiction or an appropriate administrative body with legal authority to order the disclosure of confidential information or protected data, Contractor will notify Agency in writing prior to any such disclosure to give Agency an opportunity to oppose any such disclosure. Prior to any disclosure of confidential information as required by legal process, Contractor shall notify Agency of any actual or threatened legal compulsion of disclosure, and any actual legal obligation of disclosure, immediately upon becoming so obligated; and c. Contractor shall cooperate with any litigation or investigation proceedings concerning protected data loss or other breach of Contractor’s obligations under this Contract. Any access, transmission, or storage of protected data outside the United States must be approved in writing by Agency in advance. Contractor’s failure to comply with any provision of this Section shall constitute a material breach of the Contract.

26. Payment Card Industry (PCI) Compliance Standards. Contractor provides a service that involves storage, processing or transmission of payment card data. Contractor represents and warrants that it shall implement and maintain certification of Payment Card Industry (“PCI”) compliance standards regarding data security and that it shall undergo independent third-party quarterly system scans that audit for all known methods hackers use to access private information, in addition to vulnerabilities that would allow malicious software (i.e., viruses and worms) to gain access to or disrupt the network devices. If during the term of the Agreement, Contractor undergoes, or has reason to believe that it will undergo, an adverse change in its certification or compliance status with the PCI DSS standards and/or other material payment card industry standards, it will promptly notify Agencies of such circumstances. Contractor agrees to promptly provide current evidence of compliance with PCI-DSS standards at the request of Agencies and on an annual basis thereafter. The form and substance of such evidence must be reasonably satisfactory to and must be certified by an authority recognized by the payment card industry for that purpose. Contractor shall maintain and protect in accordance with all applicable laws and PCI regulations the security of all cardholder data when performing the contracted Services on behalf of the Agencies. Contractor will provide reasonable care and efforts to detect fraudulent credit card activity in connection with credit card transactions processed for the Agencies. Contractor

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shall indemnify and hold the Agencies harmless from loss or damages resulting from Contractor’s failure to maintain PCI compliance standard in accordance with this section. Contractor shall not be held responsible for any such loss of data if it is shown that the loss occurred as a result of the sole negligence of the Agencies.

27. Examination and Audit. For contracts in excess of $10,000, Contractor shall be subject to the examination and audit by
(a) the Office of the University Auditor, and
(b) the Bureau of State Audits, for a period of three (3) years after final payment under the Contract. The examination and audit shall be confined to those matters connected with the performance of the contract, including, but not limited to, the costs of administering the Contract.

Note: Authority Cited: Government Code Section 8546.7; Education Code Section 89045(c&d), respectively.

28. Dispute: Any dispute arising under or resulting from this Contract that is not resolved within 60 days of time by authorized representatives of Contractor and CSU shall be brought to the attention of Contractor’s Chief Executive Officer (or designee) and CSU’s Chief Business Officer (or designee) for resolution. Either Contractor or CSU may request that the CSU Vice Chancellor, Business and Finance (or designee) participate in the dispute resolution process to provide advice regarding CSU contracting policies and procedures. If this informal dispute resolution process is unsuccessful, the Parties may pursue all remedies not inconsistent with this Contract. Despite an unresolved dispute, Contractor shall continue without delay in performing its responsibilities under this Contract. Contractor shall accurately and adequately document all service it has performed under this Contract. City retains, without waiving any other rights and remedies under this Contract or applicable law, the opportunity to participate in the dispute resolution process stated herein, but is not obligated to do so.

29. Conflict of Interest: Agencies requires a Statement of Economic Interests (California Form 700) to be filed by any Consultant (or Contractor) who is involved in the making or participation in the making of decisions which may foreseeably have a material effect on any Agency financial interest.

30. Endorsement: Nothing contained in this Contract shall be construed as conferring on any Party, any right to use the other Parties’ names as an endorsement of product/service or to advertise, promote or otherwise market any product or service. Furthermore, nothing in this Contract shall be construed as endorsement of any commercial product or service by the Agencies, its officers or employees.

31. Covenant Against Gratuities: Contractor shall warrant that no gratuities (in the form of entertainment, gifts, or otherwise) were offered or given by Contractor, or any agent or representative of Contractor, to any officer or employee of Agencies with a view toward securing the Contract or securing favorable treatment with respect to any determinations concerning the performance of the Contract. For breach or violation of this warranty, Agencies shall have the right to terminate the Contract, either in whole or in part. Agencies’ rights and remedies provided in this clause shall not be exclusive and are in addition to any other rights and remedies provided by law, equity or under the Contract.

32. Nondiscrimination:
a. During the performance of this Contract, Contractor and its subcontractors shall not unlawfully discriminate, harass or allow harassment, against any employee or applicant for employment because of sex, sexual orientation, race, color, ancestry, religious creed, national origin, disability (including HIV and AIDS), medical condition, age, marital status, and denial of family care leave. Contractor and subcontractors shall insure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment.

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b. Contractor and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code, Section 12990 et seq.) and the applicable regulations promulgated thereunder (California Code of Regulations, Title 2, Section 7285.0 et seq.).

The applicable regulations of the Fair Employment and Housing Commission implementing Government Code Section 12990 (a f), set forth in Chapter 5 of Division 4 of Title 2 of the California Code of Regulations are incorporated into this Contract by reference and made a part hereof as if set forth in full. Contractor and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. c. Contractor shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under the Contract.

33. Compliance with NLRB Orders: Contractor declares under penalty of perjury under the laws of the State of California that no more than one final, unappealable finding of contempt of court by a federal court has been issued against Contractor within the immediately preceding two-year period because of Contractor's failure to comply with an order of a federal court to comply with an order of the National Labor Relations Board. Note: Cite Authority: PCC 10296

34. Drug-Free Workplace Certification: Contractor certifies that Contractor shall comply with the requirements of the Drug-Free Workplace Act of 1990 and shall provide a drug-free workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations
b. Establish a Drug-Free Awareness Program to inform employees about all of the following:
i. the dangers of drug abuse in the workplace;
ii. the person's or organization's policy of maintaining a drug-free workplace; iii. any available counseling, rehabilitation and employee assistance programs; and, iv. penalties that may be imposed upon employees for drug abuse violations. c. Provide that every employee who works on the proposed or resulting Contract:
i. will receive a copy of the company's drug-free policy statement; and, ii. will agree to abide by the terms of the company's statement as a condition of employment on the Contract. Note: Authority Cited: Government Code Section 8350-8357

35. Forced, Convict, Indentured and Child Labor: By accepting a contract with CSU, Contractor:
a. certifies that no equipment, materials, or supplies furnished to CSU pursuant to this Contract have been produced in whole or in part by sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor or exploitation of children in sweatshop labor, or with the benefit of sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor or exploitation of children in sweatshop labor. Contractor further certifies it will adhere to the Sweat-free Code of Conduct as set forth on the California Department of Industrial Relations website located at http://www.dir.ca.gov/, and Public Contract Code Section 6108.
b. agrees to cooperate fully in providing reasonable access to its records, documents, agents or employees, or premises if reasonably required by authorized officials of the State, the Department of Industrial Relations, or the Department of Justice to determine Contractor's compliance with the requirements under paragraph (a).

36. Recycled Content Certification: To the extent that services involve the supply of post-consumer materials (see below) Contractor shall certify in writing the minimum, if not exact, percentage of post-consumer material, as defined in Public Contract Code Section 12200, in products, materials,

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goods, or supplies offered or sold to CSU regardless whether the product meets the requirements of Section 12209. With respect to printer or duplication cartridges that comply with the requirements of Section 12156(e), the certification required by this subdivision shall specify that the cartridges so comply (PCC 12205).

37. Americans With Disabilities Act (ADA): Contractor warrants that it complies with California and federal disabilities laws and regulations. (Americans with Disabilities Act of 1990,42 U.S.C. 12101 et seq). Contractor hereby warrants the products or services it will provide under this Contract comply with the accessibility requirements of Section 508 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794d), and its implementing regulations set forth at Title 36, Code of Federal Regulations, Part 1194. Contractor agrees to promptly respond to and resolve any complaint regarding accessibility of its products or services. Contractor further agrees to indemnify and hold harmless Agencies from any claims arising out of Contractor’s failure to comply with the aforesaid requirements. Failure to comply with these requirements shall constitute a material breach of this Contract.

38. Debarment and Suspension: By accepting a contract with the CSU, Contractor certifies neither it nor its principals or its subcontractors are presently debarred, suspended, proposed for debarment, declared ineligible or voluntarily excluded from participation in this transaction by any federal department or agency (2 Code Federal Regulations[CFR] 180.220, in accordance with the Office of Management and Budget guidelines at 2 CFR 180 that implement Executive Orders 12549 (3 CFR Part 1986 Comp., p. 189) and 12689 (3 CFR Part 1989 Comp., p. 235)).

39. Expatriate Corporations: Contractor declares and certifies that it is not an expatriate corporation, and is not precluded from contracting with CSU by The California Taxpayer and Shareholder Protection Act of 2003, Public Contract Code Section 10286, et seq.

40. Loss Leader: Contractor certifies and declares it is not engaged in business within this State of California to sell or use any article or product as a "loss leader" as defined in Section 17030 of the Business and Professions Code. Note: Authority Cite: (PCC 12104.5(b).)

41. DVBE and Small Business Participation
a. If Contractor has committed to achieve small business (SB) participation it shall, within 60 days of receiving final payment under this Contract (or within such other time period as may be specified elsewhere in this Contract), report to CSU: (1) the name and address of the SB(s) who participated in the performance of the Contract; (2) the total amount the prime Contractor received under the Contract; and (3) the amount each SB received from the prime Contractor.(Govt. Code § 14841.)
b. If Contractor has committed to achieve disabled veteran business enterprise (DVBE) participation, it shall, within 60 days of receiving final payment under this Contract (or within such other time period as may be specified elsewhere in this Contract), report to CSU:
i. the name and address of the DVBE(s) who participated in the performance of the Contract;
ii. the total amount the prime Contractor received under the Contract; and iii. the amount each DVBE received from the prime Contractor. The Contractor shall also certify that all payments under the Contract have been made to the DVBE. A person or entity that knowingly provides false information shall be subject to a civil penalty for each violation. (Mil. & Vets. Code § 999.5(d); Govt. Code § 14841.)

42. Contractor’s Staff: Contractor warrants that its staff assigned to performing work under this Contract are legally able to perform such duties in the country where the work is being performed.

43. Force Majeure
a. No Party shall be liable for any failure to perform its obligations under this Contract for the period of time that it is prevented, hindered, or delayed in performing those

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obligations by circumstances beyond its control, including, but not limited to, fire, strike, war, riots, acts of terrorism, disaster, acts of God, acts of any governmental authority, communicable disease outbreak, epidemic or pandemic, unavailability or shortages of labor, materials, or equipment, disruption of transportation, or any other comparable event beyond the control of the Party whose performance is affected (each, a “Force Majeure Event.”).
b. The Party claiming Force Majeure shall, as soon as reasonably practicable after the occurrence of a Force Majeure Event, provide written notice to the other Parties of the nature, extent, and expected duration of the Force Majeure Event and use its diligent efforts to mitigate the effects of the Force Majeure Event upon such Party’s performance under this Contract, it being understood that upon completion of the Force Majeure Event, the Party whose performance was affected must, as soon as reasonably practicable, recommence the performance of its obligations under this Contract. c. Notwithstanding any other term in this Contract, including, but not limited to, the foregoing subsections of this section, during the period of a Force Majeure Event affecting performance by Contractor, Agencies may elect to do all or any of the following:
i. extend the time for Contractor’s performance by a period equal to the duration of the Force Majeure Event; and/or
ii. terminate the Contract.

44. Material Change of Circumstances: The terms of this Contract are based on conditions in existence on the date that Contractor commences performance. In the event of a material change in the conditions that adversely affects the ability of Contractor to perform its obligations, Contractor shall reasonably cooperate with Agencies to minimize the impact from such change in conditions on Contractor’s performance and shall, if requested by Agencies, negotiate in good faith to adjust the terms of this Contract on a mutually agreeable basis to address the impact of such material change in conditions. This provision shall not limit Agencies’ ability to avail themselves of any rights or remedies provided to Agencies by law, equity or any other term of this Contract.

45. Notice. All written notices to the parties hereto shall be sent by United States mail, postage prepaid by registered or certified mail addressed as follows:

City CSU
Office of Sustainability Transportation and Parking Services City of San Luis Obispo Cal Poly, San Luis Obispo
990 Palm Street 1 Grand Avenue
San Luis Obispo, CA 93401 Building 36
San Luis Obispo, CA 93407

CONTRACTOR
[Addressee]
[Street address]

46. Contract Amendment. Any amendment, modification, or variation from the terms of this Contract shall be in writing and shall be effective only upon approval by the City Manager of the City and the Chief Procurement Officer on behalf of CSU.

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EXHIBIT B-1: CITY’S INSURANCE REQUIREMENTS
The Contractor shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by the Contractor, its agents, representatives, employees, or subcontractors.

Minimum Scope of Insurance. Coverage shall be at least as broad as:

1. Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).

2. Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any auto).

3. Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance.

Minimum Limits of Insurance. Contractor shall maintain limits no less than:

1. General Liability: $2,000,000 per occurrence for bodily injury, personal injury, and property damage. If Commercial General Liability or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit of $4,000,000.

2. Automobile Liability: $1,000,000 per accident for bodily injury and property damage.

3. Employer's Liability: $1,000,000 per accident for bodily injury or disease.

Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees, and volunteers; or the Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses.

Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions:

1. The City, its officers, officials, employees, agents, and volunteers are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of the Contractor; products and completed operations of the Contractor; premises owned, occupied or used by the Contractor; or automobiles owned, leased, hired or borrowed by the Contractor. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, official, employees, agents, or volunteers.

2. For any claims related to this project, the Contractor's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers shall be excess of the Contractor's insurance and shall not contribute with it.

3. The Contractor's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.

4. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City.

Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A: VII.

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Verification of Coverage. Contractor shall furnish the City with a certificate of insurance showing maintenance of the required insurance coverage. Original endorsements effecting general liability and automobile liability coverage required by this clause must also be provided. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be received and approved by the City before work commences.

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EXHIBIT B-2: CSU INSURANCE REQUIREMENTS
(The Insurance Requirements provided in this section are reproduced from the most current CSU Standard Terms and Conditions)

7. Insurance
Contractor shall not commence the Contracted Work until it has obtained all the insurance required by this Contract, and such insurance has been approved by CSU.

7.1 Policies and Coverage
(a) Required. Contractor shall obtain and maintain the following policies and coverage:
(1) Comprehensive or Commercial General Liability Insurance, on an occurrence basis, covering Contracted Work done or to be done by or on behalf of the Contractor and providing insurance for bodily injury, personal injury, property damage, and contractual liability. CSU may require the aggregate limit to apply specifically to the Contracted Work in certain circumstances, and will notify Contractor of this requirement.
(2) Business Automobile Liability Insurance on an occurrence basis, covering owned, hired, and nonowned automobiles used by or on behalf of Contractor and providing insurance for bodily injury, property damage, and contractual liability. Such insurance shall include coverage for uninsured and underinsured motorists.
(3) Worker's Compensation, including Employers Liability Insurance as required by law. (b) Additional. Contractor shall also be required to obtain and maintain the following policies and coverage to the extent indicated below:
(1) Environmental Impairment Liability or Pollution Liability Insurance in the event that the Contracted Work involves hazardous materials which could result in any loss, cost or expense arising out of any requirement to clean up, remove, contain, treat, detoxify or in any way respond to pollutants or injury or damage resulting therefrom. This includes, but is not limited to, Contracted Work involving asbestos, lead, fuel storage or pipes, sewage, industrial waste, and hazardous chemicals (such as pesticides, carcinogens, trichloroethylene (TCE), or polychlorinated biphenyls (PCBs). (2) Privacy, Technology and Data Security Liability, Cyber Liability, or Technology Professional Liability Insurance in the event that the Contracted Work involves access to or storage of Protected Data. For purposes of this Contract, “Protected Data” has the same meaning as defined in the CSU Information Security Policy and Standards, section VI (which, for clarification, includes both “Level 1 -Confidential” data and “Level 2 - Internal Use” data). Such insurance shall cover liabilities for financial loss, damages, and/or costs incurred as a result of any confirmed or suspected data security breach or loss of Protected Data (including personally identifiable information) due to the acts, omissions, and/or intentional misconduct of Contractor, its officers, employees, agents, sub-contractors, or anyone acting on behalf of Contractor in connection with the performance of this Contract. Such coverage shall include without limitation, all of the following:
(A) Costs to notify persons whose data were lost or compromised (B) Costs to provide credit monitoring and credit restoration services to persons whose data were lost or compromised
(C) Costs associated with third party claims arising from a confirmed or suspected data security breach or loss of CSU confidential data, including litigation costs and settlement costs (D) Any investigation, enforcement, fines and penalties, or similar miscellaneous costs arising from a confirmed or suspected data security breach or loss of CSU confidential data (E) Any payment made to a third party as a result of extortion related to a confirmed or suspected data security breach or loss of CSU confidential data

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(3) Professional Liability Insurance if the Contracted Work involves professional services involving specialized skill or training, including but not limited to:
(A) preparation of any map, shop drawing, opinion, report, survey, field order, change order, design, drawing, specification, recommendation, warning, permit application, payment request, manual or inspection;
(B) supervision, inspection, quality control, architectural, engineering or surveying activity or service; (C) job site safety;
(D) construction contracting, construction administration, or construction management; (E) computer consulting or design, software development or programming service; (F) selection of a contractor or subcontractor;
(G) real estate, legal, medical, employment, investment, or management services; (H) monitoring, testing, or sampling services; or
(I) if otherwise directed by CSU in writing.
(4) Other insurance as agreed upon by CSU and Contractor. (c) Verification of Coverage. Contractor shall submit original certificates of insurance and endorsements to the policies of insurance required by the Contract to CSU as evidence of the insurance coverage. Renewal certifications and endorsements shall be timely filed by Contractor for all coverage until the Contracted Work is accepted as complete. CSU reserves the right to require Contractor to furnish CSU complete, certified copies of all required insurance policies.
(d) Required Provisions. Nothing in these insurance provisions shall be deemed to alter the indemnification provisions in this Contract. The insurance policies shall contain, or be endorsed to contain, the following provisions.
(1) The general and automobile liability policies shall name the State of California, CSU, the Trustees of the California State University, and their officers, employees, representatives, volunteers, and agents as additional insureds. Such endorsement shall be documents on an ACORD or similar form for this purpose; a statement on the certificate itself does not satisfy this requirement. (2) For any claims related to the Contracted Work, Contractor’s insurance coverage shall be primary insurance as respects the State of California, CSU the Trustees of the California State University, and their officers, employees, representatives, volunteers, and agents. Any insurance or self-insurance maintained by the State of California, CSU, the Trustees of the California State University, and their officers, employees, representatives, volunteers, and agents shall be in excess of Contractor’s insurance and shall not contribute with it.
(3) Each insurance policy required by this section shall state that coverage shall not be canceled by either Contractor or the insurance carrier, except after thirty (30) days prior written notice by certified mail, return receipt requested (or other written notice with proof of receipt), has been given to CSU.
(4) The State of California, CSU, the Trustees of the California State University, and their officers, employees, representatives, volunteers, and agents shall not by reason of their inclusion as additional insureds incur liability to the insurance carriers for payment of premiums for such insurance.
(5) Each insurance policy required by this section shall contain an endorsement providing a waiver of transfer of rights of recovery against others (waiver of subrogation) as to the State of California, CSU, the Trustees of the California State University, and their officers, employees, representatives, volunteers, and agents.

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7.2 Amount of Insurance
(a) Minimum Coverage. The limits stated below are minimum required amounts of insurance coverage but do not serve to limit amounts recoverable by CSU. CSU is entitled to any valid and collectible insurance and any other sources of recovery. The insurance furnished by Contractor under this Contract shall provide coverage in amounts not less than the following:
(1) Comprehensive or Commercial General Liability Insurance—Limits of Liability (A) $4,000,000 General Aggregate
(B) $2,000,000 Each Occurrence—combined single limit for bodily injury and property damage. (C) $2,000,000 Each Person/Entity for personal liability (D) $2,000,000 for contractual liability
(2) Business Automobile Liability Insurance—Limits of Liability (A) $1,000,000 Each Accident—combined single limit for bodily injury and property damage to include uninsured and underinsured motorist coverage.
(3) Workers’ Compensation—limits as required by law with Employers Liability limits of $1,000,000. (b) Hazardous Materials. For Contracts involving hazardous materials, Contractor shall provide additional coverage in amounts not less than the following, unless a different amount is agreed upon in writing signed by Contractor and CSU:
(1) Environmental Impairment or Pollution Liability Insurance—Limits of Liability (A) $10,000,000 General Aggregate
(B) $5,000,000 Each Occurrence—combined single limit for bodily injury and property damage, including cleanup costs.
(2) In addition to the above-referenced coverage for Business Automobile Liability Insurance, Contractor shall obtain for hazardous material transporter services:
(A) MCS-90 endorsement
(B) Sudden & Accidental Pollution coverage endorsement—Limits of Liability* $2,000,000 Each Occurrence
$2,000,000 General Aggregate
*A higher limit on the MCS-90 endorsement required by law must be matched by the Sudden & Accidental Pollution Insurance.
(3) With CSU’s approval, Contractor may delegate the responsibility to provide the additional coverage required under this subsection (2) to its hazardous materials subcontractor. In the event that Contractor has obtained CSU’s permission to delegate such responsibility to its hazardous materials subcontractor, Contractor shall provide CSU a letter within thirty (30) days of executing this Contract stating that Contractor is requiring its hazardous materials subcontractor to provide the additional coverage required under this subsection (2), if applicable. Contractor shall affirm in this letter that the hazardous materials subcontractor’s certificate of insurance shall adhere to all of the requirements of this Contract. Further, this letter will provide that the subcontractor’s certificate of insurance will be provided to CSU as soon as Contractor fully executes its subcontract with the hazardous materials subcontractor, or within thirty (30) days of the Notice to Proceed, whichever is less.
(c) Cyber. For Contracts involving Contractor access to or storage of Protected Data, Contractor shall obtain the additional coverage in amounts not less than the following, unless a different amount is agreed upon in writing signed by Contractor and CSU:

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(1) Privacy, Technology and Data Security Liability, Cyber Liability, or Technology Professional Liability Insurance – Limits of Liability
(A) $5,000,000 General Aggregate
(B) $5,000,000 Each Occurrence
(d) Professional Services. For Contracts involving professional services, Contractor shall obtain the additional coverage in amounts not less than the following, unless a different amount is agreed upon in writing signed by Contractor and CSU:
(1) Professional Liability Insurance – Limits of Liability (A) $5,000,000 General Aggregate
(B) $5,000,000 Each Claim

7.3 Acceptability of Insurers
Insurers shall be licensed by the State of California to transact insurance and shall hold a current A.M. Best’s rating of A:VII, or shall be a carrier otherwise acceptable to CSU.

7.4 Subcontractor’s Insurance
Contractor shall ensure that its subcontractors are covered by insurance of the types required by this Contract, and that the amount of insurance for each subcontractor is appropriate for that subcontractor’s work as relates to this Contract.

Contractor shall not allow any subcontractor to commence work on its subcontract until the insurance has been obtained and approved by CSU. Only the Contractor and its hazardous materials subcontractor(s) are required to have the coverage for projects involving hazardous materials.

7.5 Miscellaneous
(a) Any deductible under any policy of insurance required in this Contract shall be Contractor’s liability. (b) Acceptance of certificates of insurance by CSU shall not limit Contractor’s liability under the Contract. (c) In the event Contractor does not comply with these insurance requirements, CSU may, at its option, provide insurance coverage to protect CSU. The cost of the insurance shall be paid by Contractor and, if prompt payment is not received, may be deducted from Contract sums otherwise due the Contractor. (d) If CSU is damaged by Contractor’s failure to provide or maintain the required insurance, Contractor shall pay CSU for all such damages.
(e) Except as specifically provided for in contracts involving hazardous materials, Contractor’s obligations to obtain and maintain all required insurance are non-delegable duties under this Contract.

MEMORANDUM OF UNDERSTANDING BETWEEN THE LOCAL

JURISDICTIONS PARTICIPATING IN THE SAN LUIS OBISPO

COUNTY REGIONAL BIKESHARE PROGRAM
I. Background

1. Beginning in 2023, the City of San Luis Obispo, and California State University, San Luis Obispo, (collectively, the “Participating Jurisdictions” and individually “Participating Jurisdiction”) commenced the coordinated procurement of a proposals for the implementation of an electric-assist bicycle shared mobility program (“Bike Share Program”) within the defined territories of the Participating Jurisdictions.

2. The purpose of collaborating on the procurement of the Bike Share Program is to attract a broader set of vendors interested in providing services within the Participating Jurisdictions than might otherwise be interested in providing bike share services to individual Participating Jurisdictions.

3. The Participating Jurisdictions will collaboratively select a vendor (“Vendor”) to operate the Bike Share Program through a joint RFP review committee process. It is anticipated that the Participating Jurisdictions will sign a singular contract with the selected Vendor authorizing operation of the Bike Share Program in their respective territorial jurisdictions and establishing standard terms and conditions of agreement. Subsequently, the Participating Jurisdictions will work with Vendor to align on shared terms for a Service Level Agreement that define operational agreements for the Bike Share Program. However, separate, negotiated Service Level Agreements will be signed between the Vendor and each Participating Jurisdiction.

4. The Participating Jurisdictions, and each of them, recognize and agree that it is desirable and mutually beneficial to continue their communication and cooperation beyond selection of the Vendor, and extend such cooperation to the management and implementation of the Bike Share Program within the boundaries of their respective jurisdictions, particularly since their individual approaches to managing the portion of the Bike Share Program in their individual jurisdictions may have impacts on the success of the Bike Share Program in the jurisdictions of other Participating Jurisdictions.

5. For the foregoing reasons, the Participating Jurisdictions have agreed to this Memorandum of Understanding to better facilitate between them the coordination and management of the Bike Share Program.

6. This Memorandum of Understanding is intended only as a statement of intent, and not as a binding or enforceable contract.

II. Agreement

1. Identification of Staff Contacts for Management and Coordination of Bike Share Program. Each Participating Jurisdiction agreesto identify appropriate staff-level points of contact to the other Participating Jurisdictions for the purpose of efficient management and coordination of the Bike Share Program. In the event that there is a change in staffing, each Participating DocuSign Envelope ID: F967E655-ADFA-45B8-9E2D-A9856DA94263 DocuSign Envelope ID: 83CDB992-1A13-4DD0-8242-13024CADE604

Jurisdiction agrees to make reasonable efforts to promptly inform the other Participating Jurisdiction of that change.

2. Placement of New Bike Share Program Docks. The Participating Jurisdictions agree to communicate and reasonably cooperate with each other in regard to the placement and location of Bike Share Program docks within their respective jurisdictions for the purpose of ensuring adequate dock coverage and public access to the Bike Share Program.

3. Coordination Regarding Future Amendment of Bike Share Program Contract.

Each of the Participating Jurisdictions anticipates executing its own contract with the selected Bikeshare Program vendor, to regularly confer and communicate with the other Participating Jurisdictions, and to the extent possible, coordinate, any amendments of their respective individual Service Level Agreements governing the Bike Share Program. Each Participating Jurisdiction agrees to provide the other Participating Jurisdictions with notice of any proposed amendments in advance and in writing at least ninety (90) days prior to the proposed effective date of the amendment to allow the Participating Jurisdictions an opportunity to review proposed amendments to provide a reasonable opportunity to mitigate any potential impacts on the other Participating Jurisdictions.

4. Coordination Regarding Vendor Fees. The Participating Jurisdictions agree to coordinate and communicate with one another regarding all rental and other fees charged by Vendor to the general public, with the goal of sustaining the viability of the Bike Share Program in all of the Participating Jurisdictions. If the Vendor proposes to charge new or different fees to users of any Participating Jurisdiction, the Participating Jurisdictions agree to meet and confer at least ninety (90) days prior to those fees being assessed; provided, however, that the Participating Jurisdictions acknowledge that any of them may, from time to time, negotiate discounted rates for discrete groups of people (included, but not limited to, students and persons of low-income) or for limited duration events (including, but not limited to, concerts, festivals, and the like), and agree that such discounted rates need not, but may, be discussed and coordinated among the Participating Jurisdictions.

5. Coordination regarding Bike Share Program Advertising, Branding and Messaging.

The Participating Jurisdictions agree to communicate and coordinate messaging, branding, advertising, and promotion of the Bike Share Program to the community.

6. Notice of Termination to Other Participating Jurisdictions. Each Participating Jurisdiction agrees to provide the other Participating Jurisdictions with ninety (90) days prior notice of its intent to cease its participation in the Bike Share Program and terminate its contract with the Bike Share Program vendor. The purpose and intent of this agreement is to allow the other Participating Jurisdictions reasonable opportunity to mitigate any impacts that the cessation of a Participating Jurisdiction’s participation in the Bike Share Program may have on the operation of the Bike Share Program in the jurisdictions of the remaining Participating Jurisdictions. To that end, and notwithstanding its promise to provide ninety days’ prior notice of intent to cease participation in the Bike Share Program, each Participating Jurisdiction agrees to reasonably cooperate with the other Participating Jurisdictions to mitigate such impacts.

DocuSign Envelope ID: F967E655-ADFA-45B8-9E2D-A9856DA94263 DocuSign Envelope ID: 83CDB992-1A13-4DD0-8242-13024CADE604

7. Effective Date; Termination. This Memorandum of Understanding shall be effective the later of date which it is fully executed by representatives of all Participating Jurisdictions, or the date which each Participating Jurisdiction has executed a contract with the selected Bike Share Program vendor. As this Memorandum of Understanding is intended to be only a statement of the Participating Jurisdiction’s support and is not intended to be a legally enforceable contract, each Participating Jurisdiction may withdraw at any time with no penalty to the other Participating Jurisdictions. Notice of termination to the other Participating Jurisdictions shall be provided within a reasonable time prior to the effective date of termination.

8. Addition of New Participating Jurisdictions. The Participating Jurisdictions understand and agree that it may be beneficial in the future to allow other local agencies to participate in this Memorandum of Understanding. The Participating Jurisdictions agree that any local agency located within or immediately adjacent to the boundaries of the County of San Luis Obispo will be treated as a Participating Jurisdiction within the meaning of this Memorandum of Understanding under the following circumstances:
a. The new Participating Jurisdiction executes this Memorandum of Understanding; and
b. The new Participating Jurisdiction transmits a copy of the same to each of the existing Participating Jurisdictions; and
c. The new Participating Jurisdiction executes a general contract and Service Level Agreement with Vendor that is substantially similar to said contracts between each of the Participating Jurisdictions and Vendor.

9. Mutual Indemnification. The Participating Jurisdictions acknowledge and agree that nothing in this Agreement is intended to assign liability to any of the Participating Jurisdictions with regards to the operation of the Bike Share Program, and that the Vendor will be required to indemnify each of the Participating Jurisdictions in the general contract and/or the Service Level Agreements.”
IN WITNESS WHEREOF the Participating Jurisdictions have caused this Memorandum of Understanding to be duly executed by their respective authorized officers identified below in counterparts, and a scanned, electronic, or other copy of a party’s signature is accepted as an original.

DOCUSIGN ELECTRONIC RECORD AND SIGNATURE DISCLOSURE
From time to time, California State University Office of the Chancellor, on behalf of its San Luis Obispo campus (we, us, California State University San Luis Obispo, or the University) may provide to you certain written forms, notices, or disclosures. Described below are the terms and conditions for providing to you such notices and disclosures electronically through the DocuSign system. Please read the information below carefully and thoroughly, and if you can access this information electronically to your satisfaction and agree to this Electronic Record and Signature Disclosure (ERSD), please confirm your agreement by selecting the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

DocuSign Envelope ID: F967E655-ADFA-45B8-9E2D-A9856DA94263 DocuSign Envelope ID: 83CDB992-1A13-4DD0-8242-13024CADE604

Getting paper copies
At any time, you may request from us a paper copy of any record provided or made available electronically to you by us. You will have the ability to download and print documents we send to you through the DocuSign system during and immediately after the signing session and, if you elect to create a DocuSign account, you may access the documents for a limited period of time (usually 30 days) after such documents are first sent to you. After such time, if you wish for us to send you paper copies of any such documents from our office to you, you will be charged a reasonable per-page fee. You may request delivery of such paper copies from us by following the procedure described below.

Withdrawing your consent
If you decide to receive forms, notices and disclosures from us electronically, you may at any time change your mind and tell us that thereafter you want to receive required notices and disclosures only in paper format. How you must inform us of your decision to receive future forms, notices, and disclosure in paper format and withdraw your consent to receive forms, notices, and disclosures electronically is described below.

Consequences of changing your mind
If you elect to receive and/or return required forms, notices, and disclosures only in paper format, it will slow the speed at which we can complete certain steps in transactions with you and delivering services to you because we will need first to send the required notices or disclosures to you in paper format, and then wait until we receive back from you your acknowledgment of your receipt of such paper notices or disclosures or your completed forms. Further, you will no longer be able to use the DocuSign system to receive required forms, notices and consents electronically from us or to sign electronically documents from us. Forms, Notices, and Disclosures may be sent to you electronically Unless you tell us otherwise in accordance with the procedures described herein, we may provide electronically to you through the DocuSign system forms, notices, disclosures, authorizations, acknowledgments, and other documents that are required to be provided or made available to you during the course of our relationship with you. If you do not agree to receive a certain form, notice or disclosure electronically, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us or return completed forms electronically to us.

DocuSign Envelope ID: F967E655-ADFA-45B8-9E2D-A9856DA94263 DocuSign Envelope ID: 83CDB992-1A13-4DD0-8242-13024CADE604

How to contact us
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CALIFORNIA STATE

UNIVERSITY, SAN LUIS OBISPO

CITY OF SAN LUIS OBISPO,
a Municipal Corporation
________________________________ ___________________________________ Name: Ashley Sangster Name: Whitney McDonald
Title: ___________________________ Title: Interim City Manager Date: ___________________________ Date: ______________________________ DocuSign Envelope ID: F967E655-ADFA-45B8-9E2D-A9856DA94263 4/18/2024 | 10:53 AM PDT
Procurement Manager
DocuSign Envelope ID: 83CDB992-1A13-4DD0-8242-13024CADE604 5/8/2024 | 11:27 AM PDT

Item 6d
Department: Attorney
Cost Center: 1501
For Agenda of: 10/6/2026
Placement: Consent
Estimated Time: N/A
FROM: Christine Dietrick, City Attorney
Prepared By: Sarah Zion, Legal Assistant
SUBJECT: ADDITIONAL FUNDING FOR LEGAL SERVICES AGREEMENTS WITH CIVICA LAW GROUP, APC, RELATED TO THE 1150 LAUREL

RECEIVERSHIP, AND WITH RICHARDS WATSON GERSHON RELATED

TO THE RIGHETTI HILLSIDE LITIGATION

RECOMMENDATION

1. Approve $273,000 as the new not-to-exceed amount for the existing legal services agreement with Civica Law Group, APC, related to the 1150 Laurel receivership (a $50,000 increase).

2. Approve $220,000 as the new not-to-exceed amount for the existing legal services agreement with Richards Watson Gershon for Righetti Hillside litigation (a $50,000 increase).

3. Authorize the City Attorney to execute any legal services agreement amendments necessitated by the approvals above.

POLICY CONTEXT
In accordance with the City Purchasing Policy, City Council approval is necessary for professional services agreements of more than $150,000. A Request for Proposals is also necessary at this approval threshold, but the requirement was supplanted by the current on-call list for legal services in the Righetti Hillside matter and was waived in the 1150 Laurel matter by submission and approval of a Specialized Services Justification form at the time of initial contracting with outside counsel.

DISCUSSION
Background
Civica Law Group, APC
In May 2025, after the commercial property at 1150 Laurel Lane had several years of code violations, substandard building conditions, and failure to make progress following the issuance of an extensive notice of violation and order to abate, the City Council made the decision to file, in the name of the City, a civil complaint seeking the appointment of

Item 6d
a receiver to take control of the property. Due to the expected complexity of the matter, and the significant number of financial interest holders and liens against the property, compared to the receiverships for residential properties that in-house attorneys have petitioned for in recent years, outside counsel with extensive, relevant experience was contracted to take lead on the matter. The law firm chosen, Civica Law Group, APC, (“Civica”), almost immediately learned the matter was even more complex than anticipated with two separate pending lawsuits involving the property, a pending bankruptcy proceeding, and more than 18 lienholders with more than 40 liens. The noticing alone to all these parties took several months longer than anticipated due to the need to negotiate subordination agreements and/or stipulations with various interest holders and due to difficulty in completing legal process service in some instances.

The City’s Verified Complaint for Violation of Health & Safety Code and Receivership; Nuisance; Nuisance per se; and Unfair Business Practices was filed in October of 2025.

Since then, Civica attorneys and staff have been navigating communications and formal responses from the numerous defendants and interested parties. In March 2026, in order to keep the litigation moving forward, the City filed an ex parte application for consideration of the motion seeking appointment of a receiver. The order was granted by the court in June of 2026 but required several additional months of follow-up by Civica to obtain the actual signature of the Judge on the proposed order. This was finally signed in August 2026 and allowed the receiver to take possession of the property.

Though the receiver has been appointed by the court, additional legal services support is still needed from Civica to reach a satisfactory conclusion to the matter. The current estimate for this continued support ranges from $34,000 to $48,000. Staff are recommending City Council approval of $50,000 due to the complex and repeatedly surprising nature of this litigation which several times has exceeded predictions as to cost.

Looking forward, Civica expects the following work will be needed:
 Monitor and review reports from the receiver
 Prepare for and attend status conferences
 Monitor for any motions filed in opposition to the receiver’s work  Prepare and file a cost recovery motion for the City’s recoverable costs and fees  Review and respond to any and all opposition to the receiver’s motion for discharge and final accounting
Richards, Watson, & Gershon
In April 2025, after several years of discussions with counsel for Righetti NC, LLC (“Righetti”) and an unsuccessful mediation regarding claims related to land subsidence events at Righetti Hill in 2019 and 2023, the City Council made the decision to file, in the name of the City, a civil complaint seeking to recover more than $871,000 spent repairing the hillside. To coordinate and retain necessary geotechnical experts and facilitate settlement discussions, outside counsel with extensive, relevant experience was contracted to take lead on the matter. The law firm chosen, Richards, Watson, & Gershon

Item 6d
(“RWG”) has assisted City staff throughout the entire claims process.

The City’s Complaint for Trespass, Nuisance, and Negligence was filed in April of 2025.

On the same day the City’s Complaint was filed, Righetti filed a Verified Complaint for Damages and Declaratory Relief. In October 2025, the court ordered the two matters consolidated, with the City’s Complaint being the lead case. Since then, RWG attorneys and staff have been navigating communications and formal responses from the defendants and attempting to schedule another mediation.

Looking forward, RWG expects the following work will be needed to get through to mediation:
 Reviewing subpoenaed documents
 Preparing an updated mediation brief
 Deposing persons most knowledgeable
 Attending mediation
Previous Council or Advisory Body Action
Civica Law Group, APC
On May 5, 2025, the Construction Board of Appeals held a hearing for the appeal of the 1150 Laurel property owner contesting the validity of the notice of violation and order to abate. City Council then held a closed session on May 20, 2025, during which approval was granted to file the initial complaint in the name of the City. After that, the contract with Civica was increased by the City Manager on December 11, 2025, and then increased again by City Council on May 19, 2026.

Richards, Watson, & Gershon
The initial contract with RWG was increased by the City Manager on August 22, 2024.

After that, City Council held a closed session (April 1, 2025) during which approval was granted to file the initial complaint in the name of the City. Most recently, the RWG contract amount was increased by the City Council on October 21, 2025.

Public Engagement
Civica Law Group, APC
When the various tenants at 1150 Laurel were forced to vacate their leased spaces due to the un-remediated hazardous conditions of the property, City Council and staff engaged in written and verbal communication with members of the public about the necessity of the action. There was also public comment at the May 2025 Construction Board of Appeals hearing.

For the current item, public comment can be provided to the City Council through written

Item 6d
correspondence prior to the meeting and through public testimony at the meeting.

Richards, Watson, & Gershon
For the current item, public comment can be provided to the City Council through written correspondence prior to the meeting and through public testimony at the meeting.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (“CEQA”) does not apply to the recommended actions in the 1150 Laurel matter, because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378.

In May 2015, City Council approved Vesting Tentative Tract Map No. 3063 (VTM #3063), creating 328 lots for Righetti’s property located at 3987 Orcutt Road in San Luis Obispo.

The project was subject to an environmental impact report (EIR) conducted in 2009 for the Orcutt Area Specific Plan. Council Resolution No. 10154 (2010 Series) approved VTM #3063.

FISCAL IMPACT
Civica Law Group, APC
Budgeted: No Budget Year: 2025-26
Funding Identified: Yes
The Fire, City Attorney, and Community Development (“CDD”) departments reviewed their budgets for the current fiscal year to identify a funding source for the recommended $50,000 contract increase. While no source in the current year could be found, the Fire Department and City Budget Manager did identify the full funding amount as part of the budget carryover process from Fiscal Year 2025-26. Previous funding for this contract has come from City Attorney legal and other contract services, CDD Code Enforcement contract services, and CDD salary savings.

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $208,078 $50,000 $158,078 $0
State
Federal
Fees
Other:

Total $208,078 $50,000 $158,078 $0

Item 6d
Richards, Watson, & Gershon
Budgeted: No Budget Year: 2026-27
Funding Identified: Yes
The project account for the Righetti Hillside emergency repair (2001069) currently has a balance around $600,000 that is sufficient to cover the $50,000 increase being recommended to the not-to-exceed amount of the agreement with RWG. The previous $170,000 for the agreement came from the same project account.

Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $600,000 $50,000 $550,000 $0
State
Federal
Fees
Other:

Total $600,000 $50,000 $550,000 $0

ALTERNATIVES

1. Approve a different not-to-exceed amount. If the amounts being requested at this time are deemed to be too high for one or both of these matters, lesser amounts could be selected. However, with the work currently forecast for each of them, approving a lesser amount now may just necessitate a return to City Council, after a relatively short amount of time, to request additional funding.

2. Decline to increase the contracts with Civica and RWG. The work to guide and monitor the 1150 Laurel receivership and to lead the Righetti Hillside cost-recovery litigation would then fall on in-house attorneys. With the other existing workload and priorities being managed in-house at this time, and the complexities involved in both matters, selection of this alternative would also require further direction from City Council as to which work efforts should be deprioritized. If no work efforts can be removed from or made lower priority in the City Attorney workload, then this option is not recommended.

Item 6e
Department: Administration
Cost Center: 1021
For Agenda of: 10/6/2026
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Sara Armas, Deputy City Clerk
SUBJECT: ADVISORY BODY APPOINTMENT FOR AN UNSCHEDULED VACANCY

ON THE TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD

RECOMMENDATION
Confirm the appointment of Carolina Ertani to the Tourism Business Improvement District Board (TBID) for the remainder of a vacated term expiring June 30, 2028.

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 City Council Policies and Procedures Manual describes the “Appointment Procedure” 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
Annual appointments to the various City Advisory Bodies were made at the June 16, 2026 City Council meeting. The process for those appointments included recruitment by the City Clerk’s Office, interviews, and recommendations by the respective Council Liaison Subcommittees, with final confirmation of those recommendations made by the full Council. The applications of qualified candidates who are not chosen for immediate appointment are held for one-year for possible consideration in the event an unscheduled vacancy occurs. When unscheduled vacancies occur throughout the year, outreach to the qualified applicant list is conducted along with any necessary new recruitment for the given vacancies.

Item 6e
Tourism Business Improvement District Board: The City Clerk’s Office received notice on August 3rd of the resignation of a member of the TBID. The 2026 Annual Advisory Body recruitment period had only identified one candidate, who was appointed at the June 16, 2026 City Council Meeting. A recruitment was promptly opened to seek a new pool of potential applicants for consideration. After a month-long recruitment, one application was received for the unscheduled vacancy.

Upon completion of an interview, the Council Liaison Subcommittee consisting of Vice Mayor Francis and Council Member Boswell recommended Carolina Ertani to the unscheduled vacancy through June 30, 2028.

Public Engagement
Notices that the City was accepting applications for the above listed Advisory Bodies were placed on the City’s website and “e-notification” service, listed in the annual Local Appointments List (Maddy Act Notice – Government Code Section 54972), posted on the City website and City Information kiosk, and distributed via City social media outlets in February 2026 for the Annual Recruitment cycle. Following Maddy Act guidelines, notices were posted in the City Information kiosk outside City Hall and on the Advisory Body Vacancies page of the City’s website alerting the public that the City was specifically accepting applications for the vacancy on the TBID.

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

FISCAL IMPACT
Budgeted: Yes 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 $ $ $ $
State
Federal
Fees
Other:

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

Administration of the process is considered in the City Clerk’s annual budget.

Item 6e

ALTERNATIVES
Council could direct staff to re-open recruitment for additional candidates.

City of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: October 6, 2026
TO: Mayor and Council
FROM: Aaron Floyd, Public Works and Utilities Director
Prepared By: Luke Schwartz, Transportation Manager
VIA: Whitney McDonald, City Manager
SUBJECT: ITEM #6f - AUTHORIZATION TO APPLY FOR GRANT FUNDING

THROUGH THE CALTRANS SUSTAINABLE COMMUNITIES PLANNING

GRANT PROGRAM FOR PREPARATION OF A CITYWIDE SAFE

ROUTES TO SCHOOL PLAN
Staff received the following questions regarding Item #6f for the October 6, 2026, City Council Agenda. The questions are below with staff’s response shown in italics:
1) Will approval of this item impact the City’s ability to deliver on current as well as future active transportation plan projects that may be identified through the FY2027-29 Financial Plan?
The 2027–29 Financial Plan process is just getting underway and as part of this effort, current and future active transportation projects and programs will be reviewed and prioritized by the Active Transportation Committee (ATC), the community, and ultimately the City Council.

The ATC is scheduled to discuss and take action on budget priorities in November 2026. Although this meeting occurs after applications are due for this planning grant, feedback received so far from the ATC and community indicates that Safe Routes to School (SRTS) planning is likely to rank highly among the committee’s recommendations for funding in the FY2027–29 Financial Plan.

Anticipating that SRTS will be a priority, and recognizing the level of work and resources needed to move planning efforts forward, staff are recommending pursuit of external grant funding. This funding would allow the City to hire a professional transportation engineering consultant to lead most of the outreach, technical studies, and plan development, reducing the time and effort required of in-house staff to prepare the SRTS Plan. If funding is available to allow a consultant to take on the bulk of this effort, either through success with this grant pursuit or by appropriating new funding for consultant support as part of the FY2027-29 Financial Plan, staff believes that this work effort could be advanced without substantially impacting other priority active transportation projects. Under this scenario, the Active Transportation Manager would be the staff person primarily managing this planning effort, with minimal involvement from other Transportation Engineering staff.

Item #6f – AUTHORIZATION TO APPLY FOR GRANT FUNDING THROUGH CALTRANS Page 2 If preparation of a Citywide SRTS Plan is ultimately not ranked highly by the ATC or City Council for inclusion in the FY2027-29 work program, the City could choose to reject this grant funding (if this application is successful).

If SRTS planning is ranked as a high priority for the FY2027-29 work program, but no funding is secured for outside consultant support, staff may have the capacity to prepare a Citywide SRTS Plan in-house, but at a much slower pace over several years to avoid pulling resources away from other high-priority active transportation projects, such as work on the South Broad Street, Foothill Boulevard, and Grand Avenue corridors.
2) If approved, are staff confident that a contractor will be available to perform the work?
The City currently has several on-call transportation engineering consultants that have prepared similar SRTS plans for other communities and would be wellqualified for this work. Further, if the grant requires a competitive public request for proposals (RFP) process for procuring consultant support, this will further increase the potential to attract qualified consultants for this project. Staff is not concerned about the ability to attract a well-qualified contractor who can lead the bulk of this planning effort, with oversight and coordination from the City’s Active Transportation Manager to supervise the overall work product.

Item 6f
Department: Public Works
Cost Center: 5010
For Agenda of: 10/6/2026
Placement: Consent
Estimated Time: N/A
FROM: Aaron Floyd, Public Works & Utilities Director
Prepared By: Jennifer Rice, Active Transportation Manager SUBJECT: AUTHORIZATION TO APPLY FOR GRANT FUNDING THROUGH THE

CALTRANS SUSTAINABLE COMMUNITIES PLANNING GRANT

PROGRAM FOR PREPARATION OF A CITYWIDE SAFE ROUTES TO

SCHOOL PLAN

RECOMMENDATION

1. Authorize staff to prepare and submit an application for the Caltrans Sustainable Communities grant program, including a request of up to $300,000 to fund preparation of a Citywide Safe Routes to School Plan; and,

2. Approve the use of up to $50,000 in Active Transportation Plan Implementation capital project account (Specification No. 2000608) funding as the required local match funds for this grant pursuit; and,

3. Authorize the Finance Director to appropriate grant funds and approve a budget amendment to reflect received grant funds, if awarded;

4. Authorize the City Manager and City Attorney, or their respective designees, to act as agents to conduct all negotiations, execute and submit all grant documents including, but not limited to, applications, agreements, and payment requests which may be necessary for the completion of the aforementioned project; and,

5. Adopt a Draft Resolution entitled, “A Resolution of the City Council of San Luis Obispo, California, approving the application for grant funding through the Caltrans Sustainable Communities Grant Program to fund preparation of a Citywide Safe Routes to School Plan.”

REPORT-IN-BRIEF
In September 2025, the Active Transportation Committee (ATC) established a Safe Routes to School (SRTS) subcommittee tasked with providing updates and recommendations to the ATC on SRTS planning, funding, and outreach ahead of the ATC’s review and recommended prioritization of projects and programs for the 2027–29 Financial Plan. The committee has expressed a clear intent to identify preparation of a Citywide SRTS Plan as a high-priority recommendation for funding.

In parallel, staff continually monitor upcoming grant opportunities to identify funding sources that may align with current or future projects and planning efforts. Recently, Caltrans released the FY 2027-28 Sustainable Transportation Planning Grant application,

Item 6f
which includes Sustainable Communities Grants. This program presents a strong opportunity to secure funding to support preparation of a Citywide SRTS Plan; therefore, staff are recommending Council approval for the City to submit an application seeking up to $300,000 in grant funding. Staff are requesting authorization for up to $50,000 to provide flexibility to meet the final local match requirement, which will depend on the final grant award amount. The minimum match required for the full $300,000 grant request is $34,410. Staff estimate a total budget of up to $350,000 would be appropriate and sufficient to fund the full scope of work with a minor contingency.

Caltrans’ announcement of grant awards is anticipated to occur during this current fiscal year, in the spring of 2027 with project activities beginning in the summer. If the grant is awarded, this effort will be formally incorporated into the 2027–29 Financial Plan work program, including the allocation of staff resources to manage the project. Budget to fund the $50,000 local match is identified in the current fiscal year, as the grants are anticipated to be awarded this spring. There is currently available in the Active Transportation Plan Implementation capital project account (No. 2000608), and in addition, the Capital Improvement Plan identifies a potential future annual allocation in out-years 2027-29.

If secured, funding would allow staff to hire a professional transportation planning/engineering consultant via a Request for Proposals (RFP) to lead planning activities including community and stakeholder engagement and collaboration, compiling background information, conducting walk and bike audits, identifying safety and accessibility barriers, mapping and prioritizing these improvement opportunities. The planned scope of work will include all K-12 public schools within the City limits as well as Los Ranchos Elementary.

POLICY CONTEXT
The Active Transportation Plan (ATP) includes a goal1 to develop a focused Safe Routes to School Improvement Plan for all K-12 schools in San Luis Obispo to reduce safety and mobility barriers for walking and biking to school. Additionally, the Vision Zero Safe Streets Action Plan reinforces this goal, including it as a Safer Streets (Engineering) Proactive Safety Recommendation.
2 In 2017, the City Council adopted the Bishop’s Peak and Pacheco Elementary Schools Safe Routes to School Plan which include a needs assessment and transportation improvement and enforcement recommendations. The City has no other adopted single or citywide school safe routes to school plans.

1 Goal 2.5 on page 25 of the Active Transportation Plan: Safe Routes to School. Develop a focused Safe Routes to School Improvement Plan for all K-12 schools in San Luis Obispo to reduce safety and mobility barriers to walking and biking to school.
2 Safer Streets (Engineering) Proactive Safety Recommendation 7 on page 128 of the Vision Zero Safe Streets Action Plan: Safe Routes to Schools Planning: As recommended in the City’s Active Transportation Plan, prepare a focused Safe Routes to School Improvement Plan for each K-12 school within the city limits, focusing on strategies that improve safety for vulnerable road users and reduce barriers to walking and biking to school.

Item 6f
Per Section 740 of the City’s Financial Management Manual, staff is required to obtain Council approval prior to applying for grant applications over $5,000.

DISCUSSION
Background
Consistent with the goals of the Active Transportation Plan (ATP), the ATC has identified preparation of a Citywide SRTS Plan as a priority. However, due to other projects and programs also identified as high priorities during development of the current Financial Plan, funding for an SRTS planning effort was not included in the current 2025-27 budget.

Further staff did not have sufficient capacity during this current work program to begin this planning work in-house. In response to these constraints, community members and ATC members expressed interest in contributing their own time to advance preliminary tasks to lay the groundwork for a future SRTS planning effort, including conducting research, early public engagement, and identifying potential future funding opportunities. This interest showed that the community wants this important work to continue and led the ATC to consider forming a subcommittee to help move it forward.

At the September 18, 2025 ATC meeting, the committee established a SRTS subcommittee consisting of three members with staff providing support. The subcommittee was tasked with providing updates and recommendations to the ATC on SRTS planning, funding, and outreach. Its work is scheduled to conclude at the end of November 2026, ahead of the ATC’s review and prioritization of projects and programs for the 2027–29 Financial Plan. Since the fall, the ATC has informally expressed an co intent to identify preparation of a Citywide SRTS Plan as a high-priority recommendation for funding.

Since forming in September 2025, the subcommittee, with support from community volunteers, including the Cal Poly Urbanists Club, has made substantial progress, including:
 Safe Routes to School and Active Transportation Plan Review: Research Report: Under the guidance of the subcommittee with staff support, the Cal Poly Urbanists Club prepared a research report comparing SRTS plans from mid-sized California cities and other notable examples to help identify a suitable format for a citywide SRTS approach. After review and as recommended by the subcommittee, at the July 16, 2026 meeting, the ATC expressed consensus during their deliberation that the City of Davis model could be a strong fit for San Luis Obispo.

Rather than producing a standalone SRTS Plan, Davis includes a Safe Routes to School Bicycling and Walking Audit Report as an appendix to its bicycle action plan. Each chapter focuses on an individual elementary or junior high school and includes review of existing conditions, a prioritized list of recommended improvement projects, and maps of existing and planned improvements, such as suggested walking and biking routes and bicycle parking.  CL Smith Elementary Preliminary SRTS Audit and Findings: To test an approach similar to Davis, the subcommittee, alongside staff and community

Item 6f
volunteers, developed a draft SRTS audit and findings report for CL Smith Elementary School. This effort involved coordinating with school and community stakeholders, gathering background and site information, completing an in-person walking and biking audit, and mapping existing and planned improvements. The resulting materials mirror the type of content compiled for each school in the Davis report.

Again, during the July 16, 2026 meeting, the ATC shared consensus during deliberation for this approach as piloted at CL Smith Elementary and expressed support for continuing citywide SRTS planning efforts as capacity allows, with ongoing involvement from volunteers and interested community members.

Caltrans Sustainable Communities Grant
Caltrans has released the FY 2027-28 Sustainable Transportation Planning Grant Application Guide and Call for Applications, which includes Sustainable Communities Grants (approximately $30.4 million) to encourage local and regional planning that supports State goals, implements Regional Transportation Plan (RTP) Sustainable Communities Strategies (SCS) (where applicable), and ultimately achieves the State’s greenhouse gas (GHG) reduction target of 40 and 85 percent below 1990 levels by 2030 and 2045, respectively. The program requires a minimum of 11.47% match of local funds.

This program presents a strong opportunity to secure funding to support preparation of a Citywide SRTS Plan and therefore staff are recommending Council approval to submit an application seeking up to $300,000 in grant funding.

The Sustainable Transportation Planning Grant opportunity allows the City to advance a priority identified by the ATC while leveraging outside funding and minimizing the amount of local funding needed to complete the planning effort. It should be noted that typically, staff recommends pursuing grant opportunities for projects already included in the City Council–approved work plan. However, the timing of this grant application aligns well with the proposed planning effort, should it be prioritized and incorporated into the work program, and would allow staff to continue making progress on this initiative.

If secured, this funding would allow staff to hire a professional transportation planning/engineering consultant to lead this planning effort in FY2027-29, with continued collaboration from staff, the ATC, school representatives, and community members.

Award of the grant is anticipated to be announced in the spring of 2027, during this current fiscal year, while planning activities would begin in the summer.

Planning activities would include community and stakeholder engagement and collaboration, compiling background and layout information, conducting walk and bike field assessments to identify walking and bicycling conditions, identifying safety and accessibility barriers, mapping and prioritizing these improvement opportunities. The planned scope of work will include all K-12 public schools3 within the City limits as well as

3 Schools planned to be included are: Bishop Peak Elementary, Hawthorne Elementary, Los Ranchos Elementary, Pacheco Elementary, Sinsheimer Elementary, CL Smith Elementary, Teach Elementary, Laguna Middle School, San Luis High School, and Pacific Beach High School

Item 6f
Los Ranchos Elementary4.

The project’s anticipated timeframe is as follows:

Task Anticipated Schedule
Submit Sustainable Communities Grant Application By October 9, 2026 Grant Award and Contract Administration Spring 2027
Request for Proposals (RFP) for Consultant
Services
Summer 2027
Begin Planning and Public Outreach Fall 2027
Final Citywide Safe Routes to School Plan Winter 2029
The schedule above is preliminary and dependent on grant administration requirements and resources. Per the grant application guidelines, awarded funding must be spent by June 30, 2030.

Previous Council or Advisory Body Action
September 18, 2025, Active Transportation Committee (ATC) meeting: ATC established a three-member Safe Routes to School (SRTS) subcommittee.

July 16, 2026, Active Transportation Committee (ATC) meeting: SRTS subcommittee presented an update to the broader ATC and received support on initial progress and approach.

September 17, 2026, Active Transportation Committee: ATC supported and recommended Council’s consideration of applying for a Caltrans Sustainable Communities Grant.

Public Engagement
SRTS subcommittee members have engaged with various community volunteers to support early planning activities, particularly parents and staff of the CL Smith Elementary School.

If the project receives funding, future planning will build on these established stakeholder partnerships and include multiple opportunities for close coordination with local school representatives and the public, such as walk and bike audits for each school and surveys of key walking and biking barriers and opportunities for improvement.

CONCURRENCE
The Public Works Department, Finance Department, and City Administration have reviewed this staff report and concur with its contents.

4 While outside the City Limits, Los Ranchos Elementary attendance boundaries include several neighborhoods within the City, including Avila Ranch, Righetti Ranch, and the Arbor neighborhoods.

Item 6f

ENVIRONMENTAL REVIEW
There is no environmental review required for grant submittals. The California Environmental Quality Act (CEQA) does not apply to the recommended action in this report because the action does not constitute a “Project” under CEQA Guidelines Sec. 15378. The appropriate level of CEQA review will be prepared for the recommendations and actions that are ultimately identified in a forthcoming SRTS Plan.

FISCAL IMPACT
Budgeted: Yes Budget Year: 2027-28
Funding Identified: Yes
Fiscal Analysis:

Based on a proposed grant request for up to $300,000, staff is proposing to earmark up to $50,000 in local funds to meet the local match requirement for this grant program. The grant requires a minimum local match of 11.47%, ($34,410). Staff estimate a total budget of up to $350,000 would be appropriate and sufficient to fund the full scope of work with a minor contingency.

Because the grant is expected to be announced in the spring of 2027, staff are requesting allocation of funds from this current fiscal year to be earmarked for the match requirement.

Funding is available in the Active Transportation Plan Implementation capital project account (No. 2000608) to fund this local match of up to $50,000. There is currently $100,000 available from the CIP Capital Outlay – Local Revenue Measure (LRM) funding source and the 10-year Capital Improvement Plan identifies a potential future annual allocation of another $200,000 per year in out-years 2027-29.

If the grant is awarded, the funds from this current fiscal year will be added to a new task within the Active Transportation Plan Implementation capital project account (No. 2000608). Additionally, this work effort will be incorporated into the recommended 2027– 29 Financial Plan, including the allocation of staff resources to manage the project and oversee the consultant.

Upon completion of the SRTS Plan, projects would likely be implemented through a combination of approaches. Smaller improvements could be incorporated into annual paving projects or funded as standalone projects through the Active Transportation Plan Implementation or Vision Zero accounts. Larger projects would need to be considered through future budgeting and Capital Improvement Planning processes or potential future grant opportunities.

Funding Sources Total Budget
Available
Total Budget
Available Total Balance

Item 6f
(Active
Transportation Plan
Implementation)
(NEW Task 05 –
Safe Routes to
School Plan)
CIP – Capital Outlay Fund
- LRM
$100,000 $0 $100,000
State: Sustainable
Communities Grant*
$0 $300,000* $300,000
Current Funding Request ($50,000) $50,000 $0
Total $50,000 $350,000* $400,000
*If grant application is successful.

ALTERNATIVES
Deny authorization to apply for grant funding. The City Council could decide not to authorize staff to apply for the Caltrans Sustainable Communities Grant at this time.

Under this scenario, staff would likely request local funding to support this SRTS planning effort as part of the FY 2027-29 Financial Plan, assuming the ATC identifies preparation of a Citywide SRTS Plan as one of the committee’s top priority recommendations for the 2027–29 Financial Plan (the ATC will meet to identify budget priorities in November 2026). Council could then consider the funding request within the broader context of all other proposed budget priorities and capital projects in the next financial plan.

Alternatively, if the City Council does not authorize staff to pursue this grant funding, and local funding for SRTS planning is ultimately not approved as part of the 2027–29 Financial Plan, preparation of a full Citywide SRTS plan would not be feasible at this time.

If SRTS planning remains a high priority based on ATC and community input, but no funding for outside consultant support is available, it is possible that focused SRTS plans could be prepared incrementally using a combination of in-house staff and volunteer support. However, under this approach, it would take several years to complete this planning, as staffing resources can likely support planning for only one-to-two schools each year.

The City’s Active Transportation Plan (ATP) is also approaching an appropriate timeframe for an update, and staff are targeting the 2029–31 work program. If funding and staffing resources cannot support SRTS planning as part of the 2027-29 work program, the 2029- 31 Financial Plan may present another opportunity to pursue funding for this effort. Under this scenario, there may be additional opportunities to pursue outside grant funding in the coming years.

ATTACHMENTS
A - Draft Resolution Approving the Application for Caltrans Sustainable Transportation Planning Grant Program

R ______
RESOLUTION NO. _____ (2026 SERIES)

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

OBISPO, CALIFORNIA, APPROVING THE APPLICATION FOR GRANT

FUNDING THROUGH THE CALTRANS SUSTAINABLE COMMUNITIES

GRANT PROGRAM TO FUND PREPARATION OF A CITYWIDE SAFE

ROUTES TO SCHOOL PLAN
WHEREAS, Caltrans released the FY 2027-28 Sustainable Transportation Planning Grant Application Guide and Call for Applications including Sustainable Communities Grants with approximately $30.4 million; and WHEREAS, the Sustainable Transportation Planning Grant program encourages local and regional planning that supports state goals, implements Regional Transportation Plan (RTP) Sustainable Communities Strategies (SCS) (where applicable), and to ultimately achieve the State’s greenhouse gas (GHG) reduction target of 40 and 85 percent below 1990 levels by 2030 and 2045, respectively; and WHEREAS, the City of San Luis Obispo 2021 Active Transportation Plan (ATP) includes a goal to develop a focused Safe Routes to School Improvement Plan for all K12 schools in San Luis Obispo to reduce safety and mobility barriers to walking and biking to school; and
WHEREAS, the 2026 Vision Zero, San Luis Obispo’s Safe Streets Action Plan includes the Safer Streets (Engineering) Proactive Safety Recommendation to prepare a focused Safe Routes to School Improvement Plan for each K-12 school within the city limits, focusing on strategies that improve safety for vulnerable road users and reduce barriers to walking and biking to school; and
WHEREAS, the Sustainable Communities Grant requires an 11.7% match of local funds.

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

SECTION 1. Authorizes staff to prepare and submit an application for the Sustainable Communities Grant of up to $300,000 for preparation of a Citywide Safe Routes to School Plan.

SECTION 2. Approves the use of up to $ 50,000 in local Active Transportation Plan Implementation Project Account funding as matching funds for this grant, if awarded.

SECTION 3. Authorizes the Finance Director to appropriate grant funds and approve a budget amendment to reflect received grant funds, if awarded.

Resolution No. _____ (2026 Series) Page 2
R ______
SECTION 4. Authorizes the City Manager and City Attorney, or their respective designees, to act as agents to conduct all negotiations, execute and submit all grant documents including, but not limited to, applications, agreements, and payment requests which may be necessary for the completion of the aforementioned project.

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

City of San Luis Obispo, Council Memorandum
City of San Luis Obispo
Council Agenda Correspondence
DATE: October 6, 2026
TO: Mayor and Council
FROM: Christine Dietrick, City Attorney
Prepared By: Sadie Symens, Deputy City Attorney
Madeline Kacsinta, Assistant Director of Public Works
VIA: Whitney McDonald, City Manager
SUBJECT: ITEM #6g - ADOPT A RESOLUTION OF INTENTION TO APPROVE A RENEWED FRANCHISE AGREEMENT WITH PHILLIPS 66 PIPELINE,
LLC FOR EXISTING PIPELINES LOCATED WITHIN THE CITY RIGHTOF-WAY AND SET A PUBLIC HEARING FOR NOVEMBER 17, 2026 Staff received the following questions, regarding the recommendation to adopt a Resolution of Intent to approve a renewed Franchise Agreement with Philips 66. The questions are below with staff’s response shown in italics:

1. Could the City prevent the future construction of additional oil pipelines by eliminating Articles 4 and 5, or would a new ordinance or other action be required?
The City does not need to eliminate Articles 4 and 5 or adopt a separate ordinance to prevent future pipeline expansion. Article 1A of the proposed franchise specifically states that there shall be “no expansion of the existing infrastructure or operations within the City without the express prior written consent of the City Council.” This means Phillips 66 cannot construct an additional pipeline within the City without first obtaining approval from the City Council. Articles 4 and 5 establish the requirements and process that would apply if Council were to approve the construction of a new pipeline. These provisions do not give Phillips 66 an independent right to construct new pipelines. Therefore, if Council does not want additional oil pipelines constructed in the City, Council can simply decline to approve a future request for expansion.

Council could also choose to renew the franchise on the express condition that no future pipelines will be constructed and modify the proposed Agreement accordingly.

If Phillips 66 rejects this revision and an agreement cannot be reached, City staff could pursue decommissioning of the existing lines under the terms of the former franchise agreement (which survived expiration). As discussed above, however, expressly prohibiting expansion within the Agreement is not necessary, but the Council has considerable discretion to do so since it may deny the franchise altogether (California Resources Production Corp v. City of Antioch (2024) 107 Cal.App.5th 481, holding that a city has discretion to deny a requested franchise and need not make findings to do so under Public Utilities Code 6231 et seq.).

ITEM #6g - ADOPT A RESOLUTION OF INTENTION TO RENEW FRANCHISE AGREEMENT Page 2 In sum, as the proposed franchise agreement is currently drafted, additional Council action would not be needed to prevent new pipelines; on the contrary, Phillips 66 would have to obtain Council approval (in Council’s sole discretion) in order to expand.

2. What is Phillips 66’s responsibility if an unknown, old or discontinued pipeline is discovered, such as the situation referenced during construction of the LOVR overpass?
The franchise provides the City with authority to address abandoned and permanently discontinued pipelines.

Under Article 10 of the proposed agreement, the City may require Phillips 66 to relocate any facilities (abandoned or otherwise) for public purposes. Article 11 also expressly reserves to the City “the right to require removal of Grantee’s facilities abandoned in place at any time following the expiration, revocation, or termination of this franchise.” During the term of the franchise, the City can require removal of pipelines that have been permanently discontinued (see Article 11(G)(3).) The specific circumstances of a situation like the LOVR overpass can depend on where the pipeline is located and who owns the underlying property or right-of-way.

For example, if a pipeline is located within City right-of-way, the franchise would squarely govern the City's ability to require relocation for a public project. If, as with the Prado Road overpass, the facility is located on property owned by another public agency, additional property rights or agreements may also be involved. In those circumstances, the City would determine the appropriate relocation or removal requirements based on the location of the facility, the applicable property rights, and the provisions of the franchise.

Item 6g
Department: Public Works
Cost Center: 5001
For Agenda of: 10/6/2026
Placement: Consent
Estimated Time: N/A
FROM: Aaron Floyd, Public Works & Utilities Director
Prepared By: Brendan Pringle, Senior Business Analyst
Madeline Kacsinta, Assistant Director of Public Works
SUBJECT: ADOPT A RESOLUTION OF INTENTION TO APPROVE A RENEWED FRANCHISE AGREEMENT WITH PHILLIPS 66 PIPELINE, LLC FOR

EXISTING PIPELINES LOCATED WITHIN THE CITY RIGHT-OF-WAY AND SET A PUBLIC HEARING FOR NOVEMBER 17, 2026

RECOMMENDATION

1. Adopt a Resolution of Intention (Attachment A) entitled, “A Resolution of the City Council of the City of San Luis Obispo, California, declaring the City’s intent to approve a Franchise Ordinance, superseding Ordinance 1709 (2022 Series), to allow Phillips 66 Pipeline LLC to operate and maintain pipelines for the transportation of oil and other specified materials in the City of San Luis Obispo and setting a public hearing for November 17, 2026”; and

2. Authorize the Public Works and Utilities Director to execute the letter agreement memorializing the abandonment of the Phillips 66 proprietary pipeline.

REPORT-IN-BRIEF
This agenda item presents a draft Resolution of Intention (Attachment A) declaring the City’s intent to consider renewal of a franchise agreement with Phillips 66 Pipeline LLC (Phillips 66) for the continued operation and maintenance of existing common carrier pipelines within City rights-of-way. The Resolution of Intention does not approve a renewed franchise agreement. Rather, it initiates the process required by the Public Utilities Code and provides an opportunity for the Council and community to review and comment on the proposed agreement before any action on adoption.

Phillips 66 submitted a written request to renew its franchise agreement as required under the existing agreement. The prior franchise agreement expired on April 14, 2025. Since that time, Phillips 66 has remained operational and subject to standard City encroachment permit requirements while staff completed its review of the renewal request. Phillips 66 has held the franchise since 2013, when it succeeded Union Pipeline Company (UNOCAP), which was initially granted the franchise in 2001.

Item 6g
The proposed franchise agreement applies only to existing common carrier pipelines located within City rights-of-way. It does not authorize new pipeline corridors, expansion of existing facilities, or expanded operations without prior City Council approval. The proposed term of the renewal agreement is five years.

As compensation for use of the public right-of-way, the agreement includes a $30,000 granting fee and annual franchise fees established pursuant to Public Utilities Code (PUC) § 6231.5). During review of prior franchise fee payments, staff identified historical underpayments associated with Consumer Price Index (CPI) calculations, and Phillips 66 has agreed to remit approximately $51,201 to reconcile the difference.

This agenda item also includes a separate letter agreement memorializing the abandonment of proprietary pipelines previously operated by Phillips 66 Company under a separate franchise agreement. These proprietary pipelines are distinct from the common carrier pipelines that are the subject of the proposed franchise renewal and have already been abandoned through the City's encroachment permit and inspection process.

The letter agreement documents abandonment and does not grant or renew any franchise rights for that proprietary pipeline. Upon execution of the agreement, Phillips 66 will also pay the City a one-time administrative fee in the amount of $10,000 to compensate the City for its time in reviewing the abandonment report and related materials.

If the Council adopts the Resolution of Intention, a public hearing would be held on November 17, 2026, to consider introduction of an ordinance approving a renewed franchise agreement. A second reading and potential adoption would occur on December 1, with the ordinance becoming effective on December 31, 2026.

POLICY CONTEXT
The action before Council on October 6, 2026, is limited to initiating the public hearing process and scheduling the required public hearing. Adoption of the Resolution of Intention does not approve a new franchise agreement.

The renewal of the Phillips 66 franchise agreement is subject to the provisions of PUC §§ 6231–6234, which establish the process for granting and renewing franchises that authorize utility operators to occupy public rights-of-way. Under these provisions, the City Council has discretion to approve or deny a franchise renewal. If the Council wishes to consider renewing a franchise, state law requires the Council to first adopt a Resolution of Intention and schedule a public hearing. Following the public hearing, the Council may consider an ordinance approving the proposed franchise agreement.

The proposed renewal aligns with the authority granted to the City Council under Article X of the City Charter (Licenses and Franchises), which authorizes the Council to grant franchises through the adoption of an ordinance. Accordingly, approval of a franchise renewal requires both compliance with the PUC process and adoption of an ordinance by the City Council.

DISCUSSION

Item 6g
Phillips 66 operates petroleum pipelines that traverse portions of the City's right-of-way and are used to transport refined petroleum products through the region. Franchise agreements provide utility operators with a limited, revocable right to occupy public rightsof-way for specific purposes, subject to terms and conditions intended to protect public infrastructure, public safety, and the broader public interest. Franchise agreements also provide compensation to the City for the use of public property.

The City currently maintains franchise agreements with several utility providers that utilize public rights-of-way to deliver services or transport products, including Pacific Gas and Electric, Southern California Gas Company, and Charter Communications.

Phillips 66 has held a franchise agreement with the City since February 2013, when the franchise originally granted to Union Pipeline Company (UNOCAL) in 2001 was transferred from ConocoPhillips Pipeline Company to Phillips 66 Pipeline LLC. Most recently, the City Council renewed the franchise in March 2022 for a three-year term that expired on April 14, 2025.

On March 17, 2025, Phillips 66 submitted a written request seeking renewal of the franchise agreement (Attachment C). The existing franchise agreement does not provide for extensions, and renewal requires adoption of a new ordinance pursuant to the Public Utilities Code and City Charter. Following expiration of the previous franchise agreement, Phillips 66 remained subject to the City's encroachment permit requirements while staff conducted additional review of the renewal request, including review of franchise fee calculations and clarification of the status of separate proprietary pipelines discussed later in this report.

Scope of Common Carrier Franchise Agreement
The proposed franchise agreement (Attachment D) grants Phillips 66 a non-exclusive right to use portions of the City's right-of-way for the continued operation, maintenance, repair, replacement, and eventual removal of existing common carrier petroleum pipelines. The agreement does not authorize new pipeline corridors, expansion of existing facilities, or expanded operations without prior City Council approval.

The common carrier pipeline system is part of a larger regional network extending through multiple jurisdictions and serving facilities beyond City limits. The proposed franchise renewal applies only to those portions of the existing pipeline system located within City rights-of-way. Attachment E includes maps showing both the regional system and the specific pipeline segments located within the City's jurisdiction.

The franchise agreement grants Phillips 66 the right to occupy City rights-of-way for the purposes of transmitting and distributing oil/oil products under the terms and conditions established in the agreement; it does not regulate petroleum production, refining, or end use, nor does it authorize expanded pipeline operations.

Pipeline Decommissioning and Abandonment Requirements

Item 6g
The proposed agreement includes requirements governing future decommissioning, abandonment, or removal of pipeline facilities if they are no longer utilized or if the franchise is not renewed in the future. Upon expiration, revocation, termination, or permanent discontinuance of use, Phillips 66 would be required to submit an application to the City describing the facilities proposed for abandonment or removal and documenting their physical condition.

The agreement requires coordination with the City regarding environmental testing, facility condition, record documentation, and future maintenance responsibilities. Phillips 66 would also be required to provide decommissioning and removal plans, updated record drawings, and facility location information to assist with future utility coordination and capital project planning.

The proposed agreement does not predetermine whether future pipeline facilities would be removed or abandoned in place. Any such determination would be based on the specific circumstances at that time and the City's evaluation of public safety, environmental considerations, infrastructure impacts, operational needs, and long-term liability considerations. If facilities are abandoned in place, Phillips 66 would remain responsible for applicable bonding, insurance, indemnification, encroachment, defense, indemnification, and right of way repair and restoration requirements of this franchise.

The City retains the right to require future removal of abandoned facilities and may recover costs associated with environmental testing, remediation, disposal, restoration, and administration if Phillips 66 fails to satisfy its obligations.

Franchise Fees
Franchise fees for petroleum pipeline operators are governed by PUC § 6231.5, which sets a fee schedule based on pipeline diameter. The proposed agreement specifies that Phillips 66 operates approximately 18,800 linear feet of 8-inch pipeline and 5,800 linear feet of 12-inch pipeline within the City’s right-of-way.

Base rates were originally established in 1989 as follows:
 $0.176 per linear foot for 8-inch pipelines
 $0.264 per linear foot for 12-inch pipelines
These base rates are subject to adjustments based on the CPI to reflect inflation over time. PUC § 6231.5 states that the “applicable base rate shall be multiplied by the CPI for the area, as published by the United States Department of Labor, Office of Information for the month of September immediately preceding the month in which payment is due and payable, and divided by the Consumer Price Index for June 30, 1989, which is declared to be 100.0.”
The City uses the CPI for All Urban Consumers (CPI-U) for the Los Angeles area, as published by the U.S. Bureau of Labor Statistics1. Applying the CPI adjustment from June

1 U.S. Bureau of Labor Statistics (CPI-U) Los Angeles-Long Beach-Anaheim

Item 6g
1989 to September 2025 (169%), the adjusted rates for the most recent payment in April 2026 were:
 $0.473 per linear foot for 8-inch pipelines
 $0.709 per linear foot for 12-inch pipelines
Using the adjusted rates and total pipeline footage, the current annual franchise fee is approximately $12,603.

In addition to this recurring fee, the City is proposing a one-time granting fee of $30,000 to recover costs associated with administering the franchise, in line with the previous franchise agreement. This granting fee, which is not currently identified in the User Fee Schedule, includes the preparation and negotiation of the franchise agreement, public noticing, and facilitation of the required three public meetings (including one public hearing for introduction of the Ordinance), and ongoing management and compliance oversight of the agreement. The granting fee also accounts for staff time required to coordinate with Phillips 66 on City capital projects that may be affected by the presence or potential relocation of the pipelines.

Past Years’ Underpayments of Franchise Fees
In a recent audit of franchise fee payments, staff identified a discrepancy in Phillips 66’s past years’ calculations of franchise fee payments. Payment calculations did not align with the formula set out by PUC guidelines on CPI-related annual increases. Phillips 66 has offered to remedy this error by tendering payment for underpayments from 2021- 2025, totaling $51,200.70.

Although annual franchise fee payments were made during this period, staff determined that the amounts paid did not fully reflect the CPI-adjusted rates required under state law.

Phillips 66 has agreed to remit the outstanding balance within thirty (30) days after the date City Council adopts this franchise agreement by ordinance, should the Council ultimately choose to move forward with the franchise renewal process. Staff will require payment of these amounts prior to execution of any renewed franchise agreement.

Proprietary Pipeline Agreement Previously Held by Phillips 66 Company The proprietary pipelines discussed in this section are separate from the common carrier pipelines that are the subject of the proposed franchise renewal.

Phillips 66 Pipeline LLC, the applicant for renewal of the common carrier franchise, is a wholly owned subsidiary of Phillips 66 Company. Phillips 66 Company previously held a separate franchise agreement for proprietary pipelines used exclusively to transport company-owned products rather than products belonging to multiple customers.

The proprietary pipeline franchise agreement expired on April 14, 2025. Over time, portions of the proprietary pipeline system were taken out of service through the City's

Item 6g
encroachment permit and inspection process. City records document those abandonment activities within the public right-of-way.

As part of the current franchise review process, Phillips 66 informed the City that all proprietary pipelines previously covered by the separate franchise agreement have been abandoned and are no longer in service. Staff reviewed available records and verified that prior abandonment activities were consistent with that representation.

To formally document the abandonment and conclude the associated franchise obligations, Phillips 66 provided an abandonment report and proposed letter agreement (Attachment B). The agreement is administrative in nature and memorializes the abandonment in place of facilities that have been isolated, purged, and rendered inert.

The agreement does not grant, renew, extend, or confer any franchise rights and is separate from the statutory process applicable to the proposed common carrier franchise agreement.

Under the proposed letter agreement, Phillips 66 will continue to be subject to applicable bonding, insurance, indemnification, environmental compliance, and other franchiserelated obligations unless and until the facilities are removed. The agreement does not waive, release, or discharge any existing obligations associated with the abandoned facilities.

The City also retains the authority to require future removal or relocation of the abandoned facilities if they conflict with, interfere with, or must be removed to accommodate a City or third-party project, or if removal is necessary to protect public health or safety.

Upon execution of the agreement, Phillips 66 will also pay the City a one-time administrative fee in the amount of $10,000 to compensate the City for its time in reviewing the abandonment report and related materials.

Based on staff's review, documented abandonment in place of the proprietary facilities represents the most practical long-term approach. Removal of inactive pipeline facilities can be environmentally disruptive and may result in greater impacts to surrounding infrastructure and environmental resources. In this case, staff determined that documented abandonment in place, coupled with the continuing obligations retained by Phillips 66 and the City's ability to require future removal if necessary, provides the greatest long-term public benefit.

Previous Council or Advisory Body Action
 July 10, 2001 – City Council adopted Ordinance No. 1391 granting a franchise to Union Pipeline Company (UNOCAP) for a period of ten (10) years.  April 17, 2007 – City Council adopted Ordinance No. 1504 transferring the franchise from UNOCAP to ConocoPhillips Pipeline Company.

Item 6g
 June 21, 2011 – City Council adopted Ordinance No. 1564 to renew the franchise agreement with ConocoPhillips Pipeline Company for a period of ten (10) years.  October 18, 2011 – City Council adopted Ordinance No. 1569 granting a proprietary pipeline franchise agreement to ConocoPhillips Pipeline Company.  February 5, 2013 – City Council adopted Ordinance No. 1587, transferring the common carrier pipeline franchise from ConocoPhillips Pipeline Company to Phillips 66 Pipeline LLC.
 February 5, 2013 – City Council adopted Ordinance No. 1588, transferring the proprietary pipeline franchise agreement from ConocoPhillips Pipeline Company to Phillips 66 Pipeline LLC.
 March 15, 2022 – City Council adopted Ordinance No. 1709 to renew the common carrier franchise agreement with Phillips 66 Pipeline LLC for a period of three (3) years. This ordinance became effective on April 14, 2022.

Public Engagement
If the Council adopts this resolution, a public hearing will be held on November 17, 2026, giving community members a formal opportunity to review and comment on the proposed agreement and proposed ordinance.

Pursuant to PUC § 6234, members of the public may submit written objections to the franchise renewal prior to the hearing scheduled for November 17, 2026.

At the hearing, the Council must hear and consider any objections received before the hearing. Protests must be submitted in writing, signed by the protestant, and delivered to the City Clerk. Any objections received must be considered by the Council.

The Council is not required to make any findings in order to deny the franchise renewal.

However, if written objections are received from community members or organizations and the Council wishes to grant the renewal, the Council must first determine that the objections are insufficient or otherwise overrule or deny them. The statute does not define “insufficient.” However, since it is within the Council’s discretion to grant or deny the franchise altogether, it is reasonable to conclude that this determination of sufficiency is likewise within the Council’s discretion, taking into account policy considerations, fiscal impacts, and other legitimate municipal objectives.

Next Steps
If the Council elects to renew the franchise agreement, state law and the City Charter require that it be renewed via ordinance. Staff have developed the following schedule of next steps, if Council wishes to move forward, to ensure compliance with all legal requirements and to allow for public transparency and Council deliberation:
 November 17, 2026: Hold public hearing and introduce ordinance

Item 6g
 December 1, 2026: Second reading and final adoption of ordinance  December 31, 2026: Ordinance becomes effective
The November 17, 2026 meeting will serve as the public hearing required under state law and provide the opportunity for public comment and Council discussion on the merits of the renewed franchise agreement.

The Resolution of Intention does not grant or renew a franchise. However, it does initiate the statutory process and schedules the required public hearing. The currently proposed and any future franchise renewal must be considered by the Council at a public hearing to introduce the Ordinance, at which time the Council may approve, modify, or reject the proposed terms of the agreement.

As referenced above, if the Council decides against moving forward in the hearing process for the common carrier franchise agreement, pipelines would be abandoned or removed by Phillips 66 at their own expense, and oil would be transported by ground transportation or be rerouted via pipelines through a neighboring jurisdiction.

CONCURRENCE
The City Attorney’s office approves the draft agreement as to form.

ENVIRONMENTAL REVIEW
The renewal of the franchise agreements is categorically exempt from the provisions of the California Environmental Quality Act, in accordance with section 15301 (Existing Facilities) because renewing the franchise agreement involves negligible or no expansion of existing use of the pipeline infrastructure by Phillips 66. Any expansion in the future would require advanced consideration and approval of the City Council, which would then trigger any applicable environmental review at that time.

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 $0 $0 $0 $0
State
Federal
Fees
Other:

Total $0 $0 $0 $0

Item 6g
The proposed agreement is expected to generate around $13,000 annually in franchise fee revenue, increasing with CPI as outlined in the PUC § 6231.5. Franchise fees are collected each April for the prior calendar year to allow time for CPI to be calculated. This annual fee collection would continue throughout the term of the agreement (5 years).

The agreement also includes a one-time granting fee of $30,000 to recover staff costs related to agreement preparation, public noticing, required hearings, and ongoing administration of the franchise. This granting fee is not determined by the User Fee Schedule but is in line with other fees on the User Fee Schedule based on the amount of staff time required.
2 Pipeline franchise fees are budgeted in aggregate form with the other General Fund franchise fees based on financial models. Additionally, the FY 2026-27 budget does not include the $30,000 granting fee.

As part of the new common carrier franchise agreement, Phillips 66 is issuing a check for $51,200.70 to settle underpayments from 2021-2025 for both the common carrier pipeline agreement that is being considered for renewal under this process; and for the proprietary pipeline which has been formally abandoned and confirmed by the City. The amount represents the actual difference owed, dating back to 2021, based on staff’s calculations, which were confirmed and verified by Phillips 66. The FY 2026-27 budget does not include this amount either.

Separately, as part of the proprietary pipeline abandonment agreement, Phillips 66 would also pay the City a one-time administrative fee in the amount of $10,000 to compensate the City for its time in reviewing the abandonment report and related materials. The FY 2026-27 budget does not include this administrative fee.

These fees and settlement underpayments will support the City’s General Fund.

ALTERNATIVES

1. The City Council may choose not to move forward with a franchise agreement with Phillips 66. If the Council elects not to renew the franchise agreement, Phillips 66 would no longer have a franchise authorizing operation of the pipeline within City right-of-way. Certain provisions of the former franchise agreement, such as environmental responsibility, indemnification, annual franchise fees, insurance, and bonding, survive the expiration of that agreement and continue for as long as Phillips 66 facilities remain within the City (except for annual fees, which terminate upon formal abandonment in place.) The City also retains the right to require removal of the facilities now or in the future, should Phillips 66 abandon them in place under the terms of the franchise agreement.

2 The FY 2026-27 Comprehensive Fee Schedule outlines the fee for a Reimbursement Agreement as $43,584.55 (p.2), and the Development Review of a Moderate Development Project as $26,644.42 (p.3).

Item 6g

2. The City Council may decline to delegate authority to the Director of Public Works and Utilities to execute the letter agreement memorializing the abandonment of the Phillips 66 proprietary pipeline. The letter agreement as drafted ensures that Phillips 66 retains environmental responsibility, indemnification, insurance, and bond requirements as long as pipelines remain within the City. The final execution of this letter agreement does not affect and is not related to the timeline for Council’s consideration of the common carrier franchise agreement, nor is it governed by that statutory framework. If the Council does not wish to delegate authority to the Director of Public Works and Utilities to execute the letter agreement (Attachment B), Council may instead authorize the Mayor or City Manager to execute the letter agreement, provide direction to staff regarding any necessary revisions to the letter, or continue consideration of the letter agreement to a future meeting with direction regarding any additional information needed.

3. The City Council may consider negotiating a franchise agreement with a term length different than the proposed 5 years, such as a longer 10-year term. A shorter term, as recommended, allows for more frequent review by Council and renegotiation, and would result in more frequent one-time administrative fees, while a longer term can provide stability and reduce administrative burdens. This alternative enables the City to tailor the agreement’s duration to best balance oversight, operational certainty, and future planning. Should Council wish to designate a different term length, that determination must be made now as part of this agenda item, as PUC § 6233 states that the notice of public hearing shall designate the term for which the franchise is proposed to be granted.

ATTACHMENTS
A - Draft Resolution of Intention to approve a new franchise agreement with Phillips 66 Pipeline LLC
B - Proprietary Pipeline Abandonment Agreement
C - Phillips 66 Pipeline LLC Franchise Application
D - Draft Common Carrier Pipeline Franchise Agreement
E - Map of Existing Common Carrier Pipeline and Abandoned Proprietary Pipeline Locations

R ______
RESOLUTION NO. _____ (2026 SERIES)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, DECLARING THE CITY’S INTENT TO

APPROVE A FRANCHISE ORDINANCE, SUPERSEDING ORDINANCE
1709 (2022 SERIES), TO OPERATE AND MAINTAIN PIPELINES FOR

THE TRANSPORTATION OF OIL AND OTHER SPECIFIED MATERIALS IN THE CITY OF SAN LUIS OBISPO BY PHILLIPS 66 PIPELINE LLC AND SETTING A PUBLIC HEARING FOR NOVEMBER 17, 2026
WHEREAS, the City of San Luis Obispo adopted Ordinance No. 1391 on July 10, 2001 granting a franchise to Union Pipeline Company, a California Corporation for a term of 10 years for the transportation and distribution of oil and other specified materials in the City of San Luis Obispo; and
WHEREAS, on April 17, 2007 the City Council adopted Ordinance No. 1504 transferring the franchise agreement from Union Pipeline Company to Conoco-Phillips; and
WHEREAS, on June 21, 2011, the City of San Luis Obispo adopted Ordinance No. 1564 for a new ten-year franchise agreement to replace the existing franchise agreement approved by Ordinance No. 1391 and set to expire on July 9, 2011; and WHEREAS, on February 5, 2013 the City Council adopted Ordinance No. 1587 transferring the franchise from ConocoPhillips to Phillips 66 Pipeline LLC; and WHEREAS, the City of San Luis Obispo adopted Ordinance No. 1709 on March 15, 2022 renewing a franchise agreement with Phillips 66 Pipeline LLC for a term of three years; and
WHEREAS, on March 14, 2025, Phillips 66 Pipeline LLC applied to the City of San Luis Obispo for a new franchise agreement to replace the franchise agreement which was set to expire on April 14, 2025; and
WHEREAS, Phillips 66 Pipeline LLC continues to operate pipelines for the transportation of oil and other specified materials within the City of San Luis Obispo’s right-of-way; and
Purpose: To maintain and operate pipelines for the transportation of oil and hydrocarbons within the City of San Luis Obispo.

Type: Non-exclusive
Term: 5-years

Resolution No. _____ (2026 Series) Page 2
R ______
Fees: One-time granting fee of $30,000 and annual franchise fee to the City in accordance with Public Utilities Code Section 6231.5, adjusted per the Consumer Price Index, per lineal foot based on pipeline diameter Bond: One-million dollars faithful performance bond.

Insurance: Ten million dollars liability insurance, five million dollars automobile liability insurance, and ten million dollars pollution liability insurance (each amount is per occurrence)
Indemnity: Phillips 66 Pipeline LLC to indemnify the City of any and all damages to personas or property arising out of operations under the franchise.

Includes indemnity for joint acts with the City. Survives expiration or termination of the franchise agreement and abandonment of the pipelines until all pipelines are removed from City property.

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

SECTION 1. Pursuant to Section 1002 of the City Charter of the City of San Luis Obispo, the City Council hereby declares its intention to consent to the granting of a franchise to maintain and operate pipelines for the transportation of oil and other specified materials within the City of San Luis Obispo to Phillips 66 Pipeline LLC.

SECTION 2: A public hearing will be held on November 17, 2026 at 5:30pm at 990 Palm Street in the City Council Chambers for the purpose of hearing and considering any objections to the granting of the above-described franchise. The City Council will, on that date, vote on the introduction of an Ordinance renewing such franchise agreement.

SECTION 3: The City Clerk is directed to publish a notice of the hearing described in Section 2 at least once within fifteen (15) days after the passage of this Resolution in a newspaper of general circulation within the City.

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

Resolution No. _____ (2026 Series) Page 3
R ______
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

City of San Luis Obispo
Public Works & Utilities Department
919 Palm Street
San Luis Obispo, CA 93401
[Date]
[VIA EMAIL AND U.S. MAIL]
Phillips 66 Company
420 S. Keeler Ave.

Bartlesville, OK 74003
Re: Letter Agreement – City of San Luis Obispo Acceptance of Abandonment in Place of Pipeline Facilities and Continuing Obligations under Franchise This letter agreement (the “Agreement”) confirms the City of San Luis Obispo’s (the “City”) acceptance of the abandonment in place of certain pipeline facilities owned by Phillips 66 Company (“Grantee”) within City public streets, ways, alleys and places (hereinafter collectively referred to as “streets”) and memorializes Grantee’s surviving and continuing obligations under that certain franchise granted by the City to Grantee, being Ordinance No. 1588 and adopted on February 5th, 2013 (the “Franchise”), the terms of which are incorporated by reference herein.

1. Identification of Facilities; Effective Date of Abandonment: Grantee represents and warrants that as of [Effective Date of Abandonment] (the “Abandonment Effective Date”) it has permanently discontinued the use of, and has abandoned in place, the pipeline facilities described in Exhibit A (the “Abandoned Facilities”), which facilities were installed within streets under the City’s jurisdiction, pursuant to the Franchise. Grantee has delivered to the City reports detailing its work to abandon and inert the Abandoned Facilities. The parties agree that, as of the Abandonment Effective Date, the Abandoned Facilities may remain in place within City streets subject to the terms of this Agreement and the Franchise.

2. City’s Acceptance; No Waiver or Release: Subject to the terms and conditions of this Agreement and the Franchise, the City hereby accepts Grantee’s abandonment in place of the Abandoned Facilities as of the Abandonment Effective Date. This acceptance is administrative in nature, acknowledges Grantee’s discontinuation of use, and permits the Abandoned Facilities to remain in place on the conditions set forth herein. This acceptance does not constitute a waiver, release, or discharge of any obligations of Grantee arising under the Franchise, including obligations relating to bonding and insurance, indemnity, environmental compliance, or future removal. The City reserves all rights and remedies with respect to the Abandoned Facilities.

3. Grantee Representations: Grantee represents, warrants, and covenants that, prior to the Abandonment Effective Date, it has isolated, purged, and rendered inert the Abandoned Facilities in compliance with applicable laws, rules, and regulations.

4. One-Time Administrative Review Fee; No Ongoing Annual Fee: Upon execution of this Agreement, Grantee shall pay the City a one-time administrative fee in the amount of Ten Thousand Dollars ($10,000.00) (the “Review Fee”) to compensate the City for its time

reviewing Grantee’s abandonment report and related materials. The parties agree that, with respect to the Abandoned Facilities, no annual franchise fee or other recurring occupancybased charge shall accrue after the Abandonment Effective Date so long as the facilities remain abandoned in place in accordance with this Agreement and the Franchise. This provision does not waive or alter standard permit, encroachment, or inspection fees of general applicability for any future work.

5. Bonding and Insurance: For so long as the Abandoned Facilities remain in the City streets, Grantee shall maintain the performance security required by the Franchise (which may include surety bonds, letters of credit, or other security acceptable to the City) and shall maintain insurance meeting the coverage, limits, and endorsement requirements of the Franchise.

6. Indemnity; Defense; Cost Reimbursement: Grantee’s defense, indemnification, and holdharmless obligations under the Franchise survive and continue in full force and effect with respect to the Abandoned Facilities and all closure-related activities.

7. Relocation; Conflicts with City Projects: If the City determines that any portion of the Abandoned Facilities conflicts with, interferes with, or must be removed or relocated to accommodate a City or third-party public project or to protect public health or safety, the City may direct Grantee to remove or relocate the Abandoned Facilities (or portions thereof) , in accordance with the Franchise. If Grantee fails to timely act, the City may perform or cause the work to be performed and recover its costs from Grantee, including through application of performance security.

8. Future Removal: Any removal by Grantee of all or a portion of the Abandoned Facilities shall be done in accordance with the Franchise, including written application to the City.

9. Environmental Responsibilities: Grantee remains responsible for any release, contamination, or environmental condition attributable to the Abandoned Facilities or to Grantee’s activities, whether discovered before or after the Abandonment Effective Date. Grantee shall timely investigate, report, and remediate such conditions in compliance with applicable laws, rules, and regulations and shall coordinate with the City and any regulatory agencies having jurisdiction.

10. Term; Satisfaction; Endpoints: This Agreement remains in effect for so long as any Abandoned Facilities remain within City streets or until all obligations related to the Abandoned Facilities have been fully satisfied and the City has provided written confirmation of completion and, if applicable, has released performance security. The parties acknowledge that, with respect to the Abandoned Facilities, no annual franchise fee or other recurring occupancy-based charge shall accrue after the Abandonment Effective Date as provided in Section 4, and that the Review Fee constitutes the City’s agreed administrative charge for review of the abandonment report and related materials. Indemnity, environmental, and warranty/defect correction obligations survive in accordance with the Franchise.

11. No Renewal or Extension of Franchise Rights: This Agreement does not renew, extend, or confer any franchise rights to construct, operate, or maintain facilities within City streets beyond those rights, if any, otherwise in effect under the Franchise. It solely memorializes the City’s acceptance of abandonment in place and Grantee’s continuing obligations associated with the Abandoned Facilities.

12. Defaults; Remedies: A failure by Grantee to perform any obligation under this Agreement or the Franchise constitutes a default. Upon written notice and expiration of any applicable cure period, the City may exercise any rights and remedies available at law, in equity, under the Franchise, including drawing on performance security, imposing administrative penalties

where authorized, and seeking injunctive relief or specific performance. In an emergency or where delay would risk public safety or substantial harm, the City may act immediately and seek reimbursement from Grantee.

13. Notices: All notices under this Agreement shall be in writing and delivered by personal delivery, nationally recognized overnight courier, or email with confirmation of receipt, to the addresses set forth above or such other addresses as a party may designate by notice. Notices are effective upon receipt or, for email, upon confirmation of receipt if sent during normal business hours, otherwise the next business day.

14. Authority; No Assignment: Each signatory represents and warrants that they are duly authorized to execute this Agreement on behalf of their respective party. Grantee shall not assign or transfer obligations relating to the Abandoned Facilities without the City’s prior written consent except as permitted under the Franchise; any permitted assignee shall assume in writing all obligations hereunder.

15. Integration; Amendment: This Agreement, together with the Franchise, comprises the entire understanding with respect to the subject matter and may be amended only by a written instrument executed by both parties. In the event of a conflict, the more specific requirements of the Franchise govern.

16. Counterparts; Electronic Signatures: This Agreement may be executed in counterparts, each of which is deemed an original, and all of which together constitute one instrument. Signatures delivered electronically or by PDF are deemed originals.

Please confirm Grantee’s agreement to the foregoing by executing and returning a countersigned copy of this Agreement.

Sincerely,
City of San Luis Obispo
By: ______________________________ Name: ____________________________ Title:
_____________________________ Date: _____________________________ Acknowledged and Agreed:

Phillips 66 Company
By: ______________________________ Name: ____________________________ Title:
_____________________________ Date: _____________________________ Exhibit A – Description and Location of Abandoned Facilities

PHil.UPS Angie Hindman
RES - Operafions Support Analyst
420 S Keeler Ave
508-02 Phillips Building
Bartlesville OK 74003
O: 918-977-6795 C: 918-273-8097
An g ie.D.H i nd m a [email protected] m
March 14,2025

CITY OF SAN SAN LUIS OBISPO

PUBLIC WORKS
990 PALM ST
SAN LUIS OBISPO CA 93401
RE: Phillips 66 Pipeline Ordinance No. 1709 - Application Request for Extension Public Works Department:

Phillips 66 Pipeline LLC (Phillips 66) currently operates pipelines within the city limits of San Luis Obispo, CA under the subject pipeline ordinance. Phillips 66 is requesting an extension to this existing Ordinance.

The existing pipelines are listed on the attachment describing the current locations of the existing pipelines.

As in the past, Phillips 66 intends to continue with all safety measures and regulatory practices for the continued safe operations of all our pipelines within the City of San Luis Obispo.

For more information about Phillips 66 Pipeline LLC, and its pipeline safety practices, please visit www. oh i I li ps66pipel i ne. com.

We look fonr'rard to working with you on this renewal process Regards,
Angie Hindman
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ORDINANCE NO. ___________

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, GRANTING TO PHILLIPS 66 PIPELINE LLC, A FRANCHISE TO

CONSTRUCT, OPERATE, AND MAINTAIN COMMON CARRIER PIPELINES

FOR THE TRANSPORTATION OF OIL, AND OTHER SPECIFIED MATERIALS,

IN THE PUBLIC STREETS OF THE CITY OF SAN LUIS OBISPO, STATE OF

CALIFORNIA

RECITALS
WHEREAS, Phillips 66 Pipeline LLC (“Phillips 66”) is currently maintaining and/or operating pipelines for the transportation of oil and other specified materials within the City of San Luis Obispo, pursuant to a franchise agreement executed on or about March 18, 2022; and WHEREAS, Phillips 66 has requested the City of San Luis Obispo (“City”) enter into a new franchise agreement; and
WHEREAS, on [INSERT DATE], the City of San Luis Obispo passed Resolution No. [INSERT No.], a resolution of intention to approve a franchise agreement with Phillips 66 Pipeline LLC; and;
WHEREAS, the Council of the City of San Luis Obispo conducted a public hearing on [DATE], for the purpose of considering approval of the franchise agreement; and WHEREAS, notices of said public hearing were made at the time and in the manner required by law; and
WHEREAS, [no protests in writing were filed with the City Clerk by the time of the public hearing] OR [all protests filed in writing with the City Clerk were heard by the City Council and determined to be insufficient].

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

SECTION 1. The City Council of the City of San Luis Obispo hereby grants to Phillips 66 Pipeline LLC the non-exclusive right, privilege and franchise to continuation of its existing use of the public streets for its defined operational purposes on the terms and conditions and subject to the restrictions and obligations set forth herein.

SECTION 2. Summary and Terms and Conditions of Franchise:

TABLE OF CONTENTS
ARTICLE 1 NATURE OF FRANCHISE ........................................................................................3 ARTICLE 2 APPURTENANCES...................................................................................................5 ARTICLE 3 LOCATION OF PIPELINES.......................................................................................6 ARTICLE 4 CONSTRUCTION OF NEW PIPELINES ...................................................................6 ARTICLE 5 COMMENCEMENT OF CONSTRUCTION................................................................7 ARTICLE 6 MAPS AND REPORTS TO BE FURNISHED ............................................................7 ARTICLE 7 COMPENSATION TO THE CITY ..............................................................................8 ARTICLE 8 EMERGENCY EQUIPMENT AND CREWS.............................................................10 ARTICLE 9 REPAIR OF DEFECTIVE FACILITIES AND REPAIR OF DAMAGE TO CITY STREETS ...................................................................................................................11 ARTICLE 10 REARRANGEMENT OF FACILITIES....................................................................11 ARTICLE 11 GRANTEE’S REMOVAL OR ABANDONMENT OF FACILITIES............................14 ARTICLE 12 COMPLETION OF WORK.....................................................................................16 ARTICLE 13 RECOVERY OF COSTS OF REPAIRS AND UNPAID FEES ................................16 ARTICLE 14 BOND....................................................................................................................19 ARTICLE 15 INSURANCE .........................................................................................................19 ARTICLE 16 INDEMNIFICATION BY GRANTEE.......................................................................21 ARTICLE 17 CHANGES IN CONTROL OF FRANCHISE...........................................................22 ARTICLE 18 WAIVER OF BREACH ..........................................................................................25 ARTICLE 19 DEFAULT..............................................................................................................25 ARTICLE 20 SCOPE OF RESERVATION..................................................................................26 ARTICLE 21 NOTICE.................................................................................................................26 ARTICLE 22 SUCCESSORS .....................................................................................................26 ARTICLE 23 ACCEPTANCE OF FRANCHISE...........................................................................27 ARTICLE 24 FORCE MAJEURE................................................................................................27 ARTICLE 25 LIQUIDATED DAMAGES ......................................................................................27 ARTICLE 26 ATTORNEY’S FEES………………………………………………………………….29
ARTICLE 27 CONDEMNATION………………………………………………………………29
ARTICLE 28 SURVIVAL OF OBLIGATIONS……………….……………………………….30

ARTICLE 1

NATURE OF FRANCHISE
A. Grant of Franchise.

1. The City of San Luis Obispo (hereinafter referred to as “City”), hereby grants to Phillips 66 Pipeline LLC (hereinafter referred to as “Grantee”), pursuant to the provisions of Article X of the San Luis Obispo City Charter, Article XI, Section 9(b) of the California Constitution, Section 39732(b) of the California Government Code, and Chapter 2 of Division 3 of the California Public Utilities Code the non-exclusive right, privilege and franchise, subject, however, to all the limitations and restrictions herein contained, to construct, erect, maintain, operate, repair, renew, abandon, and change the size of and remove existing pipelines within the City of San Luis Obispo, not to exceed twelve (12) inches nominal internal diameter, for the transportation of oil, products thereof, hydrocarbon gases and other gas necessary for the operation and maintenance of the pipelines, water and mixtures thereof, movable by pipeline, in, under, along, and across the public streets, ways, alleys and places within the City of San Luis Obispo (hereinafter collectively referred to as “streets”), as described in Exhibit No. 1, attached hereto and made a part hereof. There shall be no expansion of existing infrastructure or operations within the City without the express prior written consent of the City Council.

2. The Term of the franchise granted under this Agreement shall be for a term of five (5) years, commencing with the date on which it is Granted by the City (the “Term.”) Should Grantee intend to pursue continuation of their franchise rights after expiration of the Term, Grantee shall submit to the City an application for a franchise in compliance with Public Utilities Code § 6231.5 et seq no later than twelve (12) months prior to expiration of the Term.

3. Unless otherwise specifically stated, the following provisions shall govern the interpretation and construction of the franchise granted herein:
(a) This franchise shall include the right, for the period and subject to the conditions hereof, to construct, erect, maintain, operate, repair, renew, abandon, and change the size and remove existing pipelines, if any, of Grantee, as laid and constructed in said streets as of the date of this Agreement.
(b) The terms and conditions of this franchise shall also apply to any existing pipe or other facilities of Grantee which are located within the right of way of any existing public road or street at the time such road or street becomes a City Street through annexation or otherwise, subject to any other superior rights enjoyed by Grantee. (c) Grantee shall not be relieved of its obligation to promptly comply with any provision of this franchise by failure of the City to enforce prompt compliance. (d) Any right or power conferred, or duty imposed upon any officer, employee, department, or other City entity, by the terms of this franchise, may be legally transferred to any other City officer, employee, department, or other City entity. (e) Grantee shall have no recourse whatsoever against the City for any loss, cost, expense, or damage suffered by Grantee and arising out of any provision or requirement of this franchise or its lawful enforcement by the City.

(f) This franchise does not relieve Grantee of any applicable requirements of the San Luis Obispo Municipal Code or of any applicable federal, state, or City law, ordinance, rule, regulation, or specification, including, but not limited to, any requirement relating to street work, street excavation permits, or the use, removal or relocation of property in streets, or the payment of applicable permit fees, except as specifically prescribed herein. (g) This franchise is non-exclusive. Neither the granting of this franchise nor any of the provisions contained herein shall be construed to prevent the City from granting any identical or similar franchise to any other person.
(h) The compensation provided for in this franchise is for (i) the rights and privileges granted by this franchise; and (ii) the right and privilege granted to the Grantee to construct, erect, maintain, operate, repair, renew, abandon and change the size of and remove existing pipelines pursuant to this franchise within the City’s streets. The City expressly reserves the right to impose and collect from Grantee, on a non-discriminatory basis, its normal duly established processing and inspection fees from street cutting and excavation permits to the extent such fees are imposed generally on all non-governmental applicants for such permits within the City. (i) Any activities involving the use of a pipeline system for the transmitting of oil, products thereof, hydrocarbon gases and other gas necessary for the operation and maintenance of the pipelines, water and mixtures thereof, which are not specifically authorized under this franchise are prohibited under this franchise. Except as provided in Article 2, any telecommunication or other uses not authorized in this franchise must be approved by the City under a separate franchise.
(j) If any provision of this franchise, or the application of this franchise to any person or circumstance is held invalid by a court of competent jurisdiction or is not in compliance with any requirement of the California Public Utilities Commission, the City, or any other federal or state body or agency having jurisdiction over Grantee’s franchise activities, the remainder of this franchise, or the application of this franchise to persons or circumstances other than those to which it is held invalid or not in such compliance, shall not be affected thereby.

B. Limitations Upon Grant.

1. No privilege or exemption is granted or conferred by this franchise, except those specifically prescribed herein.

2. Any privilege claimed under this franchise by Grantee in any street shall be subordinate to any prior lawful occupancy of the street, including the City’s express right to demand relocation of any pipelines or appurtenances as may be necessary for the City to undertake its municipal functions and otherwise utilize its right of way for any valid municipal purpose.

3. The rights and privileges of this franchise are granted solely to Grantee, except as provided within this franchise. This franchise is not to be sold, transferred, leased, assigned, or disposed of as a whole or in part, either by forced sale, merger, consolidation, or otherwise, without the City’s prior consent as described in Article 17, infra, which consent may be granted or withheld in City’s reasonable discretion, or as otherwise expressly provided herein C. Rights Reserved to the City.