Agenda packet, regular meeting, second session — San Mateo City Council, December 9, 2024 (part 1 of 2)

CITY OF SAN MATEO
City Council Regular Meeting
December 9, 2024
7:00 PM
City Hall Council Chamber
Entrance is on O’Farrell Street

COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine
AGENDA
THIS MEETING CAN BE ATTENDED IN PERSON OR REMOTE BY JOINING ZOOM – SEE CODES BELOW.

PUBLIC COMMENTS WILL BE ACCEPTED BOTH IN PERSON AND REMOTELY.

SEE END OF AGENDA FOR OPTIONS AND INSTRUCTIONS ON HOW TO PARTICIPATE IN THE MEETING.

To join via Zoom – click here: December 9, 2024
To join via telephone: (408) 638-0968
Webinar ID: 895 4243 6454 Passcode: 044666
The City Council meeting will conclude by 11:00 p.m. unless otherwise extended by council vote.

Any unheard items will automatically move forward to the next regular meeting.

Items amended on December 9, 2024, changes are highlighted in yellow.

CALL TO ORDER
Pledge of Allegiance
Roll Call
AB 2449 Requests and Considerations for Meeting Participation by Teleconference due to Just Cause or Emergency Circumstances

CONSENT CALENDAR
All matters listed under the Consent Calendar are considered by the Council to be routine and will be enacted by one motion without discussion. If discussion is desired, that item may be removed and considered separately.

1. City Council Meeting Minutes - Approval
Approve the special and regular minutes of the City Council meetings of October 21 and November 4, and the special minutes of the City Council meeting of October 29.

CEQA: This minutes approval is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

2. Senior Advisory Commission - Ordinance Adoption
Adopt an Ordinance to amend San Mateo Municipal Code Chapter 2.29 "Senior Citizens Commission" to change its name to "Senior Advisory Commission" and make other miscellaneous revisions.

3. Legislative Management Software — Agreement
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Adopt a Resolution to approve an alternative purchasing procedure and approve an agreement with Granicus, LLC for legislative management software solutions for $144,839.06; authorize a contingency reserve of $14,483.91, for a total amount not-to-exceed $159,322.97 over three years; and authorize the City Clerk to execute the agreement in substantially the form presented.

CEQA: This agreement is not a project subject to CEQA because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b) (5).)

4. General Municipal Election November 5, 2024 - Certification of Results Adopt a Resolution to declare the results of the General Municipal Election held on November 5, 2024, as presented in the Certificate and Statement of Results of Vote Cast for the City of San Mateo.

CEQA: This resolution of adoption is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

5. San Mateo County Gun Relinquishment Task Force — Amendment Approve an Amendment to the agreement with the County of San Mateo to maintain the assignment of one Police Officer to the Gun Relinquishment Task Force by extending the term for two years through November 20, 2026 and increasing the amount reimbursable to the City by $600,000 for a new total amount of $1,300,000; and ratify the execution of the agreement.

CEQA: This action is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

6. California Department of Justice Tobacco Grant– Grant Acceptance, Appropriation, and Backfill Officer Assignment
Adopt a Resolution to accept grant funds in the amount of $651,800 from the State of California Department of Justice, Tobacco Grant Program; appropriate $102,600 of the grant funds to the Police Departments 2024-25 Budget; authorize the Chief of Police to execute the Memorandum of Understanding with the California Department of Justice and all other necessary grant documents; authorize the addition of 1.00 Full-Time Equivalent Police Officer position for the three-year duration of the grant period; and amend the adopted fiscal year 2024-25 budget.

7. San Mateo Building Decarbonization Strategy — Agreement Amendment Adopt a Resolution appropriating $10,000 in funding and approve Amendment No. 1 to the agreement with Rincon Consultants, Inc. for a term extension and to increase compensation by an amount of $10,000 for a new agreement total of $125,600; and authorize the City Manager to execute the amendment.

CEQA: This administrative activity is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

8. Peninsula Clean Energy (PCE) Member Agency Grant — Agreement Adopt a Resolution to accept grant funds in the amount of $1,406,718 from Peninsula Clean Energy (PCE) for the implementation of clean energy projects and to appropriate the grant funds to the applicable capital improvement program projects and various operating funds; approve the PCE Member Agency Grant Agreement; 2 of 563
and authorize the City Manager to execute all required documentation to receive the funds.

CEQA: Adoption of a resolution to accept grant funds, approval of a grant agreement, and the appropriation of grant funds to partially fund the EV Charging Infrastructure, Marina Library Electrification, and High Voltage Streetlight Conversion projects are exempt from CEQA as “existing facilities.”

9. Peninsula Clean Energy Solar and Storage on Public Buildings Program - Updated Power Purchase Agreement Approve an agreement with Peninsula Clean Energy (PCE) for a Power Purchase Agreement (PPA) to procure, install, operate, and maintain a solar photovoltaic system at the Beresford Park parking lot; and authorize the City Manager to execute the agreement in substantially the form presented and to execute any amendments necessary to implement the solar photovoltaic system.

CEQA: The installation of solar carports on an existing parking lot is categorically exempt from CEQA as an “existing facility,” because it consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. (CEQA Guidelines Section 15301.)

10. Metropolitan Transportation Commission Housing Incentive Pool Grants – Resolutions Adopt a resolution to file an application with the Metropolitan Transportation Commission for Housing Incentive Pool Grants and adopt a resolution to comply with State Housing Laws.

CEQA: The adoption of both resolutions is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) As stated in the resolution authorizing the filing of an application with MTC, the projects identified for funding remain subject to environmental clearance, which will occur at the time of formal project approval.

11. Serra Yellow Cab, Inc. Agreement — Amendment No. 2
Approve a Resolution for the appropriation of Amendment No. 2 to the agreement with Serra Yellow Cab, Inc. in the amount of $150,000, resulting in a new contract total of $300,000 for the Senior Get Around Transportation Program for Fiscal Year (FY) 24-25; and authorize the Director of Parks and Recreation to execute the amendment in substantially the form presented.

CEQA: This amendment is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b) (5).)

12. Edgewater Isle Master Association, Inc. Recreational Vehicle Storage Real Property Lease Agreement Extension – Amendment No. 4
Approve Amendment No. 4 to the agreement for Lease of Real Property for recreational vehicle storage with Edgewater Isle Master Association, Inc. to extend the agreement an additional ten years, from January 1, 2025, to December 31, 2034, update to the rental rate to account for annual adjustments for CPI, update contact information, and add a required temporary vacation provision for the property to accommodate the City’s needed use of the property for City projects; and authorize the City Manager to execute Amendment No. 4 in substantially the form presented.

CEQA: This action is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

13. Axon Master Services and Purchasing Agreement — Approval 3 of 563
Approve a Master Services and Purchasing agreement with Axon Enterprise, Inc., for hardware, software and services for the Police Department for a five year term with an automatic renewal clause for an additional five year term in the cumulative amount of $7,350,052.13; authorize the Chief of Police to execute the agreement in substantially the form presented; approve a contingency reserve of $100,000 and authorize the Chief of Police to issue change orders within that reserve of up to $50,000 cumulatively; authorize the City Manager to issue change orders within that reserve in excess of $50,000 but not to exceed $100,000 cumulatively; and adopt a resolution to authorize the use of an alternative purchasing procedure in accordance with Municipal Code Section 3.60.070(h)(3).

CEQA: This action is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment (Public Resources Code Section 21065.)

14. Fashion Island Boulevard/19th Avenue Class IV Bike Way Complete Streets - Appropriation and Memorandum of Understanding
Adopt a Resolution to appropriate $200,000 from the City’s Measure A funds to the US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) Project in the Capital Projects Fund; approve a Memorandum of Understanding (MOU) with San Mateo County Transportation Authority (SMCTA) for the Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project (Project) memorializing SMCTA as the implementation agency with a total contribution of $1,586,364, and the City as the Sponsor with contributing funds in the amount of $438,636 and delivering the environmental and design phase of the Project; and authorize the City Manager to execute the MOU in substantially the form presented.

CEQA: The appropriation of funds to the Project and approval of the MOU is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) In addition, the Project will be reviewed for environmental clearance, which will occur during the PE/environmental and design phase.

15. Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program – Grant Acceptance
Adopt a Resolution accepting grant funding in the amount of $155,720 from the Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program for the installation of electric vehicle charging infrastructure for City fleet and appropriating $155,720 to the Green Fleet Charging Infrastructure Project; approve the EECBG Program Special Terms and Conditions; and authorize the City Manager to execute required documentation to receive the grant funds.

CEQA: Adoption of a Resolution to accept grant funds and to authorize the appropriation of grant funds, and approval of special terms and conditions to receive the grant funds, is not a project subject to CEQA, because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

16. 2000 S. Delaware Street Affordable Housing Project – Loan Documents, Regulatory Agreement, Ground Lease and Supplemental Appropriation
Adopt a Resolution appropriating $500,000 from the General Fund Housing Set-Aside to provide a loan to MP 2000 Delaware, LLC in the amount of $500,000 for the 2000 S. Delaware Street affordable housing project; approve an Amended and Restated Ground Lease and Regulatory Agreement restricting the units at 2000 South Delaware to households at specified income levels, and approve a Loan Agreement, a Deed of Trust, and a Promissory Note; and authorize the City Manager to execute all documents and make any appropriate changes that do not differ from the Term Sheet.
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CEQA: This action is not a project subject to CEQA, because it can be seen with certainty that approval of loan documents, a regulatory agreement, a ground lease and a supplemental appropriation related to an existing residential building will not cause a physical change in the environment. (Public Resources Code Section 21065.)

17. Afterschool Enrichment Services for School Year 2024-2025 — Agreement Amendment No. 1 To approve Amendment No. 1 to the agreement with San Mateo Union High School District for afterschool enrichment services for Empowerment Through Action (ETA) Program in an amount of $17,000 for a new total not to exceed amount of $48,000 and authorize Parks and Recreation Director to execute the agreement in substantially the form presented.

CEQA: This agreement amendment is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

18. Third Avenue and South Norfolk Street Intersection Modification Project – Appropriation, Budget Transfers, and Agreement. THIS ITEM HAS BEEN REMOVED FROM THE AGENDA FOR FUTURE CONSIDERATION Adopt a resolution authorizing an appropriation of $200,000 from the City’s Measure A funds, and budget transfers of $65,000 from the Traffic Signal Video Detection Replacement Project and $35,000 from the Bike San Mateo Program Project to the Community Development Block Grant Projects project budget in the Capital Project Fund; approve an agreement with Liffey Electric, Inc. for construction of the 3rd Avenue and South Norfolk Street Intersection Modification Project in the amount of $1,298,745; establish a contingency reserve in the amount of $200,000; and authorize the Public Works Director to execute the agreement in substantially the form presented and issue change orders as allowed by the contract documents and within the contingency amount.

CEQA: This Project is categorically exempt from CEQA as an “existing facility,” because it consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. (CEQA Guidelines Section 15301.)

19. Wireless Communication Facilities in the Public Right of Way Update — Ordinance Adoption Adopt an Ordinance to amend San Mateo Municipal Code (SMMC) Chapter 17.10 "Wireless Communications Facilities in the Public Right-Of-Way".

CEQA: This Ordinance adoption is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) In addition, small cell facilities are categorically exempt from CEQA as they ether are (1) minor alterations of existing facilities, (2) replacements of existing structures where the new structure will be located in the same site and have substantially the same purpose, or (3) construction and location of new small facilities or structures. (CEQA Guidelines Section 15301, 15302, 15303.

20. New Beginnings Supportive Housing Project at 831 Monte Diablo Avenue — Agreement Authorize the City Manager to execute a Regulatory Agreement, Loan Agreement, Deed of Trust, and Promissory Note with Saint James Community Development Corporation for the New Beginnings Supportive Housing Project and to make any appropriate changes that do not differ from the terms previously approved by the City Council.

CEQA: This agreement is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.) 5 of 563

21. Police, Human Resources and Parks and Recreation Departments Classification Updates and Police Officers Association and Management Association Letters of Understanding - Approval Adopt a Resolution to approve: 1) reallocation of two vacant Dispatcher positions to two Senior Dispatcher positions in the Police Department, 2) job specification updates for the classification of Senior Dispatcher, 3) Letters of Understanding to provide a training premium for Dispatchers assigned as Lead Trainers, to acknowledge Dispatch Supervisors’ status change from exempt to non-exempt, and to increase the compensation for the Police Technical Services Administrator’s for covering a dispatch shift, 4) job specification and salary range for the new flexibly-staffed classification Human Resources Information Systems Analyst I-II, 5) elimination of 1.00 vacant Lead Teacher position in Parks and Recreation to increase two .75 Lead Teacher positions to two 1.00 FTE positions, 6) reallocation of a vacant Administrative Assistant to Administrative Technician, and 7) reallocation of a Senior Accounting Assistant to an Administrative Technician in the Parks and Recreation Department.

CEQA: These classification updates are not subject to CEQA, because they will not cause a physical change in the environment. (CEQA Guidelines Section 15378(b)(4).)

22. Central Park Phase 1 Playground Improvements Project - Agreement Amendment No. 2 Approve Amendment No. 2 to the agreement with RRM Design Group (RRM) for additional scope of services for the Central Park Phase 1 Playground Improvements Project in the amount of $24,140, bringing the total agreement amount to $644,379; authorize a contingency fund in the amount of $10,000 for a contract total of $654,379; and authorize the Director of Parks and Recreation to execute the amendment in substantially the form presented and issue subsequent amendments to the agreement within the contingency.

CEQA: This Agreement amendment is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

23. Receipt and Use of Development Impact Fees, In-Lieu Fees, and Wastewater Capacity Charges – Annual Report Adopt a Resolution to make findings and accept the annual report on receipt and use of development impact fees, in-lieu fees, and wastewater capacity charges for the year ended June 30, 2024.

CEQA: This report is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

24. San Mateo Police Sergeants’ Association - Memorandum of Understanding Changes Adopt a Resolution to amend the Memorandum of Understanding with the San Mateo Police Sergeants’ Association for a term through January 3, 2027
CEQA: This amended Tentative Agreement amendment is not a project subject to CEQA, because it is a government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

25. King and Joinville Pools — Budget Appropriation
Adopt a Resolution to authorize a supplemental budget appropriation in the amount of $900,000 from the unassigned fund balance from the General Fund to the Capital Project Fund to address immediate- and long-term improvements and upgrades at the Joinville and Martin Luther King Jr. pool facilities.

CEQA: This action is not a project subject to CEQA, because it is a government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)
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PUBLIC COMMENT
Members of the public wishing to comment on any item not appearing on the agenda may address the City Council at this time. State law prevents Council from taking action on any matter not on the agenda; your comments may be referred to staff for follow up.

Public comment is limited to a total of 15 minutes; however, an opportunity for additional public comment may be provided later in the agenda.

Any written public comment received by 12P.M. on Monday, December 9 2024 will be added to packet. Any written public comment received after this time will be added after the meeting.

CEREMONIAL

26. Commendatory Resolution - Recognizing Lisa Diaz Nash for her term as Mayor

27. Recognition of Outgoing Council Members
A) Adopt Commendatory Resolution for Council Member Amourence Lee for her five years of service as a Council Member and as Mayor in 2023.

B) Adopt Commendatory Resolution for Council Member Rich Hedges for his two years of service as a Council Member.

28. Oath of Office for Newly Elected Council Members
Administer the oath of office to each newly elected Council Member:

A) Nicole Fernandez
B) Danielle Cwirko – Godycki

29. City Council Reorganization
Nominations and selection of the Mayor and Deputy followed by the drawing of lots to establish the rotation from the newly elected for the future and then installation of officers.

REPORTS AND ANNOUNCEMENTS
City Manager, City Attorney and Council Members report on their various assignments and liaison roles and Council requests for scheduling future items.

ADJOURNMENT
----------------------------------------------------------------------------------------------------------------------------- AGENDAS: Agendas and material are posted on the City’s website on the Friday preceding each Council Meeting and can be viewed on the City's website at www.cityofsanmateo.org . Any supplemental material distributed to the Council after the posting of the agenda will be made part of the official record.

WATCHING A MEETING ON TV: City Council meetings are broadcast live on Comcast/channel 27, Wave/channel 26, or AT&T/channel 99.

For transmission problems during the broadcast, please call (650) 522-7099. For all other broadcast comments, call (650) 522-7040, Monday-Friday, 8 a.m. - 5 p.m.

WATCHING A MEETING ON A COMPUTER: There are three ways to stream. 1) Public Meeting Portal www.cityofsanmateo.org/publicmeetings 2) City YouTube channel and stream it on YouTube: http://youtube.com/CityofSanMateo 3) Watch TV live stream: https://www.cityofsanmateo.org/193/Channel-San-Mateo-Live-Stream

PUBLIC COMMENTS/REQUEST TO SPEAK
Prior to the Meeting
Send comments to: [email protected] until 4 p.m. the day of the meeting. 7 of 563
During the meeting
By Zoom: Click the link at the top of the agenda and you’ll be added to the meeting. All attendees are muted by default. When the item of interest is open for consideration, select the “Raise Your Hand” icon and you will be called on at the appropriate time.

By telephone: Call (408) 638-0968 and enter the conference ID found at the top of the meeting agenda. When the item of interest is open for consideration, select *9 to raise your hand. When called upon, press *6 to unmute, state your name and provide your comments.

In Person: At the meeting complete a “Request to Speak” form, submit a request at the speaker kiosk or scan the QR code.

ACCESSIBILITY: In compliance with the Americans with Disabilities Act, those with disabilities requiring special accommodations to participate in this meeting may contact the City Clerk’s Office at (650) 522-7040 or [email protected] . Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. 8 of 563

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 1 Section Name: CONSENT CALENDAR Account Number: 10-1511 File ID: 24-9391 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Clerk's Office
MEETING DATE: December 09, 2024
SUBJECT:

City Council Meeting Minutes – Approval
RECOMMENDATION:

Approve the special and regular minutes of the City Council meetings of October 21 and November 4, and the special minutes of the City Council meeting of October 29.

BUDGET IMPACT:

There is no budgetary impact associated with this minutes approval.

ENVIRONMENTAL DETERMINATION:

This minutes approval is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Minutes 2024-10-21 Special
Att 2 – Minutes 2024-10-21 Regular
Att 3 – Minutes 2024-11-04 Special
Att 4 – Minutes 2024-11-04 Regular
Att 5 – Minutes 2024-10-29 Special

STAFF CONTACT
Martin McTaggart, City Clerk
[email protected]
(650) 522-7044
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City Council Special Meeting Minutes – 10/21/2024 Page 1

COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine

CITY OF SAN MATEO
Special Meeting Minutes
City Council
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
October 21, 2024
City Hall Council Chambers 6:00 PM
Special Meeting
CALL TO ORDER at 6:00 p.m.

Roll Call

Present: Mayor Diaz Nash, Deputy Mayor Newsom, Council Members: Hedges, Lee, and Loraine AB 2449 Requests and Considerations for Meeting Participation by Teleconference due to Just Cause or Emergency Circumstances – there were no requests.

CLOSED SESSION
Following the opportunity for public comment, there were no speakers, the City Council convened into Closed Session at 6:01 p.m. to consider:

1. Conference with Legal Counsel – Existing Litigation
(Paragraph (1) of subdivision (d) of Government Code Section 54956.9) Name of Case: VW Credit Leasing Ltd. v. City of San Mateo and Red Line Towing, U.S. Dist. Court Case No.: 3:23-CV02884 DMR

2. Conference with Legal Counsel – Existing Litigation
(Paragraph (1) of subdivision (d) of Government Code Section 54956.9) Name of Case: Housing Action Coalition v. City of San Mateo, San Mateo Superior Court Case No.:24-CIV-03126 ADJOURNMENT –The meeting adjourned at 6:35 p.m.

APPROVED BY: SUBMITTED BY:

Lisa Diaz Nash, Mayor Martin McTaggart, City Clerk
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City Council Regular Meeting Minutes – 10/21/2024 Page 1

COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine

CITY OF SAN MATEO
Regular Meeting Minutes
City Council Meeting
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
October 21, 2024
City Hall Council Chambers 7:00 PM
Regular Meeting
CALL TO ORDER at 7:00 p.m.

Pledge of Allegiance
Roll Call

CEREMONIAL

1. Code Enforcement Officer Appreciation Week – Proclamation - Zach Dahl, Community Development Director, received the proclamation

2. Domestic Violence Awareness Month – Proclamation - Melissa Gibbs, Senior Manager of Legal Services, CORA, received the proclamation

CONSENT CALENDAR
The following items, 3 through 19, were considered to be routine by the City Council. After the titles of the items were read by the City Clerk, the public was invited to comment and there were two speakers: Michael Tejada and Andy Landles spoke in support of Item #18. Motion passed 5-0.

Moved: Hedges, Seconded: Newsom
Ayes: Diaz Nash, Newsom, Hedges, Lee, and Loraine
Noes: None

3. City Council Meeting Minutes – Approval
Approve the special and regular minutes of the City Council meetings of August 19, September 3, September 16, and October 7.

4. Legal Advertising Services – Bid Rejection
Reject all proposals received for the City's Legal Advertising Services.

5. Park and Recreation Commission Youth Commissioner – Reappointment Reappoint Thomas Jacob Jelniker as a Youth Commissioner to the Park and Recreation Commission for one additional one-year term, expiring November 6, 2025.
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City Council Regular Meeting Minutes – 10/21/2024 Page 2

6. Solid Waste Rate Setting Consultant - Agreement
Approve an agreement with HF&H Consultants, LLC for solid waste rate setting consultant services through March 31, 2028, in an amount not to exceed $217,646, with up to three optional one-year extensions in the amount of $64,018 each, and each subject to an annual inflationary adjustment capped at 5% based on the change in the CPIU (San Francisco) published by the Bureau of Labor Statistics, for a total potential agreement amount not to exceed $409,700 plus CPI-U increases; and authorize the Director of Public Works to execute the agreement in substantially the form presented and issue amendments for no-cost time extensions.

7. Citywide Facilities Condition Assessments – Amendment Approve Amendment No. 1 to the agreement with ELS Architecture & Urban Design for professional services to perform Citywide Facilities Condition Assessments Tasks 2, 3, and 4 in the amount of $556,433.75, for a new agreement total of $607,500; and authorize the Public Works Director to execute the amendment in substantially the form presented.

8. Office of Traffic Safety - Appropriation and Grant Spending Plan Adopt a Resolution to approve a grant spending plan and appropriate funds for the Office of Traffic Safety Selective Traffic Enforcement Program grant totaling $200,000 and authorize the Chief of Police to accept and execute the agreement in substantially the form presented and expend the funds.

Enactment: Resolution No. 93 (2024)

9. Community Wellness and Crisis Response Team Mental Health Partnership Services – Agreement Approve an agreement with the County of San Mateo for the provision of the Community Wellness and Crisis Response Team Program in FY24/25 in the estimated amount of $79,100; approve a change order in the amount of $35,267.46 to cover the final costs for CWCRT services rendered in FY23/24; authorize the Chief of Police to issue change orders of up to $50,000 cumulatively and the City Manager to issue change orders in excess of $50,000 but not to exceed $100,000 cumulatively; and authorize the Chief of Police to execute the agreement in substantially the form presented.

10. Congregate Nutrition Program — Interagency Agreement Approve an interagency agreement with the County of San Mateo for Fiscal Year 2024-2025 to partially fund a congregate nutrition program through the Older Americans Act up to $47,686; and authorize the Director of Parks and Recreation to execute the agreement.

11. Lifeline Grant Cycle 7 — Interagency Memorandum of Understanding Adopt a Resolution to approve an interagency Memorandum of Understanding (MOU) between the San Mateo County Transit District ("DISTRICT") and the City of San Mateo ("RECIPIENT") for the funding of the Get Around! Senior Transportation Program and authorize the acceptance of $314,000 in grant funds to support the program for Fiscal Year 2024-2025; and authorize the Director of Parks and Recreation to execute the MOU.

Enactment: Resolution No. 94 (2024)

12. Wastewater Treatment Plant On-Call Consulting Services – Amendment Approve Amendment No. 1 to the professional consultant services agreement with Carollo Engineers, Inc. for Wastewater Treatment Plant On-Call Consulting Services, increasing the agreement by $450,000 for a new total agreement amount of $850,000 and authorize the Public Works Director to execute the amendment in substantially the form presented and to amend the agreement within the budget amount. 12 of 563
City Council Regular Meeting Minutes – 10/21/2024 Page 3

13. Parks and Recreation Department Field Mowers - Purchase Contract Adopt a Resolution to approve an alternative purchasing procedure and approve a purchase contract with Turf Star, Inc., for the purchase of one (1) Toro Z Master Revolution 5-foot Wide Mower and one (1) Toro Groundsmaster 4700D 12-foot Wide Area Mower in a total amount not to exceed $182,782.62; establish a contingency reserve in the amount of $30,000.00; and authorize the Public Works Director to execute the purchase contract in substantially the form presented and issue change orders within the contingency amount.

Enactment: Resolution No. 95 (2024)

14. Personal Computer Replacements — Purchase
Adopt a Resolution to approve an alternative purchasing procedure and approve a Master Purchasing Agreement with Lenovo Inc. for the purchase of 93 personal computers in an amount not-to-exceed $120,342.82; establish a contingency reserve in the amount of $18,051.42, for a total amount of $138,394.24; and authorize the Director of Information Technology to execute the agreement in substantially the form presented.

Enactment: Resolution No. 96 (2024)

15. Clean Water Program — Program Management Amendment
Approve Amendment No. 10 to the agreement with CH2M Hill Engineers, Inc. to authorize scope and funding for program management services for the Clean Water Program; authorize payment in an amount not to exceed $7,945,378; establish a contingency amount of $2,520,000; and authorize the Public Works Director to execute this amendment in substantially the form presented and execute task amendments within the contingency amount.

16. Unmanned Aerial Systems Program – Amendment
Approve Amendment No. 3 to the master services and purchasing agreement with Axon Enterprise, Inc., to provide additional equipment and software for the unmanned aerial systems program for a five-year term in the amount of $83,348.90, for a new cumulative agreement total of $1,759,352.53; authorize the Chief of Police to issue change orders of up to $50,000 cumulatively, and the City Manager to issue change orders in excess of $50,000 but not to exceed $100,000 cumulatively; and authorize the Chief of Police to execute the agreement in substantially the form presented.

17. Payment of Capital Costs of Clean Water Program Projects – Interim Agreement Adopt a Resolution to approve an Interim Agreement with the Crystal Springs County Sanitation District and the County of San Mateo for the Payment of Capital Costs of Clean Water Program Projects that establishes 30-year amortized payment schedules for the District and County in the amount of $206,568.49 and $17,591.53 per quarter, respectively and authorize the City Manager to execute the Interim Agreement in substantially the form presented and amend the payment schedule, as specified.

Enactment: Resolution No. 97 (2024)

18. Child Care Facilities Fund Loan for Improvements at 847-849 N. San Mateo Drive – Agreement Adopt a Resolution to approve a Child Care Facilities Fund loan of $1,143,800 to Mi Second Casa Spanish Immersion Preschools, Inc. for tenant improvements at 847-849 N. San Mateo Dr. to establish a new childcare facility and authorize the City Manager to execute the loan agreement, promissory note, short form deed of trust and agreement containing covenants affecting real property and all related documents in such a manner that does not substantially change the loan terms.

Enactment: Resolution No. 98 (2024)
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City Council Regular Meeting Minutes – 10/21/2024 Page 4

19. Peninsula Clean Energy Solar and Storage on Public Buildings Program — Power Purchase Agreement Approve an agreement with Peninsula Clean Energy (PCE) for a Power Purchase Agreement (PPA) to procure, install, operate, and maintain a solar photovoltaic system at the Beresford Park parking lot; and authorize the City Manager to execute the agreement in substantially the form presented and to execute any amendments necessary to implement the solar photovoltaic system.

PUBLIC COMMENT
In Person: Shawn Fahrenbruch Raised concerns about the potential impact of historical registries on home insurance policies; Chris Cavoli, volunteer with United Sovereign Americans USA, Bob Cohen, Patty Willet, and Lisa Smith are concerned with voting accuracy and urged Council to consider a resolution created by them in support of fair and honest and valid elections. Maria, Deborah Rosenfeld, and Dasha S Voiced concerns about excessive train horn noise, emphasizing its impact on quality of life and requesting continued Council support for noise reduction measures.

Alex Khojikian, City Manager, stated that earlier today he and Public Works staff met with the Executive Director of Caltrain and were informed there is a fix which will be implemented at the end of this month.

NEW BUSINESS

20. Climate Action Plan – Annual Progress Report
Andrea Chow, Sustainability Analyst, gave the annual progress report on the implementation of the City's Climate Action Plan.

Public Comment – there were no speakers.

Council asked questions, made comments, and approved of the progress.

REPORTS AND ANNOUNCEMENTS
City Manager, City Attorney and Council Members reported on their various assignments and liaison roles and noted past and future events. Council Member Lee requested additional staff research be conducted on insurance companies insure homes within historic districts, a majority of Council approved this direction.

ADJOURNMENT –The meeting adjourned at 8:55 p.m.

APPROVED BY: SUBMITTED BY:

Lisa Diaz Nash, Mayor Martin McTaggart, City Clerk
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City Council Special Meeting Minutes – 11/4/2024 Page 1

COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine

CITY OF SAN MATEO
Special Meeting Minutes
City Council
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
November 4, 2024
City Hall Council Chambers 5:30 PM
Special Meeting
CALL TO ORDER at 5:30 p.m.

Roll Call

CLOSED SESSION
Following the opportunity for public comment, there were no speakers, the City Council convened into Closed Session at 5:35 p.m. to consider:

1. Conference With Legal Counsel – Existing Litigation
(Paragraph (1) of subdivision (d) of Government Code Section 54956.9) Name of Case: City of San Mateo v. Grigorian, San Mateo Superior Court Case No.: CIV 475201 Council reconvened at 5:54 p.m.

STUDY SESSION

2. Economic Development Plan Framework — Review
Jennifer Chen, Economic Development Manager, gave the presentation and reviewed the proposed framework for the Economic Development Work Plan.

Public Comment – Erica Wood, CEO of the San Mateo Area Chamber of Commerce, expressed support for the plan and emphasized the importance of inclusivity and strategic communication in the framework.

Questions and Comments from Council.

Ed Barberini, Police Department, and Zach Dahl, Community Development Director, answered Council questions.

The Council provided consensus approval to move forward with the proposed framework. Staff to conduct stakeholder outreach and provide a draft work plan in Spring 2025. Incorporate Council suggestions, including antidisplacement measures, cultural initiatives, and strategies for underutilized spaces.

ADJOURNMENT –The meeting adjourned at 6:52 p.m.
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City Council Special Meeting Minutes – 11/4/2024 Page 2 APPROVED BY: SUBMITTED BY:

Lisa Diaz Nash, Mayor Martin McTaggart, City Clerk
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COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine

CITY OF SAN MATEO
Regular Meeting Minutes
City Council Meeting
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
November 4, 2024
City Hall Council Chambers 7:00 PM
Regular Meeting
CALL TO ORDER at 7:00 p.m.

Pledge of Allegiance led by San Mateo Police Department’s Explorer Program Roll Call

CEREMONIAL

1. Police Explorer Program – Proclamation - Ed Barberini, Chief of Police, received the proclamation

2. Lights On! Safer San Mateo Streets – Presentation – Police Sergeant Greg Colum, gave the presentation

CONSENT CALENDAR
The following items, 3 through 6, were considered to be routine by the City Council. After the titles of the items were read by the City Clerk, the public was invited to comment and there were no speakers. Motion passed 5-0.

Moved: Hedges, Seconded: Newsom
Ayes: Diaz Nash, Newsom, Hedges, Lee, and Loraine
Noes: None

3. Marina Library Structural Improvements Project – Grant Agreement Approve a Grant Agreement to receive grant funds in the amount of $1,500,000 from the Department of Housing and Urban Development Community Project Funding Grant Program for the Marina Library Structural Improvements Project; and authorize the City Manager to execute the Grant Agreement in substantially the form presented and all other required documentation to receive the grant funds.

4. Public Works Facilities Construction Manager — Amendment Approve Amendment No. 1 to the professional services agreement with Nickitas 7280 Inc. in the amount of $490,500, for a revised total agreement amount of $540,000; revise the term of the agreement to a duration of three years; and authorize the Public Works Director to execute the amendment in substantially the form presented.
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5. Wastewater Treatment Plant Outfall Cleaning and Repair Services — Agreement Adopt a resolution approving an alternative purchasing procedure to approve an agreement with Power Engineering Construction in an amount not to exceed $132,100 for the repair and cleaning of the Wastewater Treatment Plant's outfall; establish a $30,000 contingency reserve; and authorize the Public Works Director to execute the agreement in substantially the form presented and execute amendments within the contingency reserve.

Enactment: Resolution No. 99 (2024)

6. Community Member Participation in Sojourn to the Past Training – Payment Authorization Adopt a Resolution to authorize the payment of City funds to Sojourn to the Past for the purpose of funding the participation of two community members in the Sojourn to the Past training, in an amount not to exceed $6,000.

Enactment: Resolution No. 100 (2024)

PUBLIC COMMENT
(16 speakers)
In-Person: Martin Elliott, Linda San Felipe, David Deasy, Tom Lease, Dr. Vikash, Maria Mavridis, Irena Mavridis, Bernard Brand, Mara Kamasu, Ginine Fuitas, Robert Kiss, Kelly Ryerson, and Michael Ragan thanked the City Council for progress on the wireless ordinance while expressing urgent concerns about Crown Castle's tactics to bypass new regulations, calling for immediate adoption of the ordinance, enforcement of stricter standards, and potential interim measures like a moratorium to protect residents and maintain community safety.

Andrew Ryan and Frank Elliott opposed the proposed Baywood Historic District, citing increased insurance costs, a lack of homeowner consent, and concerns over the process being undemocratic.

Remote: Daria spoke about the train noise problem.

NEW BUSINESS

7. Gardening Waste – Ordinance Introduction
Prasanna Rasiah, City Attorney, gave the presentation.

Public Comment –
Maria Godfrey, Rich Kranz, Susan Manheimer; Rick Sakuda, Regina all spoke in supported the proposed ordinance prohibiting garden waste disposal into streets and drains, emphasizing its critical role in protecting stormwater infrastructure, preventing flooding, and ensuring compliance with federal environmental regulations. They highlighted the ordinance's alignment with city investments in flood prevention and called for its swift implementation, effective enforcement, and public education.

Council asked questions and made comments.

Motion to Introduce an Ordinance prohibiting gardening waste from being deposited into the public right of way.

Motion passed 5-0.

Moved: Hedges, Seconded: Newsom
Ayes: Diaz Nash, Newsom, Hedges, Lee, and Loraine
Noes: None
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8. City Council Priority List – Progress Report
Christina Horrisberger, Assistant City Manager, gave the presentation and progress report on the City Council Priority List for fiscal year 2024-25.

Public Comment – Trina Pierce sought clarification on whether North Central is included in the flood zone removal efforts referenced for North Shore View, expressing concern over inconsistent references to the two areas.

Council asked questions and made comments and Matt Fabry, Public Works Director, answered questions from Council. Council highlighted the importance of citywide collaboration in projects such as stormwater management, emphasizing the need for continued efforts to align infrastructure improvements with community needs.

REPORTS AND ANNOUNCEMENTS
City Manager, City Attorney and Council Members reported on their various assignments and liaison roles, noted past and future events, and commented on the upcoming election. Councilmember Hedges requested the Council to consider implementing an interim moratorium on the use of city infrastructure by cell tower providers, specifically to prevent Crown Castle from submitting new applications before the new ordinance is adopted. Staff clarified that Crown Castle is currently under a stop-work notice and is unlikely to submit new applications until after the new ordinance's implementation. Council decided not to take additional interim action but to await discussion on the proposed ordinance at the November 18 meeting. Councilmember Lee proposed drafting a resolution requesting San Mateo Heritage Alliance to withdraw their application for the Baywood Historic District, citing new evidence that a majority of impacted property owners oppose the designation. The majority of the Council did not support drafting the resolution at this time, citing prior discussions and the ongoing historic ordinance process, which will be revisited in January.

ADJOURNMENT –The meeting adjourned at 9:53 p.m.

APPROVED BY: SUBMITTED BY:

Lisa Diaz Nash, Mayor Martin McTaggart, City Clerk
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City Council Special Meeting Minutes – 10/29/2024 Page 1

COUNCIL MEMBERS
Lisa Diaz Nash, Mayor
Rob Newsom Jr., Deputy Mayor
Rich Hedges
Amourence Lee
Adam Loraine

CITY OF SAN MATEO
Special Meeting Minutes
City Council
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
October 29, 2024
City Hall Conference Room C 7:00 PM
Special Meeting
CALL TO ORDER at 7:00 p.m.

Roll Call

Present: Mayor Diaz Nash, Deputy Mayor Newsom, Council Members: Hedges, Lee, and Loraine

CLOSED SESSION
Following the opportunity for public comment, there were no speakers, the City Council convened into Closed Session at 7:01 p.m. to consider:

1. Public Employee Performance Evaluations – City Manager

2. Public Employee Performance Evaluations – City Attorney ADJOURNMENT –The meeting adjourned at 9:50 p.m.

APPROVED BY: SUBMITTED BY:

Lisa Diaz Nash, Mayor Martin McTaggart, City Clerk
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 2 Section Name: CONSENT CALENDAR Account Number: 10-6143 File ID: 24-9378 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Clerk's Office
MEETING DATE: December 09, 2024
SUBJECT:

Senior Advisory Commission - Ordinance Adoption
RECOMMENDATION:

Adopt an Ordinance to amend San Mateo Municipal Code Chapter 2.29 “Senior Citizens Commission” to change its name to “Senior Advisory Commission” and make other miscellaneous revisions.

BACKGROUND:

On November 18, 2024, the City Council introduced an Ordinance to amend San Mateo Municipal Code Chapter 2.29 “Senior Citizens Commission” to change its name to “Senior Advisory Commission” and make other miscellaneous revisions. The proposed Ordinance is attached. If adopted, the Ordinance will become effective 30 days after its adoption.

BUDGET IMPACT:

There is no budget impact associated with this administrative action.

ENVIRONMENTAL DETERMINATION:

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Ordinance
Att 2 – Proposed Ordinance – Tracked Changes

STAFF CONTACT
Chantal Eaton, Deputy City Clerk
[email protected]
(650) 522-7044
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PROPOSED ORDINANCE
An Ordinance Amending San Mateo Municipal Code Chapter 2.29 WHEREAS, on September 16, 2024, the City Council directed staff to update San Mateo Municipal Code Chapter 2.29 to change the name of the Senior Citizens Commission to the Senior Advisory Commission; and WHEREAS, the commission was formed in 1986, and the code has not been amended since it was adopted; and
WHEREAS, under section 2.29.010, Organization, reference to the previous Senior Advisory Council has been removed, as it does not exist anymore; and
WHEREAS, Section 2.29.020, Meetings, has been updated to reflect the meeting schedule which is the second Monday of every other month at 4 PM; and
WHEREAS, in section 2.29.030, Powers-Duties, reference to the implementation of the Adopted Master Plan for Senior Services is deleted, as implementation of this plan has been completed.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF SAN MATEO ORDAINS AS FOLLOWS:

Section 1. Section 2.29.010 of the San Mateo Municipal Code is amended as follows:

2.29.010 Organization.

The senior advisory commission of the City shall consist of no more than five members appointed by the Council. Members shall be persons who display an interest in and appreciation of senior affairs.

Each member of the senior advisory commission shall serve at the pleasure of the Council and for a term of four years or until the appointment of a successor, except that the initial terms of the first members appointed shall be determined by lot at their first meeting so that each year at least one term will expire.

Thereafter, all appointments shall be for a term of four years.

Section 2. Section 2.29.020 of the San Mateo Municipal Code is amended as follows:

2.29.020 Meetings.

Regular meetings will take place on the second Monday of every other month at 4 PM.

Section 3. Section 2.29.030 of the San Mateo Municipal Code is amended as follows:

2.29.030 Powers – Duties.

It shall be the objective of the senior advisory commission, as an advisory body to the Council, to encourage, foster, and facilitate programs for the enhancement of all matters relating to the social, economic, and personal well-being of the senior population.
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The Commission shall recommend to the Council the establishment and funding of programs and services for seniors within the City and review and make recommendations to the Council regarding any senior center operated by the City.

The Commission shall possess other such powers and duties as may be prescribed from time to time by resolution of the City Council.

Section 4. Environmental Determination. In accordance with California Environmental Quality Act (CEQA) Guidelines, section 15378(b)(5), this action is an administrative activity that will not result in direct or indirect physical changes in the environment.

Section 5. Severability. In the event any section, clause or provision of this ordinance shall be determined invalid or unconstitutional, such section, clause or provision shall be deemed severable and all other sections or portions hereof shall remain in full force and effect.

Section 6. Publication. This ordinance shall be published in summary in a newspaper of general circulation, posted in the City Clerk's Office, and posted on the City's website, all in accord with Section 2.15 of the City Charter.

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2.29.010 ORGANIZATION.

The senior citizens advisory commission of the City shall consist of no more than five members appointed by the Council. The President of the Senior Advisory Council, or designee, shall be an ex-officio member of the Senior Citizens Commission without the right to vote.

Members shall be persons who display an interest in and appreciation of senior affairs.

Each member of the senior citizens advisory commission shall serve at the pleasure of the Council and for a term of four years or until the appointment of a successor, except that the initial terms of the first members appointed shall be determined by lot at their first meeting so that each year at least one term will expire. Thereafter, all appointments shall be for a term of four years.

2.29.020 MEETINGS.

The commission shall meet within one month of its formation and establish itself by electing a chairperson and vice chairperson to serve at the pleasure of the board. The board may adopt reasonable rules and regulations for the conduct of its business. A regular time and place of meetings shall be established and adhered to in the manner of holding public meetings for legislative bodies in the state.Regular meetings will take place on the second Monday of every other month at 4 PM.

2.29.030 POWERS—DUTIES.

It shall be the objective of the senior citizens advisory commission, as an advisory body to the Council, to encourage, foster, and facilitate programs for the enhancement of all matters relating to the social, economic, and personal well beingwell-being of the senior population.

The Commission shall recommend to the Council the establishment and funding of programs and services for seniors citizens within the City and review and make recommendations to the Council regarding any senior citizen center operated by the City.

Further, the Commission shall periodically review the efforts being made towards implementing the recommendations set forth in the Adopted Master Plan for Senior Services and shall be charged with keeping said plan current.

The Commission shall possess other such powers and duties as may be prescribed from time to time by resolution of the City Council.
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 3 Section Name: CONSENT CALENDAR Account Number: 10-1511 File ID: 24-9291 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Clerk's Office
MEETING DATE: December 09, 2024
SUBJECT:

Legislative Management Software — Agreement
RECOMMENDATION:

Adopt a Resolution to approve an alternative purchasing procedure and approve an agreement with Granicus, LLC for legislative management software solutions for $144,839.06; authorize a contingency reserve of $14,483.91, for a total amount not-to-exceed $159,322.97 over three years; and authorize the City Clerk to execute the agreement in substantially the form presented.

BACKGROUND:

In 2018 the City Clerk’s Office conducted an informal evaluation of multiple legislative management solutions. Prime Government Solutions was selected having met the Clerk’s Office’s essential criteria for providing agenda management, video streaming integration, public access, and boards and commission administration. The City entered into an agreement with Prime Government Solutions on December 28, 2018. It has served as the city’s legislative management system for City Council, Boards, Commissions, and Committees since this date. The parent company of Prime Government Solutions (Rock Solid) was acquired by Granicus, LLC in late 2022. During the acquisition, the vendor continued to provide continuous service as established in the 2018 agreement. The City’s current service period with this vendor is set to expire on December 27, 2024 and subsequent renewals for this software product must now be under the acquiring company, Granicus, LLC. The term of the proposed contract is three years.

San Mateo Municipal Code section 3.60.050(b) authorizes the renewal of an agreement with Granicus, LLC without a competitive bidding procedure when calling for bids would be impracticable, unavailing, or impossible. Council is requested to approve an alternative purchasing procedure for this agreement due to the multiple years this service has been in use and to avoid service disruption that would occur from a change in vendors. Reassessing and evaluating alternative solutions and providers at this time would adversely impact current operations and efficient production of legislative content. San Mateo was one of the first agencies in California to move to Prime Government Solutions, and multiple other cities, such as San Carlos, Foster City, and Palo Alto, have since moved to this solution.

BUDGET IMPACT:

There are sufficient funds within the current Information and Technology Department operating budget to cover the costs associated with this agreement. In addition, staff will include the costs of the agreement in future budgets.

ENVIRONMENTAL DETERMINATION:

This agreement is not a project subject to CEQA because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
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CITY OF SAN MATEO
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Agreement

STAFF CONTACT
Erin Fellers, Management Analyst I
[email protected]
(650) 522-7066
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RESOLUTION NO. ____ (2024)

APPROVING AN ALTERNATIVE PURCHASING PROCEDURE FOR THE MASTER

TECHNOLOGY-RELATED SOFTWARE AS A SERVICE AGREEMENT WITH GRANICUS, LLC FOR LEGISLATIVE MANAGEMENT SOFTWARE FOR 144,839.06
WHEREAS, Prime Gov is the City’s legislative management software solution for agenda management, video streaming, and boards and commissions administration; and WHEREAS, Granicus, LLC acquired Prime Government Solutions (Rock Solid) in 2022; and WHEREAS, after the acquisition, the City continued service under the original terms with Prime Gov but must enter into a new agreement with Granicus, LLC as the current service period expires on December 27, 2024; and
WHEREAS, Municipal Code Sections 3.60.050(b) provides that exceptions to the City Council award procedures are possible if the Council makes a finding concurrent with the award that calling for bids for that particular agreement is impracticable, unavailing, or impossible;

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This agreement is not a project subject to CEQA, because it is a government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

2. Pursuant to Municipal Code Section 3.60.050(b), calling for bids would be impracticable, unavailing, or impossible because:
a. Prime Government Solutions (now Granicus, LLC) has already rendered services for fiscal year 2023-24.
b. The initial award of agreement with Prime Government Solutions was approved by the City Council in 2018.
c. A review of vendors and implementation of an alternative solution provider would disrupt current City operations.
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 4 Section Name: CONSENT CALENDAR Account Number: 10-1511 File ID: 24-9311 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Clerk's Office
MEETING DATE: December 09, 2024
SUBJECT:

General Municipal Election November 5, 2024 - Certification of Results RECOMMENDATION:

Adopt a Resolution to declare the results of the General Municipal Election held on November 5, 2024, as presented in the Certificate and Statement of Results of Vote Cast for the City of San Mateo.

BACKGROUND:

The City of San Mateo held its first candidate by-district election for Districts 2 and 4 on November 5, 2024; and for submitting to the Voters Measure T to approve the General Plan Land Use Element.

The number of ballots cast for a candidate in each district were District 2 – 5,703 and District 4 - 5,302. At the general municipal election held in the City of San Mateo on November 5, 2024, the following persons were elected to the following offices:

Nicole Fernandez and Danielle Cwirko-Godycki were elected as members of the City Council for terms commencing Monday, December 9, 2024. Nicole Fernandez will serve as the representative for District 2, while Danielle Cwirko-Godycki will represent District 4. Both terms will continue until the general municipal election in the fourth year thereafter and the election and qualification of their respective successors.

The number of ballots cast citywide for the ballot measure were 42,554 with 25,271 voting yes and 17,283 voting no. The ordinance approving Measure T was therefore adopted by the voters on November 5, 2024 and will go into effect ten days after certification of election results, i.e., on December 19, 2024.

BUDGET IMPACT:

There is no budgetary impact associated with this administrative action of certifying the election results.

ENVIRONMENTAL DETERMINATION:

This resolution of adoption is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Exhibit A – Statement of the Vote
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CITY OF SAN MATEO

STAFF CONTACT
Martin McTaggart, City Clerk
[email protected]
(650) 522-7044
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 5 Section Name: CONSENT CALENDAR Account Number: 10-5131 File ID: 24-9205 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Police Department
MEETING DATE: December 9, 2024
SUBJECT:

San Mateo County Gun Relinquishment Task Force — Amendment RECOMMENDATION:

Approve an Amendment to the agreement with the County of San Mateo to maintain the assignment of one Police Officer to the Gun Relinquishment Task Force by extending the term for two years through November 20, 2026 and increasing the amount reimbursable to the City by $600,000 for a new total amount of $1,300,000; and ratify the execution of the agreement.

BACKGROUND:

The City of San Mateo has assigned a Police Officer to the Countywide Gun Relinquishment Task Force (GRTF) since 2022.

The GRTF operates out of the San Mateo County District Attorney’s Office to coordinate and share resources among law enforcement agencies to enforce unlawful firearm possession laws, promote safety, and reduce gun violence. The term of the current agreement concluded November 20, 2024, and all parties wish to continue the assignment of a Police Officer to the GRTF, so that the City and County can continue to work collaboratively on these efforts. The Chief of Police has executed the amendment to extend the term and ensure continuity. The Council action requested is to ratify and formally approve the execution of the amendment, making it officially valid.

The Amendment to the Agreement will extend the term through November 20, 2026, and correspondingly increase the total amount authorized to be paid in reimbursement by $600,000, for a new total amount of $1,300,000. The City will receive full reimbursement of all costs of the Police Officer assigned to the GRTF.

BUDGET IMPACT:

The County will provide full reimbursement to cover the salary, benefits, and task force related overtime for the Officer assigned. The anticipated reimbursement revenue has already been planned for in the FY24/25 budget.

ENVIRONMENTAL DETERMINATION:

This action is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Agreement
Att 2 – Amendment
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STAFF CONTACT
Ed Barberini, Chief of Police
[email protected]
(650) 522-7600
Tricia Toomey, Business Manager
[email protected]
(650) 522-7623
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CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 6 Section Name: CONSENT CALENDAR Account Number: 10-5112 File ID: 24-9270 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Police Department
MEETING DATE: December 09, 2024
SUBJECT:

California Department of Justice Tobacco Grant– Grant Acceptance, Appropriation, and Backfill Officer Assignment RECOMMENDATION:

Adopt a Resolution to accept grant funds in the amount of $651,800 from the State of California Department of Justice, Tobacco Grant Program; appropriate $102,600 of the grant funds to the Police Departments 2024-25 Budget; authorize the Chief of Police to execute the Memorandum of Understanding with the California Department of Justice and all other necessary grant documents; authorize the addition of 1.00 Full-Time Equivalent Police Officer position for the three-year duration of the grant period; and amend the adopted fiscal year 2024-25 budget.

BACKGROUND:

The San Mateo Police Department has been awarded a grant from the California Department of Justice (DOJ) for the Proposition 56 Tobacco Grant Program. The intent of this grant is to fund a Police Officer position focused on reducing and preventing the illegal sale of tobacco products through retail inspections, education and enforcement. The total grant award is $651,800 to be expended over the course of three years.

The application process was highly competitive, and prioritized funding for local retailer enforcement, including enforcement of flavored tobacco bans. In October 2020, the City Council adopted an Ordinance to add language to the municipal code to prevent the sale of e-cigarettes and flavored tobacco within the City of San Mateo. The grant will provide the salary and benefits for 1.00 Full Time Equivalent Police Officer who will coordinate and carry out activities to address and reduce illegal, underage tobacco/vape sales by ensuring compliance with City Ordinances. Through engagement and outreach efforts, the officer will build relationships with business leaders and tobacco retailers, offering ongoing training on ordinances and laws to retailers, staff, and other SMPD officers. A significant community education component will be implemented to raise awareness and emphasize the importance of compliance, with information shared via social media platforms, news outlets, radio, and TV.

The assignment of an officer to perform the tasks funded by the grant will create a vacancy in the complement of police officers assigned to the Field Operations Patrol Division. Authorization for an additional 1.00 FTE Police Officer position is requested for the three-year grant period to ensure there is no loss of service to the community. The addition of this position will have a net-zero budget impact as the cost will be offset by grant reimbursement.

The Police Department plans to staff the position this winter, with a proposed expenditure timeline commencing in February 2025 and concluding in January 2028. Therefore, the requested action includes authorizing the addition of 1.00 FTE Police Officer position and amending the adopted 2024-2025 budget in the amount of $102,600. This reflects grant costs that will be incurred during the remainder of the current fiscal year, including $96,715 for the additional officer position, $1,000 in operating expenses for training and educational materials, and $4,885 for administrative costs related to staff time associated with administering the grant.
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The resolution and MOU (Attachments 1 and 2) must be approved by the City Council within 90 days of the notification of the grant award on October 24, 2024. The Police Department looks forward to the opportunity to enhance the depth of services we provide to our community by performing the work funded by the grant.

BUDGET IMPACT:

The requested action includes the appropriation of $102,600 to the Police Department’s authorized 2024-25 budget, which will be fully offset by grant revenue, resulting in no net financial impact.

ENVIRONMENTAL DETERMINATION:

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Grant Memorandum of Understanding

STAFF CONTACT
Ed Barberini, Chief of Police
[email protected]
(650) 522-7600
Matt Lethin, Captain
[email protected]
(650) 522-7663
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)
AUTHORIZING ACCEPTANCE OF GRANT FUNDS IN THE AMOUNT OF $651,800

FROM THE STATE OF CALIFORNIA DEPARTMENT OF JUSTICE, OFFICE OF THE ATTORNEY GENERAL, TOBACCO GRANT PROGRAM; AUTHORIZING THE ADDITION OF 1.00 FULL TIME EQUIVALENT (FTE) POLICE OFFICER; AND AMENDING THE FISCAL YEAR 2024-25 BUDGET
WHEREAS, the City of San Mateo (City) desires to participate in the Tobacco Grant Program made available through the California Healthcare Research and Prevention Tobacco Tax Act of 2016 (Prop. 56) and administered by the California Department of Justice (DOJ) to support local efforts to reduce the illegal sale of tobacco products to underage youth in the City; and
WHEREAS, the DOJ offered to award the City $651,800 for a three-year grant program beginning November 1, 2024 and ending June 30, 2028; and
WHEREAS, grant funds will be used to provide salary and benefits for a Police Officer focused on antivaping/tobacco enforcement, education and outreach; overtime costs related to tobacco enforcement and outreach; operating expenses for training and marketing materials; and administrative costs for staff time associated with administering the grant; and
WHEREAS, in order to be considered eligible to receive grant funding, the City must submit a completed Grant Award Memorandum of Understanding to the DOJ; and WHEREAS, the assignment of an Officer to perform grant activities creates a vacancy in the complement of officers in the Patrol Division; and
WHEREAS, staff recommends authorization of an additional 1.00 FTE Police Officer position for the three-year grant period to ensure no loss of service to the community, with no net financial impact as costs will be off-set by grant reimbursement revenues; and
WHEREAS, Section 5.13(a) of the City Charter requires Council approval by resolution for amendments to the City’s budget.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This action is not a project subject to CEQA, because it is an organization or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

2. Grant funding in the amount of $651,800 from the DOJ is accepted, and appropriation of these funds into the Police Grants Fund (Fund 200) is authorized.

3. The Chief of Police or his designee is authorized, on behalf of the City, to execute and submit the grant award MOU and any additional documents including, without limitation, contracts, 76 of 563
amendments, extensions, modifications, and payment requests as appropriate to accept the funds and comply with the conditions of the grant.

4. Grant funds received hereunder shall not be used to supplant ongoing law enforcement operations.

5. The addition of 1.00 FTE Police Officer Position is authorized for the term of the grant.

6. A budget appropriation for Fiscal year 2024-25 is approved in the amount of $102,600 to the Police Grants Fund (Fund 200).
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 7 Section Name: CONSENT CALENDAR Account Number: 10-1311 File ID: 24-9284 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Manager's Office
MEETING DATE: December 09, 2024
SUBJECT:

San Mateo Building Decarbonization Strategy — Agreement Amendment RECOMMENDATION:

Adopt a Resolution appropriating $10,000 in funding and approve Amendment No. 1 to the agreement with Rincon Consultants, Inc. for a term extension and to increase compensation by an amount of $10,000 for a new agreement total of $125,600; and authorize the City Manager to execute the amendment.

BACKGROUND:

Building energy use represents 38 percent of communitywide greenhouse gas emissions in San Mateo and in January 2022, the City Council prioritized the decarbonization of existing buildings to help meet the City’s climate goals. The decarbonization or electrification of buildings refers to the transition from gas equipment to electric equipment for space and water heating, clothes drying, cooking and more. Electrifying existing buildings is key to further reducing communitywide greenhouse gas emissions and technical analysis and community engagement is needed to develop and inform a roadmap to clean energy buildings in San Mateo.

On March 20, 2023, the City Council approved an agreement with Rincon Consultants, Inc. for the development of a building decarbonization strategy. This effort will result in San Mateo’s Sustainable Building Strategy that centers equity and promotes a collaborative pathway to electrification. The project was scoped for an 18-month effort with the agreement set to expire on December 31, 2024. In 2023, the project team completed a building inventory analysis, market segmentation study, and decarbonization policy analysis but the project was put on hold February through July 2024 due to City staffing vacancies. The project team still needs to complete community engagement and develop the final Sustainable Building Strategy for City Council approval.

Staff worked with Rincon Consulting, Inc. to revise the project schedule and budget. In early 2025, the project team will work on community outreach and engagement prior to the completion of the draft Sustainable Building Strategy. The project team anticipates presenting to the Sustainability and Infrastructure Commission twice for review and once to the City Council for Sustainable Building Strategy approval, tentatively aiming for August 2025. Currently, the project budget has $44,000 remaining, but additional funding in an amount of $10,000 is necessary to complete the robust community engagement, final plan development, public meetings, and additional project management through 2025. Funding was identified within the available fund balance of the Advance Planning Fund to complete this work. Based on the information provided above, staff recommends that the City Council approve the agreement amendment for a term extension through December 31, 2025 and increase the compensation by $10,000 for a new agreement total of $125,600; adopt a Resolution appropriating $10,000 from the Advance Planning Fund to the Sustainability program budget within the City Manager’s Office; and authorize the City Manager to execute the agreement amendment.

BUDGET IMPACT:
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CITY OF SAN MATEO
This agreement amendment impacts the Advanced Planning Fund. At the March 20, 2023, City Council meeting, the City Council approved a budget appropriation of $115,600 from available fund balance in the Advanced Planning Fund for this effort. This agreement amendment would appropriate an additional $10,000 of available fund balance in the Advanced Planning Fund to the Sustainability program budget within the City Manager’s Office to complete the work for a new agreement total of $125,600.

ENVIRONMENTAL DETERMINATION:

This administrative activity is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Agreement Amendment No. 1

STAFF CONTACT
Andrea Chow, Sustainability Analyst
[email protected]
(650) 522-7007
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)
APPROPRIATING $10,000 FROM THE ADVANCE PLANNING FUND TO THE SUSTAINABILITY PROGRAM BUDGET FOR THE COMPLETION OF THE SUSTAINABLE BUILDING STRATEGY WITH RINCON CONSULTANTS, INC.

WHEREAS, on March 20, 2023, the City Council approved an agreement with Rincon Consultants, Inc. for the development the Sustainable Building Strategy; and
WHEREAS, the agreement was scoped for an 18-month effort and will expire on December 31, 2024; and
WHEREAS, the project team completed a building inventory analysis, market segmentation study, and decarbonization policy analysis; and
WHEREAS, the project was put on hold February through July 2024 due to City staffing; and WHEREAS, the project team still needs to complete community engagement and develop the final Sustainable Building Strategy for City Council approval; and WHEREAS, City staff worked with the project team to revise the project schedule and budget; and WHEREAS, additional funding in the amount of $10,000 is necessary to complete the robust community engagement, final plan development, public meetings, and additional project management through 2025; and WHEREAS, the City of San Mateo wishes to appropriate $10,000 from the Advance Planning Fund to the Sustainability program budget within the City Manager’s Office to complete this work.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This City Council action adopting a resolution to appropriate funds is not a project subject to CEQA review because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment. (CEQA Guidelines Section 157378(b)(4).)

2. An appropriation of $10,000 from the Advanced Planning Fund to the Sustainability program budget within the City Manager’s Office is approved.

3. The City Manager, or designee, is authorized to execute an agreement amendment to extend the term and increase the compensation of the agreement by $10,000 for a new agreement total of $125,600.
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Contract Amendment Page 1 of 2
CAO Approved June 2024
AMENDMENT NO. 1 TO THE AGREEMENT
BETWEEN THE CITY OF SAN MATEO AND RINCON CONSULTANTS, INC. FOR PROFESSIONAL

CONSULTANT SERVICES FOR THE DEVELOPMENT OF A BUILDING DECARBONIZATION STRATEGY FOR

SAN MATEO
($115,600; $10,000)
This Amendment is made and entered into this day of December 9, 2024, by and between the CITY OF SAN MATEO, a municipal corporation existing under the laws of the State of California ("CITY"), and RINCON CONSULTANTS, INC. ("CONSULTANT").

WHEREAS, City and Consultant wish to amend the Agreement effective March 23, 2023 to extend the term and to increase compensation of this Agreement.

NOW, THEREFORE, the Parties agree as follows:

1. Section 4 of the Agreement is amended to read:

The services to be performed under this Agreement shall commence on March 27, 2023 and be completed December 31, 2025.

2. Section 5 of the Agreement is amended to read:

Payment shall be made by CITY only for services rendered and upon submission of a payment request upon completion and CITY approval of the work performed. In consideration for the full performance of the services set forth in Exhibit A, CITY agrees to pay CONSULTANT a fee in an amount up to $125,600, pursuant to rates stated in Exhibit B to this Agreement, attached and incorporated by reference.

3. The remaining terms of the Agreement remain in full force and effect. [SIGNATURE PAGE FOLLOWS]
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Contract Amendment Page 2 of 2
CAO Approved June 2024
IN WITNESS WHEREOF, CITY OF SAN MATEO and CONSULTANT have executed this Amendment on ___________________.

CITY OF SAN MATEO CONSULTANT
Alex Khojikian
City Manager
Date John Dreher
Its Authorized Agent
President and CEO
If a Corporation, can be either 1)
President or 2) Vice President plus
an additional corporate officer
(i.e., Secretary, Treasurer) who
shall sign below.

Date

APPROVED AS TO FORM ADDITIONAL CORPORATE

OFFICER
(if necessary per the above)
Mazarin Vakharia
Assistant City Attorney
Date
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 8 Section Name: CONSENT CALENDAR Account Number: 10-1311 File ID: 24-9260 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Manager's Office
MEETING DATE: December 9, 2024
SUBJECT:

Peninsula Clean Energy (PCE) Member Agency Grant — Agreement RECOMMENDATION:

Adopt a Resolution to accept grant funds in the amount of $1,406,718 from Peninsula Clean Energy (PCE) for the implementation of clean energy projects and to appropriate the grant funds to the applicable capital improvement program projects and various operating funds; approve the PCE Member Agency Grant Agreement; and authorize the City Manager to execute all required documentation to receive the funds.

BACKGROUND:

Peninsula Clean Energy (PCE) is a joint powers authority developed in 2016 to reduce greenhouse gas emissions by providing electricity from clean energy sources. The PCE Board of Directors authorized a one-time allocation of $11.5 million in surplus funds for member agencies to implement local energy projects through the PCE Member Agency Grant Program. This is a noncompetitive funding source for which the City of San Mateo is eligible for $1,406,718. Eligible projects must align with PCE’s goal of carbon neutrality through the advancement of electrification of transportation and buildings.

Through multidepartment collaboration, staff identified a number of different projects for this funding source. Staff then narrowed it down to five projects that meet the constraints of the grant program and align with the City’s Climate Action Plan and City Council’s priorities. The following table summarizes the five projects, and their estimated budget allocation included in the City’s PCE Member Agency Grant application:

Project Name Estimated Budget

1. EV Charging Infrastructure for City Fleet $500,000

2. Electrifying Marina Library $395,000

3. High Voltage Streetlight Conversion $332,718

4. Electric Landscaping Equipment for City Operations $135,000

5. Pilot Electric Motorcycles for Police Department $44,000 Total $1,406,718
The PCE Member Agency Grant will fully fund the City’s transition to electric landscaping equipment in City parks and the purchase of two electric motorcycles for the Police Department which are estimated to cost $135,000 and $44,000, respectively. These budget appropriations are anticipated to be adjusted at the midcycle budget review after the purchase of the various equipment and verification of final equipment costs. The PCE Member Agency Grant will provide partial funding to three Capital Improvement Program (CIP) projects including the electric vehicle charging infrastructure for City 87 of 563

CITY OF SAN MATEO
fleet, the Marina Library Structural Improvement Project, and the high voltage streetlight conversion in the amount of $1,227,718. These projects are also partially funded by other grants, rebates, and funding sources.

On November 21, 2024, the PCE Board of Directors approved the City of San Mateo’s Member Agency Grant Agreement including the five proposed projects. Staff recommends City Council adopt a resolution to accept the grant funding in the amount of $1,406,718 and appropriate grant funds to applicable CIP projects and various operating funds; approve the PCE Member Agency Grant Agreement with PCE; and authorize the City Manager to execute all required documentation to receive the funds. The timeline for each of the five projects varies. Funding must be expended within two years. The City will receive 50 percent of the funding ($703,359) upon execution of the agreement, allowing staff to move forward with project work immediately.

BUDGET IMPACT:

Acceptance of the PCE Member Agency Grant does not require local match. PCE Member Agency Grant funding will be appropriated to Capital Improvement Program projects including $500,000 to the Green Fleet Charging Infrastructure Project 46C003, $395,000 to the Marina Library Structural Improvement Project 665100, and $332,718 to the High Voltage Streetlight Conversion Project 460040. The remaining grant funds will be appropriated to various operating funds in the amounts of $10,000 to Fund 190, $40,000 to Fund 810, $85,000 to Fund 100 and $44,000 to Fund 200 to support the purchase of electric landscaping equipment for City operations and the purchase of electric motorcycles for the Police Department.

ENVIRONMENTAL DETERMINATION:

Adoption of a resolution to accept grant funds, approval of a grant agreement, and the appropriation of grant funds to partially fund the EV Charging Infrastructure, Marina Library Electrification, and High Voltage Streetlight Conversion projects are exempt from CEQA as “existing facilities.” These projects consist of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. This is because each of these projects are intended to only include minor installations and upgrades of existing City owned structures without any changes in their use. (CEQA Guidelines Section 15301.) In addition, the appropriation of these grant funds to fund electric landscape equipment and electric police department motorcycles are exempt from CEQA review under the “common sense” exemption, in that it can be seen with certainty that there is no possibility that these activities in question may have a significant effect on the environment. (CEQA Guidelines Section 15061(b)(3).)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – PCE Member Agency Grant Agreement

STAFF CONTACT
Andrea Chow, Sustainability Analyst
[email protected]
(650) 522-7007
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)

ACCEPTING GRANT FUNDING FROM PENINSULA CLEAN ENERGY (PCE) THROUGH THE PCE MEMBER AGENCY GRANT PROGRAM IN THE AMOUNT OF $1,408,718 FOR THE IMPLEMENTATION OF CLEAN ENERGY PROJECTS

AND APPROPRIATING THE GRANT FUNDS TO THE APPLICABLE CAPITIAL IMPROVEMENT PROJECTS AND

VARIOUS OPERATING FUNDS
WHEREAS, Peninsula Clean Energy (PCE) is a joint powers authority developed in 2016 to reduce greenhouse gas emissions by providing electricity from clean sources; and WHEREAS, the PCE Board of Directors authorized a one-time allocation of $11.5 million in surplus funds for member agencies to implement local energy projects through the PCE Member Agency Grant Program for which the City of San Mateo is eligible for $1,408,718; and WHEREAS, eligible projects must align with PCE’s mission for carbon neutrality through the electrification of buildings and transportation; and
WHEREAS, the City proposed the implementation of five clean energy projects that align with the City’s Climate Action Plan and grant program requirements; and WHEREAS, the proposed projects include electric vehicle charging for City fleet, electrification improvements at the Marina Library, high voltage streetlight conversion, electric landscaping equipment for City operations, and pilot electric motorcycles for the Police Department; and WHEREAS, on November 21, 2024, the PCE Board of Directors approved the City of San Mateo’s Member Agency Grant Agreement with PCE including the five proposed projects; and WHEREAS, an agreement is needed to be executed with PCE before such funds can be reimbursed through the PCE Member Agency Grant Program; and
WHEREAS, the City of San Mateo approves acceptance of the PCE Member Agency Grant in the amount of $1,406,718; and
WHEREAS, the City of San Mateo wishes to approve the appropriation of these grant funds to applicable capital improvement program projects in the amounts of $500,000 to the Green Fleet Charging Infrastructure Project 46C003; $395,000 to the Marina Library Structural Improvement Project 665100; and $332,718 to the High Voltage Streetlight Conversion Project 460040; and WHEREAS, the City of San Mateo wishes to approve the appropriation of these grant funds to various operating funds in the amounts of $10,000 to Fund 190, $40,000 to Fund 810, $85,000 to Fund 100 and $44,000 to Fund 200 to support the purchase of the electric landscaping equipment for City operations and the purchase of electric motorcycles for the Police Department.
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NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This City Council action of adopting a resolution to accept grant funds and appropriate the grant funds, is not a project subject to CEQA review because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment. (CEQA Guidelines Section 157378(b)(4).)

2. The acceptance of the PCE Member Agency Grant and an agreement with PCE for grant funding in the amount of $1,408,718.

3. City Council hereby authorizes and directs the City Manager to execute all required documentation to receive the grant funds, including but not limited to, the PCE Member Agency Grant Agreement, amendments to the PCE Member Agency Grant Agreement, and all required grant forms.

4. The City Manager, or designee, is authorized to execute a funding agreement with PCE and to take other actions necessary to give effect to this resolution.

5. An appropriation of $500,000 to the Green Fleet Charging Infrastructure Project 46C003; $395,000 to the Marina Library Structural Improvement Project 665100; and $332,718 to the High Voltage Streetlight Conversion Project 460040 is authorized.

6. An appropriation of $10,000 to Fund 190, $40,000 to Fund 810, $85,000 to Fund 100, and $44,000 to Fund 200 to support the purchase of the electric landscaping equipment for City operations and the purchase of electric motorcycles for the Police Department is authorized. 90 of 563

AGREEMENT BETWEEN THE PENINSULA CLEAN ENERGY AUTHORITY AND

CITY OF SAN MATEO FOR MEMBER AGENCY ENERGY GRANT PROGRAM This Agreement is entered into this _________________, by and between the Peninsula Clean Energy Authority, a joint powers authority of the state of California, hereinafter called “PCEA,” and City of San Mateo, hereinafter called “Grantee.” * * *

1. Exhibits and Attachments
The following exhibits and attachments are attached to this Agreement and incorporated into this Agreement by this reference:

Exhibit A—Project Description
Exhibit B—Grant Distribution

2. Grant Process
In consideration of the payments set forth in this Agreement and in Exhibit B, Grantee shall implement the Project in accordance with the terms, conditions, and specifications set forth in this Agreement and in Exhibit A.

3. Grant Distribution
In consideration of the Project to be implemented by Grantee in accordance with all terms, conditions, and specifications set forth in this Agreement and in Exhibit A, PCEA shall make a grant payment to Grantee in the manner specified in Exhibit B. PCEA reserves the right to withhold final grant payment if PCEA determines that the quantity or quality of the work performed by Grantee is unacceptable or does not meet the requirements of Exhibit B. In no event shall PCEA’s total fiscal obligation under this Agreement exceed one million, four hundred and six thousand, seven hundred and eighteen dollars ($1,406,718). In the event that the Project described by Exhibit A does not move forward or is terminated for any reason, Grantee agrees to return any unused grant funds associated with approved project.

4. Term
Subject to compliance with all terms and conditions, the term of this Agreement shall be from the date of execution through Nov 30, 2026.

5. Relationship of Parties
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Grantee agrees and understands that Grantee is not an employee of PCEA and that neither Grantee nor its employees acquire any of the rights, privileges, powers, or advantages of PCEA employees.

6. Hold Harmless
a. General Hold Harmless
Grantee shall indemnify and save harmless PCEA and its officers, agents, employees, and servants from all claims, suits, or actions of every name, kind, and description resulting from this Agreement, the performance of any work or services required of Grantee under this Agreement, or payments made pursuant to this Agreement brought for, or on account of, any of the following:
(A) injuries to or death of any person, including Grantee or its employees/officers/agents;
(B) damage to any property of any kind whatsoever and to whomsoever belonging; (C) any sanctions, penalties, or claims of damages resulting from Grantee’s failure to comply, if applicable, with the requirements set forth in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and all Federal regulations promulgated thereunder, as amended; or
(D) any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of PCEA and/or its officers, agents, employees, or servants. However, Grantee’s duty to indemnify and save harmless under this Section shall not apply to injuries or damage for which PCEA has been found in a court of competent jurisdiction to be solely liable by reason of its own negligence or willful misconduct.

The duty of Grantee to indemnify and save harmless as set forth by this Section shall include the duty to defend as set forth in Section 2778 of the California Civil Code.

7. Payment of Permits/Licenses
Grantee bears responsibility to obtain any license, permit, or approval required from any agency for work/services to be performed under this Agreement at Grantee’s own expense prior to commencement of said work/services. Failure to do so will result in forfeit of any right to compensation under this Agreement.

8. Insurance
PCEA shall not be responsible for the provision of any insurance policy on behalf of the Grantee.
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The parties understand and agree that Grantee shall not commence work using the grant funds without insurance coverage appropriate to its specific project and as reviewed by Grantee’s own legal counsel and/or Risk Manager.

9. Compliance With Laws
The Project to be performed by Grantee pursuant to this Agreement shall be performed in accordance with all applicable Federal, State, County, and municipal laws, ordinances, and regulations, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Federal Regulations promulgated thereunder, as amended (if applicable), the Business Associate requirements set forth in Attachment H (if attached), the Americans with Disabilities Act of 1990, as amended, and Section 504 of the Rehabilitation Act of 1973, which prohibits discrimination on the basis of disability in programs and activities receiving any Federal or County financial assistance. The Project shall also be performed in accordance with all applicable ordinances and regulations, including but not limited to appropriate licensure, certification regulations, provisions pertaining to confidentiality of records, and applicable quality assurance regulations. In the event of a conflict between the terms of this Agreement and any applicable State, Federal, County, or municipal law or regulation, the requirements of the applicable law or regulation will take precedence over the requirements set forth in this Agreement.

Grantee shall be timely and accurately complete, sign, and submit all necessary documentation of compliance.

10. Retention of Records; Right to Monitor and Audit
(a) Grantee shall maintain all required records relating to the Project under this Agreement for three (3) years after PCEA makes final payment and all other pending matters are closed, and Grantee shall be subject to the examination and/or audit by PCEA, a Federal grantor agency, and the State of California. (b) Grantee shall comply with all program and fiscal reporting requirements set forth by applicable Federal, State, and local agencies and as required by PCEA. (c) Grantee agrees upon reasonable notice to provide to PCEA, to any Federal or State department having monitoring or review authority, to PCEA’s authorized representative, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement, and to evaluate the quality, appropriateness, and timeliness of the Project work.

11. Merger Clause; Amendments
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This Agreement, including the Exhibits and Attachments attached to this Agreement and incorporated by reference, constitutes the sole Agreement of the parties to this Agreement and correctly states the rights, duties, and obligations of each party as of this document’s date. In the event that any term, condition, provision, requirement, or specification set forth in the body of this Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in any Exhibit and/or Attachment to this Agreement, the provisions of the body of the Agreement shall prevail.

Any prior agreement, promises, negotiations, or representations between the parties not expressly stated in this document are not binding. All subsequent modifications or amendments shall be in writing and signed by the parties.

12. Controlling Law; Venue
The validity of this Agreement and of its terms, the rights and duties of the parties under this Agreement, the interpretation of this Agreement, the performance of this Agreement, and any other dispute of any nature arising out of this Agreement shall be governed by the laws of the State of California without regard to its choice of law or conflict of law rules.

Any dispute arising out of this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court for the Northern District of California.

13. Notices
Any notice, request, demand, or other communication required or permitted under this Agreement shall be deemed to be properly given when both: (1) transmitted via facsimile to the telephone number listed below or transmitted via email to the email address listed below; and (2) sent to the physical address listed below by either being deposited in the United States mail, postage prepaid, or deposited for overnight delivery, charges prepaid, with an established overnight courier that provides a tracking number showing confirmation of receipt.

In the case of PCEA, to:

Name/Title: Shawn Marshall, Chief Executive Officer
Address: 2075 Woodside Road, Redwood City, CA 94061
Telephone: 650-474-5002
Email: [email protected]
In the case of Grantee, to:

Name/Title: Alex Khojikian, City Manager
Address: 330 W. 20th Avenue, San Mateo, CA 94403
Telephone: 650-522-7000
Email: [email protected]
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14. Electronic Signature
PCEA and Grantee wish to permit this Agreement, and future documents executed pursuant to this Agreement, to be digitally signed in accordance with California law. Any party that agrees to allow digital signature of this Agreement may revoke such agreement at any time in relation to all future documents by providing notice pursuant to this Agreement.

15. No Recourse Against PCEA’s Member Agencies
Grantee acknowledges and agrees that PCEA is a Joint Powers Authority, which is a public agency separate and distinct from its member agencies. All debts, liabilities, or obligations undertaken by PCEA in connection with this Agreement are undertaken solely by PCEA and are not debts, liabilities, or obligations of its member agencies. Grantee waives any recourse against PCEA’s member agencies.
* * *
In agreement with this Agreement’s terms, the parties, by their duly authorized representatives, affix their respective signatures:

PENINSULA CLEAN ENERGY

AUTHORITY
__________________________________
Chief Operating Officer, Peninsula Clean
Energy Authority
Date:__________________________
City of San Mateo
__________________________________
Title: ______________________________
Date: ________________________
Exhibit A
In consideration of the payments set forth in Exhibit B, Grantee shall execute the following project:

See attached proposal as submitted by
Submittal Date: October 22, 2024
Point of contact name: Andrea Chow
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Point of contact role/title: Sustainability Analyst
Point of contact email: [email protected]
Exhibit B
In consideration of the Project implemented by Grantee described in Exhibit A and subject to the terms of the Agreement, PCEA shall pay Grantee based on the following fee schedule and terms:

Eligible Project Expenses
Expenses funded under this agreement must be in alignment with PCEA’s mission and the goals of its Strategic Plan to decarbonize the service territory. Expense must be tangible infrastructure associated with electric power.

Examples of eligible projects:

1. Installation of EV charging infrastructure for fleet or public use

2. Building heat pump systems in government facilities

3. Incentive programs for electrifying landscape equipment, etc.

4. Installation of solar and storage systems

5. Upgrades to efficient street lights
Ineligible projects and costs:

1. Purchase of equipment using fossil fuels

2. Staff time associated with operations and other administrative costs

3. Indirect decarbonization education or general transportation infrastructure such as workshops and bike lanes

4. Production of reports or plans
Payments

1. First payment: $703,359. Upon execution of this contract

2. EV Charging payments: Funds for the EV charging project will be disbursed through the PCE EV Ready program. The EV Ready program will disburse funding through its standard process. This shall include the EV Ready standard rebate in addition to added funds from this Member Agency Energy Grant for the EV charging project up to the lesser sum of the following: a) total remaining eligible project costs (after standard rebate), or b) total remaining Member Agency Energy Grant allocation. The required application for the EV Ready program is located at the following link:
https://peninsulacleanenergy.formstack.com/forms/ev_charger_incentives_application 96 of 563

3. Final payment: Balance of funds ($1,406,718 less prior payments as listed in Sections 1-3 above). Within 45 days following receipt of project invoices for Eligible Project Expenses of $1,406,718 or more. Send materials to [email protected]. PCEA reserves the right to review the submitted invoices and Grantee must respond to reasonable requests for clarifications on the information provided. PCEA reserves, at its sole discretion, the right to approve and/or reject project invoices from Grantee.

Payment Method
Grantee EFT/ACH details for transfers:
o City of San Mateo
o Wells Fargo Bank
o 121000248
o 4520070962
o Checking
Exhibit A: City of San Mateo – PCE
Member Agency Grant Application
The City of San Mateo’s PCE Member Agency Grant Application contains funding requests for five projects.

Project Name Estimated Budget

1. EV Charging Infrastructure for City Fleet $500,000

2. Electrifying Marina Library $395,000

3. High Voltage Street Light Conversion $332,718

4. Electric Landscaping Equipment for City Operations $135,000

5. Pilot Electric Motorcycles for Police Department $44,000 Total $1,406,718

1. Electric Vehicle Charging for City Fleet
The City Council has a goal of a clean City fleet by 2030. Additionally, state law mandates the shift to electric vehicles. To prepare for this transition, the City needs electric vehicle charging infrastructure at City Hall, the Corp Yard/Park Yard and the Police Department. This funding would build off the City’s Electric Fleet Transition Plan developed in partnership with PCE and Optony. Partial funding has been secured for EV infrastructure at City Hall. This funding allocation would enable the installation of electric vehicle charging infrastructure at City the Corp Yard/Park Yard and Police Department.
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Outcomes and Benefits:
 EV infrastructure will enable City’s transition to EVs and replacement of gas vehicles  Cleaner air and better health from replacement of gas vehicles  Reduced greenhouse gas emissions
Budget:

Estimated Budget
Corp Yard / Park Yard EV charging $250,000
Police Department EV charging $250,000
Total $500,000
Timeline:

The need for new PG&E service is highly impactful on the project timeline for installing chargers at City sites. The City has already initiated conversations with PG&E to add new service at the Corp Yard / Park Yard and will initiate discussions regarding the Police Department site pending funding approval. Staff anticipates the PG&E work to take roughly a year. Concurrently, staff will develop a construction bid to select a contractor to install the chargers.

2. Electrifying Marina Library
The Marina Branch Library is located at 1530 Susan Court, San Mateo and has served the community since 1966. Situated on the west embankment of Seal Slough, the building has experienced differential settlement on the order of five inches and currently leans towards the waterway. The Marina Library has been awarded state funding to make necessary repairs for significant structural damage due to the shifting of the building’s foundation, which was likely caused by seismic activity. The major renovations provide an opportunity for building electrification and efficiency improvements.

Outcomes and Benefits:
 New efficient building equipment and upgrades will reduce energy consumption  Electric equipment will replace existing gas equipment Budget:

Estimated Budget
HVAC Upgrade $55,000
Water heater replacement $10,000
Efficiency upgrades (lighting, insulation, etc.) $330,000 Total $395,000
Timeline:

Design is currently at 50% and is expected to be completed in Spring 2025. Construction is anticipated start in late May 2025 and expected to last for 12-16 months.

3. High Voltage Street Light Conversion
The High Voltage Streetlight Conversion Program is replacing aging high-voltage streetlight circuits with safer and more reliable low-voltage circuits. The program is also replacing the existing streetlights with more energy-efficient LED streetlights. The City will complete this light conversion in five phases with Phase 3 nearing completion. Total project funding for all five 98 of 563
phases is an estimated $14.3 million. This funding allocation would provide partial funding toward this project work.

Outcomes and Benefits:
 LED bulbs are safer and more reliable
 LEDs are more energy efficient and will reduce energy consumption  More reliable lighting means safer streets
Budget:

Estimated Budget
Partial funding for construction budget for
Phase 5 High Voltage Streetlight Conversion
$332,718
Timeline:

Funding would be allocated toward project construction of Phase 5. It is anticipated that project construction of Phase 5 will begin soon. Note, Phase 4 is currently in design with project work not following numerical order.

4. Electric Landscaping Equipment for City Operations
The Parks team relies on gas powered equipment to maintain Poplar Golf Course and City parks. This funding allocation would include the purchase of electric equipment to replace gas equipment.

Outcomes and Benefits:
 Reduced smog and greenhouse gas emissions by replacing gas equipment  Human health benefits in terms of noise reduction and pollution reduction Budget:

Estimated Budget
Electric Sand Star (Golf) $40,000
Electric Leaf Blowers (Golf) $10,000
Electric Leaf Blowers (Parks) $55,000
Replacement batteries (Parks) $30,000
Total $135,000
Timeline:

Equipment can take roughly 6-8 months to procure. Once funding is approved, staff would move quickly to begin procurement process.

5. Electric Motorcycles for Police Department
The Police Department presents an opportunity to reduce greenhouse gas emissions from vehicles because of their consistent high mileage usage. There are a few barriers to transitioning to EVs such as the unfamiliarity with EVs, concerns about battery capacity, and range anxiety. The purchase of two electric motorcycles offers the Police Department an opportunity to gain experience with electric units for patrol and evaluate future potential replacements of gas vehicles.
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Outcomes and Benefits:
 Police Department staff will gain experience with electric units  Electric motorcycles can replace gas units, reducing greenhouse gas emissions Budget:

Estimated Budget
Electric Motorcycles (2) $44,000
Timeline:

Electric motorcycles can take 3 months for delivery. Units arrive fully upfitted and ready to deploy with exception of the City's logo.
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 9 Section Name: CONSENT CALENDAR Account Number: 10-1311 File ID: 24-9310 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Manager's Office
MEETING DATE: December 09, 2024
SUBJECT:

Peninsula Clean Energy Solar and Storage on Public Buildings Program - Updated Power Purchase Agreement RECOMMENDATION:

Approve an agreement with Peninsula Clean Energy (PCE) for a Power Purchase Agreement (PPA) to procure, install, operate, and maintain a solar photovoltaic system at the Beresford Park parking lot; and authorize the City Manager to execute the agreement in substantially the form presented and to execute any amendments necessary to implement the solar photovoltaic system.

BACKGROUND:

The City of San Mateo is a longtime leader in sustainability with ambitious Climate Action Plan goals to reduce greenhouse gas emissions by 49 percent below the 2005 baseline by 2030. The City’s most recent greenhouse gas emissions inventory shows that the City reduced emissions 22 percent below the 2005 baseline in 2019. While this marks great progress in Climate Action Plan implementation, more work is needed to advance the City’s climate goals.

Peninsula Clean Energy (PCE) is a joint powers authority developed in 2016 to reduce greenhouse gas emissions by providing electricity from clean energy sources. PCE’s Solar and Storage on Public Buildings Program collaborates with jurisdictions across San Mateo County to identify public facilities for solar installations through a Power Purchase Agreement (PPA). Through the program, jurisdictions can install solar systems to generate on-site electricity to meet and exceed the energy demand of municipal facilities. While much of San Mateo’s electricity already comes from carbon-free sources, increasing the amount of energy in the community from renewable sources not only further reduces greenhouse gas emissions but also has the potential to reduce electricity costs and enhance the local green economy.

Staff worked closely with PCE to identify Beresford Recreation Center as the optimal site to participate in the program.

After analysis of the Rec Center roof and three parking lots at Beresford Park, the parking lot on Parkview Way next to the basketball court and community garden was identified as the project site. In August and September, staff focused on outreach and engagement of the residents near the project site to share the impacts of the project and project construction.

At the September 16, 2024 City Council meeting, the PPA with PCE was approved but due to an administrative error, an incomplete version of the agreement was included in the Council agenda packet. At the October 21, 2024 City Council meeting, a full version of PPA was included in the packet and approved. Since that City Council meeting, PCE found that PG&E mitigations (electrical upgrades) are required to enable the installation of the solar carports, resulting in a need to revise the PPA pricing to account for the necessary electrical mitigation work. PG&E estimates $121,000.00 of mitigation work, including a transformer and service upgrade. The project team anticipates replacing an existing pad-mounted transformer located adjacent to Beresford Recreation Center, as well as replacement of pole-mounted equipment also located adjacent to Beresford Recreation Center.
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PCE is able to front the cost of the mitigation in full, but an updated PPA is needed to revise the costs and termination schedule to account for the mitigation costs. The original PPA rate was $0.274/kWh resulting in a simple payback for $282k over 20 years with savings beginning in Year 2. The new PPA rate is $0.331/kWh resulting in a simple payback of $147k over 20 years with savings beginning in Year 6. Even though the project will result in less cost savings than the original PPA, staff recommends approving the updated PPA because the project still results in reduced greenhouse gas emissions in the community and cost savings to the City over the lifetime of project.

BUDGET IMPACT:

There is no fiscal impact for entering the Power Purchase Agreement with Peninsula Clean Energy. There is no upfront cost to the City for entering into the Agreement. The solar photovoltaic system is anticipated to provide utility cost savings over the life of the project beginning in Year 6. The estimated 20-year energy savings simple is $147,200.

ENVIRONMENTAL DETERMINATION:

The installation of solar carports on an existing parking lot is categorically exempt from CEQA as an “existing facility,” because it consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. (CEQA Guidelines Section 15301.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Power Purchase Agreement

STAFF CONTACT
Andrea Chow, Sustainability Analyst
[email protected]
(650) 522-7007
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 10 Section Name: CONSENT CALENDAR Account Number: 10-4679 File ID: 24-9312 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: December 9, 2024
SUBJECT:

Metropolitan Transportation Commission Housing Incentive Pool Grants – Resolutions RECOMMENDATION:

Adopt a resolution to file an application with the Metropolitan Transportation Commission for Housing Incentive Pool Grants and adopt a resolution to comply with State Housing Laws.

BACKGROUND:

The Housing Incentive Pool (HIP) grants provide transportation grants to promote the production and preservation of affordable housing.

Established by the Metropolitan Transportation Commission (MTC) in October 2018, the HIP includes funding for transportation projects, in flexible federal funds through the second round of the One Bay Area Grant (OBAG 2) program and in local funds available for project selection by MTC through a funding exchange.

MTC will distribute $71 million in HIP grants on a per-unit basis to the 15 jurisdictions that issued certificates of occupancy for the greatest number of eligible housing units over the five calendar years 2018 through 2022. This includes both newly built units and those preserved as affordable to households with low, very-low, and moderate incomes.

The City was listed as one of the 15 jurisdictions eligible for funding and MTC awarded $959,000 in HIP funds in March 2024 to the City. To receive and utilize these funds, the City must satisfy certain requirements and submit application materials to MTC by the end of this calendar year (12/31/24). Included in the requirements are two resolutions the City must adopt, one for compliance with State Housing Laws and one to accept the terms of conditions set forth by the MTC.

Public Works staff consulted with the Community Development Department and determined the housing law compliance resolution is in line with the City’s existing goals and language within the Housing Element. The language in the second resolution for the acceptance of MTC’s terms is standard and the City has previously adopted similar resolutions with MTC for grant funding.

Once authorized, the funding will be used to implement transportation projects that may include, but are not limited to, projects identified in the City’s Local Roadway Safety Plan (LRSP). The LRSP, adopted in May 2024, provides a framework to reduce fatal and severe injury collisions on roadways within San Mateo and identified 10 high-priority intersections needing safety improvements. Improvements include raised crosswalks, lighting, curb extensions, centerline hardening, signage, and various other safety improvements. Presently, funding for the LRSP projects has not been identified and the grant funding provides the City with an opportunity for expedited implementation. The projects will be packaged together to fully utilize the available grant funds.
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Staff is recommending adopting both resolutions for state housing law compliance and to accept terms and conditions set forth by MTC in order to accept the HIP grants in an amount of $959,000 at a future City Council meeting.

BUDGET IMPACT:

The adoption of the resolutions makes the City eligible to receive and use $959,000 of Housing Incentive Pool grant funds.

ENVIRONMENTAL DETERMINATION:

The adoption of both resolutions is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) As stated in the resolution authorizing the filing of an application with MTC, the projects identified for funding remain subject to environmental clearance, which will occur at the time of formal project approval.

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – MTC Resolution of Local Support
Att 2 – Housing Law Resolution

STAFF CONTACT
Jay Yu, Engineering Manager
[email protected]
(650) 522-7323
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 11 Section Name: CONSENT CALENDAR Account Number: 11-6114 File ID: 24-9328 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Parks and Recreation Department
MEETING DATE: December 09, 2024
SUBJECT:

Serra Yellow Cab, Inc. Agreement — Amendment No. 2
RECOMMENDATION:

Approve a Resolution for the appropriation of Amendment No. 2 to the agreement with Serra Yellow Cab, Inc. in the amount of $150,000, resulting in a new contract total of $300,000 for the Senior Get Around Transportation Program for Fiscal Year (FY) 24-25; and authorize the Director of Parks and Recreation to execute the amendment in substantially the form presented.

BACKGROUND:

The Parks and Recreation Department facilitates the Senior Transportation “Get Around” Program. This program was initiated in January of 2018. Since the inception of this Senior Transportation Program, active ridership has dramatically increased annually. In FY 21-22, ridership averaged approximately 125 participants per month. As of this fiscal year, ridership participants per month average approximately 500. In June 2023, City Council approved a contract for FY 23-24 with the option to extend an additional year for FY 24-25 in the amount of $150,000 per fiscal year, for a total contract amount of $300,000. It was believed that, even with the increase in cost of services and increased volume of ridership from previous years, the approved $150,000 per year would suffice programmatic operations. However, with the significant continuous growth in ridership compiled with the rise in prices for wheelchair accessible rides cost have considerably increased. City Council approved Amendment No. 1 in March 2023 for an increase for FY 23-24 funding from $150,000 to $225,000. For FY 24-25, it is projected that the cost of transportation services will require an additional increase of approved funding of $150,000. Thus, the contract total for FY 24-25 will be $300,000, bringing the total twoyear contract to $525,000.

BUDGET IMPACT:

The amended agreement will be funded with $100,000 from C/CAG Lifeline Transportation Program Cycle 7 funding and $200,000 from Measure S Funds. The $200,000 in funding from Measure S is already included in the Parks and Recreation operating budget. Staff is appropriating $100,000 from the recently accepted C/CAG Lifeline Transportation Program Cycle 7 grant to fund the additional agreement amendment costs.

ENVIRONMENTAL DETERMINATION:

This amendment is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
All meeting noticing requirements were met.
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CITY OF SAN MATEO

ATTACHMENTS
Att 1 — Proposed Amendment No. 2 FY 24-25
Att 2 — Proposed Resolution

STAFF CONTACT
Stephanie Douglas, Recreation Manager
[email protected]
(650) 522-7442
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AMENDMENT NO. 2 TO THE AGREEMENT

BETWEEN THE CITY OF SAN MATEO AND
SERRA YELLOW CAB, INC. FOR FISCAL YEAR 2024-2025
(Original Amount $150,000; New Amount Not to Exceed $300,000) This Amendment No. 2 is made and entered into as of December __, 2024, by and between the City of San Mateo, a municipal corporation existing under the laws of the State of California ("City"), and Serra Yellow Cab, Inc. (“Contractor”).

WHEREAS, the City and Contractor entered into an Agreement for Senior Transportation Services (“Agreement”) on June 23, 2023; and
WHEREAS, the City and Contractor wish to amend the Agreement amount by $150,000, for a total Agreement amount of $300,000 for fiscal year 2024-2025.

NOW, THEREFORE, the parties agree as follows:

1. Section 5 of the Agreement is amended to read:

Payment shall be made by City only for services rendered and upon submission of a payment request upon completion and City approval of the work performed.

In consideration for the full performance of the services set forth in Exhibit A, City agrees to pay Contractor a fee in an amount of up to $300,000 for fiscal year 2024-2025, pursuant to rates stated in Exhibit B, attached and incorporated by reference.

2. Exhibit B of the Agreement is amended to read:

Contractor will submit an itemized invoice to the City by the 20th of each month to evidence all rides provided. Invoices shall be sent to:

San Mateo Parks and Recreation
Attn: Senior Transportation “Get Around” Program
330 West 20th Avenue San Mateo, CA 94403
The City will send invoiced payment within 30 days of receipt of the invoice.

Payments shall be sent to:

Serra Yellow Cab of Daly City Inc.

Attn: Talib Salamin
195 87th Street #D
Daly City, CA 94015
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Transportation rates will be charged at the following rates: Rides that are over 5 miles will be charged $25.10 starting fee, plus $3.00 per mile on the 5 plus mile, plus 15% service fee. Any rides that are less than five miles will be charged a fivemile rate of $25.10.

Wheelchair accessible rides will be charged a $40.00 starting fee (flag drop), plus $3.00 dollars a mile, plus 15% service fee. Any wheelchair accessible rides that are less than five miles will be charged a five-mile rate of $40.00.

An additional $0.30 click charge will be incurred for trips slowed by excessive traffic or other uncontrollable circumstances.

The senior patrons will pay the first $5.00 and the remaining fee will be paid by the City.

The City of San Mateo will not pay for any gratuity or tipping. Any tips will be left to the rider’s discretion. All fees, taxes and services under this Agreement shall not exceed $300,000 for fiscal year 2024-2025.”

3. The remaining terms of the Agreement remain in full force and effect.

IN WITNESS WHEREOF, the CITY OF SAN MATEO and SERRA YELLOW CAB, INC. have executed this Amendment No. 2 as of the day and year first above written.

CITY OF SAN MATEO CONTRACTOR
Joanne Magrini
Parks and Recreation Director
APPROVED AS TO FORM:
_____________________
Mazarin Vakharia
Assistant City Attorney
Date Talib Salamin
Serra Yellow Cab of Daly City
Inc.

President
Date
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)

AUTHORIZING AN APPROPRIATION FOR AN AGREEMENT AMENDMENT WITH SERRA YELLOW CAB OF DALY CITY, INC. FOR SENIOR GET-AROUND PROGRAM (LIFELINE GRANT) IN THE AMOUNT OF $150,000 WHEREAS, the Council awarded a contract amendment for the in the amount of $ 150,000 concurrently with this Resolution; and
WHEREAS, an appropriation of $ 100,000 from C/CAG Lifeline Transportation Program Cycle 7 Grant is necessary to appropriately allocate the funds to the general fund;

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. The Council authorizes the appropriation of $ 100,000 of C/CAG Lifeline Transportation Program Cycle 7 Grant to the general fund Get-Around Program.
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 12 Section Name: CONSENT CALENDAR Account Number: 10-4679 File ID: 24-9329 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: December 09, 2024
SUBJECT:

Edgewater Isle Master Association, Inc. Recreational Vehicle Storage Real Property Lease Agreement Extension – Amendment No. 4
RECOMMENDATION:

Approve Amendment No. 4 to the agreement for Lease of Real Property for recreational vehicle storage with Edgewater Isle Master Association, Inc. to extend the agreement an additional ten years, from January 1, 2025, to December 31, 2034, update to the rental rate to account for annual adjustments for CPI, update contact information, and add a required temporary vacation provision for the property to accommodate the City’s needed use of the property for City projects; and authorize the City Manager to execute Amendment No. 4 in substantially the form presented.

BACKGROUND:

The property located under the Mariner’s Island Bridge near Winward Way is owned by the City. On January 4, 1984, City Council approved and authorized the execution of a lease of City property to the homeowner’s association of the Edgewater Isle Subdivision for recreational vehicle storage. The lease of the City-owned property was an integral part of the development plan providing residents with off-street parking for recreational vehicles. The term of the initial agreement was ten years with a provision granting the Lessee the option to extend for three additional periods of ten years each, providing both parties are able to agree on a rental rate.

The current lease agreement is set to expire at the end of 2024. The proposed amendment would extend the lease for an additional 10-year period, covering 2025 through 2034, and allow for one additional 10-year option. This extension represents a fourth renewal of the lease, a period not originally included in the initial agreement. The terms of the proposed amendment, including the rental rate for the 2025-2034 period, were agreed upon following negotiations between the City and the Lessee. Both parties reached a mutual understanding on the updated terms, ensuring the continued use of the property for recreational vehicle storage in alignment with the needs of Edgewater Isle residents.

These terms include a condition requiring the Edgewater Isle Master Association to temporarily vacate the property upon notice by the City to allow for use of the property during a future Capital Improvement Project to address settlement issues associated with the Mariner’s Island Bridge.

The Edgewater Isle Master Association will pay $15,671.37 for the initial year. For each year thereafter, the lease will be adjusted annually by the Consumer Price Index (CPI) for the San Francisco Bay Area. The City will collect this fee annually.

BUDGET IMPACT:

The first year of the proposed agreement will generate revenue of $15,671.37 and will be adjusted annually based on the CPI.
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ENVIRONMENTAL DETERMINATION:

This action is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Amendment No. 4

STAFF CONTACT
Matt Fabry, Public Works Director
[email protected]
(650) 522-7309
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Contract Amendment Page 1 of 3
CAO Approved June 2024
AMENDMENT NO. 4 TO THE AGREEMENT

BETWEEN THE CITY OF SAN MATEO AND
EDGEWATER ISLE MASTER ASSOCIATION, INC. FOR

AGREEMENT TO LEASE REAL PROPERTY
This Amendment is made and entered into this day of December ___, 2024, by and between the CITY OF SAN MATEO, a municipal corporation existing under the laws of the State of California ("CITY"), and Edgewater Isle Master Association, Inc., a California corporation (“LESSEE"). CITY and LESSEE may collectively be referred to as the “PARTIES.” WHEREAS, CITY and LESSEE entered into a lease agreement for the lease of real property (“Agreement”) on January 4, 1984; and
WHEREAS, the CITY and LESSEE amended the Agreement on November 25, 1994 to extend the term of the lease until December 31, 2004; and
WHEREAS, the CITY and LESSEE amended the Agreement on November 19, 2004 to extend the term of the lease until December 31, 2014; and
WHEREAS, the CITY and LESSEE amended the Agreement on November 17, 2014 to extend the term of the lease until December 31, 2024; and
WHEREAS, the Agreement originally provided for an initial 10-year term, with three, 10-year options to extend by the LESSEE; and
WHEREAS, LESSEE has exercised all its options to extend; and WHEREAS, the PARTIES are agreeable to extending the Agreement term by an additional 10- years to December 31, 2034, with one option to extend for another 10-year term, pursuant to the conditions provided below.

NOW, THEREFORE, the Parties agree as follows:

1. Section 2 of the Agreement is amended to read:
“The term of this Agreement shall commence on January 1, 1984, and terminate on December 31, 2034.”

2. Section 3 of the Agreement is amended to read:
“Lessor does hereby grant to Lessee an option to extend the term of this Lease for one additional period of 10 years. The rent for said extended time period shall be negotiated between Lessor and Lessee at the time of the exercise of said right to said extension by 145 of 563
Contract Amendment Page 2 of 3
CAO Approved June 2024
the Lessee. Lessee shall exercise said right to said extension in writing. Lessor shall upon receipt of said notice of exercise of said option to extend advise Lessee of the rental rate for the 10 year period then in question. If the parties at the time are unable to agree upon a rental rate for said additional 10 year period, both parties shall be relieved of their obligation at the point to proceed with the extension of the term of said lease.

Each party however, agrees to negotiate in good faith the rental rate for the extended time periods.”

3. Section 4 of the Agreement is amended to read:
“In consideration of the lease of said real property Lessee shall pay the sum of $15,671.37 per year commencing January 1, 2025.

For each year thereafter, the leasehold rental charge shall be adjusted annually to reflect the increase in the cost of living as determined by the Consumer Price Index – All Urban, for the San Francisco Bay Area. The Price adjustment shall be performed in the month of November, using the October CPI.”

4. Section 9 is amended as follows:

Notices to Lessee shall be addressed as follows:

Edgewater Isle Master Association, Inc.
c/o Kristine Peterson
12647 Acosta Blvd
Suite 275
San Ramon CA 94583

5. Section 10 is added to the Agreement and shall read:
“Upon written notice from the City, Lessee agrees to vacate the real property for a duration of up to 180 days in order for the City to utilize the real property for any City project(s), including improvements projects to the Mariner’s Island Bridge. Lessee agrees to comply with such written notice within 60 days. Lessee agrees this duration shall be extended upon written notice from the City for a duration up to an additional 90 days. The City will deduct any time not occupied by the Lessee for these purposes from next year’s annual fee. Upon completion of the City’s project(s), the City agrees to restore the property to a condition comparable to its condition prior to the commencement of such improvements.”

6. The remaining terms of the Agreement remain in full force and effect. [SIGNATURE PAGE FOLLOWS]
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Contract Amendment Page 3 of 3
CAO Approved June 2024
IN WITNESS WHEREOF, CITY OF SAN MATEO and EDGEWATER ISLE MASTER ASSOCIATION, INC. have executed this Amendment No. 4 on ___________________.

CITY OF SAN MATEO EDGEWATER ISLE MASTER
ASSOCIATION, INC.

City Manager
Alex Khojikian
Date President
Gregory Collis
Date
APPROVED AS TO FORM:

Linh Nguyen
Assistant City Attorney
Date
ATTEST:

Martin McTaggart
City Clerk
Date
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 13 Section Name: CONSENT CALENDAR Account Number: 10-5112 File ID: 24-9331 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Police Department
MEETING DATE: December 09, 2024
SUBJECT:

Axon Master Services and Purchasing Agreement — Approval RECOMMENDATION:

Approve a Master Services and Purchasing agreement with Axon Enterprise, Inc., for hardware, software and services for the Police Department for a five year term with an automatic renewal clause for an additional five year term in the cumulative amount of $7,350,052.13; authorize the Chief of Police to execute the agreement in substantially the form presented; approve a contingency reserve of $100,000 and authorize the Chief of Police to issue change orders within that reserve of up to $50,000 cumulatively; authorize the City Manager to issue change orders within that reserve in excess of $50,000 but not to exceed $100,000 cumulatively; and adopt a resolution to authorize the use of an alternative purchasing procedure in accordance with Municipal Code Section 3.60.070(h)(3).

BACKGROUND:

The San Mateo Police Department first entered into a Master Services and Purchasing Agreement (MSPA) with Axon for the provision of Body Worn Cameras and Tasers in 2017. Since that time, Axon has emerged as the industry leader in providing public safety technology, and the MSPA has been amended several times to incorporate additional components of law enforcement equipment and software. The cumulative cost for all current Axon products and services is just under $450,000 annually.

The term of the original MSPA will end in 2025, and staff has initiated conversations with Axon regarding a new agreement to combine all services into a single contract as well as add components essential to current efforts to establish a Real Time Information Center in the Police Department. The proposed agreement consolidates all Axon products currently used by the Police Department into a single contract, with the addition of an exciting software program called Fusus, as well as Drone as First Responder technology.

Axon Fusus is a critical component of the Real Time Information Center, as it unifies all existing technology inputs such as body worn cameras, car cameras, automated license plate readers, unmanned aerial systems, security camera footage, etc., allowing for a full-scale collaboration network that works in real time in the field. With the Fusus program, every tool that compiles information for the police during a crime or emergency gets consolidated into a single system. Integrating data from multiple sources into a single platform will enhance real time situational awareness and operational efficiency.

Another essential component of the Real Time Information Center is enhancement of the unmanned aerial systems (UAS) program with the addition of Drone as First Responder (DFR) technology. DFR programs are used by law enforcement agencies nationwide to augment police field response to calls for service with real-time actionable video intelligence. A DFR program is comprised of prepositioned UAS devices (drones), which are ready to launch from docking stations placed in strategic locations throughout the City. This allows a drone to arrive quickly to locations of calls for service to survey the scene, preserve evidence, and potentially avoid unnecessary response. DFR programs provide safer, more efficient, and 148 of 563

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often faster responses to calls for service. UAS devices can launch and be onsite overhead at a call for service typically before ground resources can arrive via vehicle. The addition of the DFR technology along with the Fusus platform are foundational elements to the Real Time Information Center and will modernize our ability to respond to crimes and emergencies.

There are over 250 cities currently using the Axon Fusus program and DFR technology; however, there are none in San Mateo County. Because Axon is motivated to expand this technology approach in our region, the vendor has extended significant discounts in the quoted price, totaling over $4.8M in savings over the term. Axon has indicated they will be unable to extend these discounts on contracts approved in 2025. The contract has been structured with a five-year term, with an automatic renewal clause for an additional five years –allowing for the option to opt-out after the first five years.

The proposed contract reflects bundled pricing for all Axon products and services currently used by the Police Department including body worn cameras, conducted energy devices (Tasers), in-car cameras for the patrol vehicle fleet, interview room recording equipment, virtual reality training equipment, unmanned aerial systems, and related software systems and services. The table below shows the total cost of the proposed agreement:

Date Cost
December 2024 $349,502.45
FY25/26 $648,765.94
FY26/27 $705,753.73
FY27/28 $705,753.73
FY28/29 $705,753.73
FY29/30 $705,753.73
FY30/31 $705,753.73
FY31/32 $705,753.73
FY32/33 $705,753.73
FY33/34 $705,753.73
FY34/35 $705,753.90
TOTAL $7,350,052.13
The reduced cost in the first and second years reflects that annual costs for some Axon services have already been paid for during the 24/25 Fiscal Year, which are intended to cover service for the next 12 months. The remaining $349,502.45 in costs for the first year can be accommodated in the Police Department’s existing budget appropriation through a combination of unspent operational funds budgeted for Axon, funds allocated for the Real-Time Crime Center, and funding from the Byrne JAG grant. As a result of this new contract, there are several items of existing technology (software and hardware) that will be redundant and can be eliminated, resulting in an annual savings of approximately $50,000. In addition, staff has proactively planned for the potential integration of additional technology and has confirmed with Axon that the cost of AI report writing would be just over $105,000 annually, should the City choose to implement it before 2026.

Staff recommends approval of the purchase pursuant to SMMC 3.60.070(h)(3), which allows the Council to use any purchasing process that is in the best interest of the City. Staff conducted an extensive testing and review process before contracting with Axon in 2017, and overwhelmingly identified that Axon provided the products that best met our needs.

Axon is a leader in the industry; their systems are the most highly-developed and established, and continuing to use their products meets the Police Department’s interest in that it will not require changes in how we train, operate, or manage data. Staff has been pleased with Axon’s responsiveness and customer service. For these reasons, staff believes it is in the best interest of the City to proceed with this Master Services and Purchasing Agreement with Axon Enterprise, Inc.

BUDGET IMPACT:

The proposed agreement with Axon will generate annual savings of approximately $50,000 by eliminating redundant components in the current contract. It also includes an additional cost of $200,000 annually for essential software (Fusus) and drone equipment, which are critical to establish the Real Time Information Center. 149 of 563

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The cost for the current Fiscal Year can be accommodated in the Police Department’s operating budget. As such, no budget amendment is required.

For future years, the department requests Council approval to allocate $200,000 annually from the Measure CC Fund. If approved, the Measure CC Fund, supported by increased local property transfer tax for properties valued over $10 million, will cover a total commitment of $2 million over ten years to support the Real Time Information Center for the Police Department.

ENVIRONMENTAL DETERMINATION:

This action is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment (Public Resources Code Section 21065.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Master Services and Purchasing Agreement

STAFF CONTACT
Ed Barberini, Chief of Police
[email protected]
(650) 522-7600
Matt Lethin, Captain
[email protected]
(650) 522-7663
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 14 Section Name: CONSENT CALENDAR Account Number: 10-4661 File ID: 24-9339 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: December 09, 2024
SUBJECT:

Fashion Island Boulevard/19th Avenue Class IV Bike Way Complete Streets - Appropriation and Memorandum of Understanding
RECOMMENDATION:

Adopt a Resolution to appropriate $200,000 from the City’s Measure A funds to the US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) Project in the Capital Projects Fund; approve a Memorandum of Understanding (MOU) with San Mateo County Transportation Authority (SMCTA) for the Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project (Project) memorializing SMCTA as the implementation agency with a total contribution of $1,586,364, and the City as the Sponsor with contributing funds in the amount of $438,636 and delivering the environmental and design phase of the Project; and authorize the City Manager to execute the MOU in substantially the form presented.

BACKGROUND:

The 19th Avenue/Fashion Island Boulevard Complete Street Class IV Bikeway Project involves constructing a two-way separated bike facility along Fashion Island Boulevard and 19th Avenue, with pedestrian access improvements at four intersections, including the US 101/SR 92 highway ramps. This mile-long bikeway will connect San Mateo and Foster City to the Hayward Park Caltrain Station and the planned US 101 Express Bus service, offering new travel options for residents, visitors, and workers. The City is also working on a separate project titled "Norfolk Street and Fashion Island Boulevard Intersection Reconstruction Project," which is on the same corridor as the 19th Avenue/Fashion Island Boulevard Complete Street Class IV Bikeway Project. To streamline both projects, the City is consolidating the scope of the Norfolk Street and Fashion Island Boulevard Intersection Reconstruction Project in the 19th Avenue/Fashion Island Boulevard Complete Street Class IV Bikeway Project (Consolidated Project).

As a result of the consolidation of projects, in addition to the bicycle infrastructure, the Consolidated Project also reconstructs the intersection of S. Norfolk Street/Fashion Island Boulevard to optimize corridor travel times. The project will ultimately enhance safety and efficiency for all transportation modes through features like high-visibility crosswalks, protected bicycle intersections, ADA-compliant curb ramps, signal timing upgrades, pedestrian-scale lighting, and stormwater treatments.

The City is partnering with the San Mateo County Transportation Authority (SMCTA) on the Consolidated Project; City staff is seeking Council approval of a Memorandum of Understanding (MOU) with SMCTA to memorialize the City as the Sponsor of the project and SMCTA as the implementation agency. As part of the MOU, the City will allocate $438,636 of local funds to SMCTA to deliver the Project's preliminary engineering (PE)/environmental and design phase. The estimated PE/environmental and design phase cost is $2.025 million; the difference between the estimated total cost and the City’s local fund contribution is being provided by SMCTA.

BUDGET IMPACT:
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The scope of the Consolidated Project under the MOU is supported by both the City’s existing 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) (46R016) and Norfolk Street and Fashion Island Boulevard Intersection Reconstruction (463338) projects. The City’s contribution was originally anticipated and planned for FY 2026-27 in the current five-year Capital Improvement Program Plan for the US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) (46R016) project.

However, City staff and SMCTA were able to accelerate the project to start design in FY 2024-25. As a result, staff is requesting an appropriation of $200,000 from the City’s Measure A funds to the 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) Project (46R016) budget. Approximately, $100,000 of this Measure A allocation will be for city staff time to manage the project, the remaining will be part of the $438,636 allocation to SMCTA to deliver the PE/environmental and design phase. With this appropriation, there will be sufficient funding available in both project budgets to allocate to SMCTA to deliver the PE/environmental and design phase for the Project and to fund the estimated associated staff time.

ENVIRONMENTAL DETERMINATION:

The appropriation of funds to the Project and approval of the MOU is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) In addition, the Project will be reviewed for environmental clearance, which will occur during the PE/environmental and design phase.

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Memorandum of Understanding

STAFF CONTACT
Jay Yu, Engineering Manager
[email protected]
(650) 522-7323
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RESOLUTION NO. _____(2024)
AUTHORIZING AN APPROPRIATION IN THE AMOUNT OF $200,000 FROM THE CITY’S MEASURE A FUNDS TO THE US 101/92 MULTI-MODAL (FASHION ISLAND CLASS IV BIKE

LANE) PROJECT IN THE CAPITAL PROJECT FUND
WHEREAS, the 19th Avenue/Fashion Island Boulevard Complete Streets Class IV Bikeway Project (Project) involves constructing a two-way separated bike facility and reconstructs the intersection of S. Norfolk Street/Fashion Island Boulevard to optimize corridor travel times; and WHEREAS, at the Project will ultimately enhance safety and efficiency for all transportation modes through features like high-visibility crosswalks, protected bicycle intersections, ADA-compliant curb ramps, signal timing upgrades, pedestrian-scale lighting, and stormwater treatments; and WHEREAS, the Memorandum of Understanding (MOU) will memorialize the City as the Sponsor of the project and San Mateo County Transportation Authority (SMCTA) as the implementation agency; and
WHEREAS, the City will allocate $438,636 of local funds to SMCTA to deliver the Project's PE/environmental and design phase. The estimated PE/environmental and design phase cost is $2.025 million; and
WHEREAS, the City’s contribution will be funded by US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) and Norfolk Street and Fashion Island Boulevard Intersection Reconstruction projects; and
WHEREAS, additional funding is needed in the US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) project to fund the City’s contribution; and WHEREAS, staff proposed allocating $200,000 from the City’s Measure A funds to fulfill the total allocation amount to SMCTA in the Fiscal Year 2024-25 budget.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, FINDS and RESOLVES that:

1. This City Council action is not a project subject to CEQA, because it consists of a government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

2. An appropriation in the amount of $200,000 from the City’s Measure A funds to the US 101/92 Multi-Modal (Fashion Island Class IV Bike Lane) project (46R016) in the Capital Project Fund is authorized.
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Memorandum of Understanding (MOU)
San Mateo County Transportation Authority
and
City of San Mateo
for the Implementation of
FASHION ISLAND BOULEVARD/19TH AVENUE

CLASS IV BIKEWAY COMPLETE STREETS PROJECT
This Memorandum of Understanding (MOU) is entered into as of _________________ (Execution Date) by and between the San Mateo County Transportation Authority (TA) and the City of San Mateo (Sponsor), each of which is referred to herein individually as "Party" and jointly as "Parties."

RECITALS
WHEREAS, on November 2, 2004, the voters of San Mateo County approved the continuation of the collection and distribution by the TA of the Measure A half-cent transaction and use tax for 25 years to implement the 2004 Transportation Expenditure Plan, beginning January 1, 2009 (New Measure A); and
WHEREAS, the New Measure A Transportation Expenditure Plan designates three percent of New Measure A funds for Pedestrian and Bicycle projects throughout the County; and WHEREAS, on August 4, 2022, the TA issued the 2022 Cycle 6 Pedestrian and Bicycle Program Call for Projects; and
WHEREAS, in response to the call for projects, Sponsor requested that the TA provide $2,000,000 in funds for the Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project (Project); and
WHEREAS, the Project meets the intent of the 2004 Transportation Expenditure Plan and the TA’s Strategic Plan 2020-2024; and
WHEREAS, on December 1, 2022, the TA’s Board of Directors programmed and allocated up to $2,200,000 of New Measure A funds from the Pedestrian and Bicycle Program Category for the Project Approval and Environmental Document (PAED), Plans, Specifications, and Estimates (PS&E), and Construction (CON) phases of the Project through Resolution 2022- 39; and
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WHEREAS, this MOU covers the PAED and PS&E phases of the Project (Scope of Work), and the Parties will execute a new MOU for the CON phase after the PAED and PS&E phases are completed; and
WHEREAS, $554,545 was allocated for the PAED phase and $831,819 was allocated for the PS&E phase for a total of $1,386,364; and
WHEREAS, in addition to the $1,386,364, up to $200,000 may be provided in the form of TA technical assistance, which may include staff or consultant support for the Scope of Work, for a total allocation of $1,586,364; and
WHEREAS, the Sponsor will contribute $138,636 in local, state, federal, or other grant matching funds and has requested including Local Congestion Relief funds for an additional $300,000 in matching funds, for a total match of $438,636 for the PAED and PS&E phases; and
WHEREAS, the Sponsor desires the TA to implement the Scope of Work as described in Section A-2, below.

NOW, THEREFORE, the Parties to this MOU agree as follows:

A. Project Scope and Description

1. Project Scope. This Project is the Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project.

2. Scope of Work. The Scope of Work, which is further detailed in Exhibit A, is the PAED and PS&E phases of the Project.

3. Limited to Scope of Work. This MOU is intended to cover only the Scope of Work.

Further roles and responsibilities for subsequent phases of work on, or other tasks related to, the Project will be determined by negotiations between the Parties.

B. Funding and Payment

1. Funding Commitment. The TA will provide up to $1,586,364 of New Measure A Pedestrian and Bicycle Program funds, consisting of up to $1,386,364 for completion of the Scope of Work and up to an additional $200,000 in technical assistance staff support services (provided by a combination of TA staff and consultants) associated with implementing the Project.

2. Cost Savings. Any cost savings of the New Measure A funds allocated for the Scope of Work will revert to the New Measure A Pedestrian and Bicycle Program for the TA to reallocate to any eligible project through its usual fund programming and allocation activities.
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3. Matching Funds. Sponsor will provide $438,636 of its discretionary funds for the completion of the Scope of Work. Sponsor agrees to contribute matching funds to the TA in one upfront lump sum payment of $438,636 following the Sponsor’s approval of an invoice from the TA describing the expenses to which the matching funds will be applied, subject to the following terms and conditions:
a. TA agrees that matching funds are to be expended solely for the Project and agrees to apply the matching funds using the pro-rata share (24%) contribution from the Sponsor toward the Scope of Work. TA technical assistance funding does not count toward the pro-rata share calculation. Should any funding remain upon completion or termination of the Project, the TA will immediately return any available balance to the Sponsor.
b. TA will document Project progress and expended New Measure A and matching funds in its regular status reports (see section D-5).

4. Insufficient Funding. In the event that additional funding is needed to complete the Scope of Work, the TA will identify the additional amounts needed and review those estimates with the Sponsor. The Parties will work together to identify potential sources of funding, as well as obtain the necessary funds to complete the Scope of Work. If additional funding is needed due to a change in the Scope of Work, as requested by the Sponsor, the TA will identify the additional amounts needed and review those estimates with the Sponsor. In such case, it is the responsibility of the Sponsor to identify the potential sources of funding, as well as obtain the necessary funds to complete the changed Scope of Work. The TA may consider requests for additional funding, but is under no obligation to grant such requests.

C. Term

1. Term of Agreement. This MOU is effective upon the Execution Date, and will terminate upon the earliest of: (a) 6 months after written acceptance/endorsement of the Sponsor of the completion of the Scope of Work, (b) termination by Sponsor or the TA pursuant to section C-3, C-4 or C-5, or (c) March 30, 2028.

2. Time of Performance. This Project Scope of Work must be completed no later than September 30, 2025.

3. Termination by Sponsor. The Sponsor may at any time terminate the MOU by giving ten (10) days’ written notice to the TA. Sponsor will reimburse the TA for all funds expended by the TA in connection with the Scope of Work, and for all costs incurred by the TA in connection with the termination, within ninety (90) days of the TA’s submission to Sponsor of a detailed statement of such payments and costs.

4. Termination by the TA. The TA may at any time terminate the MOU, with or without cause, by giving ten (10) days' written notice of such termination. If the TA terminates the MOU for Sponsor's default, Sponsor will reimburse the TA for all funds expended by the TA in 213 of 563
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connection with performance of this MOU. If the TA terminates the MOU for convenience, the TA will reimburse Sponsor all costs and expenses incurred by Sponsor as a result of such termination.

5. Termination by the Parties. If it is mutually agreed by the Parties that it would be in their mutual best interests to terminate or suspend work on the Project, neither Party may seek nor be entitled to receive further reimbursement for any costs or expenses incurred in connection with the Scope of Work nor termination of this MOU.

6. Expiration of TA Financial Obligations. Any and all financial obligations of the TA pursuant to this MOU will expire upon the expenditure of the TA’s maximum contribution to the Project as established in Section B-1 above or upon termination of this MOU under Section C-1 above, whichever occurs first.

D. TA Responsibilities

1. The TA will perform and complete the Scope of Work, either through its own forces or the use of one or more third-party consultants or contractors.

2. The TA will make available to the Project up to $1,386,364 of New Measure A funds for the Scope of Work and up to $200,000 for TA staff or consultant support.

3. For purposes of delivering the Scope of Work, the TA agrees to:
a. Manage the Scope of Work, including developing and carrying out the Scope of Work on schedule and within budget;
b. Provide technical oversight for performance of the Scope of Work; c. Lead coordination with Caltrans and other permitting agencies as necessary for the Scope of Work;
d. Obtain the necessary permits and approvals required for the Scope of Work; e. Procure and administer the consultant/contractor services to complete the Scope of Work;
f. Organize and facilitate regular meetings of a Technical Working Group (TWG) comprised of the design team, Sponsor, and representatives from involved local and regional entities to provide input and guidance on the Scope of Work; g. Keep Sponsor apprised of developments, such as award of contracts or potential changes that may affect the scope, schedule, or budget of the Project or Scope of Work; and
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h. Consult with Sponsor where necessary/appropriate.

4. The TA will provide the Sponsor access to the quarterly progress reports that the TA provides to its Board of Directors.

5. The TA will review, process, and audit (at its discretion) invoices and other documentation of expenditures for work performed under this MOU. The TA will also track the accumulation and expenditure of New Measure A funds allocated for Scope of Work, and process other documentation of expenditures in compliance with TA accounting and budgeting requirements.

6. The TA will be responsible for preparing grant applications and supporting the Sponsor in securing additional gap funding for the Project, as needed.

7. The TA will lead outreach efforts to local stakeholders and community members, including coordination of community workshops and periodic updates.

E. Sponsor Responsibilities

1. The Sponsor will share responsibilities with the TA for obtaining political and public support for the Project and securing additional gap funding for the Project, as needed.

2. The Sponsor will provide input and oversight based on local policies and desires regarding the outcome of and deliverables of the Project.

3. The Sponsor will actively participate in the TWG meetings related to the Scope of Work.

4. The Sponsor may, at its discretion, review any professional services agreements, change orders and any other agreements that the TA has entered into for the performance of Scope of Work; however, the TA retains ultimate authority over contracting and related decisions.

5. The Sponsor may, at its discretion, review the work products and deliverables produced by the TA and/or its contractors/consultants for the Scope of Work, including reports, designs, drawings, plans, specifications, schedules and other materials; however, the TA retains authority to accept or reject contractor/consultant work.

6. The Sponsor will approve or endorse, in writing, the final deliverables or work products produced by the TA and/or its contractors/consultants for the Scope of Work.

7. The Sponsor may, at its discretion, review and audit invoices and other documentation of the expenditure of New Measure A funds allocated for the Scope of Work; however, the TA retains ultimate authority for expenditure of New Measure A funds on the Project.

8. The Sponsor will provide a local match of $438,636 (see section B-3). 215 of 563
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F. Indemnification

1. Each of the Parties will indemnify, hold harmless and defend the other Party and its directors/councilmembers, officers, employees and agents (collectively, "Indemnitees") against all liability, claims, suits, actions, costs or expenses related to performance of the Scope of Work or the Project, including but not limited to those arising from loss of or damage to property, and injuries to or death of any person (including but not limited to the property or employees of each Party) when arising out of or resulting from any act or omission by the indemnifying Party, its agents, employees, contractors or subcontractors in connection with any aspect of the Project, including Project design, construction and/or maintenance.

2. Each of the Parties will also fully release, indemnify, hold harmless and defend the other Party and Indemnitees from and against any and all claims or suits that may be brought by any of the indemnifying Party's contractors or subcontractors performing work in connection with or related to the Project.

3. The indemnifying Party's obligation to defend includes the payment of all reasonable attorneys' fees and all other costs and expenses of suit, and if any judgment is rendered, or settlement entered, against any Indemnitee, the indemnifying Party must, at its expense, satisfy and discharge the same. Indemnitees may require the indemnifying Party to obtain counsel satisfactory to the Indemnitees.

4. This indemnification will survive termination or expiration of this MOU.

G. Miscellaneous

1. Ownership of Work. All reports, designs, drawings, plans, specifications, schedules, studies, memoranda, and other documents assembled for or prepared by or for; in the process of being assembled or prepared by or for; or furnished to the TA or the Sponsor under this MOU, are the joint property of the TA and the Sponsor. Each Party is entitled to copies and access to these materials during the progress of the Project and upon completion of the Scope of Work or termination of this MOU. Both Parties may retain a copy of all material produced under this MOU for use in their general activities.

2. Attribution to the TA. Sponsor must include attribution that indicates work was funded by New Measure A funds from the TA. This provision applies to any project, or publication, that was funded in part or in whole by New Measure A funds. Acceptable forms of attribution include TA branding on Project-related documents, construction signs, public information materials, and any other applicable documents.

3. No Waiver. No waiver of any default or breach of any covenant of this MOU by either Party will be implied from any omission by either Party to take action on account of such default if such default persists or is repeated. Express waivers are limited in scope and 216 of 563
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duration to their express provisions. Consent to one action does not imply consent to any future action.

4. Assignment. No Party can assign, transfer or otherwise substitute its interest or obligations under this MOU without the written consent of the other Party.

5. Governing Law. This MOU is governed by the laws of the State of California as applied to contracts that are made and performed entirely in California.

6. Compliance with Laws. In performance of this MOU, the Parties must comply with all applicable Federal, State and local laws, regulations and ordinances.

7. Accessibility of Services to Persons with Disabilities. The Project implementation must comply with, and not subject the TA or Sponsor to liability under, the Americans with Disabilities Act, the California Disabled Persons Act, or any other state or federal laws protecting the rights of persons with disabilities.

8. Modifications. This MOU may only be modified in a writing executed by all Parties.

9. Disputes. If a question arises regarding interpretation of this MOU or its performance, or the alleged failure of a Party to perform, the Party raising the question or making the allegation must give written notice thereof to the other Party. The Parties will promptly meet in an effort to resolve the issues raised. If the Parties fail to resolve the issues raised, alternative forms of dispute resolution, including mediation or binding arbitration, may be pursued by mutual agreement. It is the intent of the Parties to the extent possible that litigation be avoided as a method of dispute resolution.

10. Attorneys' Fees. In the event legal proceedings are instituted to enforce any provision of this MOU, the prevailing Party in said proceedings will be entitled to its costs, including reasonable attorneys' fees, in addition to such other remedies to which it may be entitled.

11. Relationship of the Parties. It is understood that this is an MOU by and between independent contractors and is not intended to and does not create the relationship of agent, servant, employee, partnership, joint venture or association, or any other relationship whatsoever other than that of independent contractor.

12. Warranty of Authority to Execute MOU. Each Party to this MOU represents and warrants that each person whose signature appears hereon is duly authorized and has the full authority to execute this MOU on behalf of the entity that is a Party to this MOU.

13. Severability. If any portion of this Agreement, or the application thereof, is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining portions of this Agreement, or the application thereof, will remain in full force and effect.

14. Counterparts. This MOU may be executed in counterparts. 217 of 563
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15. Electronic Signatures. This MOU may be executed through the use of digital or electronic signatures in accordance with Government Code Section 16.5. The presence of an electronic signature on this MOU will be construed as the Parties’ consent to do business electronically.

16. Entire MOU. This MOU constitutes the entire agreement between the Parties pertaining to its subject matter and supersedes any prior or contemporaneous written or oral agreement between the Parties on the same subject.

17. Notices. All notices affecting any of the clauses of this MOU must be in writing and mailed postage prepaid by certified or registered mail, return receipt requested, or by personal delivery or overnight courier, to the appropriate address indicated below or at such other place(s) that either Party may designate in written notice to the other. Notices will be deemed received upon delivery if personally served, one (1) day after mailing if delivered via overnight courier, or two (2) days after mailing if mailed as provided above.

To TA: San Mateo County Transportation Authority
1250 San Carlos Avenue
P.O. Box 3006
San Carlos, CA 94070-1306
Attn: District/TA Secretary
To Sponsor: City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attn: City Manager
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IN WITNESS WHEREOF, the Parties have hereunder subscribed their names as of the Execution Date.

CITY OF SAN MATEO
By:

Name: Alex Khojikian
Its: City Manager
Approved as to Form:

Legal Counsel for the City of San Mateo

SAN MATEO COUNTY TRANSPORTATION

AUTHORITY
By:

Name: April Chan
Its: Executive Director
Approved as to Form:

Legal Counsel for the TA
Exhibit A: Scope of Work Information
Exhibit B: Excerpts from the Project’s Cycle 6 Measure A/W Pedestrian and Bicycle Program Funding Application (i.e. location maps, design plans, detailed scope of work, etc.) 219 of 563
PEDESTRIAN AND BICYCLE PROGRAM 2022 CYCLE 6 CALL FOR PROJECTS San Mateo County Transportation Authority/City of San Mateo Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project 10 21219602.2
EXHIBIT A: SCOPE OF WORK INFORMATION
Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project Sponsoring Agency: City of San Mateo
Contact: Jay Yu, Engineering Manager
(650) 522-7323, [email protected],
330 W. 20th Avenue, San Mateo, CA 94403
Lead/Implementing Agency: SMCTA
Contact: Carolyn Mamaradlo, Project Manager
(650) 394-9633, [email protected],
1250 San Carlos Avenue, San Carlos, CA 94070
Project Description and Scope of Work:

The Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project includes the environmental review and final design for multimodal roadway improvements between Pacific Boulevard and Mariners Island Boulevard. The Project elements include a Class IV separated bikeway, sidewalk and pedestrian safety features, smart/adaptive signals, traffic lane reconfiguration, stormwater treatment and the reconstruction of the intersection of S. Norfolk Street and Fashions Island Boulevard.

The Project will connect residents and commuters to the Hayward Park Caltrain Station and future SamTrans Mobility Hub at the existing Caltrans Park and Ride lot. The Project is intended to improve conditions near the freeway on-/off-ramps, incorporate areas for green stormwater infrastructure, develop protected intersections, and fill in gaps in the existing bike network.

Project Schedule:

Begin End _
Program or Planning 10/22 12/24
PE/Environmental 09/24 02/25
PS&E 02/25 09/25
Right-of-Way N/A N/A
Construction N/A N/A
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PEDESTRIAN AND BICYCLE PROGRAM 2022 CYCLE 6 CALL FOR PROJECTS San Mateo County Transportation Authority/City of San Mateo Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project 11 21219602.2
Project Budget/ Source of Funding:

Include funding plan for project defined above, including use of TA staff support if applicable List Fund Source Amount
PE/Environmental $554,545 City of San Mateo** $105,455 $660,000 PS&E $831,819 City of San Mateo** $333,181 $1,165,000
$0
TA Support, if applicable $200,000 $200,000
Total: $1,586,364 $438,636 $2,025,000
Measure A Other Sources*
Funding Amount Phase Total
* The other fund sources are provided for informational purposes. **Includes City of San Mateo Congestion Relief Funds ($50K for PE/ENV; $250K for PS&E) Operating Responsibility: N/A
Maintenance Responsibility: N/A
Project Implementation Responsibility: San Mateo County Transportation Authority Project Oversight Responsibility: San Mateo County Transportation Authority 221 of 563
PEDESTRIAN AND BICYCLE PROGRAM 2022 CYCLE 6 CALL FOR PROJECTS San Mateo County Transportation Authority/City of San Mateo Fashion Island Boulevard/19th Avenue Class IV Bikeway Complete Streets Project 12 21219602.2
Exhibit B: Excerpts from the Project’s Cycle 6 Measures A and W Pedestrian and Bicycle Program Funding Application (i.e. location maps, design plans, detailed scope of work, etc.) 222 of 563

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 15 Section Name: CONSENT CALENDAR Account Number: 10-1311 File ID: 24-9341 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Manager's Office
MEETING DATE: December 09, 2024
SUBJECT:

Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program – Grant Acceptance RECOMMENDATION:

Adopt a Resolution accepting grant funding in the amount of $155,720 from the Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program for the installation of electric vehicle charging infrastructure for City fleet and appropriating $155,720 to the Green Fleet Charging Infrastructure Project; approve the EECBG Program Special Terms and Conditions; and authorize the City Manager to execute required documentation to receive the grant funds.

BACKGROUND:

The Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program is a $550 million grant program funded through the Bipartisan Infrastructure Law. It is designed to assist states, local governments, and Tribes in implementing strategies to reduce energy use, to reduce fossil fuel emissions, and to improve energy efficiency. The City of San Mateo is eligible for a noncompetitive allocation of $155,720.

Staff reviewed the EECBG Program guidance and identified the purchase of equipment and the equipment rebate application to be the most streamlined and administratively efficient use of the grant funds. Staff applied for the purchase and installation of electric vehicle charging infrastructure for City fleet at City Hall, aligning with the City’s Climate Action Plan and City Council priority to electrify the City’s fleet. The DOE approved the City’s application and the EECBG Program Special Terms and Conditions document needs to be signed to accept the grant funding. A future staff report will be presented to the City Council seeking authorization to procure and install the charging infrastructure.

Staff recommends City Council adopt a Resolution to accept the grant funding in the amount of $155,720 and appropriate grant funding in the amount of $155,720 to the Green Fleet Charging Infrastructure Project; approve the EECBG Program Special Terms and Conditions; and authorize the City Manager to execute all required documentation to receive the funds.

BUDGET IMPACT:

There is no local match required. Grant funding in the amount of $155,720 will be appropriated to Green Fleet Charging Infrastructure Project 46C003.

ENVIRONMENTAL DETERMINATION:

Adoption of a Resolution to accept grant funds and to authorize the appropriation of grant funds, and approval of special terms and conditions to receive the grant funds, is not a project subject to CEQA, because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment. (CEQA Guidelines Section 15378(b)(4).)Click or tap here to enter text. 223 of 563

CITY OF SAN MATEO

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – EECBG Program Special Terms and Conditions

STAFF CONTACT
Andrea Chow, Sustainability Analyst
[email protected]
(650) 522-7007
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)

ACCEPTING DEPARTMENT OF ENERGY, ENERGY EFFICIENCY AND CONSERVATION BLOCK GRANT PROGRAM FUNDS IN THE AMOUNT OF $155,720 FOR THE INSTALLATION OF ELECTRIC VEHICLE CHARING INFRASTRUCTURE FOR CITY FLEET AND APPROPRIATING $155,720 TO THE GREEN FLEET

CHARGING INFRASTRUCTURE PROJECT
WHEREAS, the Department of Energy (DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program is a $550 million grant program funded through the Bipartisan Infrastructure law; and WHEREAS, the EECBG Program is designed to assist, states, local governments, and Tribes in implementing strategies to reduce energy use, to reduce fossil fuel emissions, and to improve energy efficiency; and
WHEREAS, the City of San Mateo is eligible for a noncompetitive allocation of $155,720; and WHEREAS, the City’s EECBG funding application for the purchase and installation of electric vehicle charging infrastructure for City Fleet was approved by the DOE; and WHEREAS, signing the EECBG Program Special Terms and Conditions is necessary to receive the grant funding; and
WHEREAS, the City of San Mateo wishes to approve acceptance of the grant subject to the EECBG Program Special Terms and Conditions and to appropriate $155,720 of grant funding to the Green Fleet Charging Infrastructure Project.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This City Council action adopting a resolution to accept grant funds, and approval of the Special Terms and Conditions, is not a project subject to CEQA review because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment. (CEQA Guidelines Section 157378(b)(4).)

2. Acceptance of the DOE EECBG Program grant award in the amount of $155,720 is approved.

3. An appropriation of $155,720 in grant funds to the Green Fleet Charging Infrastructure Project 46C003 is approved.
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4. The City Manager, or designee, is authorized to execute the EECBG Program Special Terms and Conditions and to take other actions necessary including the execution of any other required documentation to give effect to this resolution. 226 of 563
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 16 Section Name: CONSENT CALENDAR Account Number: 10-3133 File ID: 24-9181 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: December 9, 2024
SUBJECT:
2000 S. Delaware Street Affordable Housing Project – Loan Documents, Regulatory Agreement, Ground Lease and Supplemental Appropriation
RECOMMENDATION:

Adopt a Resolution appropriating $500,000 from the General Fund Housing Set-Aside to provide a loan to MP 2000 Delaware, LLC in the amount of $500,000 for the 2000 S. Delaware Street affordable housing project; approve an Amended and Restated Ground Lease and Regulatory Agreement restricting the units at 2000 South Delaware to households at specified income levels, and approve a Loan Agreement, a Deed of Trust, and a Promissory Note; and authorize the City Manager to execute all documents and make any appropriate changes that do not differ from the Term Sheet.

BACKGROUND:

The 2000 S. Delaware Street affordable housing project (2000 S. Delaware) is 60-unit, deed-restricted affordable development on City-owned land at 2000 S. Delaware St., owned by MidPen Housing (MidPen, operating as MP 2000 Delaware, LLC). 2000 S. Delaware was constructed and operated by Westlake Realty Group as a moderate-income affordable housing development (at or below 120 percent AMI) until MidPen acquired the property in September 2024.

At its August 19, 2024 meeting, the City Council approved the reassignment of the 2000 S. Delaware ground lease from Westlake Realty Group to MidPen and amendments to deepen the affordability of the units from moderate-income to low-income. The City Council also approved a term sheet that included a $500,000 loan commitment to MidPen in exchange for restricting the units to low-income and directed staff to return with a regulatory agreement, loan agreement, and other documents required to fulfill the requirements of the Term Sheet.

The sale of 2000 S. Delaware from Westlake Realty Group to MidPen closed on September 27, 2024. The Assignment and First Amendment to the Ground Lease (Assignment and First Amendment) that was approved by City Council at the August 19, 2024 meeting was recorded on this date. The Assignment and First Amendment was intended to be in effect in the interim period between the closing date and the execution of an Amended and Restated Ground Lease. The Amended and Restated Ground Lease is included as Attachment 6.

The Regulatory Agreement is included as Attachment 2. The Loan Agreement, Deed of Trust, and Promissory Note are included as Attachments 3, 4, and 5, respectively.

DISCUSSION:

Funding Recommendation
The City Council approved the staff recommendation to provide $500,000 to MidPen in the form of a residual receipts loan (Loan) to subsidize the deeper affordability level at 2000 S. Delaware. The Loan has a 55-year term with three percent simple interest. Repayments on the Loan will be made out of residual receipts after the repayment of a loan from MidPen 258 of 563

CITY OF SAN MATEO
to 2000 S. Delaware, which is expected to take 15 years. A residual receipts loan is a loan that is repaid out of a project’s annual revenue after all operating expenses, debt service, deposits into reserves, and other obligatory payments are paid.

Staff recommends a supplemental appropriation for this Loan from the General Fund Housing Set-Aside (Housing SetAside). The Housing Set-Aside is one of the most flexible Housing funds in terms of allowable uses, including preservation.

The balance of this Fund is approximately $6.87 million.

MidPen Ownership of 2000 S. Delaware
MidPen conducted two outreach meetings prior to the transition in ownership to discuss the upcoming changes and address any questions or concerns from residents. Residents were informed that rents will not change for the first year of ownership.

As noted in the August 19, 2024 agenda report, current tenants will be income-certified, with a potential rent adjustment to reflect the household’s income level when their current lease expires, and a new lease term begins. MidPen staff is currently auditing tenant files to create a rectification process for the development. No tenants will be displaced, including tenants who are income-certified up to and above 120 percent AMI. As units occupied by tenants above the 80 percent AMI threshold become vacant, they will be rented to these lower income households, thus deepening the affordability of the building over time without any tenant displacement. Also, the Regulatory Agreement and Amended and Restated Ground Lease, together with the marketing plan proposed by MidPen, will result in restricting the affordability of the units to low-income households. In addition, on November 25, MidPen opened the marketing period for seven vacant units at 2000 S. Delaware, which will be rented to households at or below 80 percent AMI. Applications for available units will be accepted starting the week of December 2, 2024.

Regional Housing Needs Allocation (RHNA) Credit
State law allows for some preserved units to be counted towards a portion of a jurisdiction’s Regional Housing Needs Allocation, or RHNA. In order to qualify, the preservation project must meet certain criteria, including restricting the units to low or very-low-income households for a minimum 55-year period and receiving “committed assistance” from the jurisdiction in the form of funds or in-kind assistance. In general, “acquisition/conversion” projects may qualify for RHNA credit, but this typically involves converting market-rate units to deed-restricted units. However, staff is still researching whether some units at 2000 S. Delaware could be counted towards the RHNA in the 2024 Annual Progress Report (APR).

BUDGET IMPACT:

The Loan to MidPen for 2000 S. Delaware will require an appropriation of $500,000 from the General Fund Housing SetAside, which has a fund balance of approximately $6.87 million. The Resolution appropriating these funds is provided as Attachment 1.

ENVIRONMENTAL DETERMINATION:

This action is not a project subject to CEQA, because it can be seen with certainty that approval of loan documents, a regulatory agreement, a ground lease and a supplemental appropriation related to an existing residential building will not cause a physical change in the environment. (Public Resources Code Section 21065.) NOTICE PROVIDED:

All meeting noticing requirements were met.

ATTACHMENTS
Attachment 1 — Proposed Resolution
Attachment 2 — Regulatory Agreement
Attachment 3 — Loan Agreement
Attachment 4 — Deed of Trust
Attachment 5 — Promissory Note
Attachment 6 — Amended and Restated Ground Lease
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CITY OF SAN MATEO

STAFF CONTACT
Rachel Horst, Housing and Neighborhood Services Manager [email protected]
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CITY OF SAN MATEO
RESOLUTION NO. ____ (2024)
APPROPRIATING FUNDS FOR A LOAN TO MP 2000 DELAWARE LLC FOR THE 2000 SOUTH DELAWARE

AFFORDABLE HOUSING PROJECT
WHEREAS, the City owns real property at 2000 South Delaware Street, San Mateo, California (Property); and
WHEREAS, the City leased a portion of the Property to Westlake Realty Group (Westlake), which constructed and operated an affordable housing project for moderate-income households (2000 S. Delaware); and
WHEREAS, on August 19, 2024, the City Council approved the reassignment of the Ground Lease with Westlake to MidPen Housing, operating as MP 2000 Delaware, LLC (MidPen), and an amendment to the Ground Lease to restrict the units at 2000 S. Delaware to households at or below 80 percent AMI; and WHEREAS, on September 27, 2024, MidPen and Westlake closed escrow on the sale of 2000 S.

Delaware; and
WHEREAS, the City Council wishes to provide Five Hundred Thousand Dollars ($500,000) in the form of a residual receipts loan (Loan) to subsidize the deepening of affordability at 2000 S. Delaware; and WHEREAS, an appropriation of $500,000 is necessary to fund the Loan.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. This fund appropriation is not a project of CEQA because it is an organizational or administrative activity that will not impact the environment (CEQA Guidelines Section 15378(b)(5).

2. The appropriation of $500,000 from the General Fund (Fund 100) Housing Set-Aside to fund the Loan is approved.
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: Housing Manager
SPACE ABOVE THIS LINE FOR RECORDER’S USE
This Regulatory Agreement is recorded at
the request and for the benefit of the City of
San Mateo and is exempt from the payment
of a recording fee pursuant to Government
Code Sections 27383.

REGULATORY AGREEMENT AND

DECLARATION OF RESTRICTIVE COVENANTS
(2000 South Delaware Street, San Mateo)
This REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS (the “Agreement”) is made and entered into as of ____________________, 2024, by and between the City of San Mateo, a California charter city, acting on its own behalf and in its capacity as the housing successor the dissolved Redevelopment Agency of the City of San Mateo (“City”), and MP 2000 Delaware, LLC, a California limited liability company (“Developer”).

RECITALS
A. These Recitals refer to and utilize certain capitalized terms which are defined in Article 1 of this Agreement. The Parties intend to refer to those definitions in connection with the use of capitalized terms in these Recitals.

B. The City is the owner of the Property, as more particularly described in Exhibit A attached hereto and incorporated herein by this reference, and the Developer and the City have entered into that certain Amended and Restated Ground Lease dated as of __________________ __, 2024, and as such may be further amended from time to time (collectively, the "Ground Lease"), pursuant to which the Developer will acquire a leasehold interest in the Property from the City for a period expiring at 11:59 p.m. on May 2, 2111 (the "Leasehold Interest"). The Developer owns 60 multifamily housing units on the Property for rental to Low Income households, including one (1) unrestricted manager unit, and attendant site improvements (the "Improvements"). The Developer's Leasehold Interest and the Developer's fee interest in the Improvements, are collectively herein after referred to as the "Development." 262 of 563
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C. To assist the Developer with the acquisition of the Development, the City will provide to Developer the "City Loan" totaling Five Hundred Thousand Dollars ($500,000) from the City’s General Fund (“City Loan”).

D. This Agreement imposes occupancy and affordability restrictions on the Development.

E. In order to ensure that the entire Development will be used and operated in accordance with these conditions and restrictions, the City and Developer wish to enter into this Agreement.

THEREFORE, the City and Developer hereby agree as follows:

ARTICLE 1.

DEFINITIONS
Section 1.1 Definitions.

When used in this Agreement, the following terms shall have the respective meanings assigned to them in this Article 1.
(a) “Actual Household Size” means the actual number of persons in the applicable household.
(b) "Adjusted Income" means: for all Low-Income Units, the total anticipated annual income of all persons in a household, as calculated in accordance with the California Tax Credit Allocation Committee rules and regulations or pursuant to a successor State housing program that utilizes a reasonably similar method of calculation of adjusted income. In the event that no such program exists, the City shall provide the Developer with a reasonably similar method of calculation of adjusted income as provided in California Code of Regulations Title 25, Section 6914.
(c) “Assumed Household Size” shall be set by multiplying 1.5 by the number of bedrooms in the unit. The definition is utilized to calculate affordable rent and is not intended to be a limit on the number of persons occupying a Unit. (d) "City" means the City of San Mateo, a California charter city, and its successors and assigns.
(e) "City Deed of Trust” means the Leasehold Deed of Trust with Assignment of Rents, Security Agreement, and Fixture Filing dated of even date herewith, among Developer, as trustor, Old Republic Title Company, as trustee, and the City, as beneficiary, that will encumber the Developer's leasehold interest in the Property to secure repayment of the City Loan and performance of the covenants of the Loan Documents.
(f) "City Loan" has the meaning set forth in Recital C, above. (g) "County" means the County of San Mateo.
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(h) "CTCAC" means the California Tax Credit Allocation Committee. (i) "HCD" means the California Department of Housing and Community Development.
(j) "Improvements" means the sixty (60) units of affordable rental housing on the Property, including one manager's unit, all common areas, amenities, plans, entitlements, appurtenances, improvement easements, buildings and fixtures associated with the Property. (k) “Loan Documents” means this Agreement, the Notes that evidence the City Loan, the City Deed of Trust, and the Notice of Affordability Restrictions. (l) “Low Income Household” means a Tenant household with an Adjusted Income that does not exceed 80% of Median Income, adjusted for Actual Household Size, as published by CTCAC. In the event that that such income determinations are no longer published or are not updated for a period of at least eighteen (18) months, the City shall provide the Developer with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HCD and/or TCAC. (m) "Low Income Rent" means the maximum allowable rent for a Low Income Unit.
(n) "Low Income Units" means the Units which are allowed to be occupied by Low Income Households.
(o) "Management Agent" means the management agent retained by Developer and approved by the City in accordance with the provisions of Section 5.2 to manage the Development.
(p) "Median Income" means the median income, adjusted for Actual Household Size (to qualify residents) or Assumed Household Size (to calculate rents), as applicable, in the County of San Mateo, California, as published by CTCAC. In the event that such income determinations are no longer published or are not updated for a period of at least eighteen (18) months, the City shall provide the Developer with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HCD and/or TCAC.
(q) “Median Income Household” means a Tenant household with an Adjusted Income that does not exceed 100% of Median Income, adjusted for Actual Household Size, as published by CTCAC. In the event that that such income determinations are no longer published or are not updated for a period of at least eighteen (18) months, the City shall provide the Developer with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HCD and/or TCAC. (r) “Median Income Rent” means the maximum allowable rent for a Median Income Unit.
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(s) “Median Income Units” means the Units which are allowed to be occupied by Median Income Households.
(t) “Moderate Income Household” means a household already living at the Property prior to Developer’s acquisition of the Property with an income that does not exceed the 120% of Median Income, adjusted for Actual Household Size, as established and amended from time to time pursuant to Section 8 of the United States Housing Act of 1937, and as published by HCD.
(u) "Notice of Affordability Restrictions" means the Notice of Affordability Restrictions on Transfer of Property, in a form to be provided by the City, between the City and the Developer to be recorded against the Property.
(v) “Notes” means the promissory notes from Developer to the City evidencing the City Loan.
(w) “Property” means the property that is subject to the terms and provisions of this Agreement, as referenced in Recital B, above, and comprises (1) the leasehold estate of Developer in the Property and (2) the ownership interests of Developer in the Development constructed on the Property.
(x) “Rent” means the total monthly payments by the Tenant of a Unit (other than the manager's Unit) for the following: (1) use and occupancy of the Unit and land and associated facilities; (2) the City-approved Utility Allowance. In no event shall the Rent of a Unit exceed the amount permitted by the City pursuant to Section 2.2 hereof. (y) "Restricted Units" means the Median and Low Income Units, collectively and each shall be referred to as a "Restricted Unit".
(z) “Tenant” means a household occupying a Unit.
(aa) “Term” means the term of this Agreement which commences as of the date of this Agreement, and unless sooner terminated pursuant to the terms of this Agreement, expires on the fifty-fifth (55th) anniversary of the date that the City Deed of Trust is recorded. (bb) “Unit” means one of the rental units included in the Development. (cc) “Utility Allowance” means all tenant-paid utilities, as shown in the County of San Mateo Housing Authority Utility Allowance Schedule, and any other mandatory interest, taxes, fees, or charges for use of the land or associated facilities assessed by the Developer or a public or private entity other than the developer, that are charged to the tenant.

ARTICLE 2.

AFFORDABILITY AND OCCUPANCY COVENANTS
Section 2.1 Occupancy Requirements.
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(dd) Existing Units. All existing tenants with a lease agreement prior to Developer’s acquisition of the Property (close of escrow date, September 27, 2024), who were previously qualified at below 120% AMI (Moderate Income Households), shall be allowed to continue to occupy their units until such time as they choose to vacate the unit, provided they are in good standing with their leases.
(ee) Median Income Units. Fifty-one percent (51%) of the Restricted Units, or no fewer than 30 two-bedroom Units, shall be rented to and occupied by, or, if vacant, available for occupancy by households whose income does not exceed the maximum for Median Income Households.
(ff) Low Income Units. Forty-nine percent (49%) of the Restricted Units, or no fewer than 29 two-bedroom Units, shall be rented to and occupied by or, if vacant, available for occupancy by households whose income does not exceed the maximum for Low Income Households.
(gg) Managers Unit. One (1) unit shall be designated as a manager’s unit that is not income restricted.

Section 2.2 Allowable Rent.
(a) Low Income Rent. The maximum Rent charged to Tenants of Low Income Units shall not exceed the rent permitted to be charged as published annually by CTCAC for Low-Income Housing Tax Credit Programs for Low Income Households for San Mateo County, adjusted for Assumed Household Size.
(b) Median Income Rent. The maximum Rent charged to Tenants of Median Income Units shall not exceed the rent permitted to be charged as published annually by CTCAC for Low-Income Housing Tax Credit Programs for Median Income Households for San Mateo County, adjusted for Assumed Household Size.
(c) Moderate Income Rent. The Rent charged to tenants of Moderate Income shall not exceed one-twelfth (1/12th) of thirty percent (30%) of one hundred twenty percent (120%) of Median Income, adjusted for Assumed Household Size, as published by HCD. (d) In calculating the allowable Rent for the Restricted Units, the CTCAC "Assumed Household Sizes" shall be utilized, and if not available, Assumed Household Size shall be determined pursuant to the terms of Health and Safety Code Section 50052.5(h). (e) Approval of Rents. Initial Rents for all Restricted Units shall be approved by the City prior to occupancy. All proposed Rent increases for Restricted Units shall be submitted to City for review and approval at least thirty (30) days prior to Developer providing written notice to Tenants. Notwithstanding the foregoing, City’s review and approval of Rents and Rent increases shall be limited to determining that such Rents and Rent increases comply with the requirements of this Regulatory Agreement. No later than thirty (30) days after HCD publishes State Income Limits for each calendar year, the City shall provide the Developer with a schedule of permissible maximum Low Income Rents, as applicable, for the succeeding year 266 of 563
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(the "Rent Schedule"). The Rent Schedule for each calendar year shall reflect the increase in maximum permissible rents which corresponds directly to any increase in Median Income for the County of San Mateo from the Median Income for the County of San Mateo published for the previous calendar year. Under no circumstance may the Developer raise rents above the permissible maximum rents as allowed under the annual rent schedule provided by the City. (hh) Rent Increases. Rent for the Restricted Units shall be increased no more than once annually based upon income recertifications described in Article 3 and upon expiration of a Tenant’s current lease. Except for Non-Qualifying Households, all rent increases shall comply with CTCAC rent increase regulation approved on April 3, 2024. By way of reference, Developer shall implement the MidPen Tiered Rent Increase Policy, as defined in Exhibit B attached hereto, which may change from time to time at Developer’s sole discretion with notice and updated policy delivered to the City. Tenants shall be given at least sixty (60) days’ written notice prior to any Rent increase.
(ii) No Additional Fees. Developer shall not charge any fee, other than Rent, to any resident of the Restricted Units for any housing or other services provided by Developer pursuant to the Loan Documents. Nothing herein shall prevent Developer from establishing charges for tenant defaults, so long as such fees are not prohibited under 24 CFR 92.214. (jj) Notwithstanding anything to the contrary set forth herein, in the event that Median Incomes decrease in any given calendar year, Developer is permitted to apply the "hold harmless" policy (“Policy”) implemented by CTCAC pursuant to the Housing and Economic Recovery Act of 2008 (H.R. 3221). The Policy states that, as of the date of placed-in-service, (or rent floor election date, available after CTCAC award/reservation), rent limits for a given calendar year cannot be lower than the highest amount of rent limits for each calendar year since placed-in-service.

Section 2.3 Increased Income of Tenants.
(a) Non-Qualifying Household. If, upon recertification of the income of a Tenant, the Developer determines that a former Low Income Household's Adjusted Income has increased and exceeds the maximum qualifying income for a Low Income Household (80% of Median Income), such Tenant shall be permitted to continue occupying the Unit and upon expiration of the Tenant's lease for such year and upon sixty (60) days written notice, the Tenant may continue to reside in the Unit and the Rent may be increased to the lesser of one-twelfth (1/12th) of thirty percent (30%) of actual Adjusted Income of the Tenant, or fair market rent (subject to 24 C.F.R. 92.252(i)(2) regarding low income housing tax credit requirements).

Section 2.4 Tenant Protections. For the entire Term the Restricted Units shall be subject to Just Cause for Eviction rules and regulations. For a termination to qualify as "For Cause," the Developer shall demonstrate any of the following circumstances with respect to a termination of tenancy. Nothing in this section shall abrogate the protections afforded to survivors of violence consistent with the California Code of Civil Procedure Section 1161.3, as amended, and the Violence Against Women Act, Public Law 102-322, as amended, to the extent applicable.
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(kk) Failure to Pay Rent. Tenant failed to pay Rent within three days of receiving written notice from the Developer demanding payment as provided in subsection 2 of California Code of Civil Procedure section 1161.
(ll) Breach of Rental Contract. Tenant violated a material term of the rental agreement as provided in subsection 3 of California Code of Civil Procedure section 1161. (mm) Tenant Illegal Activities. Tenant has been convicted of using the Restricted Unit for an illegal purpose as provided in subsection 4 of California Code of Civil Procedure section 1161, including but not limited to the unlawful distribution of a controlled substance as contemplated by California Civil Code section 3486, the unlawful use, manufacture, or possession of weapons and ammunition as contemplated by California Civil Code section 3485, or for of a serious crime or violent felony as defined by applicable law, which occurred during the tenancy and within 1,000 feet of the Dwelling Unit. For purposes of this subsection, Tenant Household, after receiving a written notice, may cure the violation by removing, and demonstrating such removal, of the offending Tenant. (nn) Threat of Violent Crime. Any statement made by a Tenant, or at his or her request, by his or her agent to any person who is on the property that includes the unit or to the Developer, or Developer's agents, threatening the commission of a crime which will result in death or great bodily injury to another person, with the specific intent that the statement is to be taken as a threat, even if there is no intent of actually carrying it out, when on its face and under the circumstances in which it is made, it is so unequivocal, immediate and specific as to convey to the person threatened, a gravity of purpose and an immediate prospect of execution of the threat, and thereby causes that person reasonably to be in sustained fear for his or her own safety or for his or her immediate family's safety.
(oo) Nuisance Behavior. The Tenant, after written notice to cease and the passage of a reasonable period of time to abate or cure, continues to be so disorderly or to cause such a nuisance as to destroy the peace, quiet, comfort, or safety of the Developer or other Tenants of the structure or rental complex containing the Restricted Units. Such nuisance or disorderly conduct includes violations of state and federal criminal law that destroy the peace, quiet, comfort, or safety of the Developer or other Tenants of the structure or rental complex containing the Restricted Units, or the creation or maintenance of a dangerous or unsanitary condition in violation of applicable local, state, and Federal law, and may be further defined in the regulations adopted by the Community Development Director. (pp) Notwithstanding the limitations of California Code of Civil Procedure Section 1161.3, as amended, act or acts constituting domestic violence or sexual assault or stalking against the Tenant or a member of Tenant's household cannot form the substantial basis of a For Cause reason to terminate the tenancy of the victim of such acts. A member of a Tenant household may raise such facts as an affirmative defense to an action terminating the tenancy.

Section 2.5 Lease Provisions. The Developer shall include in leases for all Restricted Units provisions which authorize the Developer to immediately terminate the tenancy of any household if one or more of whose members misrepresented any fact material to the household's 268 of 563
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qualification as a Low Income Household, as applicable. Each lease or rental agreement shall also provide that the household is subject to annual certification in accordance with Section 3.1 below, and that, if the household's income increases above the applicable limits for a Low Income Household, as applicable, such household's Rent may be subject to increase.

Section 1.2 Condominium Conversion. The Developer shall not convert the Development units to condominium or cooperative ownership or sell condominium or cooperative conversion rights to the Property during the Term of this Agreement.

Section 1.3 Units Available to the Disabled.

The Development is in compliance with all applicable federal and state disabled persons accessibility requirements including but not limited to the Federal Fair Housing Act; Section 504 of the Rehabilitation Act of 1973; Title II and/or Title III of the Americans with Disabilities Act of 1973 (29 U.S.C. 794 et seq,); and Title 24 of the California Code of Regulations. In compliance with Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794, et. seq.), a minimum of three (3) Units, shall be readily accessible and usable by households with a mobility impaired member and a minimum of one (1) Unit shall be constructed to be readily accessible and usable by households with a hearing and/or visually impaired member.

ARTICLE 3.

INCOME CERTIFICATION AND REPORTING
Section 3.1 Income Certification.
(a) Developer shall obtain, complete, and maintain on file, immediately prior to initial occupancy and annually thereafter, income certifications from each Tenant renting any of the Restricted Units. Developer shall make a good faith effort to verify the accuracy of the income provided by all applicants or all members of the occupying household (for all adults age eighteen (18) or older), as the case may be, in the income certification. To verify the information, Developer shall take one or more of the following steps as part of the verification process: (1) obtain a minimum of the three most current pay stubs for all adults age eighteen (18) or older; (2) obtain an income tax return for the most recent tax year; (3) conduct a credit agency or similar search; (4) obtain an income verification form from the applicant's current employer verifying employment for the last two months; (5) obtain the three (3) most current savings and checking account bank statements; (6) obtain an income verification form from the Social Security Administration and/or the California Department of Social Services if the applicant receives assistance from either of such agencies, verifying assistance for the last two months (as available from those agencies); or (7) if the applicant is unemployed and does not have a tax return, obtain another form of independent verification. Copies of Tenants' income certifications shall be available to the City upon reasonable written request.

Section 3.2 Tenant Selection.
(a) Prior to the date of execution of this Agreement, the Developer must provide the City for its review and approval its plan for marketing the Development to incomeeligible households as required pursuant to this Agreement, including information on affirmative 269 of 563
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marketing efforts and compliance with fair housing laws (the "Marketing Plan") that at a minimum meets the requirements for tenant selection set forth in 24 C.F.R. 92.253(d). (h) Developer shall maintain and utilize a waiting list for the property from which to select tenants for vacant units. If there are no eligible tenants on the waiting list when a unit becomes available, Developer shall announce that the property is accepting applications and open an application period to gather applicants for the vacant unit(s). Developer shall utilize the regional Doorway listing service or such other site as may be requested by the City for this purpose.
(i) Except as otherwise permitted in the City Loan Documents, the Developer shall not discriminate against any applicants for tenancy on the basis of source of income or rent payment (for example, without limitation, Temporary Assistance for Needy Families (TANF) or Section 8), and the Developer shall consider a prospective Tenant's previous rent history of at least one (1) year, or such other time period the Developer deems reasonable, as evidence of the prospective Tenant's ability to pay the applicable Rent. The ability to pay shall be demonstrated if the prospective Tenant can document that the prospective Tenant's gross income is at least two (2) times the prospective rent at the prospective Tenant's income level. The Developer, in the reasonable exercise of its discretion, may waive the requirement that the prospective Tenant's gross income equal at least two (2) times the prospective rent at the prospective Tenant's income level, and admit prospective Tenants with lower gross incomes.

Section 2.6 Annual Report to City.
(a) Developer shall submit to City: (1) not later than the forty-fifth (45th) day after the close of each calendar year, or such other date as may be requested by City, a statistical report, in a form acceptable to the City, including income and rent data for all Restricted Units, an assessment of compliance with the approved Management Plan, and an evaluation of the Management Agent. The Annual Report shall, at a minimum, include the following most recent information for each dwelling unit in the Project, but is not limited to: (i) unit number; (ii) number of bedrooms; (iii) current rent and other charges; (iv) dates of any vacancies during the previous year; (v) number of people residing in the unit; (vi) total gross household income of residents; (vii) documentation of source of household income; (viii) lease commencement and termination dates, (ix) initial move-in date, and (x) the information required by Section 3.1, any other information or completed forms reasonably requested by the City, and (2) within fifteen (15) days after receipt of a written request, any other information or completed forms requested by City in order to comply with reporting requirements of HUD, the State of California, or the City.

Section 2.7 Additional Information.

Developer shall provide any additional information reasonably requested by City. City shall have the right to examine and make copies of all books, records or other documents of Developer which pertain to the Development.

Section 2.8 Records.
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(j) Developer shall maintain complete, accurate and current records pertaining to the Development, and shall permit any duly authorized representative of City to inspect records, including records pertaining to income and household size of Tenants. All Tenant lists, applications and waiting lists relating to the Development shall at all times be kept separate and identifiable from any other business of Developer and shall be maintained as required by City, in a reasonable condition for proper audit and subject to examination during business hours by representatives of City. Developer shall retain copies of all materials obtained or produced with respect to occupancy of the Restricted Units for a period of at least five (5) years. Developer is subject to the audit requirements set forth in 24 C.F.R. 505.

Section 2.9 Annual Operating Budget. The Developer, at least sixty (60) days prior to the end of each of the Developer's fiscal year, shall furnish the City an Annual Operating Budget. Upon receipt by the City of the proposed Annual Operating Budget, the City shall promptly review the same and approve or disapprove it within ten (10) business days. If the Annual Operating Budget is not approved by the City, the City shall set forth in writing and notify the Developer of the City's reasons for withholding such approval. The Developer shall thereafter submit a revised Annual Operating Budget for City approval, which approval shall be granted or denied within ten (10) business days in accordance with the procedures set forth above. If no written comments from the City are received within ten (10) business days, the Annual Operating Budget will be deemed approved.

Section 2.10 On-Site Inspection.
(a) The City may perform, or cause to be performed, during normal business hours, an on-site inspection of the Development (including Restricted Units, subject to the rights of Tenants) at least one (1) time per year upon no less than three (3) business days' prior written notice to Developer to monitor compliance with this Agreement. Developer shall cooperate in making the Development available for such inspection. The City has the right to inspect the Development in accordance with the City's code as may be amended from time to time. (b) After the completion of an inspection the City shall deliver a copy of the Uniform Physical Conditions Standards inspection report and the Multifamily Unit Inspection (Form 9602), as applicable, to the Developer. If the City determines as a result of such inspection that there are any life-threatening health and safety related deficiencies, Developer has the obligation to correct such deficiencies immediately, in accordance with 24 C.F.R.

92.251. If the City determines as a result of the inspection that there are any deficiencies for any of the inspectable items in the Development (other than those identified in the preceding sentence), the Developer shall correct such deficiencies within thirty (30) days from the delivery of the inspection report or if a period longer than thirty (30) days is reasonably necessary to correct the deficiency, then Developer must begin to correct the deficiency within thirty (30) days and correct the deficiency as soon as reasonably possible. In addition, the Developer acknowledges that the City may re-inspect the Development to verify all deficiencies have been corrected or rely on third party documentation submitted by the Developer for non-hazardous deficiencies in conformance with 24 C.F.R 92.504(d).
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ARTICLE 4.

OPERATION OF THE DEVELOPMENT
Section 4.1 Residential Use.

The Development shall be operated only for residential use. No part of the Development shall be operated as transient housing. No part of the Development shall be operated as transient housing in which the term of Tenant occupancy is less than thirty (30) days. No part of the Development may be operated as an emergency shelter (including shelter for disaster victims) or facilities such as nursing homes, convalescent homes, hospitals, residential treatment facilities, correctional facilities, halfway houses, housing for students, or dormitories (including farmworker dormitories).

Section 4.2 Compliance with Loan Documents.

Developer shall comply shall at all times be in full conformity with any regulatory requirements imposed on the Development.

Section 4.3 Taxes and Assessments.

Developer shall pay all real and personal property taxes, assessments and charges and all franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed against it, or payable by it, at such times and in such manner as to prevent any penalty from accruing, or any lien or charge from attaching to the Property or Developer’s interest therein; provided, however, that Developer shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event Developer exercises its right to contest any tax, assessment, or charge against it, Developer, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered against it, together with all costs, charges and interest.

Section 4.4 Property Tax Exemption.

Developer shall be allowed to apply to the State Board of Equalization for or obtain a welfare exemption from property taxes under any provision of law, including California Revenue and Taxation Section 214(g).

Section 4.5 Allowable Preferences.
(a) To the extent permitted by other Project funding sources and to the extent permitted by applicable law including fair housing laws, and unless prohibited by state or federal regulations, the Developer shall grant the a preference in rental of the units to otherwise qualified households that live, work or have been offered work (and who subsequently accept such offer) in the City.
(b) Notwithstanding anything to the contrary contained herein, to the extent the preferences required under this Section are in conflict with the requirements of Section 42 of 272 of 563
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the Internal Revenue Code and implementing guidelines, the requirements of Section 42 will supersede.

Section 1.4 Nondiscrimination.
(h) Except as otherwise permitted under this Agreement, all of the Restricted Units shall be available for occupancy on a continuous basis to members of the general public who are income eligible. Developer shall not give preference to any particular class or group of persons in renting the Restricted Units, except to the extent that the Units are required to be leased to Low Income Households. All deeds, leases or contracts made or entered into by Developer, its successors or assigns, as to any portion of the Property or the Improvements shall contain the following language:
(1) "There shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased.

The foregoing covenant shall run with the land.
(2) Notwithstanding the preceding paragraph, with respect to familial status, the preceding paragraph shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the preceding paragraph shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall apply to the preceding paragraph." (i) The provisions of this Section shall run with the land and survive termination of this Agreement.

Section 1.5 Section 8 Certificate Holders. The Developer will accept as residents, on the same basis as all other prospective residents, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing housing program under Section 8 of the United States Housing Act, or its successor. The Developer shall not apply selection criteria to Section 8 certificate or voucher holders that are more burdensome than criteria applied to all other prospective residents, nor shall the Developer apply or permit the application of management policies or lease provisions with respect to the Development which have the effect of precluding occupancy of units by such prospective Tenants. In determining a Section 8 certificate or voucher holders’ ability to pay rent, the Developer shall determine the prospective Tenants ability to make only the prospective Tenant's portion of the rent. 273 of 563
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Section 1.6 Notice of Litigation. Developer shall promptly notify the City in writing of any litigation materially affecting Developer or the Development and of any claims or disputes that involve a material risk of such litigation.

Section 1.7 Lease Termination. Any termination of a lease of a Restricted Unit (other than for a default by the Tenant) or refusal to renew must be preceded by not less than sixty (60) days written notice to the Tenant by Developer specifying the grounds for the action. Any termination of a lease for a default of the Tenant shall be in accordance with applicable law.

ARTICLE 5.

PROPERTY MANAGEMENT AND MAINTENANCE
Section 5.1 Management Responsibilities.

Developer is responsible for all management functions with respect to the Development, including without limitation: the selection of tenants, certification and recertification of household size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility over management of the Development. Developer shall retain a professional property management company approved by City in its reasonable discretion to perform its management duties hereunder.

Section 5.2 Management Agent.

The Development shall at all times be managed by an experienced management agent reasonably acceptable to City, with demonstrated ability to operate residential facilities like the Development in a manner that will provide decent, safe, and sanitary housing (as approved, the “Management Agent”). Developer shall submit for City’s approval the identity of any proposed Management Agent. Developer shall also submit such additional information about the background, experience, policies, and financial condition of any proposed management agent as is reasonably necessary for City to determine whether the proposed management agent meets the standard for an experienced management agent set forth above. If the proposed management agent meets the standard for an experienced management agent set forth above, City shall approve the proposed management agent by notifying Developer in writing. Unless the proposed management agent is disapproved by City within thirty (30) days, which disapproval shall state with reasonable specificity the basis for disapproval, it shall be deemed approved. The City hereby pre-approves MidPen Property Management Corporation, as the initial property management company.

Section 5.3 Performance Review.

City reserves the right to conduct an annual (or more frequently, if deemed necessary by City) review of the management practices and financial status of the Development. The purpose of each periodic review will be to enable City to determine if the Development is being operated 274 of 563
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and managed in accordance with the requirements and standards of this Agreement. Developer shall cooperate with City in such reviews.

Section 1.8 Replacement of Management Agent.
(h) If, as a result of a periodic review, City determines in its reasonable judgment that the Development is not being operated and managed in accordance with any of the material requirements and standards of this Agreement, City shall deliver notice to Developer of its intention to cause replacement of the Management Agent, including the reasons therefor. Within fifteen (15) days after receipt by Developer of such written notice, City staff and Developer shall meet in good faith to consider methods for improving the financial and operating status of the Development, including, without limitation, replacement of the Management Agent.
(i) If, after such meeting, City staff recommends in writing the replacement of the Management Agent, Developer shall promptly dismiss the current Management Agent, and shall appoint as the Management Agent a person or entity meeting the standards for a management agent set forth in Section 5.2 above and approved by City pursuant to Section 5.2 above. (j) Any contract for the operation or management of the Development entered into by Developer shall provide that the contract can be terminated as set forth above. Failure to remove the Management Agent in accordance with the provisions of this Section shall constitute a default under this Agreement, and City may enforce this provision through legal proceedings as specified in Section 6.8 below.

Section 1.9 Marketing.

Developer and the Management Agent shall be responsible for the promotion and other marketing efforts for rental of the Restricted Units. Prior to the execution of this Agreement, Developer and the Management Agent shall develop a marketing plan in order to affirmatively market the Restricted Units with the goal of attracting all qualified persons without regard to race, color, creed, religion, sex, sexual orientation, age, marital status, national origin, source of income (e.g. SSI), ancestry, or disability, except as otherwise permitted in the City Loan Documents. The marketing plan shall be submitted to and approved by the City prior to marketing the Restricted Units.

Developer and the Management Agent shall select tenants on a non-discriminatory basis, consistent with the provisions of Section 6.3 of this Agreement and the “Marketing Policies Regulating Leasing and Sales of Subsidized Affordable Housing Units” adopted by the City in March 2009 and as amended from time to time to the extent that the Marketing Policies do not conflict with Section 4.5.

Section 1.10 Property Maintenance.
(h) Developer agrees, for the entire Term of this Agreement, to maintain all interior and exterior improvements, including landscaping, comprising the Development in good condition and repair (and, as to landscaping, in a healthy condition) and in accordance with all 275 of 563
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applicable laws, rules, ordinances, orders and regulations of all federal, state, City, municipal, and other governmental agencies and bodies having or claiming jurisdiction and all their respective departments, bureaus, and officials and in a decent, safe, sanitary condition and in good repair pursuant to the Uniform Physical Conditions Standards established by HUD pursuant to 24 C.F.R. 5.703 and as required under 24 C.F.R. 92.251.
(i) City places prime importance on quality maintenance to protect its investment and to ensure that all City and City-assisted affordable housing projects within City are not allowed to deteriorate due to below-average maintenance. Normal wear and tear of the Development will be acceptable to City assuming Developer agrees to provide all necessary improvements to assure the Development is maintained in good condition. Developer shall make all repairs and replacements necessary to keep the improvements in good condition and repair. (j) In the event that Developer breaches any of the covenants contained in this section and such default continues for a period of fifteen (15) days after written notice from City with respect to graffiti, debris, waste material, and general maintenance or thirty (30) days after written notice from City with respect to landscaping and building improvements, then City, in addition to whatever other remedy it may have at law or in equity, shall have the right to enter upon the Property and perform or cause to be performed all such acts and work necessary to cure the default. Pursuant to such right of entry, City shall be permitted (but is not required) to enter upon the Development and perform all acts and work necessary to protect, maintain, and preserve the improvements and landscaped areas comprising the Development, and to attach a lien thereon, or to assess the Development, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by City and/or costs of such cure, which amount shall be promptly paid by Developer to City upon demand.

ARTICLE 6.

MISCELLANEOUS
Section 6.1 Term.

The provisions of this Agreement apply to the Development for the entire Term even if the City Loan is paid in full prior to the end of the Term. This Agreement binds any successor, heir or assign of Developer, whether a change in interest occurs voluntarily or involuntarily, by operation of law or otherwise, except as expressly released by City. City is making the City Loan on the condition, and in consideration of, this provision, and would not do so otherwise.

Section 6.2 Lease Provisions.
(a) In leasing the Units, Developer shall use a form of Tenant lease approved by the City. The lease shall not contain any provision which is prohibited by 24 CFR Section

92.253(b) and any amendments thereto. The form of Tenant lease shall also comply with all requirements of this Agreement and the Loan Documents, and shall, among other matters:
(b) Provide for termination of the lease and consent by the Tenant to immediate eviction for failure: (1) to provide any information required under this Agreement or 276 of 563
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reasonably requested by Developer to establish or recertify the Tenant’s qualification, or the qualification of the Tenant’s household for occupancy in the Development in accordance with the standards set forth in this Agreement, or (2) to qualify as a Low Income Household, as applicable, as a result of any material misrepresentation made by such Tenant with respect to the income computation or certification;
(k) Require the Tenant to occupy the Unit as the Tenant’s principal residence and prohibit the subleasing of the Unit;
(l) Require the Tenant to maintain the Unit in good repair and in a neat, clean and sanitary condition;
(m) Prohibit the Unit from being utilized contrary to any law; (n) Provide for an increase in the Tenant’s Rent should the Tenant’s annual income exceed the income limit allowed for the Unit, pursuant to the terms outlined in Section

2.3;
(o) Be for an initial term of not less than one (1) year, unless by mutual agreement between the Tenant and Developer; and
(p) Provide for no increase in Rent during such year. After the initial year of tenancy, the lease may be month to month by mutual agreement of Developer and the Tenant, however Rent may not be raised more often than once a year. Except for Non-Qualifying Households, all rent increases shall comply with CTCAC rent increase regulation approved on April 3, 2024, limiting maximum increase in rent in a 12-month period to the lessor of: 5% plus the percentage increase in cost of living, or 10% of the lowest rental rate charged for that household during the previous 12 months.. Developer will provide each Tenant with at least sixty (60) days’ written notice of any increase in Rent applicable to such Tenant, and with such further notice as may be required by Section 2.3 above.
(q) The lease must not contain any provision which is prohibited by 24 C.F.R. Section 92.253(b) and any amendments thereto.

Section 2.11 Lease Termination.

Any termination of a lease or refusal to renew must be in conformance with California Civil Code Section 1946.1(b) and must be preceded by not less than sixty (60) days’ written notice to the Tenant by Developer specifying the grounds for the action. Any termination of a lease for a default of the Tenant shall be in accordance with all applicable laws.

Section 2.12 Compliance with Loan Documents and Program Requirements.

Developer’s actions with respect to the Development shall at all times be in full conformity with: (a) all requirements of the Loan Documents; and (b) all requirements of the City Deed of Trust; and.
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Section 1.11 Notice of Expiration of Term.
(a) Prior to the termination of the Term, the Developer shall comply with the requirements set forth in California Government Code Sections 65863.10 and 65863.11, as such may be amended from time to time. Such notice requirements may include: (1) a twelve (12) month notice to existing tenants, prospective tenants and Affected Public Agencies (as defined in California Government Code Section 65863.10(a), which would include the City's Community Development and Housing Director, prior to the expiration of the Term; (2) a six (6) month notice requirement to existing Tenants, prospective tenants and Affected Public Agencies prior to the expiration of the Term; (3) a notice of an offer to purchase the Development to "qualified entities" (as defined in California Government Code Section 65863.11(d)), if the Development is to be sold within five (5) years of the end of the Term; and (4) a notice of right of first refusal within the one hundred eighty (180) day period that qualified entities may purchase the Development.

Section 3.8 Covenants to Run With the Land.

City and Developer hereby declare their express intent that the covenants and restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title to the Development, provided, however, that on the expiration of the Term of this Agreement said covenants and restrictions shall expire. Each and every contract, deed or other instrument hereafter executed covering or conveying the Development or any portion thereof, shall be held conclusively to have been executed, delivered and accepted subject to such covenants and restrictions, regardless of whether such covenants or restrictions are set forth in such contract, deed or other instrument, unless City expressly releases such conveyed portion of the Development from the requirements of this Agreement.

Section 3.9 Enforcement by City.

If Developer fails to perform any obligation under this Agreement, and fails to cure the default within thirty (30) days after City has notified Developer in writing of the default or, if the default cannot be cured within thirty (30) days, failed to commence to cure within thirty (30) days and thereafter diligently pursue such cure and complete such cure within ninety (90) days, City shall have the right to enforce this Agreement by any or all of the following actions, or any other remedy provided by law:
(a) Calling the City Loan. City may declare a default on the Note of the City Loan, accelerate the indebtedness evidenced by the Note, and proceed with foreclosure under the City Deed of Trust.
(b) Action to Compel Performance or for Damages. City may bring an action at law or in equity to compel Developer’s performance of its obligations under this Agreement, and/or for damages.
(c) Remedies Provided Under Loan Documents. City may exercise any other remedy provided under the Loan Documents.
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(h) Cure by Investor Limited Partner. City hereby agrees to accept a cure of any default made or tendered hereunder by Investor Limited Partner on the same terms and conditions as if such cure was made or tendered by Developer.

Section 2.13 Listing of Development in Database. The Developer hereby acknowledges and agrees that Health and Safety Code Section 33418(c) requires that the Development be listed in a database that shall be made available to the public on the internet and which will include the street address, assessor's parcel number, and other information about the Development.

Section 2.14 Attorneys’ Fees and Costs.

In any action brought to enforce this Agreement, the prevailing party shall be entitled to all costs and expenses of suit, including attorneys’ fees. This section shall be interpreted in accordance with California Civil Code Section 1717 and judicial decisions interpreting that statute.

Section 2.15 Recording and Filing.

City and Developer shall cause this Agreement, and all amendments and supplements to it, to be recorded in the Official Records of the County of San Mateo.

Section 2.16 Governing Law.

This Agreement shall be governed by the laws of the State of California. Any action brought by either of the Parties for the purpose of enforcing a right or rights provided for by this Agreement will be tried in a court of competent jurisdiction in the County of San Mateo, State of California. The Parties waive all provisions of law providing for a change of venue in any proceeding to any other county
Section 2.17 Waiver of Requirements.

Any of the requirements of this Agreement may be expressly waived by City in writing, but no waiver by City of any requirement of this Agreement shall, or shall be deemed to, extend to or affect any other provision of this Agreement.

Section 2.18 Amendments.

This Agreement may be amended only by a written instrument executed by all the parties hereto or their successors in title, and duly recorded in the real property records of County of San Mateo.

Section 2.19 Notices.

Any notice requirement set forth herein shall be deemed to be satisfied three (3) days after mailing of the notice first-class United States certified mail, postage prepaid addressed to the appropriate party as follows:
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Developer:

MP 2000 Delaware, LLC
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Attention: President and Chief Executive Officer
With copy to:

Housing Trust Silicon Valley
75 E. Santa Clara Street, Suite 1350
San Jose, CA 95113
Attention: Asset Management
And:

City:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: Housing Manager
Such addresses may be changed by notice to the other party given in the same manner as provided above. Receipt will be deemed to have occurred on the date shown on a written receipt as the date of delivery or refusal of delivery (or attempted delivery if undeliverable).

Section 1.12 Severability.

If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions of this Agreement shall not in any way be affected or impaired thereby.

Section 1.13 Waiver of Requirements. No waiver of the requirements of this Agreement shall occur unless expressly waived by the City in writing. No waiver will be implied from any delay or failure by the City to take action on any breach or default of the Developer or to pursue any remedy permitted under this Agreement or applicable law. Any extension of time granted to the Developer to perform any obligation under this Agreement shall not operate as a waiver or release from any of its obligations under this Agreement. Consent by the City to any act or omission by the Developer shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the City's written consent to future waivers.
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Section 1.14 Multiple Originals; Counterparts.

This Agreement may be executed in multiple originals, each of which is deemed to be an original, and may be signed in counterparts.

Section 1.15 Hold Harmless. Developer will indemnify and hold harmless (without limit as to amount) City, its council members, officers, employees and agents in their official capacity (hereinafter collectively referred to as "Indemnitees"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgments and executions for damages of any and every kind and by whomever and whenever made or obtained, allegedly caused by, arising out of or relating in any manner to the Development, the Restricted Unit, or the Developer's performance or non-performance under this Agreement, and shall protect and defend Indemnitees, and any of them with respect thereto, except to the extent caused by the gross negligence or willful misconduct of the Indemnitees, as applicable. The provisions of this Section shall survive expiration or other termination of this Agreement or any release of part or all of the Property from the burdens of this Agreement, and the provisions of this section shall remain in full force and effect.

Section 1.16 Revival of Agreement after Foreclosure. This Agreement shall be revived according to its original terms if, during the original Term, the owner of record before the foreclosure, or deed in lieu of foreclosure, or any entity that includes the former owner or those with whom the former owner has or had family or business ties, obtains an ownership interest in the Development or the Property.

Section 1.17 Action and Approval. Whenever action and/or approval by City is required under this Agreement, the City Manager or the City Manager’s designee may act on and/or approve such matter unless specifically provided otherwise, or unless the City Manager or the City Manager's designee determine in their discretion that such action or approval requires referral to City Council for consideration.

Section 1.18 No Third Party Beneficiaries. Except as expressly set forth herein, nothing contained in this Agreement is intended to or shall be deemed to confer upon any person, other than the Parties and their respective successors and assigns, any rights or remedies hereunder.

Section 1.19 Tax Credit Program. Notwithstanding anything contained herein to the contrary, if the Property were subject to the requirements of the California and/or Federal LowIncome Housing Tax Credit Program under the provisions of Section 42 of the Code and Section 23610.5 of the California Revenue and Taxation Code, as applicable (collectively, the "Tax Credit Program") and there is a conflict between the requirements of the Tax Credit Program and either the affordability provisions set forth in 2.2 and 2.3 above or the preferences set forth in Section 4.5 above, inclusive, then the provisions of the Tax Credit Program shall prevail.

That notwithstanding, the fact that this Agreement and the Tax Credit Program provide for greater, lesser or different obligations or requirements shall not be deemed a conflict unless the applicable provisions are inconsistent and could not be simultaneously enforced or performed. 281 of 563
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Section 1.20 Subordination. This Agreement shall not be subordinated with respect to the Low Income Households in accordance with Section 2.1(c).

Section 1.21 No Claims. Nothing contained in this Agreement shall create or justify any claim against the City by any person that the Developer may have employed or with whom the Developer may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the Property or the construction or operation of the Improvements.

Section 1.22 Titles of Parts and Sections. Any titles of the sections or subsections of this Agreement are inserted for convenience of reference only and shall be disregarded in interpreting any part of the Agreement's provisions.

Section 1.23 Assignment by the City. The City may assign its rights and obligations under this Agreement to any instrumentality of the City or other public entity without the consent of, but upon prior written notice to, the Developer. [Signature Pages Follow.]
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WHEREAS, this Agreement has been entered into by the undersigned as of the date first above written.

DEVELOPER:

MP 2000 Delaware LLC,
a California limited liability company
By: Mid-Peninsula Greenridge, Inc.,
a California nonprofit public benefit corporation,
its sole member/manager
By: ___________________________________
Name: Matthew O. Franklin
Its: Assistant Secretary
[Signature must be notarized.]
CITY:

City of San Mateo, a California charter city
By: ___________________________________
Alex Khojikian, City Manager
[Signature must be notarized.]
APPROVED AS TO FORM:

By: _______________________________________
Prasanna W. Rasiah, City Attorney
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, Notary Public, personally appeared ______________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
______________________________________
Name: ______________________________
Name: Notary Public
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. 284 of 563
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I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

EXHIBIT A
Legal Description of the Property
The Property referred to is situated in the State of California, City of San Mateo and described as follows:

Parcel One:

Parcel B as shown on the Parcel Map entitled “Parcel Map 433” filed April 23, 2012 in Book 80 of Parcel Maps, Pages 30 and 31, Official Records of San Mateo County.

Parcel Two:

Rights and Easements granted in that certain Joint Use, Easement and Maintenance Agreement for 1990-2000 South Delaware dated April 1, 2012, and recorded May 2, 2012, as Instrument No. 2012-61779, in the Official Records of San Mateo County.

Property Address: 2000 S. Delaware Street, San Mateo, California APN: 035-320-470
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EXHIBIT B

MIDPEN TIERED RENT INCREASE POLICY
The following policy is provided here for reference only and may may change from time to time at Developer’s sole discretion with notice and updated policy delivered to the City. The intent of this policy is to implement rent increases to households equitably, taking into account the ratio between household income and monthly rent.

Effective January 1, 2025
Not to exceed the lesser of a) the applicable Rent Limit associated with the unit; and b) any and all requirements and restrictions that may be imposed by a regulatory agency and/or local ordinance/municipality, rent increases shall be determined as follows:

1. Tier 1 – If Rent Burden is at or below 25%, then increase by 5% plus CPI* (in no event less than 5% or greater than 10%);

2. Tier 2 – If Rent Burden is above 25% and at or below 35%, then increase by 5%;

3. Tier 3 – If Rent Burden is above 35% and below 50%, then increase by 3%; and

4. Tier 4 – If Rent Burden is at or above 50%, then increase by 1%.

Rent Burden = (Monthly Rent * 12) / (Annual Household Income) AMI shall be defined by the current year MTSP (TCAC) limits based on actual quantity of household members.

CPI is defined using the annual “Rent Increase Limit Update” published by TCAC, which covers August through July of each year.

Exceptions:

1. Rents shall be increased to the applicable Rent Limit, not to exceed 30% of Household Income, in each of the following cases*:
a. There is a termination of Section 8 subsidy;
b. A household is transferred to another unit due to over occupancy or over income; and
c. Wherever the Next Available Unit rule is invoked, requiring the changing of AMI designations to the unit.

Rent increases shall not be implemented more frequently than every 12 months, on the anniversary of the last rent increase or date of move-in. Rents cannot increase more than once in any 12-month term, unless required by a regulatory agency or rental subsidy program. 287 of 563
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1 RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: Housing Manager

NO FEE FOR RECORDING PURSUANT

TO GOVERNMENT CODE
SECTIONS 6103 AND 27383
APN:
(Space above this line for Recorder's Use)

DEED OF TRUST WITH ASSIGNMENT OF RENTS,

SECURITY AGREEMENT, AND FIXTURE FILING
(2000 South Delaware Street)

THIS DEED OF TRUST WITH ASSIGNMENT OF RENTS, SECURITY
AGREEMENT, AND FIXTURE FILING ("Deed of Trust") is made as of December __, 2024, by and among MP 2000 DELAWARE, LLC, a California limited liability company ("Trustor"), Old Republic Title Company, a California corporation ("Trustee"), and the City of San Mateo, a California charter city ("Beneficiary").

FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and conditions hereinafter set forth, Trustor's leasehold interest in the property located in the City of San Mateo, County of San Mateo, State of California, that is described in the attached Exhibit A, incorporated herein by this reference (the "Property").

TOGETHER WITH all interest, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Property and the rents; TOGETHER WITH all easements, rights-of-way and rights used in connection therewith or as a means of access thereto, including (without limiting the generality of the foregoing) all tenements, hereditaments and appurtenances thereof and thereto; TOGETHER WITH any and all buildings and improvements of every kind and description now or hereafter erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the Property;
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2 TOGETHER WITH all building materials and equipment now or hereafter delivered to said Property and intended to be installed therein;
TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter acquired, in and to any land lying within the right-of-way of any street, open or proposed, adjoining the Property, and any and all sidewalks, alleys and strips and areas of land adjacent to or used in connection with the Property;
TOGETHER WITH all estate, interest, right, title, other claim or demand, of every nature, in and to such property, including the Property, both in law and in equity, including, but not limited to, all deposits made with or other security given by Trustor to utility companies, the proceeds from any or all of such property, including the Property, claims or demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor now has or may hereafter acquire, any and all awards made for the taking by eminent domain or by any proceeding or purchase in lieu thereof of the whole or any part of such property, including without limitation, any awards resulting from a change of grade of streets and awards for severance damages to the extent Beneficiary has an interest in such awards for taking as provided in Paragraph 4.1 herein; TOGETHER WITH all of Trustor's interest in all articles of personal property or fixtures now or hereafter attached to or used in and about the building or buildings now erected or hereafter to be erected on the Property which are necessary to the complete and comfortable use and occupancy of such building or buildings for the purposes for which they were or are to be erected, including all other goods and chattels and personal property as are ever used or furnished in operating a building, or the activities conducted therein, similar to the one herein described and referred to, and all renewals or replacements thereof or articles in substitution therefor, whether or not the same are, or will be, attached to said building or buildings in any manner; and TOGETHER WITH all of Trustor's interest in all building materials, fixtures, equipment, work in process and other personal property to be incorporated into the Property; all goods, materials, supplies, fixtures, equipment, machinery, furniture and furnishings, signs and other personal property now or hereafter appropriated for use on the Property, whether stored on the Property or elsewhere, and used or to be used in connection with the Property; all rents, issues and profits, and all inventory, accounts, accounts receivable, contract rights, general intangibles, chattel paper, instruments, documents, notes drafts, letters of credit, insurance policies, insurance and condemnation awards and proceeds, trade names, trademarks and service marks arising from or related to the Property and any business conducted thereon by Trustor; all replacements, additions, accessions and proceeds; and all books, records and files relating to any of the foregoing.

All of the foregoing, together with the Property, is herein referred to as the "Security." To have and to hold the Security together with acquittances to the Trustee, its successors and assigns forever.
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3 FOR THE PURPOSE OF SECURING THE FOLLOWING OBLIGATIONS (collectively, the "Secured Obligations"):

A. Payment of just indebtednesses of Trustor to Beneficiary of all sums at any time owing under, or in connection with, the Promissory Note (defined in Article 1 below) until paid or cancelled and any other amounts owing under the City Loan Documents. Said principal and other payments are due and payable as provided in the Promissory Note. The Promissory Note and all its terms are incorporated herein by reference, and this conveyance secures any and all extensions thereof, however evidenced;
B. Payment of any sums advanced by Beneficiary to protect the Security pursuant to the terms and provisions of this Deed of Trust following a breach of Trustor's obligation to advance said sums and the expiration of any applicable cure period, with interest thereon as provided herein; C. Performance of every obligation, covenant or agreement of Trustor contained herein and in the City Loan Documents (defined in Article 1 below); and D. All modifications, extensions and renewals of any of the Secured Obligations (including without limitation: (1) modifications, extensions or renewals at a different rate of interest; or (2) deferrals or accelerations of the required principal payment dates or interest payment dates or both, in whole or in part), however evidenced, whether or not any such modification, extension or renewal is evidenced by a new or additional promissory note or notes (defined in Article 1 below).

AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR COVENANTS AND AGREES:

ARTICLE 1:

DEFINITIONS
Section 1.1 Definitions. In addition to the terms defined elsewhere in this Deed of Trust, the following terms have the following meanings in this Deed of Trust:
(a) "City Loan Documents" means this Deed of Trust, the Promissory Note, the Regulatory Agreement, the Loan Agreement, and any other debt, loan or security instruments between Trustor and the Beneficiary relating to the Property. (b) "City Loan" means the loan made by the Beneficiary to the Trustor in the amount of up to Five Hundred Thousand Dollars ($500,000). (c) "Promissory Note" means that certain promissory note in the amount of Five Hundred Thousand Dollars ($500,000) dated as of December __, 2024, herewith executed by the Trustor in favor of the Beneficiary, the payment of which is secured by this Deed of Trust. (A copy of the Promissory Note is on file with the Beneficiary and terms and provisions of the Promissory Note are incorporated herein by reference.)
(d) "Regulatory Agreement" means that certain Regulatory Agreement and Declaration of Restrictive Covenants that will be recorded in the Official Records against the 344 of 563
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4 Developer's leasehold interest of the Property upon the Close of Escrow securing the City's interest in the City Loan.
(e) "Loan Agreement" means that certain Loan Agreement between Trustor and Beneficiary, as of November __, 2024, as such may be amended from time to time, providing for the Beneficiary to make the City Loan.
(f) "Principal" means the aggregate of the amounts required to be paid under the Promissory Note.

ARTICLE 2:

MAINTENANCE AND MODIFICATION OF THE PROPERTY AND SECURITY Section 2.1
Section 2.2 Maintenance and Modification of the Property by Trustor. (a) The Trustor agrees that at all times prior to full payment of the sum owed and performance of the Secured Obligations under the Promissory Note, the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Security or cause the Security to be maintained and preserved in good condition. The Trustor will from time to time make or cause to be made all repairs, replacements and renewals deemed proper and necessary by it. The Beneficiary has no responsibility in any of these matters or for the making of improvements or additions to the Security.
(b) Trustor agrees to pay fully and discharge (or cause to be paid fully and discharged) all claims for labor done and for material and services furnished in connection with the Security, diligently to file or procure the filing of a valid notice of cessation upon the event of a cessation of labor on the work or construction on the Security for a continuous period of thirty (30) days or more, and to take all other reasonable steps to forestall the assertion of claims of lien against the Security or any part thereof. Trustor irrevocably appoints, designates and authorizes Beneficiary as its agent (said agency being coupled with an interest) with the authority, but without any obligation, to file or record any notices of completion or cessation of labor or any other notice that Beneficiary deems necessary or desirable to protect its interest in and to the Security or the City Loan Documents; provided, however, that Beneficiary exercises its rights as agent of Trustor only in the event that Trustor fails to take, or fails to diligently continue to take, those actions as hereinbefore provided.
(c) Upon demand by Beneficiary, Trustor shall make or cause to be made such demands or claims as Beneficiary specifies upon laborers, materialmen, subcontractors or other persons who have furnished or claim to have furnished labor, services or materials in connection with the Security. Nothing herein contained requires Trustor to pay any claims for labor, materials or services which Trustor in good faith disputes and is diligently contesting provided that Trustor shall, within thirty (30) days after the filing of any claim of lien, record in the Office of the Recorder of the County of San Mateo, a surety bond in an amount equal to the amount of such claim item to protect against a claim of lien, or to provide other form of security acceptable to the Beneficiary at the Beneficiary's sole and absolute discretion. 345 of 563
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5 Section 1.2 Granting of Easements. Trustor may not grant easements, licenses, rightsof-way or other rights or privileges in the nature of easements with respect to any property or rights included in the Security except those required or desirable for installation and maintenance of public utilities, including, without limitation, water, gas, electricity, sewer, telephone, or those required by law and as approved, in writing, by Beneficiary.

Section 1.3 Assignment of Rents.
(e) Subject to the rights of any approved senior mortgage lender, as part of the consideration for the indebtedness evidenced by the Promissory Note, Trustor hereby absolutely and unconditionally assigns and transfers to Beneficiary all the rents and revenues of the Property including those now due, past due, or to become due by virtue of any lease or other agreement for the occupancy or use of all or any part of the Property, regardless of to whom the rents and revenues of the Property are payable. Trustor hereby authorizes Beneficiary or Beneficiary's agents to collect the aforesaid rents and revenues and hereby directs each tenant of the Property to pay such rents to Beneficiary or Beneficiary's agents; provided, however, that prior to written notice given by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the City Loan Documents, Trustor shall collect and receive all rents and revenues of the Property as trustee for the benefit of Beneficiary and Trustor to apply the rents and revenues so collected to the Secured Obligations with the balance, so long as no such breach has occurred, to the account of Trustor, it being intended by Trustor and Beneficiary that this assignment of rents constitutes an absolute assignment and not an assignment for additional security only. Upon delivery of written notice by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the City Loan Documents, and without the necessity of Beneficiary entering upon and taking and maintaining full control of the Property in person, by agent or by a court-appointed receiver, Beneficiary shall immediately be entitled to possession of all rents and revenues of the Property as specified in this Section as the same becomes due and payable, including but not limited to rents then due and unpaid, and all such rents will, immediately upon delivery of such notice, be held by Trustor as trustee for the benefit of Beneficiary only; provided, however, that the written notice by Beneficiary to Trustor of the breach by Trustor contains a statement that Beneficiary exercises its rights to such rents. Trustor agrees that commencing upon delivery of such written notice of Trustor's breach by Beneficiary to Trustor, each tenant of the Property shall make such rents payable to and pay such rents to Beneficiary or Beneficiary's agents on Beneficiary's written demand to each tenant thereof, delivered to each tenant personally, by mail or by delivering such demand to each rental unit, without any liability on the part of said tenant to inquire further as to the existence of a default by Trustor. (f) Subject to the rights of any approved senior mortgage lender, the Trustor hereby covenants that Trustor has not executed any prior assignment of said rents, that Trustor has not performed, and will not perform, any acts or has not executed and will not execute, any instrument which would prevent Beneficiary from exercising its rights under this Section, and that at the time of execution of this Deed of Trust, there has been no anticipation or prepayment of any of the rents of the Property for more than two (2) months prior to the due dates of such rents.

Trustor covenants that Trustor will not hereafter collect or accept payment of any rents of the Property more than two (2) months prior to the due dates of such rents. Trustor further covenants 346 of 563
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6 that Trustor will execute and deliver to Beneficiary such further assignments of rents and revenues of the Property as Beneficiary may from time to time request. (c) Upon Trustor's breach of any covenant or agreement of Trustor in the City Loan Documents, after applicable notice and cure periods, Beneficiary may in person, by agent or by a court-appointed receiver, regardless of the adequacy of Beneficiary's security, enter upon and take and maintain full control of the Property in order to perform all acts necessary and appropriate for the operation and maintenance thereof including, but not limited to, the execution, cancellation or modification of leases, the collection of all rents and revenues of the Property, the making of repairs to the Property and the execution or termination of contracts providing for the management or maintenance of the Property, all on such terms as are deemed best to protect the security of this Deed of Trust. In the event Beneficiary elects to seek the appointment of a receiver for the Property upon Trustor's breach of any covenant or agreement of Trustor in this Deed of Trust, Trustor hereby expressly consents to the appointment of such receiver. Beneficiary or the receiver will be entitled to receive a reasonable fee for so managing the Property. (d) All rents and revenues collected subsequent to delivery of written notice by Beneficiary to Trustor of the breach by Trustor of any covenant or agreement of Trustor in the City Loan Documents after applicable notice and cure periods, are to be applied first to the costs, if any, of taking control of and managing the Property and collecting the rents, including, but not limited to, attorney's fees, receiver's fees, premiums on receiver's bonds, costs of repairs to the Property, premiums on insurance policies, taxes, assessments and other charges on the Property, and the costs of discharging any obligation or liability of Trustor as lessor or landlord of the Property and then to the sums secured by this Deed of Trust. Beneficiary or the receiver is to have access to the books and records used in the operation and maintenance of the Property and will be liable to account only for those rents actually received. Beneficiary is not liable to Trustor, anyone claiming under or through Trustor or anyone having an interest in the Property by reason of anything done or left undone by Beneficiary under this Section.
(e) If the rents of the Property are not sufficient to meet the costs, if any, of taking control of and managing the Property and collecting the rents, any funds expended by Beneficiary for such purposes will become part of the Secured Obligations. Unless Beneficiary and Trustor agree in writing to other terms of payment, such amounts are payable by the Trustor to the Beneficiary, upon notice from Beneficiary to Trustor requesting payment thereof and will bear interest from the date of disbursement at the rate stated in Section 3.3. (f) If the Beneficiary or the receiver enters upon and takes and maintains control of the Property, any application of rents as provided herein will not cure or waive any default hereunder or invalidate any other right or remedy of Beneficiary under applicable law or provided herein. This assignment of rents of the Property will terminate at such time as this Deed of Trust ceases to the Secured Obligations.
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7 ARTICLE 3:

TAXES AND INSURANCE; ADVANCES
Section 3.1 Taxes, Other Governmental Charges and Utility Charges. (a) Trustor shall pay, or cause to be paid prior to the date of delinquency, all taxes, assessments, charges and levies imposed by any public authority or utility company that are or may become a lien affecting the Security or any part thereof; provided, however, that Trustor is not required to pay and discharge any such tax, assessment, charge or levy so long as: (1) the legality thereof is promptly and actively contested in good faith and by appropriate proceedings; and (2) Trustor maintains reserves adequate to pay any liabilities contested pursuant to this Section.

With respect to taxes, special assessments or other similar governmental charges, Trustor shall pay such amount in full prior to the attachment of any lien thereof on any part of the Security; provided, however, if such taxes, assessments or charges may be paid in installments, Trustor may pay in such installments. Except as provided in clause (2) of the first sentence of this paragraph, the provisions of this Section shall not be construed to require that Trustor maintain a reserve account, escrow account, impound account or other similar account for the payment of future taxes, assessments, charges and levies.
(b) In the event that Trustor fails to pay any of the items required by this Section to be paid by Trustor, Beneficiary may (but is under no obligation to) pay the same, after the Beneficiary has notified the Trustor in writing of such failure to pay and the Trustor fails to fully pay such items within seven (7) business days after receipt of such notice. Any amount so advanced therefor by Beneficiary, together with interest thereon from the date of such advance at the maximum rate permitted by law, will become part of the Secured Obligations secured hereby, and Trustor agrees to pay all such amounts.

Section 3.2 Provisions Respecting Insurance.
(a) Trustor agrees to provide insurance conforming in all respects to that required under the City Loan Documents at all times and until all amounts secured by this Deed of Trust have been paid and all Secured Obligations hereunder have been fulfilled, and this Deed of Trust has been reconveyed.
(b) All such insurance policies and coverages are to be maintained at Trustor's sole cost and expense. Certificates of insurance for all of the above insurance policies, showing the same to be in full force and effect, are to be delivered to the Beneficiary upon demand therefor at any time prior to the Trustor's satisfaction of the Secured Obligations. (c) The Trustor is aware that California Civil Code Section 2955.5(a) provides as follows: "No lender shall require a borrower, as a condition of receiving or maintaining a loan secured by real property, to provide hazard insurance coverage against risks to the improvements on that real property in an amount exceeding the replacement value of the improvements on the property."
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8 Loan Documents, the Beneficiary, after at least seven (7) days' prior written notice to Trustor, may (but is under no obligation to): (a) take out the required policies of insurance and pay the premiums on the same; and (b) make any repairs or replacements that are necessary and provide for payment thereof. All amounts so advanced by the Beneficiary will become part of the Secured Obligations (together with interest as set forth below) and will be secured hereby, which amounts the Trustor agrees to pay on the demand of the Beneficiary, and if not so paid, will bear interest from the date of the advance at the lesser of ten percent (10%) per annum or the maximum rate permitted by law.

ARTICLE 4:

DAMAGE, DESTRUCTION OR CONDEMNATION
Section 4.1 Awards and Damages. All judgments, awards of damages, settlements and compensation made in connection with or in lieu of: (a) a taking of all or any part of or any interest in the Property by or under assertion of the power of eminent domain; (b) any damage to or destruction of the Property or in any part thereof by insured casualty; and (c) any other injury or damage to all or any part of the Property ( collectively, the "Funds"), are hereby assigned to and upon request are to be paid to the Beneficiary by a check made payable to the Beneficiary. The Beneficiary is authorized and empowered (but not required) to collect and receive any Funds and is authorized to apply them in whole or in part to any indebtedness or obligation secured hereby, in such order and manner as the Beneficiary determines at its sole option. The Beneficiary is entitled to settle and adjust all claims under insurance policies provided under this Deed of Trust and may deduct and retain from the proceeds of such insurance the amount of all expenses incurred by it in connection with any such settlement or adjustment. All or any part of the amounts so collected and recovered by the Beneficiary may be released to Trustor upon such conditions as the Beneficiary may impose for its disposition. Application of all or any part of the Funds collected and received by the Beneficiary or the release thereof will not cure or waive any default under this Deed of Trust. The rights of the Beneficiary under this Section are subject to the rights of any senior mortgage lender. The Beneficiary shall release the Funds to Trustor to be used to reconstruct the improvements on the Property provided that Beneficiary reasonably determines that Trustor (taking into account the Funds) has sufficient funds to rebuild the improvements in substantially the form that existed prior to the casualty or condemnation.

ARTICLE 5:

AGREEMENTS AFFECTING THE PROPERTY; FURTHER
ASSURANCES; PAYMENT OF PRINCIPAL AND INTEREST
Section 5.1 Other Agreements Affecting Property. The Trustor shall duly and punctually perform all terms, covenants, conditions and agreements binding upon it under the City Loan Documents and any other agreement of any nature whatsoever now or hereafter involving or affecting the Security or any part thereof.

Section 5.2 Agreement to Pay Attorneys' Fees and Expenses. In the event of any Event of Default hereunder, and if the Beneficiary employs attorneys or incurs other expenses for the 349 of 563
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9 collection of amounts due or the enforcement of performance or observance of an obligation or agreement on the part of the Trustor in this Deed of Trust, the Trustor agrees that it will, on demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other reasonable expenses so incurred by the Beneficiary (including, but not limited to, other professional services fees and costs). Any such amounts paid by the Beneficiary will be added to the Secured Obligations, and will bear interest from the date such expenses are incurred at the lesser of ten percent (10%) per annum or the maximum rate permitted by law.

Section 5.3 Payment of the Principal. The Trustor shall pay to the Beneficiary the Principal and any other payments as set forth in the Promissory Note in the amounts and by the times set out therein.

Section 5.4 Personal Property. To the maximum extent permitted by law, the personal property subject to this Deed of Trust is deemed to be fixtures and part of the real property and this Deed of Trust constitutes a fixtures filing under the California Commercial Code. As to any personal property not deemed or permitted to be fixtures, this Deed of Trust constitutes a security agreement under the California Commercial Code. The Trustor hereby grants the Beneficiary a security interest in such items.

Section 5.5 Financing Statement. The Trustor shall execute and deliver to the Beneficiary such financing statements pursuant to the appropriate statutes, and any other documents or instruments as are required to convey to the Beneficiary a valid perfected security interest in the Security. The Trustor agrees to perform all acts which the Beneficiary may reasonably request so as to enable the Beneficiary to maintain such valid perfected security interest in the Security in order to secure the payment of the Promissory Note in accordance with its terms. The Beneficiary is authorized to file a copy of any such financing statement in any jurisdiction(s) as it shall deem appropriate from time to time in order to protect the security interest established pursuant to this instrument. Trustor shall pay all costs of filing such financing statements and any extensions, renewals, amendments, and releases thereof, and shall pay all reasonable costs and expenses of any record searches for financing statements, and releases thereof, as the Beneficiary may reasonably require. Without the prior written consent of the Beneficiary, Trustor shall not create or suffer to be created pursuant to the California Commercial Code any other security interest in the Security, including replacements and additions thereto.

Section 5.6 Operation of the Security. The Trustor shall operate the Security (and, in case of a transfer of a portion of the Security subject to this Deed of Trust, the transferee shall operate such portion of the Security) in full compliance with the City Loan Documents.

Section 5.7 Inspection of the Security. At any and all reasonable times upon forty-eight (48) hours' prior written notice, the Beneficiary and its duly authorized agents, attorneys, experts, engineers, accountants and representatives, may inspect the Security without payment of charges or fees.
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10 Section 1.4 Nondiscrimination.
(e) In satisfaction of California Health and Safety Code Sections 33345 and 33436, the Trustor herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, that there will be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) and (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955 and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property herein conveyed, nor shall the grantee or any person claiming under or through the grantee, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the property herein conveyed. The foregoing covenant shall run with the land. (f) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in paragraph (a) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall apply to paragraph (a).

ARTICLE 6:

HAZARDOUS MATERIALS
(a) Trustor shall keep and maintain the Property in compliance with, and shall not cause or permit the Property to be in violation of any federal, state or local laws, ordinances or regulations relating to industrial hygiene or to the environmental conditions on, under, or about the Property including, but not limited to, soil and ground water conditions. Trustor shall not use, generate, manufacture, store or dispose of on, under, or about the Property or transport to or from the Property any flammable explosives, radioactive materials, hazardous wastes, toxic substances or related materials, including without limitation, any substances defined as or included in the definition of "hazardous substances," hazardous wastes," "hazardous materials," or "toxic substances" under any applicable federal or state laws or regulations (collectively referred to hereinafter as "Hazardous Materials") except such of the foregoing as may be customarily used in construction and operation of the improvements on the Property or as may be kept and used in and about residential development of this type.
(b) Trustor shall promptly advise Beneficiary in writing if at any time it receives written notice of: (1) any and all enforcement, cleanup, removal or other governmental or regulatory actions related to the Property instituted, completed or threatened against Trustor or the Property pursuant to any applicable federal, state or local laws, ordinances, or regulations relating to any Hazardous Materials Law ("Hazardous Materials Law"); (2) all claims made or threatened by any third party against Trustor or the Property relating to any loss, damage, cost, expense or liability, contribution, cost recovery compensation, loss or injury directly or indirectly arising out of or attributable to the use, generation, storage, release, threatened release, discharge, disposal, or presence of Hazardous Materials on or under the Property (the matters set forth in 351 of 563
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11 clauses (1) and (2) above are hereinafter referred to as "Hazardous Materials Claims"); and (3) Trustor's discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Property that could cause the Property or any part thereof to be classified as "borderzone property" under the provision of California Health and Safety Code, Sections 25220 et seq., or any regulation adopted in accordance therewith, or to be otherwise subject to any restrictions on the ownership, occupancy, transferability or use of the Property under any Hazardous Materials Law.
(c) Beneficiary has the right to join and participate in, as a party if it so elects, any legal proceedings or actions initiated in connection with any Hazardous Materials Claims and to have its reasonable attorneys' fees in connection therewith paid by Trustor. Trustor shall indemnify and hold harmless Beneficiary and its council members, supervisors, directors, officers, employees, and agents (collectively, "Indemnified Parties") from claims arising from Trustor's breach of its obligations under the first section of this Article 6, including without limitation claims for: (1) all foreseeable consequential damages; (2) the costs of any required, reasonable and necessary repair, cleanup or detoxification of the Property and the preparation and implementation of reasonable and necessary closure, remedial or other required plans all to the extent required by an environmental regulatory agency asserting jurisdiction under Hazardous Materials Laws; and (3) all reasonable costs and expenses incurred by Beneficiary in connection with clauses (1) and (2), including but not limited to reasonable attorneys' fees and other professional services fees and costs. This indemnification applies whether or not any government agency has issued a cleanup order. Losses, claims, costs, suits, liability, and expenses covered by this indemnification provision include, but are not limited to: (i) losses attributable to diminution in the value of the Property; (ii) loss or restriction of use of rentable space on the Property; (iii) adverse effect on the marketing of any rental space on the Property; and (iv) penalties and fines levied by, and remedial or enforcement actions of any kind issued by any regulatory agency (including but not limited to the costs of any required testing, remediation, repair, removal, cleanup or detoxification of the Property and surrounding properties). The forgoing indemnity shall not apply to any claims, losses, damages, liabilities, fines, penalties, or charges that are caused by the sole negligence or willful misconduct of the Indemnified Parties.
(d) Without Beneficiary's prior written consent, which shall not be unreasonably withheld, Trustor may not take any remedial action in response to the presence of any Hazardous Materials on, under, or about the Property, nor enter into any settlement agreement, consent decree, or other compromise in respect to any Hazardous Material Claims, which remedial action, settlement, consent decree or compromise might, in Beneficiary's reasonable judgment, impairs the value of the Beneficiary's security hereunder; provided, however, that Beneficiary's prior consent shall not be necessary in the event that the presence of Hazardous Materials on or under the Property either poses an immediate threat to the health, safety or welfare of any individual or is of such a nature that an immediate remedial response is necessary and it is not reasonably practicable to obtain Beneficiary's consent before taking such action, provided that in such event Trustor shall notify Beneficiary as soon as practicable of any action so taken.

Beneficiary agrees not to withhold its consent, where such consent is required hereunder, if either:
(1) a particular remedial action is ordered by a court of competent jurisdiction; (2) Trustor will or may be subjected to civil or criminal sanctions or penalties if it fails to take a required action; (3) Trustor establishes to the reasonable satisfaction of Beneficiary that there is no reasonable 352 of 563
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12 alternative to such remedial action which would result in less impairment of Beneficiary's security hereunder; or (4) the action has been agreed to by Beneficiary. (e) The Trustor hereby acknowledges and agrees that: (1) this Article is intended as the Beneficiary's written request for information (and the Trustor's response) concerning the environmental condition of the Property as required by California Code of Civil Procedure Section 726.5; and (2) each representation and warranty in this Deed of Trust or any of the other City Loan Documents (together with any indemnity applicable to a breach of any such representation and warranty) with respect to the environmental condition of the property is intended by the Beneficiary and the Trustor to be an "environmental provision" for purposes of California Code of Civil Procedure Section 736.
(f) In the event that any portion of the Property is determined to be "environmentally impaired" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(3)) or to be an "affected parcel" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(1)), then, without otherwise limiting or in any way affecting the Beneficiary's or the Trustee's rights and remedies under this Deed of Trust, the Beneficiary may elect to exercise its rights under California Code of Civil Procedure Section 726.5(a) to: (1) waive its lien on such environmentally impaired or affected portion of the Property; and (2) exercise: (i) the rights and remedies of an unsecured creditor, including reduction of its claim against the Trustor to judgment; and (ii) any other rights and remedies permitted by law. For purposes of determining the Beneficiary's right to proceed as an unsecured creditor under California Code of Civil Procedure Section 726.5(a), the Trustor will be deemed to have willfully permitted or acquiesced in a release or threatened release of hazardous materials, within the meaning of California Code of Civil Procedure Section 726.5(d)(1), if the release or threatened release of hazardous materials was knowingly or negligently caused or contributed to by any lessee, occupant, or user of any portion of the Property and the Trustor knew or in the exercise of reasonable diligence should have known of the activity by such lessee, occupant, or user which caused or contributed to the release or threatened release. All costs and expenses, including (but not limited to) reasonable attorneys' fees, incurred by the Beneficiary in connection with any action commenced under this paragraph, including any action required by California Code of Civil Procedure Section 726.5(b) to determine the degree to which the Property is environmentally impaired, plus interest thereon at the default rate specified in the Loan Agreement until paid, will be added to the indebtedness secured by this Deed of Trust and will be due and payable to the Beneficiary upon its demand made at any time following the conclusion of such action.

ARTICLE 7:

EVENTS OF DEFAULT AND REMEDIES
Section 7.1 Events of Default. The following constitute events of default following the expiration of any applicable notice and cure periods (each an "Event of Default"): (a) failure to make any payment to be paid by Trustor under the City Loan Documents; (b) failure to observe or perform any of Trustor's other covenants, agreements or obligations under the City Loan Documents, including, without limitation, the provisions concerning discrimination, subject to applicable notice and cure periods, if any, included in the City Loan Documents; (c) failure to make any payment, observe or perform any of Trustor's other covenants, agreements, or 353 of 563
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13 obligations under any Secured Obligations; and failure to make any payments or observe or perform any of Trustor's; or (d) failure to make any payments or observe or perform any of Trustor's other covenants, agreements or obligations under any other debt instrument or regulatory agreement secured by the Property, which default is not cured within the time and in the manner provided therein.

Section 7.2 Acceleration of Maturity. If an Event of Default has occurred and is continuing, then at the option of the Beneficiary, the amount of any payment related to the Event of Default and all unpaid Secured Obligations are immediately due and payable, upon written notice by the Beneficiary to the Trustor (or automatically where so specified in the City Loan Documents), and no omission on the part of the Beneficiary to exercise such option when entitled to do so may be construed as a waiver of such right.

Section 7.3 The Beneficiary's Right to Enter and Take Possession. If an Event of Default has occurred and is continuing, the Beneficiary may:
(a) Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the Property and take possession thereof (or any part thereof) and of any of the Security, in its own name or in the name of Trustee, and do any acts that it deems necessary or desirable to preserve the value or marketability of the Property, or part thereof or interest therein, increase the income therefrom or protect the security thereof. The entering upon and taking possession of the Security shall not cure or waive any Event of Default or Notice of Sale (as defined in Section 7.3(c) below) hereunder or invalidate any act done in response to such Event of Default or pursuant to such Notice of Sale and, notwithstanding the continuance in possession of the Security, Beneficiary will be entitled to exercise every right provided for in this Deed of Trust, or by law upon occurrence of any Event of Default, including the right to exercise the power of sale; (b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof; (c) Deliver to Trustee a written declaration of default and demand for sale, and a written notice of default and election to cause Trustor's interest in the Security to be sold ("Notice of Sale"), which notice Trustee or Beneficiary shall cause to be duly filed for record in the Official Records of the County of San Mateo, California; or
(d) Exercise all other rights and remedies provided herein, in the instruments by which the Trustor acquires title to any Security, or in any other document or agreement now or hereafter evidencing, creating or securing the Secured Obligations.

Section 7.4 Foreclosure By Power of Sale.
(a) Should the Beneficiary elect to foreclose by exercise of the power of sale herein contained, the Beneficiary shall deliver to the Trustee the Notice of Sale and shall deposit with Trustee the Promissory Note which is secured hereby (and the deposit of which will be deemed to constitute evidence that the unpaid Principal amount of the Secured Obligations are 354 of 563
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14 immediately due and payable), and such receipts and evidence of any expenditures made that are additionally secured hereby as Trustee may require.
(b) Upon receipt of such Notice of Sale from the Beneficiary, Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Sale as then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse of such time as may then be required by law and after recordation of such Notice of Sale having been given as required by law, sell the Security, at the time and place of sale fixed by it in said Notice of Sale, whether as a whole or in separate lots or parcels or items as Trustee deems expedient and in such order as it may determine unless specified otherwise by the Trustor according to California Civil Code Section 2924g(b), at public auction to the highest bidder, for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to such purchaser or purchasers thereof its good and sufficient deed or deeds conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed or any matters of facts will be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee or Beneficiary, may purchase at such sale.
(c) After deducting all reasonable costs, fees and expenses of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale to payment of: (1) the unpaid Principal amount of the Promissory Note; (2) all other Secured Obligations owed to Beneficiary under the City Loan Documents; (3) all other sums then secured hereby; and (4) the remainder, if any, to Trustor.
(d) Trustee may postpone sale of all or any portion of the Property by public announcement at such time and place of sale, and from time to time thereafter, and without further notice make such sale at the time fixed by the last postponement, or may, in its discretion, give a new Notice of Sale.

Section 7.5 Receiver. If an Event of Default occurs and is continuing, Beneficiary, as a matter of right and without further notice to Trustor or anyone claiming under the Security, and without regard to the then value of the Security or the interest of Trustor therein, may apply to any court having jurisdiction to appoint a receiver or receivers of the Security (or a part thereof), and Trustor hereby irrevocably consents to such appointment and waives further notice of any application thereof. Any such receiver or receivers will have all the usual powers and duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of entry as provided herein, and will continue as such and exercise all such powers until the date of confirmation of sale of the Security, unless such receivership is sooner terminated.

Section 7.6 Remedies Cumulative. No right, power or remedy conferred upon or reserved to the Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy will be cumulative and concurrent and will be in addition to any other right, power and remedy given hereunder or now or hereafter existing at law or in equity.
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15 Section 1.5 No Waiver.
(e) No delay or omission of the Beneficiary to exercise any right, power or remedy accruing upon any Event of Default will exhaust or impair any such right, power or remedy, and may not be construed to be a waiver of any such Event of Default or acquiescence therein; and every right, power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time to time and as often as may be deemed expeditious by the Beneficiary.

Beneficiary's express or implied consent to breach, or waiver of, any obligation of the Trustor hereunder will not be deemed or construed to be a consent to any subsequent breach, or further waiver, of such obligation or of any other obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any act or failure to act or to declare an Event of Default, irrespective of how long such failure continues, will not constitute a waiver by the Beneficiary of its right hereunder or impair any rights, power or remedies consequent on any Event of Default by the Trustor.
(f) If the Beneficiary: (1) grants forbearance or an extension of time for the payment or performance of any Secured Obligations; (2) takes other or additional security or the payment of any sums secured hereby; (3) waives or does not exercise any right granted in the City Loan Documents; (4) releases any part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms, covenants, conditions or agreements in the City Loan Documents; (5) consents to the granting of any easement or other right affecting the Security; or (6) makes or consents to any agreement subordinating the lien hereof, any such act or omission will not release, discharge, modify, change or affect the original liability under this Deed of Trust, or any other obligation of the Trustor or any subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor will any such act or omission preclude the Beneficiary from exercising any right, power or privilege herein granted or intended to be granted in any Event of Default then made or of any subsequent Event of Default, nor, except as otherwise expressly provided in an instrument or instruments executed by the Beneficiary will the lien of this Deed of Trust be altered thereby.

Section 1.6 Suits to Protect the Security. The Beneficiary has the power to: (a) institute and maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Security and the rights of the Beneficiary as may be unlawful or any violation of this Deed of Trust; (b) preserve or protect its interest (as described in this Deed of Trust) in the Security; and (c) restrain the enforcement of or compliance with any legislation or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid, if the enforcement for compliance with such enactment, rule or order would impair the Security thereunder or be prejudicial to the interest of the Beneficiary.

Section 1.7 Trustee May File Proofs of Claim. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting the Trustor, its creditors or its property, the Trustee and/or the Beneficiary, to the extent permitted by law, will be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of the Beneficiary allowed in such proceedings and for any additional amount that becomes due and payable by the Trustor hereunder after such date.
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16 Section 1.8 Waiver. The Trustor waives presentment, demand for payment, notice of dishonor, notice of protest and nonpayment, protest, notice of interest on interest and late charges, and diligence in taking any action to collect any Secured Obligations, including but not limited to sums owing under the Promissory Note, or in proceedings against the Security, in connection with the delivery, acceptance, performance, default, endorsement or guaranty of this Deed of Trust.

Section 1.9 Investor Rights. If a default or an Event of Default shall have occurred, whenever the City delivers any notice or demand to the Trustor, the City shall at the same time deliver to the Approved Lenders and the Investor Limited Partner (as defined in Section 3.4 of the Loan Agreement), a copy of such notice or demand. The Investor Limited Partner shall (insofar as the rights of the City are concerned) have the right, but not the obligation, at its option to cure such default or Event of Default as follows: (a) forty-five (45) days after the Investor Limited Partner's receipt of such notice to cure any default under the Loan Documents; and (b) If a default is incapable of being cured within the forty-five (45) day period set forth in item (a) above, so long as such cure is commenced within the forty-five (45) days and is being diligently pursued to completion, the City will give the Investor Limited Partner additional time to cure such default, but in no event later than one hundred twenty (120) days, and Beneficiary agrees to accept cures thereunder by Investor Limited Partner.

ARTICLE 8:

MISCELLANEOUS
Section 8.1 Amendments. This Deed of Trust cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by Beneficiary and Trustor.

Section 8.2 Reconveyance by Trustee. Upon written request of Beneficiary stating that all Secured Obligations have been paid or forgiven, and all obligations under the City Loan Documents have been performed, and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee shall fully reconvey the Security to Trustor, or to the person or persons legally entitled thereto.

Section 8.3 Notices.
(a) If at any time after the execution of this Deed of Trust it becomes necessary or convenient for one of the parties hereto to serve any notice, demand or communication upon the other party, such notice, demand or communication must be in writing and is to be served personally, by reputable overnight delivery service (which provides a delivery receipt) or by depositing the same in the registered United States mail, return receipt requested, postage prepaid and, (1) if intended for Beneficiary is to be addressed to:

City:

City of San Mateo
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17 330 W. 20th Avenue
San Mateo, CA 94403
Attention: City Manager
with copy to:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: City Attorney
and (2) if intended for Trustor shall be addressed to:

MP 2000 Delaware, LLC
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Attention: President and Chief Executive Officer
with copy to:

Housing Trust Silicon Valley
75 E. Santa Clara Street, Suite 1350
San Jose, CA 95113
Any notice, demand or communication will be deemed given, received, made or communicated on the date personal delivery is effected or, if mailed in the manner herein specified, on the delivery date or date delivery is refused by the addressee, as shown on the return receipt. A copy of any notice sent to the Beneficiary must also be sent to the Office of the City Clerk at the above address.

Either party may change its address at any time by giving written notice of such change to Beneficiary or Trustor as the case may be, in the manner provided herein, at least ten (10) days prior to the date such change is desired to be effective. Trustor's limited partner shall have all the notice and cure rights set forth in the Loan Agreement.

Section 8.4 Successors and Joint Trustors. Where an obligation created herein is binding upon Trustor, the obligation also applies to and binds any transferee or successors in interest.

Where the terms of the Deed of Trust have the effect of creating an obligation of the Trustor and a transferee, such obligation will be deemed to be a joint and several obligation of the Trustor and such transferee. Where more than one entity or person is signing as Trustor, all obligations of Trustor will be deemed to be a joint and several obligation of each and every entity and person signing as Trustor. 358 of 563
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18 Section 1.10 Captions. The captions or headings at the beginning of each Section hereof are for the convenience of the parties and are not a part of this Deed of Trust.

Section 1.11 Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court or other body of competent jurisdiction, such illegality or invalidity will not affect the balance of the terms and provisions hereof, which terms and provisions will remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt, and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, will be considered to have been first paid or applied to the full payment of that portion of the debt that is not secured or partially secured by the lien of this Deed of Trust.

Section 1.12 Governing Law. This Deed of Trust is to be governed by and construed in accordance with the laws of the State of California.

Section 1.13 Gender and Number. In this Deed of Trust the singular includes the plural and the masculine includes the feminine and neuter and vice versa, if the context so requires.

Section 1.14 Deed of Trust, Mortgage. Any reference in this Deed of Trust to a mortgage also refers to a deed of trust and any reference to a deed of trust also refers to a mortgage.

Section 1.15 Actions. Trustor agrees to appear in and defend any action or proceeding purporting to affect the Security.

Section 1.16 Substitution of Trustee. Beneficiary may from time to time substitute a successor or successors to any Trustee named herein or acting hereunder to execute this Trust. Upon such appointment, and without conveyance to the successor trustee, the latter will be vested with all title, powers, and duties conferred upon any Trustee herein named or acting hereunder. Each such appointment and substitution is to be made by written instrument executed by Beneficiary, containing reference to this Deed of Trust and its place of record, which, when duly recorded in the proper office of the county or counties in which the Property is situated, will be conclusive proof of proper appointment of the successor trustee.

Section 1.17 Statute of Limitations. The pleading of any statute of limitations as a defense to any and all obligations secured by this Deed of Trust is hereby waived to the full extent permissible by law.

Section 1.18 Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law the Trustee is not obligated to notify any party hereto of a pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee is to be a party unless brought by Trustee.
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19 Section 1.19 Tax Credit Provisions.
(e) Notwithstanding anything to the contrary contained herein or in any documents secured by this Deed of Trust or contained in any subordination agreement, and to the extent applicable, the Beneficiary acknowledges and agrees that in the event of a foreclosure or deed-in-lieu of foreclosure (collectively, "Foreclosure") with respect to the Security encumbered by this Deed of Trust, the following rule contained in 26 U.S.C. Section 42(h)(6)(E)(ii), as amended, applies: for a period of three (3) years from the date of Foreclosure, with respect to any unit that had been regulated by the Regulatory Agreement with the California Tax Credit Allocation Committee: (a) none of the tenants occupying those units at the time of Foreclosure may be evicted or their tenancy terminated (other than for good cause); (b) nor may any rent be increased except as otherwise permitted under Section 42 of the Internal Revenue Code. [Signature Page Follows]
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S-1
Deed of Trust
Signature Page
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IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written.

TRUSTOR:

MP 2000 DELAWARE, LLC, a California limited liability company By: Mid-Peninsula Greenridge, Inc.,
a California nonprofit public benefit corporation,
its sole member/manager
By: ________________________________
Matthew O. Franklin, Assistant Secretary
Date: ________________________________
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I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY

TO BE INSERTED
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1 PROMISSORY NOTE
(2000 South Delaware Street)
$500,000 City of San Mateo, California
December __, 2024
FOR VALUE RECEIVED, MP 2000 Delaware LLC, a California limited liability company ("Borrower"), promises to pay to the CITY OF SAN MATEO, a California charter city ("Holder") the principal sum of Five Hundred Thousand Dollars ($500,000) or so much thereof as is disbursed pursuant to the Loan Agreement (as defined in Section 1 below). All capitalized terms used but not defined in this Note have the meanings set forth in the Loan Agreement.

1. Borrower's Obligation. This Note evidences the Borrower's obligation to pay the Holder the principal amount of Five Hundred Thousand Dollars ($500,000) for the funds loaned to Borrower by Holder (the "Loan"). The Borrower intends to use the Loan funds to finance acquisition of the Development, pursuant to that certain Loan Agreement dated as of November __, 2024, as such may be amended from time to time, by and between Borrower and Holder (collectively, the "Loan Agreement").

2. Interest. The Loan will bear simple interest at three percent (3%) per annum; provided, however, in the event of an uncured Developer Event of Default under the City Loan Documents and the failure of the Borrower to cure the same within the time specified in the City Loan Documents, interest shall accrue following the Developer Event of Default at the default rate of the lesser of ten percent (10%), compounded annually, or the highest rate permitted by law.

3. Term and Repayment Requirements. Payments due under this Note are due in accordance with this Note and as set forth in Section 3.5 of the Loan Agreement. In any event, the unpaid principal balance is due and payable not later than the expiration of the Term of the Loan Agreement. Repayment of this Note shall be non-recourse to the Borrower pursuant to Section

4.10 of the Loan Agreement.

4. No Assumption. This Note is not assumable by the successors and assigns of Borrower without the prior written consent of the Holder except as provided in the Loan Agreement.

5. Security. This Note is secured by the Loan Deed of Trust executed concurrently herewith.

6. Terms of Payment.
(a) Borrower shall make all payments due under this Note in currency of the United States of America to Holder at the City of San Mateo, 330 W. 20th Avenue, San Mateo, CA 94403, Attention: City Manager, or such other place as Holder may from time to time designate.
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2 (b) All payments on this Note are without expense to Holder. Borrower shall pay all costs and expenses, including reconveyance fees and reasonable attorney's fees of Holder, incurred in connection with the payment of this Note and the release of any security hereof. (c) The obligations of Borrower under this Note are absolute and Borrower waives any and all rights to offset, deduct or withhold any payments or charges due under this Note for any reason whatsoever.

7. Default.
(a) Upon the occurrence of an uncured Developer Event of Default, the entire unpaid principal balance, and together with all other sums then payable under this Note, will, at the option of the Holder, become immediately due and payable upon written notice by the Holder to the Borrower without further demand.
(b) The Holder's failure to exercise the remedy set forth in subsection 7(a) above or any other remedy provided by law upon the occurrence of an uncured Developer Event of Default will not constitute a waiver of the right to exercise any remedy at any subsequent time in respect to the same or any other uncured Developer Event of Default. The acceptance by Holder hereof of any payment which is less than the total of all amounts due and payable at the time of such payment will not constitute a waiver of the right to exercise any of the foregoing remedies or options at that time or at any subsequent time, or nullify any prior exercise of any such remedy or option, without the express consent of the Holder, except as and to the extent otherwise provided by law.

8. Waivers.
(a) Borrower hereby waives diligence, presentment, protest and demand, and notice of protest, notice of demand, notice of dishonor and notice of non-payment of this Note.

Borrower expressly agrees that this Note or any payment hereunder may be extended from time to time, and that Holder may accept further security or release any security for this Note, all without in any way affecting the liability of Borrower.
(b) Any extension of time for payment of this Note or any installment hereof made by agreement of Holder with any person now or hereafter liable for payment of this Note must not operate to release, discharge, modify, change or affect the original liability of Borrower under this Note, either in whole or in part.

9. Miscellaneous Provisions.
(a) All notices to Holder or Borrower are to be given in the manner and at the addresses set forth in the Loan Agreement, or to such addresses as Holder or Borrower may therein designate.
(b) Borrower promises to pay all costs and expenses, including reasonable attorney's fees, incurred by Holder in the enforcement of the provisions of this Note, regardless of whether suit is filed to seek enforcement.
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3 B.This Note is governed by the laws of the State of California.

C.The times for the performance of any obligations hereunder are to be strictly construed, time being of the essence.

D.The City Loan Documents, of which this Note is a part, contain the entire agreement between the parties as to the Loan. This Note may not be modified except upon the written consent of the parties.
[Signature Page Follows]
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4 IN WITNESS WHEREOF, this Promissory Note is executed by Borrower as of the day and year written below and is effective as of the date first written above.

BORROWER:

MP 2000 DELAWARE, LLC, a California limited liability
company
By: Mid-Peninsula Greenridge, Inc.,
a California nonprofit public benefit corporation,
its sole member/manager
By:

By: ________________________________
Matthew O. Franklin, Assistant Secretary
Date: ________________________________
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AMENDED AND RESTATED GROUND LEASE
by and between

CITY OF SAN MATEO
and
MP 2000 DELAWARE, LLC
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TABLE OF CONTENTS
Page
ARTICLE 1. PROPERTY AND BACKGROUND ........................................................................

1.01. Overview ...................................................................................................................

1.02. Property .....................................................................................................................

1.03. Lease .........................................................................................................................

ARTICLE 2. TERM ........................................................................................................................

2.01. Term ..........................................................................................................................

2.02. Commencement ........................................................................................................

ARTICLE 3. RENT .........................................................................................................................

3.01. Base Rent ..................................................................................................................

3.02. Additional Rent .........................................................................................................

3.03. Net Lease ..................................................................................................................

ARTICLE 4. TAXES AND ASSESSMENTS ................................................................................

4.01. Personal Property Taxes ...........................................................................................

4.02. Real Property Taxes ..................................................................................................

4.03. New Assessments ......................................................................................................

4.04. Tenant's Tax Liability Prorated .................................................................................

4.05. Permitted Contests ....................................................................................................

ARTICLE 5. USE, CHARACTER, OPERATION AND MAINTENANCE
OF IMPROVEMENTS..............................................................................................

5.01. General ......................................................................................................................

5.02. Use Obligations .........................................................................................................

5.03. Use Prohibitions ........................................................................................................

5.04. General Standards of Maintenance ...........................................................................

5.05. Governmental Requirements ....................................................................................

ARTICLE 6. CONSTRUCTION AND LIENS...............................................................................

6.01. Initial Construction of Improvements .......................................................................

6.02. Construction Standards .............................................................................................

6.03. Additional Construction on Property ........................................................................

6.04. Protection of Landlord ..............................................................................................

6.05. Notice ........................................................................................................................

ARTICLE 7. OWNERSHIP OF IMPROVEMENTS AND PERSONAL PROPERTY.................

7.01. Ownership of Improvements During Term ...............................................................

7.02. Landlord's Right on Default by Tenant .....................................................................

7.03. Removal and Ownership at Termination ..................................................................

ARTICLE 8. UTILITIES ................................................................................................................ 370 of 563
Page
ARTICLE 9. INSURANCE AND INDEMNITY ...........................................................................

9.01. Indemnity ..................................................................................................................

9.02. Insurance ...................................................................................................................

9.03. Review ......................................................................................................................

9.04. Proof of Coverage .....................................................................................................

ARTICLE 10. DAMAGE OR DESTRUCTION...............................................................................

10.01. Restoration ................................................................................................................

10.02. Right to Terminate Upon Destruction During Final Years of Lease Term ..............

10.03. Waiver .......................................................................................................................

10.04. Determination of Extent of Destruction; Interference with Use ...............................

10.05. Procedures for Repair and Restoration .....................................................................

10.06. Right to Terminate Upon Destruction By Uninsured Casualty or Where Insufficient Insurance Proceeds .........................................................................................................

10.07. Procedures for Certain Permitted Terminations ......................................................

ARTICLE 11. CONDEMNATION...................................................................................................

11.01. Definitions .................................................................................................................

11.02. Parties' Rights and Obligations to be Governed by Lease ........................................

11.03. Total Taking ..............................................................................................................

11.04. Effect of Partial Taking .............................................................................................

11.05. Restoration of the Property .......................................................................................

11.06. Waiver of CCP Section 1265.130 .............................................................................

11.07. Award ........................................................................................................................

ARTICLE 12. ASSIGNMENT AND SUBLETTING ......................................................................

ARTICLE 13. TENANT DEFAULTS AND LANDLORD'S REMEDIES .....................................

13.01. Defaults by Tenant ....................................................................................................

13.02. Landlord's Remedies .................................................................................................

13.03. Default Not Susceptible to Cure Within Prescribed Period ......................................

13.04. Damages ....................................................................................................................

13.05. Landlord's Right to Cure Tenant's Default ...............................................................

13.06. Defaults by Landlord ................................................................................................

ARTICLE 14. MORTGAGEE PROTECTION PROVISIONS........................................................

14.01. Leasehold Mortgage Authorized ...............................................................................

14.02. Notice to Landlord ....................................................................................................

14.03. Definitions .................................................................................................................

14.04. Consent of Leasehold Mortgagee Required ..............................................................

14.05. Default Notice ...........................................................................................................

14.06. Notice to Leasehold Mortgagee ................................................................................

14.07. Mortgagee to Foreclose .............................................................................................

14.08. Purchase and Sale .....................................................................................................

14.09. Mortgagee's Right to Sell .......................................................................................... 371 of 563
Page
ARTICLE 15. MISCELLANEOUS ..................................................................................................

15.01. Holding Over ............................................................................................................

15.02. Attorneys' Fees ..........................................................................................................

15.03. Quiet Possession .......................................................................................................

15.04. Force Majeure ...........................................................................................................

15.05. Notices ......................................................................................................................

15.06. Waiver .......................................................................................................................

15.07. Surrender ...................................................................................................................

15.08. Binding ......................................................................................................................

15.09. Landlord's Right to Enter Property ...........................................................................

15.10. Disclaimer of Partnership .........................................................................................

15.11. Memorandum ............................................................................................................

15.12. Quitclaim ...................................................................................................................

15.13. Interpretation .............................................................................................................

15.14. Covenants and Conditions ........................................................................................

15.15. Integration .................................................................................................................

15.16. Estoppel Certificate ...................................................................................................

15.17. Landlord's Right to Sell ............................................................................................

EXHIBITS
Exhibit A Description of the Property
Exhibit B Form of Memorandum of Lease
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SMT/GroundLeaseMPDelaware Exhibit A 3/26/12

GROUND LEASE
THIS GROUND LEASE (the "Lease") is made and entered into this ______ day of _______________, 2024, by and between the CITY OF SAN MATEO, a municipal corporation,

AS SUCCESSOR TO THE HOUSING ASSETS OF THE FORMER REDEVELOPMENT AGENCY OF THE CITY OF SAN MATEO PURSUANT TO PART 1.85 OF DIVISION 24 OF THE HEALTH AND SAFETY CODE, IN PARTICULAR, SECTION 34176 OF THE HEALTH AND SAFETY CODE (hereinafter called "Landlord"), and MP 2000 DELAWARE, LLC, A California limited liability company, (hereinafter called "Tenant"), who agree as follows:

WHEREAS, an Assignment and Amendment to Ground Lease (“Assignment and First Amendment”) was executed on September 27, 2024 by and between 2000 Delaware San Mateo LLC, a California limited liability company, the Tenant, and the Landlord; and WHEREAS, the Assignment and First Amendment assigned all of the Assignor’s right, title, and interest in that certain unrecorded Amended and Restated Ground Lease dated February 29, 2016 (the “Ground Lease”) by and between Assignor, as tenant, and the Landlord, as lessor, a memorandum of which was recorded with the recorder of the County of San Mateo on March 1, 2016 as Instrument Number 2016-017972 (the “Memorandum of Lease”), which Ground Lease pertains to that certain real property, together with all improvements thereon, located at 2000 S.

Delaware Street, San Mateo, California, and more particularly described on Exhibit A attached hereto (the “Property”), in accordance with the terms of that certain Purchase and Sale Agreement and Joint Escrow Instructions (the “Agreement”) dated as of July 15, 2024, by and between Assignor and Assignee. Capitalized terms used herein and not defined herein shall have the meanings set forth in the Agreement; and
WHEREAS, the Assignment and First Amendment made certain modifications to the Ground Lease, namely, to deepen the affordability of the units located on the Property from moderateincome to low-income, re-start the 55-year rental restriction, and remove the option to purchase the Property; and
WHEREAS, Tenant and Landlord intended, upon execution of the Assignment and First Amendment, to execute an amended and restated Ground Lease in substantially the same form as the parties are currently under for the Delaware Pacific project located at 1990 S. Delaware Street in San Mateo, California, subject to Landlord’s approval in its sole discretion; and WHEREAS, this Lease amends, restates and supersedes in its entirety that certain Amended and Restated Ground Lease.

ARTICLE 1. PROPERTY AND BACKGROUND

1.01 Overview. The purpose of this Lease is to effectuate the Redevelopment Plans for the San Mateo Downtown Redevelopment Project and the San Mateo Shoreline Redevelopment Project through the leasing of the Property (defined in Section 1.02 hereof) for the operation thereon of affordable rental housing that will be made available to persons and families of Low Income (the “Project”).
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1.02. Property. Landlord owns the real property located in the County of San Mateo, State of California, as more particularly described in Exhibit A attached hereto and incorporated herein, and which is hereinafter called the "Property."

1.03. Lease. For and in consideration of the payment of rentals and the performance of all the covenants and conditions of this Lease, Landlord hereby leases and demises to Tenant, and Tenant hereby leases and hires from Landlord, the Property, for the term and upon the covenants and conditions set forth herein.

ARTICLE 2. TERM

2.01. Term. Unless terminated earlier in accordance with the provisions of this Lease, the term of this Lease. shall expire at 11:59 p.m. on May 2, 2111. (as defined in Section 2.02.).

2.02. Commencement. The term of this Lease shall commence upon the date of execution of this Lease (the "Commencement Date"). A “Lease Year” shall be the one-year period from the Commencement Date or anniversary thereof to 11:59 p.m. on the day immediately preceding the anniversary of the Commencement Date or an anniversary thereof.

The Commencement Date will be reflected in a memorandum of this Lease to be recorded in the office of the County Recorder of San Mateo County pursuant to Section 15.11 of this Lease.

ARTICLE 3. RENT

3.01 Base Rent. Commencing upon the Commencement Date, and thereafter annually, Tenant shall pay Landlord a base rental (the "Base Rent") in the amount of ONE DOLLAR ($1.00).

3.02 Percentage Rent. Tenant shall pay to Landlord annually after repayment of the City Loan, Percentage Rent equal to twenty-five percent (25%) of Net Cash Flow as hereinafter defined. a. “City Loan” means the Loan totaling Five Hundred Thousand Dollars ($500,000) from the City’s General Fund (“City Loan”) to the Development. b. “Net Cash Flow” means, in a particular calendar year, the amount by which Gross Revenue (defined below) exceeds Annual Operating Expenses (defined below). c. “Gross Revenue” with respect to a particular calendar year shall mean all revenue, income, receipts, and other consideration actually received from operation and leasing of the Project. Gross Revenue shall include, but not be limited to: all rents, fees and charges paid by tenants, Section 8 payments or other rental subsidy payments received for the dwelling units, deposits forfeited by tenants, all cancellation fees, price index adjustments and any other rental adjustments to leases or rental agreements; net proceeds from vending and laundry room machines; the proceeds of business interruption or similar insurance not paid to senior lenders; the proceeds of casualty insurance not used to rebuild the Project and not paid to senior lenders; and condemnation awards for a taking of part or all of the Project 374 of 563
for a temporary period and not paid to senior lenders. Gross Revenue shall not include tenants' security deposits, loan proceeds, capital contributions or similar advances.
a. “Annual Operating Expenses” with respect to a particular calendar year shall mean the following costs reasonably and actually incurred for operation and maintenance of the Project to the extent that they are consistent with an annual independent audit performed by a certified public accountant using generally accepted accounting principles: property taxes and assessments imposed on the Project; debt service (including principal, interest and any required fees) currently due on a non-optional basis on loans associated with development of the Project and approved by the Landlord; issuer fees; property management fees and reimbursements, not to exceed fees and reimbursements which are standard in the industry and pursuant to a management contract approved by the Landlord; premiums for property damage and liability insurance; utility services not paid for directly by tenants, including water, sewer, and trash collection; maintenance and repair; any annual license or certificate of occupancy fees required for operation of the Project; security services; advertising and marketing; cash deposited into reserves for capital replacements of the Project; cash deposited into an operating reserve in an amount not to exceed that approved by the Landlord) but with the operating reserve capped at six (6) months gross rent from the Project (as such rent may vary from time to time); tenant services in an amount approved by the Landlord; payment of any previously unpaid portion of the developer fee (without interest) not exceeding a cumulative developer fee in the maximum amount of $600,000; extraordinary operating costs specifically approved by the Landlord; and other ordinary and reasonable operating expenses not listed above. Annual Operating Expenses shall not include the following:
depreciation, depletion or other non-cash expenses; any amount expended from a reserve account; and any capital cost with respect to the Project, as determined by the accountant for the Project.
b. Payment of Percentage Rent. Upon repayment of the City Loan and within fortyfive (45) days of the close of each calendar year following the date (the "Percentage Rent Commencement Date") of the execution of the Lease, Tenant shall provide Landlord with annual statements certified by Tenant showing in detail the calculations of Net Cash Flow for each such calendar year. Concurrently with the submission of each annual report, Tenant shall pay to Landlord the Percentage Rent due for such calendar year. Payments of Percentage Rent for any partial year shall be prorated on a daily basis.
c. For purposes of verifying payments due Landlord, representatives of Landlord shall have the right to inspect Tenant's books and records, and independently audit the results of Tenant's operations on seven (7) days written notice to Tenant. Books and records shall be maintained at the Property or at Tenant's principal place of business, unless Landlord shall approve a different location. Tenant shall keep all books and records for not less than five (5) years from the end of the fiscal year to which they pertain. If as a result of an independent audit of Tenant's books by an 375 of 563
independent certified public accountant hired by Landlord additional Percentage Rent is due Landlord for any calendar year which exceeds by five percent (5%) or Five Thousand Dollars ($5,000), whichever is greater, the Percentage Rent actually paid for such calendar year, the reasonable cost of such audit shall be paid by Tenant, and the additional amount of Percentage Rent owed Landlord shall bear interest at the maximum rate permitted by law.

3.02. Additional Rent. In addition to and not by way of limitation of Landlord's rights under specific provisions of this Lease, Landlord shall at all times have the right (at its sole election and without any obligation to do so) to advance on behalf of Tenant any amount payable under the terms hereof by Tenant, or to otherwise satisfy any of Tenant's obligations hereunder, provided that (except in case of emergency calling for immediate payment) Landlord shall first have given Tenant no less than ten (10) days advance written notice of Landlord's intent to advance such amounts on behalf of Tenant and shall only advance such funds if Tenant fails to do so within said 10-day period. Tenant shall have the right to contest any advance made by Landlord on behalf of Tenant pursuant to this section. In the event of such contest, the issue of whether such advance was for an amount payable by Tenant under this Lease shall be determined by an arbitrator mutually acceptable to the parties. The costs of the arbitration shall be borne by the unsuccessful party. No advance by Landlord shall operate as a waiver of any of Landlord's rights under this Lease and Tenant shall remain fully responsible for the performance of its obligations under this Lease. All amounts advanced by Landlord shall constitute Additional Rent under this Lease, shall be immediately due and payable by Tenant to Landlord, and shall bear interest at the maximum rate permitted by Section 1(2) of Article XV of the California Constitution from the date of advance until paid in full.

3.03. Net Lease. This Lease is a net lease, and Base Rent, Additional Rent and other payments due and payable hereunder to or on behalf of Landlord shall be paid without notice or demand and without offset, counterclaim, abatement, suspension, deferment, deduction or defense.

ARTICLE 4. TAXES AND ASSESSMENTS

4.01. Personal Property Taxes. Tenant shall pay before delinquency all taxes, assessments, license fees and other charges ("taxes") that are levied and assessed against Tenant's personal property installed or located in or on the Property which become payable during the term.

On demand by Landlord, Tenant shall furnish Landlord with satisfactory evidence of these payments.

4.02. Real Property Taxes. Tenant acknowledges and agrees that this Lease will create a possessory interest subject to property taxation. As provided in Section 33673 of the California Health and Safety Code and/or Section 107.6 of the California Revenue and Taxation Code, as applicable, Tenant shall pay taxes upon the assessed value of the entire Property and any improvements thereon and not merely upon the assessed value of its leasehold interest. Tenant shall pay all real property taxes and general and special taxes ("real property taxes") levied and assessed against the Property and all real property taxes levied against Tenant's improvements in the Property; provided that Tenant may seek and obtain a “welfare exemption” or other applicable exemptions from the payment of such assessments. Each year Landlord shall notify Tenant of the real property taxes, and immediately on receipt of the tax bill, shall furnish Tenant with a copy of 376 of 563
the tax bill. Tenant shall, semi-annually, pay the real property taxes not later than the taxing authority's delinquency date. If at any time during the term of this Lease any authority having the power to tax, including, without limitation, any federal, state, county or city government or any political subdivision thereof (collectively, "taxing authority"), shall alter the methods and/or standards of taxation and assessment against the legal or equitable interests of Landlord in the Property or the improvements located or constructed thereon, in whole or in part, so as to impose a monetary obligation on Landlord in lieu of or in addition to the taxes and assessments in existence as of the date of this Lease, such taxes or assessments based thereon, including, without limitation, (a) a tax, assessment, excise, surcharge, fee, levy, penalty, bond or similar imposition (collectively, "impositions"), on Landlord's right to rental or other income from the Property or as against Landlord's leasing of the Property, (b) any impositions in substitution or in lieu, partially or totally, of any impositions assessed upon real property prior to any such alteration, (c) any impositions allocable to or measured by the area of the Property or the rental payable hereunder, including, without limitation, any impositions levied by any taxing authority with respect to the receipt of such rental or with respect to the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Tenant or any subtenant of the Property or any portion thereof, (d) any impositions upon this lease transaction or any document to which Tenant is a party which creates or transfers any interest or estate in or to the Property (other than any transfer tax which may be due upon recordation of the Memorandum of Lease described in Section 15.11), or (e) any special, unforeseen or extraordinary impositions which, although not specifically described above, can fairly be characterized as a real property tax or a substitute for real property tax, shall be considered as "real property taxes" for the purposes of this Lease. "Real property taxes" shall exclude, however, all general income taxes, gift taxes, inheritance taxes and estate taxes owed by Landlord.

4.03. New Assessments. If any general or special assessment is levied against the Property, Landlord shall elect to pay such assessments in installments, rather than in full, and Tenant shall promptly pay the installments when due.

4.04. Tenant's Tax Liability Prorated. Tenant's liability to pay real property taxes and new assessments shall be prorated on the basis of a 365-day year to account for any fractional portion of a fiscal tax year included in the lease term at its inception and expiration or earlier termination in accordance with this Lease.

4.05. Permitted Contests. Tenant, at its cost, shall have the right at any time to seek a reduction in the assessed valuation of the Property or to contest any real property taxes that are to be paid by Tenant. If Tenant seeks a reduction or contests the real property taxes, the failure on Tenant's part to pay the real property taxes shall not constitute a default as long as Tenant complies with the provisions of this paragraph.

Landlord shall not be required to join in any proceeding or contest brought by Tenant unless the provisions of any law require that the proceeding or contest be brought by or in the name of Landlord or any owner of the Property. In that case Landlord shall join in the proceeding or contest or permit it to be brought in Landlord's name as long as Landlord is not required to bear any cost. Tenant, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered, together with all costs, charges, 377 of 563
interest and penalties incidental to the decision or judgment. If Tenant does not pay the real property taxes when due and Tenant seeks a reduction or contests them as provided in this paragraph, before the commencement of the proceeding or contest Tenant shall furnish to Landlord a surety bond issued by an insurance company qualified to do business in California. The amount of the bond shall equal one hundred percent (100%) of the total amount of real property taxes in dispute. The bond shall hold Landlord and the Property harmless from any damage arising out of the proceeding or contest and shall insure the payment of any judgment that may be rendered.

ARTICLE 5. USE, CHARACTER, OPERATION AND MAINTENANCE OF

IMPROVEMENTS

5.01. General. Tenant shall use the Property and the improvements thereon only for the Project as specified herein. Tenant shall use the Property and the improvements thereon for no other purpose without the prior written consent of Landlord. As set forth in Section 1.01 hereof, Tenant covenants and agrees that the improvements constructed on the Property shall not be modified, altered or demolished if the modification, alteration or demolition would cause the improvements constructed as part of the Project to be in violation of any applicable land use or building code or requirement.

5.02. Use Obligations.
a. Affordable Housing Covenants.

With the exception of one (1) unrestricted manager unit and for all tenants whose leases were signed prior to Tenant’s acquisition of the Property on September 27, 2024, all of the units leased at the Property from September 27, 2024 onward shall be rent-restricted for occupancy by households whose gross income does not exceed one hundred percent (100%) of Area Median Income as adjusted by household size for San Mateo County (the “Eligible Households”), and at least forty-nine percent (49%) of those units shall be further rent-restricted for occupancy by low income households whose gross income does not exceed eighty percent (80%) of Area Median Income as adjusted by household size for San Mateo County (“Low-Income Households”). Rent for the shall be no greater than that considered to be “affordable rent” for Median or Low Income households, as applicable, adjusted for family size appropriate to the unit, as published annually by the California Tax Credit Allocation Committee (“TCAC”). “Area Median Income” means the median household income adjusted for household size, as published by CTCAC. “Adjusted for family size appropriate to the unit” shall mean multiplying 1.5 by the number of bedrooms in the unit.

Tenant shall select Eligible Households on a non-discriminatory basis, consistent with the provisions of subdivision b. below. Tenant shall annually review the income qualifications submitted by tenants occupying rental units in the Property to ascertain whether that tenant still qualifies as an Eligible Household, and each rental agreement between Tenant and a tenant occupying a rental unit in the Property shall provide for such annual review. Not later than sixty (60) days from the end of each Lease Year (defined in Section 2.02 hereof), the Tenant shall prepare and submit to the Landlord a report that contains the following information:
(1) The number of persons per rental unit;
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(2) Tenant name(s) and age(s) (if not prohibited under any applicable privacy laws);
(3) Initial occupancy date;
(4) Rent paid per month, including any applicable utility allowance; (5) Gross income per year as of the last annual income recertification; and
(6) Percent of rent paid in relation to income.

Annual income recertifications shall also contain those documents used to certify eligibility. Landlord may, from time to time during the term of this Agreement, reasonably request additional or different information and the Tenant shall promptly supply such information in the reports required hereunder. Tenant shall maintain all necessary books and records, including property, personal and financial records, in accordance with requirements prescribed by the Landlord with respect to all matters covered by this Section 5.02.a. Tenant, at such time and in such forms as Landlord may reasonably require, shall furnish to Landlord statements, records, reports, data and information pertaining to matters covered by this Section 5.02.a. Upon request for examination by Landlord, the Tenant, at any time during normal business hours, shall make available all of its records with respect to all matters covered by this Section 5.02.a. Tenant shall permit the Landlord to audit, examine and make excerpts or transcripts from these records. b. Nondiscrimination and Nonsegregation.

Tenant covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor shall the Tenant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Property.

Tenant shall refrain from restricting the rental, sale or lease of the Property on any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:
(1) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises herein 379 of 563
conveyed, nor shall the grantee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the premises herein conveyed. The foregoing covenants shall run with the land."
(2) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions:
"That there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased, nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the premises herein leased."
(3) In contracts: "There shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Section 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land."

5.03. Use Prohibitions. Tenant agrees that in connection with the use and operation of the Property it will not:
a. Use or permit the use of any objectionable advertising medium such as, without limitation, loudspeakers, phonographs, public address systems, sound amplifiers, radio or broadcast within the improvements in such manner that any sounds reproduced, transmitted or produced shall be directed primarily beyond the interior of the improvements or common areas (provided, however, that nothing herein shall be deemed to prohibit the installation and use of a public address system for security purposes), and will keep all mechanical apparatus free of vibration and noise which may be transmitted beyond the interior of the improvements or common areas; or
b. Cause or permit obnoxious odors to emanate or be dispelled from the improvements; or
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c. Permit undue accumulations of garbage, trash, rubbish or any other refuse; or
d. Create, cause, maintain or permit any nuisance in, on or about the Property; or
e. Commit or suffer to be committed any waste in, on or about the Property; or
f. Use or allow the Property to be used for any improper, immoral or unlawful purpose, or for any purpose which violates the terms of any recorded instrument affecting the Property; or
g. Do or permit to be done anything which in any way unreasonably disturbs the occupants of neighboring property; or
h. Cause or permit any insurance coverage on the Property or the improvements thereon to become void or voidable or make it impossible to obtain any required insurance at commercially feasible rates; or
i. Cause or permit any structural damage to the Property or the improvements thereon or to any adjacent public or private property, subject to acts of nature; or j. Violate any law, ordinance or regulation applicable to the Property and the improvements thereon.

5.04. General Standards of Maintenance. Tenant shall be fully responsible for the operation and maintenance of all of Tenant's improvements on the Property, and any open space and common areas on the Property, and shall operate and maintain, or cause to be operated and maintained, such improvements and open space and common areas in good order, condition and repair subject only to normal wear and tear customary in the shopping center industry.

Without limiting the generality of the foregoing, Tenant shall observe the following standards:
a. Maintain the surface of all pedestrian areas level, smooth and evenly covered with the type of surfacing material originally installed thereon or such substitute thereof as shall be in all respects equal thereto or better in quality, appearance and durability; b. Remove all papers, debris, filth and refuse, and sweep, wash down and/or clean all hard surfaces, including brick, metal, concrete, glass, wood and other permanent poles, walls or structural members as required;
c. Maintain such appropriate entrance, exit and directional signs, markers and lights as shall be reasonably required and which are in accordance with the practices prevailing in the operation of similar developments;
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d. Clean lighting fixtures and relamp and/or reballast as needed; e. Repaint striping, markers, directional signs, etc., as necessary to maintain in first-class condition;
f. Maintain landscaping as necessary to keep in a first-class, thriving condition;
g. Maintain signs, including relamping and/or reballasting and/or repairing as required;
h. Maintain and keep in good condition and repair all benches, shelters, planters, mall coverings, banners, furniture, trash containers, sculptures and other exterior elements;
i. Maintain and keep in a sanitary condition public restrooms and other common-use facilities;
j. Clean, repair and maintain all common utility systems to the extent that the same are not cleaned, repaired and maintained by public utilities; k. Maintain all fountains and associated structures, drinking fountains, pumps and associated plumbing;
l. Provide adequate security lighting in all areas during periods of unrestricted public access, and maintain all security and decorative light fixtures and associated wiring systems; m. Maintain all surface and storm lateral drainage systems; and n. Maintain all sanitary sewer lateral connections.

5.05. Governmental Requirements. Tenant shall at all times comply with, and shall pay all costs and expenses which may be incurred or required to be paid in order to comply with, any and all laws, statutes, ordinances, rules and regulations ("laws") which apply to the operation and use of the Property, including those requiring alterations or additions to be made to, or safety appliances and devices to be maintained or installed in, on or about the Property under any laws now or hereafter adopted, enacted or made and applicable to the Property, and payment of any fees, charges or assessments arising out of or in any way related to the Property as a source of adverse environmental impacts or effects.

ARTICLE 6. CONSTRUCTION AND LIENS

6.01. Additional Construction on Property.
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a. Construction Standards. Any additional building erected on any portion of the Property as permitted under this Lease, any remodeling or reconstruction work undertaken on or within any existing building on any portion of the Property, and any alteration of or addition to open spaces or common area, shall at all times be substantially in accordance with plans therefor submitted to and approved by Landlord in accordance with subsection b. of this Section 6.01. Any such development or construction of additional buildings, remodeling or reconstruction of any building on any portion of the Property, or alteration of or addition to open spaces or common area, shall at all times conform in all material respects to the approved design concepts, so that the exterior of all such buildings, including, without limitation, exterior elevations and color thereof, and all such other improvements, will be architecturally and aesthetically compatible and harmonious with the other buildings and improvements on the Property to create a uniform general plan for the Property. All construction shall be diligently prosecuted and accomplished without cost or expense to Landlord, and in a good and workmanlike manner. b. Landlord's Approval of Plans. Any construction, reconstruction or remodeling undertaken by Tenant on the Property shall be governed by the following:
(1) Tenant shall have the right, without Landlord's consent (but subject to all other provisions of this Lease), to undertake any interior, nonstructural remodeling of the Tenant's improvements not visible from the outside or affecting exterior appearance and not altering the pre-existing location of the improvements on the Property; (2) If Tenant at any time desires to undertake any construction, reconstruction, demolition or remodeling on the Property which is not exempt from Landlord's approval as provided in subsection 6.01.b.(1), above, Tenant shall, prior to the commencement of such work, prepare or cause to be prepared, at its sole expense, and shall submit to Landlord for its review and written approval, plans and specifications for such work, showing, without limitation, scaled elevations, scaled floor plans, design concepts, dimensions, material selection, colors, signing (if any) and such additional information as is reasonably necessary for Landlord to make an informed decision on such submission. Landlord shall approve or disapprove such submitted plans within thirty (30) days of receipt of complete plans and specifications meeting the requirements of this subsection. Failure of the Landlord to specify any objection to such plans and specifications or make a proposal that would add to or change the plans and specifications within such 30-day period shall be deemed to be an approval. The plans and specifications shall comply with this Lease and shall be in compliance with existing building codes and other laws, regulations and ordinances; and
(3) No material changes to the approved plans and specifications shall be made without the prior written approval of Landlord, which approval shall not be unreasonably withheld or delayed.

6.02. Protection of Landlord. Nothing in this Lease shall be construed as constituting the consent of Landlord, expressed or implied, to the performance of any labor or the furnishing of any materials or any specific improvements, alterations of or repairs to the Property or any part thereof by any contractor, subcontractor, laborer or materialman, nor as giving Tenant or any other person any right, power or authority to act as agent of or to contract for, or permit the rendering 383 of 563
of, any services, or the furnishing of any materials, in such manner as would give rise to the filing of mechanics' liens or other claims against the fee of the Property or the improvements thereon.

Landlord shall have the right at all reasonable times to post, and keep posted, on the Property any notices which Landlord may deem necessary for the protection of Landlord and of the Property and the improvements thereon from mechanics' liens or other claims. Tenant shall give Landlord ten (10) days prior written notice of the commencement of any work to be done on the Property to enable Landlord to post such notices. In addition, Tenant shall make, or cause to be made, prompt payment of all monies due and legally owing to all persons doing any work or furnishing any materials or supplies to Tenant or any of its contractors or subcontractors in connection with the Property and the improvements thereon, subject to Tenant’s right to contest same.

Tenant shall keep the Property and such improvements free and clear of all mechanics' liens and other liens on account of work done for Tenant or persons claiming under it.

Tenant agrees to and shall indemnify and save Landlord harmless against liability, loss, damages, costs, reasonable attorneys' fees, and all other expenses on account of claims of lien of laborers or materialmen or others for work performed or materials or supplies furnished to Tenant or persons claiming under it.

In the event any lien is recorded and not expunged within sixty (60) days of recording, Tenant shall, upon demand, furnish the bond described in California Civil Code Section 3143, or successor statute, which results in the removal of such lien from the Property.

6.03. Notice. Should any claims of lien be filed against the Property or the improvements thereon, or any action affecting the title to such Property be commenced, the party receiving notice of such lien or action shall forthwith give the other party written notice thereof.

ARTICLE 7. OWNERSHIP OF IMPROVEMENTS AND PERSONAL PROPERTY

7.01. Ownership of Improvements During Term. All improvements constructed on the Property by Tenant as permitted or required by this Lease shall, during the term of this Lease, be and remain the property of Tenant; provided, however, that Tenant's rights and powers with respect to the improvements are subject to the terms and limitations of this Lease and Tenant's interest in such improvements shall terminate upon the expiration or sooner termination of this Lease.

Landlord and Tenant covenant for themselves and all persons claiming under or through them that the improvements are real property.

7.02. Landlord's Right on Default by Tenant. In the event of any default on the part of Tenant in performing the terms and provisions of this Lease entitling Landlord to possession of the Property and after the expiration of any applicable cure period, Landlord shall have the immediate right of possession of all personal property and the right to assume any ownership or leasehold interest of Tenant in any financed or leased personal property, subject to the rights of third-party lenders and equipment lessors.

7.03. Removal and Ownership at Termination. At the expiration or sooner termination of the term of this Lease, Landlord may, at Landlord's election, require the removal from the Property, at Tenant's sole cost and expense, of all personal property (other than fixtures), or of certain personal property (other than fixtures), as specified in the notice provided for below. A 384 of 563
request to take effect at the normal expiration of the term shall be effected by notice given at least one hundred twenty (120) days before the expiration date. A demand to take effect on any other termination of this lease term shall be effectuated by notice given concurrently with notice of such termination or within ten (10) days after such termination. Tenant shall be liable to Landlord for costs incurred by Landlord in effecting the removal of personal property which Tenant has failed to remove after demand pursuant to this Section.

Tenant may remove any personal property from time to time, during the term of this Lease, and within forty-five (45) days of the expiration of the term of this Lease, that may be removed without damage to the structural integrity of the Property and the improvements thereon.

Tenant shall repair all damage caused by any such removal.

Any personal property not removed by Tenant within forty-five (45) days following expiration of the term shall be deemed to be abandoned by Tenant and shall, without compensation to Tenant, then become the Landlord's property, free and clear of all claims to or against it by Tenant or any other person.

ARTICLE 8. UTILITIES
Tenant shall pay when due and shall hold Landlord harmless from any liability for all charges for water, gas, sewage, electricity, telephone and other utility service supplied to the Property.

ARTICLE 9. INSURANCE AND INDEMNITY

9.01. Indemnity. Tenant agrees to protect and does hereby indemnify and hold Landlord harmless from all demands, claims, actions and damages to any person or property (including reasonable attorneys' fees) arising out of or connected with the use or occupancy of the Property by Tenant other than those attributable to the negligence or willful misconduct of Landlord.

9.02. Insurance.
a. General. Without limiting the Tenant's indemnification of the Landlord, the Tenant shall provide and maintain at its own expense during the term of this Lease the following programs of insurance covering its operations hereunder. Such insurance shall be provided by insurer(s) satisfactory to the Landlord (as determined by the Landlord’s Risk Manager) and evidence of such programs satisfactory to the Landlord shall be delivered to the Landlord on or before the Commencement Date of this Lease. Such evidence shall specifically identify this Lease and shall contain express conditions that the Landlord is to be given written notice at least thirty (30) days in advance of any modification or termination of any program of insurance. b. During the term of this Lease, Tenant shall provide the following forms and amounts of insurance with respect to the Property. Such insurance shall be primary to and not contributing with any other insurance maintained by the Landlord, shall name the Landlord as an additional insured, and shall include, but not be limited to:
(1) Fire and Extended Coverage Insurance in All-Risk form, with vandalism and malicious mischief endorsements and an earthquake endorsement (if obtainable at 385 of 563
commercially reasonable rates) covering all improvements against loss or damage in an amount equal to not less than l00% of the replacement cost, with such deductible as shall be reasonable in comparison with similar properties. Landlord shall be made an additional insured on any policy of insurance required by any permanent or construction lender. (2) Rental Income Protection Insurance covering loss due to the above perils, with a period of indemnity not less than six (6) months. (3) Comprehensive General Liability Insurance endorsed for premisesoperation, products/completed operations, contractual and broad form property damage with a combined single limit of not less than Five Million Dollars ($5,000,000) per occurrence.

9.03. Review. The liability insurance requirements may be reviewed by Landlord and Tenant every five (5) years for the purpose of mutually increasing (in consultation with their respective insurance advisors) the minimum limits of such insurance from time to time to limits which shall be reasonable and customary for similar facilities of like size and operation in accordance with generally accepted insurance industry standards. If the parties are unable to mutually agree upon such new limits within thirty (30) days of a written demand by one party upon the other, the determination of an independent insurance advisor selected by the parties' insurance advisors shall be binding upon the parties.

9.04. Proof of Coverage. All policies required hereunder shall be with companies having a Best's AA rating (and if Best's no longer exists, an equivalent rating). Executed copies of all policies of insurance or certificates thereof shall be delivered to Landlord. All insurance policies required by this Article 9 shall name Landlord as an additional insured. As often as any such policies shall expire or terminate, renewal or additional policies shall be procured and maintained in like manner and to like extent. All policies of insurance must contain a provision that the company writing such policy will give both parties thirty (30) days advance written notice of any cancellation or lapse of the effective date or any reduction in the amounts of insurance. If Tenant fails to purchase, renew or maintain any insurance policies required herein, Landlord shall have the right to so purchase any such insurance and the amount of any such advance by Landlord shall constitute Additional Rent as defined in Section 3.02.

Nothing in this Article 9 shall prevent Tenant from carrying insurance of the kind required of Tenant under a blanket insurance policy or policies which cover other properties owned or operated by Tenant. Tenant shall provide Landlord with certificates of insurance naming Landlord as an additional insured and setting forth the required coverage.

ARTICLE 10. DAMAGE OR DESTRUCTION

10.01. Restoration. No loss or damage by fire or any other cause resulting in either partial or total destruction of any improvements now or hereafter located on the Property, or any fixtures, equipment or machinery used or intended to be used in connection with the Property or the improvements thereon, shall (except as otherwise provided in Section 10.02 and 10.06, below) operate to terminate this Lease or to relieve or discharge Tenant from the payment of any rent, or other amounts payable hereunder, as and when they become due and payable, or from the performance and observance of any of the agreements, covenants and conditions herein contained 386 of 563
to be performed and observed by Tenant. Except as otherwise provided in Sections 10.02 and

10.06, and subject to lenders’ rights with respect to casualty insurance proceeds, Tenant covenants to repair or cause to be repaired and/or reconstruct or cause to be reconstructed any improvements so damaged or destroyed to the extent, condition and value of such improvements immediately prior (or if Tenant was in default of its maintenance and repair obligations at the time of such damage or destruction, to the condition and value which would have existed if Tenant had not been in default) to such damage or destruction, assuming full compliance with this Lease. Tenant's failure to make such full repair and restoration under any conditions in which it has elected or is required so to do shall constitute a default hereunder.

10.02. Right to Terminate Upon Destruction During Final Years of Lease Term. If, during the last ten (10) years of the term, the improvements on the Property are totally or partially destroyed, and if the cost of restoration exceeds ten percent (10%) of the replacement cost of the improvements on the Property immediately before the damage or destruction, Tenant may elect to terminate this Lease, provided that Tenant complies with all of the following conditions:
a. Tenant gives Landlord written notice of the damage or destruction within ten(10) days after the event causing such damage or destruction; b. Tenant is not in default under any provision or condition of this Lease; c. Tenant gives Landlord written notice of the estimated cost of repairing or restoring such damage or destruction, together with notice of its election to terminate this Lease pursuant to this Section 10.02 within ninety (90) days of the event causing the damage or destruction; and
d. Tenant delivers possession of the Property and improvements thereon to Landlord and quitclaims to Landlord all right, title and interest in the Property and the improvements thereon.

If Tenant so elects to terminate this Lease under this Section, then Tenant shall, at its expense, promptly remove all debris and put the Property in a safe condition. Thereupon, this Lease shall terminate and the parties shall have no further obligations to each other excepting those previously accrued but theretofore unsatisfied.

10.03. Waiver. The provisions of this Article 10 shall govern the rights of the parties in the event of any full or partial destruction of the Property. Tenant hereby waives the provisions of Civil Code Section 1932(2) and Civil Code Section 1933(4) and any similar successor statute or law with respect to any destruction of the Property or the improvements thereon.

10.04. Determination of Extent of Destruction; Interference with Use. For the purposes of Section 10.02, the extent of destruction of the improvements shall be determined by dividing the estimated cost of replacement or restoration as evidenced by estimates prepared by licensed general contractors acceptable to Landlord by the full replacement cost of the improvements, applying thereto the percentage change in construction cost for the applicable period based upon the Engineering News Record average construction cost index for such period, applicable to the 387 of 563
San Francisco-Oakland Area, or in the absence of such index, a similar index prepared for such area.

10.05. Procedures for Repair and Restoration. In the event of any damage or destruction, Tenant shall promptly give Landlord written notice of such damage or destruction and the date on which such damage or destruction occurred. Tenant shall promptly make proof of loss and shall proceed promptly to collect, or cause to be collected, all valid claims which Tenant may have against insurers or others based upon any such damage or destruction. Except as otherwise provided below, amounts received on account of any losses pursuant to insurance policies shall, to the extent made available by Tenant’s lenders, be used and expended for the purpose of fully repairing or reconstructing the portions of the improvements on the Property which have been destroyed or damaged.

Tenant shall commence and complete or cause to be commenced and completed, in a good and workmanlike manner and in accordance with Sections 6.01 through 6.03, the reconstruction or repair of any part of the improvements on the Property damaged or destroyed, after Landlord and Tenant’s lenders, to the extent applicable, have approved Tenant's plans, drawings, specifications and construction schedule for such reconstruction or repair.

10.06. Right to Terminate Upon Destruction By Uninsured Casualty or Where Insufficient Insurance Proceeds.
a. If the improvements on the Property are damaged or destroyed by any casualty where the casualty causing such damage or destruction is not required to be insured against under the terms of this Lease, then Tenant shall have the right, at its election, to (1) terminate this Lease in accordance with the provisions of Section 10.07, or (2) to make full repair of such damage and to restore the improvements in accordance with the provisions of Sections

10.01 and 10.05, or (3) repair such damage or restore the improvements to the extent necessary to preserve them and make them safe, and, in addition, to the extent of the insurance proceeds available unless Landlord has elected to terminate this Lease under subsection c. of Section 10.07 below.
b. If the improvements on the Property are damaged or destroyed by any casualty where the casualty causing such damage or destruction is required to be insured against under the terms of this Lease and Tenant is not in default of its obligation to maintain insurance against the casualty, but the insurance proceeds available are in an amount that is less than ninety percent (90%) of the amount necessary to repair and restore such improvements, then Tenant shall have the right, at its election, to (1) terminate this Lease in accordance with the provisions of Section 10.07, or (2) to make full repair of such damage and to restore the improvements in accordance with the provisions of Sections 10.01 and 10.05, or (3) repair such damage or restore the improvements to the extent necessary to preserve them and make them safe, and, in addition, to the extent of the insurance proceeds available unless Landlord has elected to terminate this Lease under subsection c. of Section 10.07 below.
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10.07. Procedures For Certain Permitted Terminations and Election of Landlord to Contribute. The provisions of this Section 10.07 shall apply if the Lease may be terminated pursuant to an election of Tenant under Section 10.06.
a. Whenever damage or destruction of the improvements shall have occurred which would entitle Tenant to terminate under Section 10.06, Tenant shall immediately give Landlord written notice of such damage or destruction. Tenant shall promptly make proof of loss and shall proceed promptly to collect, or cause to be collected, all valid claims which Tenant may have against insurers or others based upon any such damage or destruction. Subject to the rights of Tenant’s lenders, sums of money received as payments for any losses pursuant to said insurance policies shall be promptly paid to Landlord to be used and expended as set forth in subsection d., below.
b. Within forty-five (45) days of the date of such damage or destruction, Tenant shall notify Landlord in writing of the amount or extent of insurance proceeds available, the policies under which such proceeds are available, and the estimated cost of repairing or restoring such damaged or destroyed improvements. Tenant shall also, if entitled to do so, notify Landlord as to whether it elects to (1) terminate; or (2) repair and restore; or (3) repair and restore to the extent of insurance proceeds available, all as provided in Section 10.06. If Tenant is not entitled so to terminate thereunder, no such notice or attempted notice shall be effective and this Lease shall continue in full force and effect and repair and restoration in full of the improvements shall be required. Tenant's determination that the extent of the damage or destruction that has occurred would entitle Tenant to terminate this Lease under Section 10.06 shall not be binding upon Landlord.
c. If Tenant shall have notified Landlord pursuant to the provisions of Section

10.06 that it elects not to terminate this Lease and to repair and restore only to the extent of insurance proceeds available, then Landlord may elect to terminate this Lease by written notice to Tenant of its election, given within forty-five (45) days after receipt of the notice from Tenant referred to in subsection b. above, provided, however, that any termination by Landlord pursuant to this subsection c. shall not be effective as to any leasehold mortgagee identified in Section 14.01 hereof unless consented to in writing by such leasehold mortgagee. d. Insurance proceeds not used in repair or restoration shall be distributed as follows:
(1) First, at the option of Landlord, in any amount necessary to raze remaining improvements, clear the Property and make it safe; (2) Second, to mortgagees (in the order of their respective lien priority), in an amount equal to the unpaid balance secured by such mortgagees, the debt service on which is then a permitted expense; and
(3) Third, to Landlord.
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e. Upon termination of this Lease pursuant to this Section 10.07, Tenant shall deliver possession of the Property and improvements thereon to Landlord and quitclaim to Landlord all right, title and interest in the Property and the improvements thereon.

ARTICLE 11. CONDEMNATION

11.01. Definitions.
a. "Condemnation" means (1) the exercise of any governmental power in eminent domain, whether by legal proceedings or otherwise, by a condemnor, and (2) a voluntary sale or transfer to any condemnor, either under threat of condemnation or while legal proceedings for condemnation are pending.
b. "Date of taking" means the date the condemnor has the right to possession of the property being condemned.
c. "Award" means all compensation, sums or anything of value awarded, paid or received on a total or partial condemnation.
d. "Condemnor" means any public or quasi-public authority, or private corporation or individual, having the power of condemnation.

11.02. Parties' Rights and Obligations to be Governed by Lease. If during the term there is any taking of all or any part of the Property, any improvements on the Property or any interest in this Lease by condemnation, the rights and obligations of the parties shall be determined pursuant to the provisions of this Article 11.

11.03. Total Taking. If the Property is totally taken by condemnation, this Lease shall terminate on the date of taking.

11.04. Effect of Partial Taking. If any portion of the Property or the improvements thereon is taken by condemnation, this Lease shall remain in effect, except that Tenant may elect to terminate this Lease if the remaining portion of the Property is rendered unsuitable (as defined herein) for Tenant's continued use. The remaining portion of the Property shall be deemed unsuitable for Tenant's continued use if, in Tenant's reasonable business judgment, Tenant determines that following a reasonable amount of reconstruction Tenant's business on the Property could not be operated at an economically feasible level. Tenant must exercise its right to terminate by giving Landlord written notice of its election within ninety (90) days after the nature and extent of the taking have been finally determined. Such notice shall also specify the date of termination, which shall not be prior to the date of taking. Failure to properly exercise the election provided for in this paragraph will result in this Lease continuing in full force and effect.

In the event that a portion of the Property is taken by condemnation and the Tenant does not elect to terminate this Lease as set forth above, Base Rent shall continue without adjustment or abatement.
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11.05. Restoration of the Property. If, in Tenant's judgment, it is reasonably possible and economically feasible to do so, Tenant shall be entitled to use so much of the award as is necessary to restore or to add on to the Property so that the area and approximate layout of the Property will be substantially the same after the date of taking as they were before the date of taking. If it is not reasonably possible and economically feasible to so restore the area and layout of the Property, the remaining provisions of this Article 11 shall govern the rights of the parties. If Tenant fails to promptly commence the repair, restoration or reconstruction of the Property and diligently prosecute such repair, restoration or reconstruction to completion upon receipt of the award, Tenant shall be in default under this Lease.

11.06. Waiver of CCP Section 1265.130. Each party waives the provisions of the Code of Civil Procedure Section 1265.130 allowing either party to petition the Superior Court to terminate this Lease in the event of a partial taking of the Property.

11.07. Allocation of Award. Subject to the provisions of Section 11.05, the award for the Property and for the improvements shall belong to Landlord, except as hereinafter provided. Any leasehold mortgagee (as defined in Article 14) shall be entitled to satisfy the debt secured by its leasehold mortgage, but in no event greater than the value of the improvements constructed on the Property. Tenant shall be entitled to the value of its interest in any personal property or fixtures which it has the right to remove and to any portion of the award specified to apply to Tenant's goodwill, or to be compensation for interruption of or damage to Tenant's business, or compensation based upon the then fair market value of Tenant's interest in this Lease ("bonus value").

ARTICLE 12. ASSIGNMENT AND SUBLETTING
Tenant may not sell or assign its interest in this Lease and may not sublet all or any portion of the Property or improvements without Landlord's written consent, except to residential tenants in accordance with this Lease and except as otherwise hereinafter provided in this Article 12.

When Landlord's consent is required, it shall not be unreasonably withheld. It shall not be unreasonable for Landlord to condition its approval, among other things, upon the proposed assignee having a financial net worth, which is sufficient to meet the Tenant's obligations under this Lease, upon the proposed assignee having a reputation for and experience and qualifications in operating rental housing, and upon the proposed assignee having a reputation in the community for integrity. In evaluating the acceptability of the net worth of a proposed assignee, Landlord may require that the purchaser's or assignee's net worth be sufficient to carry out Tenant's obligations under this Lease. Landlord's consent to any one sale, assignment or sublease shall not constitute consent to any other assignment or sublease, and shall not constitute a waiver of the right to give or withhold consent in accordance with this Article 12.

Except as expressly permitted herein, unless Landlord shall have given its prior written approval thereof, which approval shall be in the discretion of Landlord, Tenant represents and agrees that Tenant has not made or created, and will not make or create or suffer to be made or created, any assignment, either voluntarily or by operation of law. Notwithstanding the foregoing, Landlord’s consent shall not be required in connection with an assignment to MidPen Housing Corporation or a wholly controlled affiliate thereof, or an assignment of, or a change in, any partnership interests in Tenant.
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Any assignment made in contravention of this Article 12 shall be void and shall be deemed to be a default hereunder whether or not Tenant knew of or participated in such assignment.

No sale, assignment or other transfer of this Lease for which Landlord’s consent is required shall be effective unless, at the time thereof, the entity to which such sale, assignment or transfer is made, by an instrument in writing reasonably satisfactory to Landlord and in form recordable among the land records, shall, for itself and its successors and assigns, and especially for the benefit of Landlord, expressly assume all of the obligations of Tenant under this Lease and shall agree to be subject to all conditions and restrictions to which Tenant is subject.

ARTICLE 13. TENANT DEFAULTS AND LANDLORD'S REMEDIES

13.01. Defaults by Tenant. Any of the following occurrences shall constitute a default under this Lease if:
a. Tenant shall at any time be in default in the payment of rent or any other monetary sum called for by this Lease for more than ten (10) days following written notice from Landlord to Tenant; or
b. Tenant shall at any time be in default in the keeping and performing of any of its other covenants or agreements herein contained, and should such other default continue for thirty (30) days after written notice thereof from Landlord to Tenant specifying the particulars of such default, or if such other default is of a nature that curing such default will take more than thirty (30) days and Tenant has failed to commence such cure within such thirty (30) days and to thereafter diligently pursue completion of such cure; or c. Tenant assigns (whether or not such assignment is deemed to be effective) this Lease (or any rights therein or herein), or sells, transfers, conveys, assigns or leases the whole or any part of the Property or any improvement constructed thereon in violation of this Lease; or d. There shall be in violation of this Lease due to any change in control of Tenant or of a part thereof, or any other act or transaction involving or resulting in a change in the identity of the parties in control of Tenant or the degree of such control; or h. The Tenant (as Developer) defaults under the DDA, which default is not cured within any applicable cure period.

13.02. Landlord's Remedies. Subject to the rights of any leasehold mortgagees permitted under Article 14 of this Lease, upon the occurrence of any such default under Section 13.01, in addition to any and all other rights or remedies of Landlord hereunder, or by law or in equity provided, Landlord shall have the sole option to exercise the following rights and remedies:
a. Terminate this Lease by giving Tenant notice of termination. On the giving of the notice, all Tenant's rights in the Property and in all improvements shall terminate. Promptly after notice of termination, Tenant shall surrender and vacate the Property and all improvements in broom-clean condition; and, subject to the provisions in Section 13.02.b., below, respecting the 392 of 563
right of certain subtenants to remain, Landlord may reenter and take possession of the Property and all improvements and eject all parties in possession or eject some and not others, or eject none.

Termination under this paragraph shall not relieve Tenant from the payment of any sum then due to Landlord or from any claim for damages previously accrued or then accruing against Tenant. b. Without terminating this Lease, Landlord may at any time and from time to time relet the Property and improvements or any part or parts of them for the account and in the name of Tenant or otherwise. Landlord may at Landlord's election eject all persons or eject some and not others, or eject none; provided, however, that Landlord shall not have the right to eject any subtenant who is not in default under a sublease whose sublease has been duly submitted and approved (if required) in writing by Landlord pursuant to Article 12 of this Lease and is not then in default. Any reletting may be for the remainder of the term or for a longer or shorter period.

Landlord may execute any leases made under this provision either in Landlord's name or in Tenant's name, and shall be entitled to all rents from the use, operation or occupancy of the Property or improvements, or both. Tenant hereby appoints Landlord its attorney-in-fact for the purpose of such leasing. Tenant shall nevertheless pay to Landlord on the due dates specified in this Lease the equivalent of all sums required of Tenant under this Lease, plus Landlord's expenses, less the avails of any reletting or attornment, including (by way of example), but not limited to, remodeling expenses, commissions and advertising costs. No act by or on behalf of Landlord under this provision shall constitute a termination of the Lease, unless Landlord gives Tenant notice of termination.
c. Even though it may have relet the Property, thereafter elect to terminate this Lease and all of Tenant's rights in or to the Property. d. Upon the occurrence of the default specified in Section 13.01.h., above, this Lease shall be terminated concurrent with the date of the termination of the DDA with respect to the Property. All other rights of Landlord with respect to termination of this Lease shall be as set forth in subsections a., b. and c., above.

13.03. Default Not Susceptible to Cure Within Prescribed Period. Notwithstanding any other provisions of this Article, Landlord agrees that if the default complained of, other than for the payment of monies, is of such a nature that the same cannot be rectified or cured within the period requiring such rectification or curing as specified in the written notice relating thereto, then such default shall be deemed to be rectified or cured if Tenant within such period shall have commenced the rectification and curing thereof and shall continue thereafter with all due diligence to cause such rectification and curing and does so complete the same with the use of such diligence as aforesaid.

13.04. Damages. Should Landlord elect to terminate this Lease, Landlord shall be entitled to recover from Tenant, as damages:
a. The worth at the time of the award of the unpaid rent that had been earned at the time of termination of this Lease;
b. The worth at the time of the award of the amount by which the unpaid rent that would have been earned by Landlord after the date of termination of this Lease until the time 393 of 563
of award exceeds the amount of the loss of rent that Tenant proves could have been reasonably avoided;
c. The worth at the time of the award of the amount by which the unpaid rent for the balance of the lease term after the time of award exceeds the amount of the loss of rent that Tenant proves could have been reasonably avoided; and
d. Any other amount (and court costs) necessary to compensate Landlord for all detriment proximately caused by Tenant's default, including, without limitation, costs of alterations and commissions in connection with reletting, but less any increased rent realized as a result of such activity.

The "worth at the time of the award," as used in subsections a. and b. of this Section, is to be computed by allowing interest at the maximum rate allowed by law. The "worth at the time of the award," as referred to in subsection c. of this Section, is to be computed by discounting the amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of the award, plus one percent (1%).

13.05. Landlord's Right to Cure Tenant's Default. Landlord, at any time after Tenant commits a default which Tenant has failed to cure within the time established therefor, may cure the default at Tenant's cost. If Landlord at any time, by reason of Tenant's default, pays any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid, and if paid at a later date, shall bear interest at the maximum rate permitted under Section 1(2) of Article XV of the California Constitution from the date the sum is paid by Landlord until Landlord is reimbursed by Tenant. The sum, together with interest on it, shall be Additional Rent.

13.06. Defaults by Landlord. In the event Landlord shall neglect or fail to perform or observe any of the covenants, provisions or conditions contained in this Lease on its part to be performed or observed within thirty (30) days after written notice of default (or if more than thirty (30) days shall be required because of the nature of the default, if Landlord shall fail to proceed diligently to cure such default after written notice thereof), then in that event Landlord shall be liable to Tenant for any and all damages sustained by Tenant as a result of Landlord's breach. The provisions of this Section 13.06 are not intended to grant to the Tenant any right to offset or deduct any damages from any amounts due under this Lease.

ARTICLE 14. MORTGAGEE PROTECTION PROVISIONS

14.01. Leasehold Mortgage Authorized. Tenant may mortgage or otherwise encumber Tenant's leasehold estate to an institutional investor (as hereinafter defined) under one or more leasehold mortgage(s) and assign this Lease as security for such mortgage(s). Any mortgage(s) shall affect only Tenant's leasehold estate and shall be subject to all of the terms and provisions of this Lease.

14.02. Notice to Landlord. If Tenant shall mortgage Tenant's leasehold estate to an institutional investor, and if the holder of such leasehold mortgage shall provide Landlord with notice of such leasehold mortgage, together with a true copy of such leasehold mortgage, the note and all other documents relating to such leasehold mortgage, and the name and address of the 394 of 563
mortgagee, Landlord and Tenant agree that, following receipt of such notice by Landlord, the provisions of this Article 14 shall apply with respect to such leasehold mortgage. In the event of any assignment of a leasehold mortgage or in the event of a change of address of a leasehold mortgagee or of an assignee of such mortgage, notice of the new name and address shall be provided to Landlord. Tenant shall thereafter also provide Landlord from time to time with a copy of each amendment or other modification or supplement to such instruments. All recorded documents shall be certified as true and correct copies of official records by the San Mateo County Recorder and all nonrecorded documents shall be accompanied by a certification by Tenant or the mortgagee that such documents are true and correct copies of the originals.

14.03. Definitions. As used in this Article 14:
a. The term "institutional investor" shall refer to a savings bank, savings and loan association, commercial bank, trust company, credit union, insurance or pension fund, or public agency. The term "institutional investor" shall also include other lenders of substance which perform functions similar to any of the foregoing, and which have assets in excess of Fifty Million Dollars ($50,000,000) at the time the leasehold mortgage loan is made. b. The term "leasehold mortgage" shall include a mortgage, deed of trust or other security instrument by which Tenant's leasehold estate is mortgaged, conveyed, assigned or otherwise transferred to secure a debt or other obligation. c. The term "leasehold mortgagee" or "mortgagee" shall refer to a holder of a leasehold mortgage with respect to which the notice provided for by Section 14.02 has been given and received and as to which the provisions of this Article 14 are applicable.

14.04. Consent of Leasehold Mortgagee Required. Notwithstanding anything to the contrary contained in this Lease, no cancellation, surrender, amendment or modification of this Lease shall be effective as to any leasehold mortgagee unless consented to in writing by such leasehold mortgagee.

14.05. Default Notice. Landlord, upon providing Tenant any notice of default under this Lease, shall at the same time provide a copy of such notice to the leasehold mortgagee and to Tenant’s investor limited partner, if Tenant’s investor limited partner has requested a copy of such notices and has provided Landlord with an address for service thereof. Notice by Landlord to Tenant shall be deemed to have been duly given even in the absence of notice to the mortgagee and investor limited partner; provided, however, that the time periods with respect to such mortgagee and investor limited partner shall not commence until notice is given to such mortgagee or investor limited partner. From and after such notice has been given to the leasehold mortgagee or investor limited partner, such leasehold mortgagee or investor limited partner shall have the same period, after the giving of such notice upon it, for remedying any default (or acts or omissions which are the subject matter of such notice) or causing the same to be remedied, as is given Tenant after the giving of such notice to Tenant, plus in each instance, the additional periods of time specified in Sections 14.06 and 14.07 to remedy, commence remedying or cause to be remedied the defaults (or acts or omissions which are the subject matter of such notice) specified in any such notice. Landlord shall accept such performance by or at the instigation of such leasehold 395 of 563
mortgagee or investor limited partner as if the same had been done by Tenant. Tenant authorizes the leasehold mortgagee or investor limited partner to take any such action at such leasehold mortgagee's or investor limited partner’s option and does hereby authorize entry upon the Property by the leasehold mortgagee or investor limited partner for such purpose.

14.06. Notice to Leasehold Mortgagee. If any default shall occur which entitles Landlord to terminate this Lease, Landlord shall have no right to terminate this Lease unless, following the expiration of the period of time given Tenant to cure such default (or the act or omission which gave rise to such default), Landlord shall notify the leasehold mortgagee of Landlord's intent to so terminate at least sixty (60) days in advance of the proposed effective date of such termination if such default is capable of being cured by the payment of money, and at least one hundred twenty (120) days in advance of the proposed effective date of such termination if such default is not capable of being cured by the payment of money. The provisions of Section 14.07 below shall apply if, during such 60-day or 120-day termination notice period, the leasehold mortgagee shall:
a. Notify Landlord of such leasehold mortgagee's desire to nullify such notice; and
b. Pay or cause to be paid all Base Rent, Additional Rent and other payments then due and in arrears as specified in the termination notice to such leasehold mortgagee and which may become due during such 60-day or 120-day period; and c. Comply, or in good faith, with diligence and continuity, commence to comply, with all nonmonetary requirements of this Lease then in default and reasonably susceptible of being complied with by such leasehold mortgagee; provided, however, that in the event such leasehold mortgagee shall commence foreclosure proceedings within such 120-day period, such leasehold mortgagee shall not be required during such 120-day period to cure or commence to cure any default consisting of Tenant's failure to satisfy and discharge any lien, charge or encumbrance against the Tenant's interest in this Lease or the Property junior in priority to the lien of the mortgage held by such leasehold mortgagee.

Any notice to be given by Landlord to a leasehold mortgagee pursuant to any provision of this Article 14 shall be deemed properly addressed if sent to the leasehold mortgagee who served the notice referred to in Section 14.02 at the address stated in such notice unless notice of a change of mortgage ownership has been given to Landlord pursuant to Section 14.02.

14.07. Mortgagee to Foreclose. If Landlord shall elect to terminate this Lease by reason of any default of Tenant and the leasehold mortgagee shall have proceeded in the manner provided for by Section 14.06, the specified date for the termination of this Lease, as fixed by Landlord in its termination notice, shall be extended for a period of six (6) months, provided that such leasehold mortgagee shall, during such 6-month period:
a. Pay, or cause to be paid, the Base Rent, Additional Rent and any other monetary obligations of Tenant under this Lease as the same become due, and continue its good faith efforts to perform all of Tenant's other obligations under this Lease; and 396 of 563
b. If not enjoined or stayed, take steps to acquire or sell Tenant's interest in this Lease by foreclosure of the leasehold mortgage or other appropriate means and prosecute the same to completion with due diligence.

If at the end of such 6-month period such leasehold mortgagee is diligently complying with this Section 14.07, this Lease shall not then terminate, and the time for completion by such leasehold mortgagee of its proceedings shall continue so long as such leasehold mortgagee is enjoined or stayed and thereafter for so long as such leasehold mortgagee proceeds to complete steps to acquire or sell Tenant's interest in this Lease by foreclosure of the leasehold mortgage, assignment in lieu of foreclosure or by other appropriate means with reasonable diligence and continuity. Nothing in this Section 14.07, however, shall be construed to extend this Lease beyond the original term hereof, nor to require a leasehold mortgagee to continue such foreclosure proceedings after the default has been cured. If the default shall be cured and the leasehold mortgagee shall discontinue foreclosure proceedings, this Lease shall remain in full force and effect as if Tenant had not defaulted under this Lease.

14.08. Purchase and Sale. If the leasehold mortgagee is complying with Section 14.07, upon the acquisition of Tenant's estate herein by such leasehold mortgagee or its designee or any other purchaser at a foreclosure sale, assignment in lieu of foreclosure or otherwise, this Lease shall continue in full force and effect as if Tenant had not defaulted under this Lease. The purchaser at any sale of this Lease and of the leasehold estate hereby created in any proceedings for the foreclosure of any leasehold mortgage, including such mortgagee, or the transferee under any instrument of assignment or transfer in lieu of the foreclosure of the leasehold mortgage shall be deemed to have agreed to perform all of the terms, covenants and conditions on the part of the Tenant to be performed hereunder from and after the date of such purchase and assignment, provided, however, that any such purchaser or assignee shall not be subject to any further obligations of the Tenant, as Developer, under the DDA.

14.09. Mortgagee's Right to Sell. If such mortgagee acquires title to Tenant's leasehold estate pursuant to foreclosure, assignment in lieu of foreclosure or other proceedings, such mortgagee, upon acquiring Tenant's leasehold estate, may sell and assign the leasehold estate on such terms and to such persons and organizations as are acceptable to such mortgagee. If such mortgagee’s proposed transferee is acceptable to Landlord, then the mortgagee shall thereafter be relieved of all obligations under this Lease if such assignee has delivered to Landlord its written agreement to be bound by all of the provisions of this Lease.

ARTICLE 15. MISCELLANEOUS

15.01. Holding Over. If Tenant shall hold over the Property after the expiration of the term hereof with the consent of Landlord, either express or implied, such holding over shall be construed to be only a tenancy from month to month, subject to all the covenants, conditions and obligations contained in this Lease. Tenant hereby agrees to pay to Landlord as monthly rental one-twelfth (1/12) of the other monetary sums (such as taxes, insurance, etc.) which are the Tenant's obligations to pay under this Lease and which are not passed on to subtenants through subleases.
397 of 563

15.02. Attorneys' Fees. In the event that any action or arbitration is brought by either party hereto as against the other party hereto for the enforcement or declaration of any right or remedies in or under this Lease or for the breach of any covenant or condition of this Lease, then and in that event the prevailing party shall be entitled to recover, and the other party agrees to pay, all fees and costs to be fixed by the court or arbitrator therein including, but not limited to, reasonable attorneys' fees.

15.03. Quiet Possession. Landlord agrees that Tenant, so long as Tenant is not in default under this Lease and is paying the rent and performing the covenants and conditions of this Lease, shall quietly have, hold and enjoy the Property throughout the term hereof without interruption or disturbance from Landlord or any other persons claiming by, through or under Landlord; and Landlord warrants to Tenant that as of the Commencement Date of said lease term, there were no existing tenancies on the Property.

15.04. Force Majeure. Except as to the payment of rent, neither of the parties hereto shall be chargeable with, liable for, or responsible to, the other for anything or in any amount for any delay caused by fire, earthquake, explosion, flood, hurricane, the elements, acts of God or the public enemy, action or interference of governmental authorities or agents, war, invasion, insurrection, rebellion, riots, strikes or lockouts or any other cause whether similar or dissimilar to the foregoing which is beyond the control of such parties and any delay due to said causes or any of them shall not be deemed a breach of or default in the performance of this Lease.

15.05. Notices. Any notice to be given or other document to be delivered by either party to the other hereunder shall be in writing and delivered to either party by personal delivery or by depositing same in the United States mail, duly certified, with postage thereon fully prepaid and addressed to the party for whom intended, as follows:

To Landlord: City of San Mateo
330 W. 20th Avenue
San Mateo, California 94403
Attention: City Manager
To Tenant: MP 2000 Delaware, LLC
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
With a copy to: Housing Trust Silicon Valley
75 E. Santa Clara Street, Suite 1350
San Jose, CA 95113
Either party hereto may from time to time by written notice to the other party designate a different address which shall be substituted for the one above specified. Notices shall be effective when received. Any notice or other document sent by certified mail, as aforesaid, shall be deemed received seventy-two (72) hours after the mailing thereof, as above provided.

Notices or other documents sent by personal delivery shall be deemed received on the date of such delivery.
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15.06. Waiver. No waiver of any breach of any of the terms, covenants, agreements, restrictions or conditions of this Lease shall be construed to be a waiver of any succeeding breach of the same or other terms, covenants, agreements, restrictions and conditions hereof.

15.07. Surrender. Upon the expiration or sooner termination of the term of this Lease, and notwithstanding anything herein contained to the contrary, Tenant shall surrender to Landlord all and singular the Property, together with the improvements then situated thereon, in good condition and repair, except for reasonable wear and tear.

15.08. Binding. Subject to the restrictions set forth herein regarding assignment of the leasehold estate, each of the terms, covenants and conditions of this Lease shall extend to and be binding on and shall inure to the benefit of not only Landlord and Tenant, but to each of their respective heirs, administrators, executors, successors and assigns. Whenever in this Lease reference is made to either Landlord or Tenant, the reference shall be deemed to include, wherever applicable, the heirs, administrators, executors, successors and assigns of such parties, the same as if in every case expressed.

15.09. Landlord's Right to Enter Property. Landlord and its authorized representatives shall have the right to enter the Property at all reasonable times, after giving Tenant three (3) business days prior written notice, for any of the following purposes: to determine whether the Property is in good condition and whether Tenant is complying with its obligations under this Lease; to do any necessary maintenance and to make any restoration to the Property that Landlord has the right or obligation to perform; to serve, post or keep posted any notices required or allowed under the provisions of this Lease; to post "for rent" or "for lease" signs during the last one (1) year of the term, or during any period while Tenant is in default; to show the Property to prospective brokers, agents, buyers, tenants or persons interested in an exchange, at any time during the term; and to do any act or thing necessary for the safety or preservation of the Property if any excavation or other construction is undertaken or is about to be undertaken on any adjacent property or nearby street.

Landlord shall not be liable in any manner for any inconvenience, disturbance, loss of business, nuisance or other damage arising out of Landlord's entry on the Property as provided in this Section other than those caused by Landlord's negligence or willful misconduct.

Tenant shall not be entitled to an abatement or reduction of rent if Landlord exercises any rights reserved in this Section.

15.10. Disclaimer of Partnership. The relationship of the parties hereto is that of Landlord and Tenant, and it is expressly understood and agreed that Landlord does not in any way nor for any purpose become a partner of Tenant or a joint venturer with Tenant in the conduct of Tenant's business or otherwise.

15.11. Memorandum. Landlord and Tenant shall execute a Memorandum of this Lease or any amendment or modification thereof for recordation in the Official Records of San Mateo County, California, in substantially the form attached hereto as Exhibit B. 399 of 563

15.12. Quitclaim. At the expiration or earlier termination of this Lease, Tenant shall execute, acknowledge and deliver to Landlord within thirty (30) days after written demand from Landlord to Tenant, any quitclaim deed or other document required by any reputable title company to remove the cloud of this Lease from the real property subject to this Lease.

15.13. Interpretation. The titles to the paragraphs of this Lease are not a part of this Lease and shall have no effect upon the construction or interpretation of any part of this Lease.

15.14. Covenants and Conditions. Each term and each provision, including, without limitation, the obligation for the payment of rent, to be performed by Tenant or Landlord, as the case may be, shall be construed to be both a covenant and a condition of this Lease.

15.15. Integration. This Lease, together with its exhibits and documents incorporated by reference, constitutes the entire agreement between the parties and there are no conditions, representations or agreements regarding the matters covered by this Lease which are not expressed herein.

15.16. Estoppel Certificate. If upon any sale, assignment or hypothecation of the Property or the land thereunder by Landlord an offset statement shall be required from Tenant, Tenant agrees to deliver, within thirty (30) days after written request therefor by Landlord, a statement in recordable form addressed to any such proposed mortgagee or purchaser, or to Landlord, in a form requested by Landlord's mortgagee or purchaser, certifying that this Lease is unmodified and is in full force and effect (if such be the case), certifying the commencement and termination dates of the lease term, certifying that there has been no assignment or sublease of this Lease and that there are no defenses or offsets hereto (or stating those claimed by Tenant) and containing such other information as may reasonably be requested by the party to whom such certificate is addressed. In the event Tenant fails to deliver such offset statement to Landlord within the 30-day period provided above, it shall be deemed that this Lease is in full force and effect and that Tenant has no defenses or offsets against Landlord.

If upon any sale, assignment or other transfer of the Tenant's leasehold interest in the Property, an estoppel statement shall be required from Landlord, Landlord agrees to deliver within thirty (30) days after written request therefor by Tenant, a statement in recordable form addressed to any such proposed transferee, certifying that this Lease is unmodified and is in full force and effect (if such be the case), certifying the commencement and termination dates of the lease term, certifying that there are no claims against Tenant under this Lease (or stating those claimed by Landlord) and containing such other information as may reasonably be requested by the party to whom such certificate is addressed. In the event Landlord fails to deliver such certificate to Tenant within the 30-day period provided above, it shall be deemed that this Lease is in full force and effect and that Landlord has no claims against Tenant under this Lease.

15.17. Landlord's Right to Sell. Landlord shall have the right to sell its fee estate in the Property and assign its interest in this Lease without limitation, provided, however, that any such sale shall be subject to this Lease. Upon any such conveyance, Landlord shall automatically be relieved of any obligations under this Lease other than those obligations which accrued prior to 400 of 563
the date of such conveyance. Landlord shall also have the right to mortgage, hypothecate or otherwise pledge its interest in the Property and this Lease, subject to this Lease.

IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the date first set forth above.

LANDLORD:

CITY OF SAN MATEO
By:

Alex Khojikian, City Manager
APPROVED AS TO FORM:

By:

Prasanna W. Rasiah, City Attorney
TENANT: MP 2000 DELAWARE, LLC
a California limited liability company
By MID-PENINSULA GREENRIDGE,
INC., a California corporation, its
sole member/manager
By:

Matthew O. Franklin, Assistant Secretary
401 of 563

EXHIBIT A

DESCRIPTION OF THE PROPERTY
[TO BE INSERTED]
402 of 563

EXHIBIT B

FORM OF MEMORANDUM OF LEASE

RECORDING REQUESTED BY AND

WHEN RECORDED MAIL TO
City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
ATTN: Executive Director
SPACE ABOVE THIS LINE FOR RECORDER’S USE

MEMORANDUM OF LEASE
This Memorandum of Lease (hereinafter “Memorandum”) is entered into this _____ day of ____________________, by and between the CITY OF SAN MATEO (hereinafter “Landlord”), a public body, corporate and politic, established and operating as successor to the Redevelopment Agency of the City of San Mateo pursuant to the Community Redevelopment Law of the State of California (Health and Safety Code Section 33000 et seq.; the “CRL”), and MP 2000 DELAWARE, LLC, A California limited liability company (hereinafter “Tenant”) with respect to that certain ground lease (the “Lease”) dated December __, 2024, between Landlord and Tenant.

Pursuant to the Lease, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord, the real property (the “Property”) more particularly described in Exhibit A, attached hereto and incorporated herein by this reference. The Lease commences on ______________________ (the “Commencement Date”),and ends on May 12, 2111 (the “Termination Date”).

Pursuant to the Lease, Tenant agrees to construct improvements on the Property within the time and manner required by the Lease.

This Memorandum shall incorporate herein all of the terms and provisions of the Lease as though fully set forth herein.

This Memorandum is solely for recording purposes and shall not be construed to alter, modify, amend or supplement the Lease, of which this is a memorandum. 403 of 563
IN WITNESS WHEREOF, Landlord and Tenant have executed this Memorandum by proper persons thereunto duly authorized as of the first date hereinabove written.

LANDLORD:

CITY OF SAN MATEO
By
TENANT: MP 2000 DELAWARE, LLC
By
404 of 563
405 of 563

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 17 Section Name: CONSENT CALENDAR Account Number: 18-6115 File ID: 24-9344 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Parks and Recreation Department
MEETING DATE: December 09, 2024
SUBJECT:

Afterschool Enrichment Services for School Year 2024-2025 — Agreement Amendment No. 1 RECOMMENDATION:

To approve Amendment No. 1 to the agreement with San Mateo Union High School District for afterschool enrichment services for Empowerment Through Action (ETA) Program in an amount of $17,000 for a new total not to exceed amount of $48,000 and authorize Parks and Recreation Director to execute the agreement in substantially the form presented.

BACKGROUND:

Empowerment Through Action (ETA) is a comprehensive program designed to support over 160 historically underserved students at Hillsdale High School. Since its inception in Spring 2018, ETA has been dedicated to closing the opportunity gap and fostering a sense of belonging among its participants. The program aims to enhance students' social, emotional, and academic growth, while also developing their self-confidence, inner capital, social connections, and job and internship placement opportunities. ETA offers a variety of services and activities, including wellness groups that foster mental and emotional well-being through group support, tutoring that provides academic assistance to help students achieve their educational goals, enrichment activities that offer extracurricular opportunities to broaden students' horizons, job and career training that prepares students for the workforce with practical skills and experience, parent education that engages parents in the educational process to support their children's success, a community closet that provides essential items to students in need, and a food pantry that ensures no student goes hungry, thereby supporting their overall wellbeing.

For many years, the San Mateo Police Activities League (PAL) and the San Mateo Parks and Recreation Department have been instrumental in supporting ETA through general oversight and the provision of stipends. This collaboration has been crucial in maintaining and expanding the diverse range of enrichment programs that ETA offers to its students. This amendment will continue to ensure that the valuable resources and services provided by ETA can be sustained and enhanced. Additional increase in funding will help offset the school district’s staffing cost for a full-time merit ETA Program Coordinator.

At the August 19, 2024, City Council meeting, City Council authorized an agreement with San Mateo Union High School District for afterschool enrichment services for Empowerment Through Action (ETA) Program in an amount not to exceed $31,000. This amendment will increase the total amount of this agreement by $17,000 to an amount not to exceed $48,000. As the proposed agreement amendment involves two government entities, it requires the approval of the City Council.

BUDGET IMPACT:

These funds are allocated in the San Mateo PAL budget and therefore there is no budget impact for the City. 406 of 563

CITY OF SAN MATEO
ENVIRONMENTAL DETERMINATION:

This agreement amendment is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 - San Mateo Union High School District ETA Amendment No. 1 for FY 24-25

STAFF CONTACT
Stephanie Douglas, Community Services Manager
[email protected]
(650) 522-7442
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AMENDMENT NO. 1 TO THE AGREEMENT

BETWEEN THE CITY OF SAN MATEO AND

SAN MATEO UNION HIGH SCHOOL DISTRICT

FOR AFTERSCHOOL ENRICHMENT SERVICES FOR EMPOWERMENT THORUGH ACTION PROGRAM FOR FISCAL YEAR 2024-2025
($31,000 [Original Amount], $48,000 [Amendment 1])
WHEREAS, the City of San Mateo (“City”), a municipal corporation of the State of California, and San Mateo Union High School District, a Public Educational High School District, ("CONTRACTOR"), entered into an Agreement for afterschool enrichment services for Empowerment Through Action Program for Fiscal Year 2024-2025 Agreement on September 11, 2024; and
WHEREAS, City and San Mateo Union High School District wish to amend the Agreement amount by $17,000, for a total Agreement amount of $48,000 for Fiscal Year 2024-2025.

NOW, THEREFORE, the parties agree as follows:

1. Exhibit A, #1. of the Agreement is amended to include:
“1. The CONTRACTOR agrees to provide enrichment activities (i.e., basketball, soccer, dance, etc.) at select high schools located in the SAN MATEO UNION HIGH SCHOOL DISTRICT to be mutually agreed upon between CITY OF SAN MATEO representative and CONTRACTOR or their designee. The CONTRACTOR agrees to provide a Bridge to Bridge Program Coordinator at select high schools in SAN MATEO UNION HIGH SCHOOL DISTRICT whose hours will be mutually agreed upon between CITY OF SAN MATEO representative and CONTRACTOR or their designee.”
Exhibit B:
“The total cost for this contract shall not exceed $48,000 for the length of the contract. Fees for activities must be mutually agreed upon by both parties in writing a minimum of two weeks in advance of implementation.”

2. The remaining terms of the Agreement remain in full force and effect. 408 of 563
IN WITNESS WHEREOF, CITY OF SAN MATEO and SAN MATEO UNION HIGH SCHOOL DISTRICT have executed this Agreement on ___________________.

CITY OF SAN MATEO CONTRACTOR
Joanne Magrini
Parks and Recreation Director
Date Yancy Hawkins
Associate Superintendent
San Mateo Union High School
District
Date

APPROVED AS TO FORM
Mazarin Vakharia
Assistant City Attorney
Date Brett Stevenson
Dean of Students
Hillsdale High School
Date
409 of 563

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 18 Section Name: CONSENT CALENDAR Account Number: 26-4662 File ID: 2018 - 24-9417 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: December 09, 2024
SUBJECT:

Third Avenue and South Norfolk Street Intersection Modification Project — Appropriation, Budget Transfers, and Agreement
RECOMMENDATION:

Adopt a resolution authorizing an appropriation of $200,000 from the City’s Measure A funds, and budget transfers of $65,000 from the Traffic Signal Video Detection Replacement Project and $35,000 from the Bike San Mateo Program Project to the Community Development Block Grant Projects project budget in the Capital Project Fund; approve an agreement with Liffey Electric, Inc. for construction of the 3rd Avenue and South Norfolk Street Intersection Modification Project in the amount of $1,298,745; establish a contingency reserve in the amount of $200,000; and authorize the Public Works Director to execute the agreement in substantially the form presented and issue change orders as allowed by the contract documents and within the contingency amount.

BACKGROUND:

The City receives federal funding from the U.S. Department of Housing and Urban Development for the Community Development Block Grant (CDBG) program and allocates the funds based on community priorities. A portion of the funds is available for infrastructure improvements, including bicycle and pedestrian projects, in the CDBG Target Areas of the City.

Improvements at the 3rd Avenue and Norfolk intersection were identified for the 2023-2025 CDBG program. The 3rd Avenue and South Norfolk Street Intersection Modification Project (Project) will improve bicycle and pedestrian safety and access around the intersection in the Shoreview and North Shoreview neighborhoods.

The Project advances several City objectives. A key part of the Project is establishing a bicycle connection between the pathway along the 3rd Avenue overcrossing and the bike path south of the 3rd Avenue and South Norfolk Street intersection that runs adjacent to San Mateo Creek. This connection was identified as a medium-high priority in the adopted 2020 Bicycle Master Plan (Plan). It includes the construction of an off-street, two-way bicycle facility as well as dedicated bicycle signals to facilitate safe passage of bicyclists through the area. The new improvements also separate vehicle, pedestrian, and bicyclist movements to minimize potential conflicts between different transportation modes in high-risk zones. In addition, traffic signal operations will optimize traffic flow through the intersection.

The Engineer's Estimate for the project is $1,250,000. The Project was advertised October 17, 2024, and a total of ten (10) bids were received and opened on November 7, 2024. The bids received are listed below in order of increasing bid amount.
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CITY OF SAN MATEO

BIDDER RANK CONTRACTOR BID AMOUNT
1 (non-responsive) BuildCorp Inc. $1,137,500.00
2 Liffey Electric, Inc. $1,298,745.00
3 Redgwick Construction $1,395,825.00
4 Sposeto Engineering $1,422,727.75
5 Interstate Grading & Paving $1,516,811.25
6 O’Grady Paving $1,591,380.00
7 Joseph J. Albanese $1,595,870.00
8 St. Francis Electric $1,672,237.00
9 Golden Bay Construction $1,680236.00
10 WR Forde Associates, Inc. $1,734,105.00
Staff reviewed the bids and found the first apparent low bidder to be nonresponsive. Staff determined Liffey Electric, Inc. is the lowest responsive, responsible bidder. Therefore, staff recommends Council award this construction agreement to Liffey Electric, Inc. Staff also recommend a $200,000 contingency be established to address unknown challenges due to the complexity of the traffic signal and civil improvement components of the project.

BUDGET IMPACT:

There are sufficient funds available in the CDBG Projects (No. 461214) and E 3rd/Norfolk Intersection Reconstruction Project (No. 466608) to award this agreement in the amount of $1,298,745. However, the project requires an additional $300,000 in funding to meet the proposed contingency reserve, construction management fees, and engineering services during construction.

To meet the funding needs of the total estimated project cost, staff has identified a combined total of $100,000 of available Measure A funding from the Traffic Signal Video Detection Replacement Project (46R004) and Bike San Mateo (46R024) project budgets to be transferred to the CDBG Projects (461214) project budget. Additionally, staff requests an appropriation in the amount of $200,000 from the City’s Measure A funds be added to the CDBG Projects (461214) project to cover the remaining estimated funding need. A breakdown of additional funding required to meet this budget gap is presented below.
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CITY OF SAN MATEO

ENVIRONMENTAL DETERMINATION:

This Project is categorically exempt from CEQA as an “existing facility,” because it consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. (CEQA Guidelines Section 15301.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Proposed Resolution
Att 2 – Agreement

STAFF CONTACT
Kenny Tanaka, Assistant Engineer
[email protected]
650 522 7318
Remaining Budget as of 11/15/2024
461214 CDBG Projects $ 1,091,449.00
466608 E 3rd/Norfolk Intersection Reconstruction $ 234,383.00 Current Available Balance $ 1,325,832.00
Planned Expenses
Construction Contract $ 1,298,745.00
Contingency Reserve $ 200,000.00
Construction Management (City Staff) $ 75,000.00
Engineering Support During Construction $ 50,000.00
$ 1,623,745.00
Anticipated Budget Gap $ (297,913.00)
Additional Funding Sources
46R004 Traffic Signal Video Detection Replacement $ 65,000.00 46R024 Bike San Mateo $ 35,000.00
Measure A Allocation $ 200,000.00
$ 300,000.00
Final Anticipated Balance $ 2,087.00
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CITY OF SAN MATEO
RESOLUTION NO. _____(2024)
AUTHORIZING AN APPROPRIATION IN THE AMOUNT OF $200,000 FROM THE CITY’S MEASURE A FUNDS AND BUDGET TRANSFERS OF $65,000 FROM THE TRAFFIC SIGNAL VIDEO DETECTION REPLACEMENT PROJECT AND $35,000 FROM THE BIKE SAN MATEO

PROGRAM PROJECT TO THE CDBG PROJECTS PROJECT IN THE CAPITAL PROJECT FUND WHEREAS, the Council considers mid-year budget balancing through adjustments, appropriations, designations and transfers to adjust the current-year budget to meet anticipated changes in departmental budgetary needs; and
WHEREAS, as detailed in the accompanying Administrative Report, a budget transfer and appropriation is necessary to accomplish the City’s day-to-day business to support its goals and programs and to provide for anticipated additional expenditures; and WHEREAS, amendments to the adopted 2024-2025 Budget are necessary to address funding of those items; and
WHEREAS, the 3rd Avenue and South Norfolk Street Intersection Modification Project (Project) is funded by the CDBG Projects project budget and will improve bicycle and pedestrian safety and access around the intersection; and
WHEREAS, in addition to the construction improvements, the Project requires construction management fees, engineering services during construction, and a proposed contingency reserve due to the complexity of the traffic signal and civil improvement components of the Project; and WHEREAS, additional funding in the amount of $300,000 is needed in the CDBG Projects project budget to meet the proposed contingency reserve, construction management fees, and engineering services during construction; and
WHEREAS, staff proposes appropriating $200,000 from the City’s Measure A funds to the CDBG Projects project for the Project;
WHEREAS, $65,000 in Measure A funds from the Traffic Signal Video Detection Replacement Project (46R004) budget is available to be transferred to the CDBG Projects project for the Project; and WHEREAS, $35,000 in Measure A funds from the Bike San Mateo Program (46R024) project budget is available to be transferred to the CDBG Projects project for the Project.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, FINDS and RESOLVES that:

1. This City Council action is categorically exempt from CEQA review because it involves funding the operation, repair, maintenance, permitting, leasing, licensing or minor alternation of existing public or private structures, facilities, mechanical equipment, or topographical facilities involving negligible or no expansion of existing or former use. (CEQA Guidelines Section 15301.)

2. An appropriation in the amount of $200,000 from the City’s Measure A funds to the CDBG Projects (461214) project budget in the Capital Project Fund is approved. 413 of 563

3. Amendments to the 2024-2025 Budget are approved, and transfers are authorized, as follows:
a. A transfer totaling $100,000 to the CDBG Projects (461214) project budget in the Capital Project Fund for the Third Avenue and South Norfolk Street Intersection Modification Project as follows:
 $65,000 from the Traffic Signal Video Detection Replacement Project (46R004).
 $35,000 from the Bike San Mateo Program Project (46R024). 414 of 563
AGREEMENT WITH LIFFEY ELECTRIC, INC.

FOR PUBLIC IMPROVEMENT
FOR

THIRD AVENUE AND SOUTH NORFOLK STREET INTERSECTION MODIFICATION PROJECT CITY PROJECT NO. 461214-46021
THIS AGREEMENT FOR PUBLIC IMPROVEMENTS (“Agreement”), made and entered into in the City of San Mateo, County of San Mateo, State of California, by and between the CITY OF SAN MATEO, a municipal corporation existing under the laws of the State of California, (hereinafter called "City") and LIFFEY ELECTRIC, INC., a corporation, with offices at 3450 – 3rd Street, Unit 4E, San Francisco, CA 94124 (hereinafter called "Contractor"), entered into this day of December 9, 2024.

RECITALS:
(a) City has taken appropriate proceedings to authorize construction of the public work and improvements or other matters herein provided, and execution of this Agreement. (b) A notice was duly published for bids for the contract for the improvement hereinafter described. (c) After notice duly given, on the date hereof, the City awarded the contract for the construction of the improvements hereinafter described to Contractor.

IT IS AGREED, as follows:

1. Scope of Work. Contractor shall perform the work according to the Contract Book entitled:
3 RD AND SOUTH NORFOLK STREET INTERSECTION MODIFICATION PROJECT CITY PROJECT NO. 461214-46021

2. Contract Price. City shall pay, and the Contractor shall accept, the sum of one million, two hundred ninety-eight, seven hundred forty-five dollars and zero cents ($1,298,745.00) in full payment for the work set forth above.

Said price is determined by the prices contained in Contractor's bid and shall be paid as described in the Contract Book. In the event work is performed or materials furnished in addition to or a reduction of those set forth in Contractor's bid and the specifications herein, such work and materials will be paid for as described in the Contract Book.

3. The Contract Documents. The complete contract consists of the following documents: this Agreement; the Notice Inviting Sealed Proposals; the Accepted Proposal; the Contract Book which includes the Special Provisions, Revised Standard Specifications dated April 15, 2022, and Contract Drawings, the State of California Standard Specifications 2018 Edition, the State of California 415 of 563
Department of Transportation Standard Plans, 2018 Edition, the Faithful Performance Bond, and the Labor and Material Bond (hereinafter referred to as the “contract documents”).

All rights and obligations of City and Contractor are fully set forth and described in the contract documents. The contract documents constitute the entire contract between the parties hereto pertaining to the subject matter hereof, fully supersede any and all prior understandings, representations, warranties and agreements between the parties hereto, or any of them, pertaining to the subject matter hereof, and may be modified only by written agreement signed by all of the parties hereto.

All of the above-named documents are complementary and are intended to operate in harmony, so that any work called for in one, and not mentioned in the other, or vice versa, is to be executed the same as if mentioned in all said documents. In the event of any variation or discrepancy between any portion of this Agreement and any portion of the contract documents, this Agreement shall prevail. The precedence of the remaining contract documents will be as specified in the Contract Book.

4. Schedule. All work shall be performed in accordance with the schedule provided pursuant to the Contract Book.

5. Performance by Sureties. In the event of any termination as hereinbefore provided, City shall immediately give written notice thereof to Contractor and Contractor's sureties, and the sureties shall have the right to take over and perform the Agreement, provided, however, that if the sureties, within 5 days after giving them said notice of termination, do not give City written notice of their intention to take over the performance thereof within 5 days after notice to City of such election, City may take over the work and prosecute the same to completion, by contract or by any other method it may deem advisable, for the account, and at the expense of Contractor, and the sureties shall be liable to City for any excess cost or damages occasioned City thereby; and, in such event, City may, without liability for so doing, take possession of, and utilize in completing the work, such materials, appliances, plant and other property belonging to Contractor as may be on the site of the work and necessary therefor.

6. Legal Work Day - Penalties for Violation. Eight hours of labor shall constitute a legal day's work.

Contractor shall not require more than 8 hours labor in a day and 40 hours in a calendar week from any person employed by Contractor in the performance of such work unless such excess work is compensated for at not less than 1-1/2 times the basic rate of pay. Contractor shall forfeit as a penalty to City the sum of $25.00 for each laborer, workman or mechanic employed in the execution of this contract by Contractor, or by any subcontractor for each calendar day during which such laborer, workman or mechanic is required or permitted to labor more than 8 hours in any calendar day and 40 hours in any one calendar week in violation of the provisions of Sections 1810 and 1816, inclusive, of the Labor Code of the State of California.

7. Prevailing Wage Scale. The prevailing wage scale as determined by the Director of Industrial Relations of the State of California, in force on the day the bid was announced, will be the minimum paid to all craftsmen and laborers working on this project. Contractor shall also require any subcontractors who work or provide any services related to the project to pay all persons performing labor or rendering service under said subcontract or other arrangement at least the general prevailing rate of wages, determined as set forth herein for the respective crafts and employments, including such wages for holiday and overtime work. A copy of the correct determination will be posted at the job site. It is understood that it is the responsibility of Contractor to determine the correct scale. Copies of the prevailing wage rates are on file at the City Clerk's office, however, errors or defects in the materials in the City Clerk's office will not excuse a bidder's failure to comply with the actual scale then in force.

Contractor must submit certified payrolls to the Department of Industrial Relations in accordance with Labor Code Section 1776.
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Contractor agrees to comply with the City’s minimum wage ordinance as codified in Municipal Code Chapter 5.92, which differs from the state minimum wage and includes a Consumer Price Index escalator.

8. Senate Bill 854 Compliance Required. In accordance with Labor Code Sections 1725.5 and 1771.1, all contractors and subcontractors must be registered with the Department of Industrial Relations. In accordance with Labor Code Section 1771.4 the contractor must post job site notices as required by regulation and this project will be subject to compliance monitoring and enforcement by the Department of Industrial Relations.

9. Insurance. The Contractor shall procure and maintain for the duration of the contract and five years thereafter the insurance as specified in Exhibit A of this agreement.

10. Indemnity. Contractor agrees to hold harmless and indemnify City, its elected and appointed officials, employees, and agents from and against any and all claims, loss, liability, damage, and expense arising out of Contractor’s performance of this Agreement, except for those claims arising out of City’s active negligence, sole negligence or willful misconduct. Contractor agrees to defend City, its elected and appointed officials, employees, and agents against any such claims. The Contractor’s duty to indemnify shall survive expiration or early termination of this Agreement.

11. Attorney Fees. Attorney fees in total amount not exceeding $5000, shall be recoverable as costs (by the filing of a cost bill) by the prevailing party in any action or actions to enforce the provisions of this Agreement. The above $5000 limit is the total of attorney fees recoverable whether in the trial court, appellate court, or otherwise, and regardless of the number of attorneys, trials, appeals, or actions. It is the intent of this provision that neither party shall have to pay the other more than $5000 for attorney fees arising out of an action, or actions to enforce the provisions of this Agreement.

12. Mediation. Should any dispute arise out of this Agreement, any party may request that it be submitted to mediation. The parties shall meet in mediation within 30 days of a request. The mediator shall be agreed to by the mediating parties; in the absence of an agreement, the parties shall each submit one name from mediators listed by either the American Arbitration Association, the California State Board of Mediation and Conciliation, or other agreed-upon service. The mediator shall be selected by a blind draw.

The cost of mediation shall be borne equally by the parties. Neither party shall be deemed the prevailing party. No party shall be permitted to file a legal action without first meeting in mediation and making a good faith attempt to reach a mediated settlement. The mediation process, once commenced by a meeting with the mediator, shall last until agreement is reached by the parties but not more than 60 days, unless the maximum time is extended by the parties.

13. Provisions Cumulative. The provisions of this agreement are cumulative, and in addition to and not in limitation of, any other rights or remedies available to City.

14. Notices. All notices shall be in writing, and delivered in person or transmitted by certified mail, postage prepaid.
a. Notices required to be given to City shall be addressed as follows:
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Director of Public
Works
City of San Mateo
330 West 20th Avenue
San Mateo, CA 94403
Notices required to be given to Contractor shall be addressed as appears in the signature block as shown on the Bidder's Statement.

15. Interpretation. As used herein any gender includes each other gender, the singular includes the plural and vice versa.

16. Governing Law and Venue. This Agreement, the contract documents, and the performance hereon shall be governed, interpreted, construed, and regulated by the laws of the State of California. The parties agree that any action related to this Agreement or the contract documents will be venued in the County of San Mateo.

17. Headings. The title and headings of the various sections of this Agreement and the contract documents are intended solely for convenience of reference and are not intended to explain, modify, or place any construction on any provisions.

18. No Partnership or Agency. Nothing in this Agreement nor the contract documents shall be deemed to constitute a partnership in law between City and Contractor, or any sub-contractor, to constitute either party as an agent of the other for any purpose; or to entitle either party to commit or bind the other in any manner unless expressly agreed upon in the contract documents.

19. Severability. If any part or provision of the contract documents is determined by any court to be illegal, invalid, or unenforceable, in whole or in part, the contract documents shall continue to be valid as to its other provisions and the remainder of the affected provision, unless it can be concluded from the circumstances that, in the absence of the provisions found to be null and void, the parties would not have entered into the contract documents. The parties shall use all reasonable efforts to replace any and all provisions or parts found to be null and void with provisions that are valid under the applicable law and come closest to their original intention.

20. Waiver. None of the following shall operate as a waiver of any provision of the contract documents, or of any power herein reserved by the City, or any right to damages herein provided: 1) inspection by the City or its authorized agents or representatives; 2) any order or certificate for payment, or any payment for, or acceptance of the whole or any part of the work by the City; 3) an extension of time; or 4) any position taken by the City or its authorized agents or representatives.

21. Warranty. Contractor warrants and guarantees that the materials and equipment provided shall be at least of the quality specified and new unless otherwise required or permitted by the contract documents, and, if no quality is specified, then the materials and equipment shall be of commercial grade, suitable for heavy public use in facilities of similar size and complexity, that the work performed hereunder will be free from defects, and that the work will conform to the requirements of the contract documents. [SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, CITY OF SAN MATEO and LIFFEY ELECTRIC, INC. have executed this Agreement the day and year first above written.

CITY OF SAN MATEO CONTRACTOR
Matt Fabry
Public Works Director
Date Patrick White
Its Authorized Agent
President
If a Corporation, can be either 1)
President or 2) Vice President
plus an additional corporate
officer (i.e., Secretary, Treasurer)
who shall sign below.

Date

APPROVED AS TO FORM
Linh Nguyen
Assistant City Attorney
Date

CITY OF SAN MATEO
Attachments:

Exhibit A: Insurance Requirements
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Exhibit A
Insurance Requirements for Construction Contracts
Contractor shall procure and maintain for the duration of the contract, and for five years thereafter, 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, his agents, representatives, employees, or subcontractors.

MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office (ISO) Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $5,000,000 per occurrence.

If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general aggregate limit shall be twice the required occurrence limit.

2. Automobile Liability: Insurance Services Office Form CA 0001 covering Code 1 (any auto), with limits no less than $5,000,000 per accident for bodily injury and property damage.

3. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employers’ Liability insurance with a limit of no less than $1,000,000 per accident for bodily injury or disease.

4. Builder’s Risk (Course of Construction) insurance utilizing an “All Risk” (Special Perils) coverage form, with limits equal to the completed value of the project and no coinsurance penalty provisions.

5. Surety Bonds as described below.

6. Contractors’ Pollution Legal Liability and/or Asbestos Legal Liability and/or Errors and Omissions (if project involves environmental hazards) with limits no less than $1,000,000 per occurrence or claim, and $2,000,000 policy aggregate.

If the contractor maintains broader coverage and/or higher limits than the minimums shown above, the City requires and shall be entitled to the broader coverage and/or higher limits maintained by the contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City.

Self-Insured Retentions
Self-insured retentions must be declared to and approved by the City. At the option of the City, either: the contractor shall cause the insurer shall to reduce or eliminate such self-insured retentions as respects the City, its officers, officials, employees, and volunteers; or the Contractor shall provide a financial guarantee satisfactory to the City guaranteeing payment of losses and related investigations, claim administration, and defense expenses. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City.

Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:

1. The City, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Contractor including materials, parts, or equipment furnished in connection with such work or operations and automobiles owned, leased, hired, or borrowed by or on behalf of the Contractor. General liability coverage can be provided in the form of an endorsement to the Contractor’s insurance (at least as broad as ISO Form CG 20 10, CG 11 85 or both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 forms if later revisions used).

2. For any claims related to this project, the Contractor’s insurance coverage shall be primary insurance coverage at least as broad as ISO CG 20 01 04 13 as respects the City, its officers, 420 of 563
officials, employees, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Contractor’s insurance and shall not contribute with it.

3. Each insurance policy required by this clause shall provide that coverage shall not be canceled, except with notice to the City.

Builder’s Risk (Course of Construction) Insurance
Contractor may submit evidence of Builder’s Risk insurance in the form of Course of Construction coverage. Such coverage shall name the City as a loss payee as their interest may appear.

If the project does not involve new or major reconstruction, at the option of the City, an Installation Floater may be acceptable. For such projects, a Property Installation Floater shall be obtained that provides for the improvement, remodel, modification, alteration, conversion or adjustment to existing buildings, structures, processes, machinery and equipment. The Property Installation Floater shall provide property damage coverage for any building, structure, machinery or equipment damaged, impaired, broken, or destroyed during the performance of the Work, including during transit, installation, and testing at the City’s site.

Claims Made Policies – (If at all possible avoid and require occurrence type CGL policies) If any coverage required is written on a claims-made coverage form:

1. The retroactive date must be shown, and this date must be before the execution date of the contract or the beginning of contract work.

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

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the contract effective, or start of work date, the Contractor must purchase extended reporting period coverage for a minimum of five years after completion of contract work.

4. A copy of the claims reporting requirements must be submitted to the City for review.

5. If the services involve lead-based paint or asbestos identification/remediation, the Contractors Pollution Liability policy shall not contain lead-based paint or asbestos exclusions. If the services involve mold identification/remediation, the Contractors Pollution Liability policy shall not contain a mold exclusion, and the definition of Pollution shall include microbial matter, including mold.

Acceptability of Insurers
Insurance is to be placed with insurers authorized to conduct business in the state with a current A.M.

Best rating of no less than A: VII, unless otherwise acceptable to the City.

Waiver of Subrogation
Contractor hereby agrees to waive rights of subrogation which any insurer of Contractor may acquire from Contractor by virtue of the payment of any loss. Contractor agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation. The Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by the Contractor, its employees, agents and subcontractors.

Verification of Coverage
Contractor shall furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy listing all policy endorsements to City before work begins. However, failure to obtain the required documents prior to the work beginning shall not waive the Contractor’s obligation to provide them. The City reserves the right to require 421 of 563
complete, certified copies of all required insurance policies, including endorsements, required by these specifications, at any time.

Subcontractors
Contractor shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and Contractor shall ensure that City is an additional insured on insurance required from subcontractors. For CGL coverage subcontractors shall provide coverage with a form at least as broad as CG 20 38 04 13.

Surety Bonds
Contractor shall provide the following Surety Bonds:

1. Bid bond

2. Performance bond

3. Payment bond

4. Maintenance bond
The Payment Bond and the Performance Bond shall be in a sum equal to the contract price. If the Performance Bond provides for a one-year warranty a separate Maintenance Bond is not necessary. If the warranty period specified in the contract is for longer than one year a Maintenance Bond equal to 10% of the contract price is required. Bonds shall be duly executed by a responsible corporate surety, authorized to issue such bonds in the State of California and secured through an authorized agent with an office in California.

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

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 19 Section Name: CONSENT CALENDAR Account Number: 10-4661 File ID: 24-9366 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Clerk's Office
MEETING DATE: December 09, 2024
SUBJECT:

Wireless Communication Facilities in the Public Right of Way Update — Ordinance Adoption RECOMMENDATION:

Adopt an Ordinance to amend San Mateo Municipal Code (SMMC) Chapter 17.10 "Wireless Communications Facilities in the Public Right-Of-Way;".

BACKGROUND:

On November 18, 2024, the City Council introduced an Ordinance to amend San Mateo Municipal Code (SMMC) Chapter

17.10 "Wireless Communications Facilities in the Public Right-Of-Way;". The proposed Ordinance is attached. If adopted, the Ordinance will become effective 30 days after its adoption.

BUDGET IMPACT:

There is no budget impact associated with review of the proposed Ordinance and Policy update.

ENVIRONMENTAL DETERMINATION:

This Ordinance adoption is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) In addition, small cell facilities are categorically exempt from CEQA as they ether are (1) minor alterations of existing facilities, (2) replacements of existing structures where the new structure will be located in the same site and have substantially the same purpose, or (3) construction and location of new small facilities or structures. (CEQA Guidelines Section 15301, 15302, 15303).

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1— Proposed Ordinance
Att 2— Public Comments

STAFF CONTACT
Chantal Eaton, Deputy City Clerk
[email protected]
(650) 522-7044
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CITY OF SAN MATEO

PROPOSED ORDINANCE

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, APPROVING AMENDMENTS TO CHAPTER 17.10 (“WIRELESS COMMUNICATIONS FACILITIES IN THE PUBLIC RIGHTOF-WAY”), TITLE 17 THE OF SAN MATEO MUNICIPAL CODE WHEREAS, pursuant to the California Constitution, Article XI, section 7; California Government Code Section 37100 and other applicable law, the City Council of the City of San Mateo (“City Council”) may make and enforce within its limits all local, police, sanitary and other ordinances, resolutions and other regulations not in conflict with general laws; and
WHEREAS, the federal Telecommunications Act of 1996, 47 U.S.C. § 332(c)(7)(B), preserves local government zoning authority as it relates to location and siting of wireless communication facilities, but limits local regulations in three key ways: (1) a local ordinance may not unreasonably discriminate among providers of functionally equivalent services; (2) a local ordinance may not prohibit or effectively prohibit service; and (3) a local ordinance may not regulate based on environmental impacts from radio frequency emissions; and WHEREAS, the federal Telecommunications Act of 1996, 47 U.S.C. § 253 prohibits state and local requirements that prohibit or effectively prohibit any entity’s ability to provide any telecommunication service but preserves the authority of state and local governments to manage the public right-of-way on a nondiscriminatory basis; and
WHEREAS, Section 7901 of the California Public Utilities Code grants telephone corporations the limited right to use the public right-of-way to the extent necessary to provide services to their customers in a manner that does not incommode the public’s use of the public right-of-way; and WHEREAS, Section 7901.1 of the California Public Utilities Code bolsters the rights reserved to California local governments under Section 7901 and affirms local authority to manage, on a nondiscriminatory basis, the time, place and manner in which telephone corporations access the public right-of-way and deploy their facilities; and
WHEREAS, since the enactment of the Telecommunications Act of 1996, significant changes have occurred in federal and state laws that affect local authority over personal wireless service facilities; and WHEREAS, on July 16, 2018, the City Council adopted Ordinance No. 2018-5, which added Chapter 17.10 to the San Mateo Municipal Code and regulated wireless communications facilities in the public right-of-way; and
WHEREAS, on June 21, 2021, the City Council adopted Ordinance No. 2021-18, which amended various provisions in Chapter 17.10 in response to contemporaneous changes in law and technologies, including a new Section 17.10.120 (“Review of Ordinance”) that authorized the City Council to “amend . . . Chapter [17.10] or [the City’s] rules or policies by resolution after a change to the FCC’s regulations or standards, or any applicable state or federal laws”; and
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WHEREAS, given the rapid and substantial changes in applicable state laws and FCC regulations since the City Council adopted Ordinance No. 2021-18, the active and effective federal prohibition on reasonable moratorium ordinances to allow local public agencies to study these changes and develop appropriate responses and the significant adverse consequences for noncompliance with these changes in applicable law, and in response to practical experience processing applications for wireless facilities under the San Mateo Municipal Code, the City Council desires to amend San Mateo Municipal Code Chapter 17.10 by adopting this Ordinance No. 2024-[XXXX] (this “Ordinance”) to allow the City greater flexibility and responsiveness to these federal and state laws in order to preserve the City’s traditional authority to the maximum extent practicable; and WHEREAS, amending San Mateo Municipal Code Chapter 17.10 by adopting this Ordinance will allow the City Council to quickly and efficiently adopt administrative policies that provide clear procedures for wireless communications facilities bolster the City’s policies and regulations concerning public health, safety and welfare and the aesthetic character of the City; and
WHEREAS, consolidating all its regulations for wireless communications facilities in the public right-ofway into a single policy will tend to make the regulations easier to locate, understand and apply for all stakeholders; and
WHEREAS, amending San Mateo Municipal Code Chapter 17.10 by adopting this Ordinance neither materially limits a person’s ability to provide or receive wireless communications services nor creates unfair competition among wireless telecommunications service providers; and WHEREAS, amending San Mateo Municipal Code Chapter 17.10 by adopting this Ordinance will, to the extent permitted by federal and California state law, protect and promote public health, safety, and welfare, and also balance the benefits that flow from robust, advanced wireless services with the City’s local values, which includes without limitation the aesthetic character of the City, its neighborhoods and community; and WHEREAS, the San Mateo Sustainability and Infrastructure Commission considered the proposed Ordinance at a duly noticed public hearing on October 23, 2024, and by a vote of 4-0 recommended the City Council approve the proposed Ordinance to amend San Mateo Municipal Code Chapter 17.10; and WHEREAS, on November 18, 2024, the City Council conducted a duly noticed public hearing to take public testimony and consider the introduction of this Ordinance to amend San Mateo Municipal Code Chapter

17.10 by adopting this Ordinance.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF SAN MATEO ORDAINS AS FOLLOWS:

Section 1. Findings. The City Council finds that: (a) the facts set forth in the recitals in this Ordinance are true and correct and hereby incorporated by this reference; (b) the recitals constitute findings in this matter and, together with the staff report, other written reports, public testimony and other information contained in the record, are an adequate and appropriate evidentiary basis for the actions taken in this Ordinance; (c) the provisions in this Ordinance and San Mateo Municipal Code Chapter 17.10 as amended are consistent with the San Mateo General Plan, the San Mateo Municipal Code and applicable federal and state law; and (d) neither this Ordinance nor San Mateo Municipal Code Chapter 17.10 as amended will be detrimental to the public interest, health, safety, convenience or welfare.
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Section 2. Section 17.10.020 of the San Mateo Municipal Code is amended as follows:

17.10.020 General Definitions
The abbreviations, phrases, terms and words used in this Chapter will have the meanings assigned to them in this Section unless context indicates otherwise. Undefined phrases, terms or words in this Section will have the meanings assigned to them in 47 U.S.C. § 153, as may be amended from time to time, and, if not defined therein, will have their ordinary meanings. In the event that any definition assigned to any phrase, term or word in this Section conflicts with any federal or state-mandated definition, the federal or state-mandated definition will control.
(a) Base Station means the same as defined by the FCC in 47 C.F.R. § 1.6100(b)(1), as may be amended. (b) City Council means the City Council of the City of San Mateo. (c) Collocation means the same as defined by the FCC in 47 C.F.R. § 1.60002(g), as may be amended. (d) CPUC means the California Public Utilities Commission established in the California Constitution, Article XII, § 5, or its duly appointed successor agency. (e) Design Standards and Application Requirements means the aesthetic and design standards and the wireless permit application requirements for wireless facilities adopted by the Director of Public Works, consistent with this Chapter.
(f) Director means the Director of Public Works of the City of San Mateo, or the Director's designee. (g) FCC means the Federal Communications Commission or its duly appointed successor agency. (h) FCC Shot Clock means the reasonable time frame within which the City generally must act on a given wireless application, as defined by the FCC and as may be amended from time to time. (i) Wireless Permit means the permit issued by the Department of Public Works for any work required in the public right-of-way for the installation or in support or otherwise related to a wireless facility, consistent with the Design Standards and Application Requirements and City Council Policy. (j) Personal Wireless Services means the same as defined in 47 U.S.C. § 332(c)(7)(C)(i), as may be amended, which defines the term as commercial mobile services, unlicensed wireless services and common carrier wireless exchange access services.
(k) Personal Wireless Service Facilities means the same as defined in 47 U.S.C. § 332(c)(7)(C)(i), as may be amended, which defines the term as facilities that provide personal wireless services. (l) Pole License or City Pole License means the license that the department of public works may issue for any wireless facility installation on a City-owned pole located within the public right of way, consistent with the requirements of this Chapter.
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(m) Public right-of-way or City right-of-way means any public street, public way, public alley, or public place and the space on, above or below it, and all extensions thereof, and additions thereto, under the ownership or control of the city of San Mateo and in its jurisdiction. (n) RF means radio frequency or electromagnetic waves generally between 30 kHz and 300 GHz in the electromagnetic spectrum range or otherwise within applicable legal exposure standards and limits. (o) Section 6409 means Section 6409(a) of the Middle Class Tax Relief and Job Creation Act of 2012, Pub.

L. No. 112-96, 126 Stat. 156, codified as 47 U.S.C. § 1455(a), as may be amended. (p) Small Cell Wireless Facility(ies) means the same as defined by the FCC in 47 C.F.R. § 1.6002(l), as may be amended.
(q) Temporary Wireless Facilities means portable wireless facilities intended or used to provide personal wireless services on a temporary or emergency basis (r) Tower means the same as defined by the FCC in 47 C.F.R. § 1.6100(b)(9), as may be amended. (s) Transmission equipment means the same as defined by the FCC in 47 C.F.R. § 1.6100(b)(8), as may be amended.
(t) Wireless means any FCC-licensed or authorized wireless communication service transmitted over frequencies in the electromagnetic spectrum.
(u) City Council Policy means a policy adopted by resolution pursuant to this Chapter which authorizes the City Council to adopt procedural and substantive rules for small wireless facilities deployment with the City of San Mateo.

Section 3. Section 17.10.030 of the San Mateo Municipal Code is amended as follows:

17.10.030 Applicability
(a) Applicable Wireless Facilities. The provisions in this Chapter shall be applied to all wireless facilities, including, without limitation, all new facilities and existing facilities, within the City's public rights-of-way, including small cell wireless facilities, and all applications to construct, install, operate, collocate, modify, reconstruct, relocate or otherwise deploy wireless facilities within the City's public rights-of-way, including Section 6409 requests, except as may be expressly provided otherwise in this Chapter. (b) Exempt Wireless Facilities. Notwithstanding Section 17.10.030(a), the provisions in this Chapter will not be applicable to: (1) wireless facilities not proposed or currently located in the public right-of-way; (2) wireless facilities owned and operated by the City for public purposes; (3) amateur radio facilities; and (4) wireless facilities or equipment owned and operated by CPUC-regulated electric companies for use in connection with electrical power generation, transmission and distribution facilities subject to CPUC General Order 131-D.
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(v) Special Provisions for Section 6409 Approvals. Notwithstanding Section 17.10.030(a), all requests for approval to collocate, replace, or remove transmission equipment at an existing wireless tower or base station located in the public right-of-way and submitted pursuant to Section 6409 will be reviewed under the general wireless permit application procedures provided in this Chapter, as well as the special Section 6409 provisions provided in Section 17.10.110 and the Design Standards and Application Requirements. (w) Special Provisions for Small Wireless Facilities. Notwithstanding Section 17.10.030(a), all small wireless facilities within the City’s public rights-of-way are subject to a permit as specified in a City Council Policy, which may be adopted, amended and/or repealed by a resolution of the City Council. All small wireless facilities within the City’s public rights-of-way shall comply with the City Council’s Policy. If a City Council Policy regulating small wireless facilities within the City’s rights-of-way is not adopted, or is otherwise repealed after adoption and not replaced, an application for a small wireless facility within the City’s public rights-of-way shall be processed pursuant to the provisions in this Chapter.

Section 4. Subsection (a) of Section 17.10.040 of the San Mateo Municipal Code is amended as follows:

17.10.040 Required Approvals
(a) Wireless Permit. A wireless permit, subject to the City's prior review and approval in accordance with the procedures in this Chapter, the City Council Policy, and the City's Design Standards and Application Requirements, is required for any applicant seeking to construct, install, modify, maintain or engage in an activity relating to a wireless facility in, on, under, or above the public right-of-way prior to conducting any work related to such wireless facility.

Section 5. Section 17.10.050 of the San Mateo Municipal Code is amended as follows:

17.10.050 Application Process and Requirements
(a) Permit Application Form. The applicant shall submit a complete, duly executed wireless permit application in a form approved by the City, which may be updated from time to time by the Director. (b) Generally Applicable Design Standards and Application Requirements. All new wireless facilities and collocations, modifications or other changes to existing wireless facilities must conform to the City's Design Standards and Application Requirements, which may be updated from time to time by the Director to be necessary or appropriate to process any application governed under this Chapter, as authorized by the city council.
(c) City Council Policy. All new wireless facilities, or other changes to existing wireless facilities must comply with the City Policy, which may be adopted and updated by City Council resolution. (d) Procedures for a Duly Filed Application. Any application for a wireless permit will not be considered duly filed or complete unless submitted in accordance with any and all written rules and policies the City may adopt consistent with this Chapter, including but not limited to the Design Standards and Application Requirements and City Council Policy.
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(e) Notice. Within three (3) calendar days of submitting an application for a wireless permit, the applicant shall provide written notice by U.S. mail informed delivery to all property owners and residents within a 500' radius of the proposed project site. In addition, the notice shall be posted in a minimum of three (3) locations near the project site. The content of the notice shall be in a form approved by the city and include information as specified in the Design Standards and Application Requirements and City Council Policy, including but not limited to: 1) a general description of the proposed improvements and other equipment to be constructed or installed, and proposed site location; 2) applicant's contact information for property owners and residents to submit comments regarding the project and the timeline to do so; 3) city's webpage to access and be notified of decisions on applications; and 4) right to appeal a decision and timeline to do so.

Notices shall be in English and in other languages as deemed appropriate by the city. The applicant shall provide documentation of satisfaction of the notification requirement to the City prior to approval of the wireless permit.
(f) Additional Procedures. The City Council authorizes the Director to establish any other forms and procedures relating to the implementation of this Chapter.

Section 6. Section 17.10.070 of the San Mateo Municipal Code is amended as follows:

17.10.070 Decisions, Decision Notices, Limited Exceptions, Protests, Appeals (b) Decisions. The Director shall approve, conditionally approve, or deny a complete application for a wireless permit. A wireless permit shall be acted on within all processing timelines required by the FCC shot clocks, applicable state or federal laws, or other applicable timelines. (c) Required Findings for Approval. The Director may approve or conditionally approve an application for a wireless permit submitted under this Chapter when the Director finds all of the following:
(1) the applicant and the proposed wireless facility comply with all applicable requirements of this Chapter, the City Council Policy, and the City Design Standards and Application Requirements; and (2) the application is deemed complete by the Director; and (3) the proposed wireless facility complies with all applicable federal, state and local laws, regulations, rules, restrictions and conditions, which includes without limitation, the California Building Standards Code or any local building codes; the Americans with Disabilities Act, and all applicable health and safety requirements, including Public Utilities Commission General Order 95, (and as these rules may be amended or superseded); General Plan and any applicable specific plan; the San Mateo Municipal Code; and any conditions or restrictions in any permit or other governmental approval issued by any public agency with jurisdiction over the project; and (4) the applicant has demonstrated that its proposed wireless facility will be in compliance with all applicable FCC rules and regulations for human exposure to RF emissions. 435 of 563
(g) Conditional Approvals; Denials without Prejudice. Subject to any applicable federal or California laws, nothing in this Chapter is intended to limit the Director's ability to conditionally approve or deny without prejudice any application governed under this Chapter as may be necessary or appropriate to protect and promote the public health, safety and welfare, and to advance the goals or policies in the General Plan and any specific plan, the San Mateo Municipal Code and/or this Section. (h) Limited Exceptions for Personal Wireless Service Facilities. In the event that an applicant claims that strict compliance with this Chapter and the Design Standards and Application Requirements would effectively prohibit the applicant's ability to provide personal wireless services, the Director may grant a limited exception from such requirements in accordance with the required findings provided in the Design Standards and Application Requirements.
(i) Decision Notices to the Applicant. After the director acts on an application, and within the timeframe provided in the Design Standards and Application Requirements or before the FCC Shot Clock expires (whichever occurs first), the Director or designee shall send a written notice to the applicant. In the event that the Director denies the application (with or without prejudice), the written notice to the applicant must contain: (1) the reasons for the decision and (2) instructions for how and when to file an appeal. (j) Decision Notice to Public. The decision on an application along with the appeal process, shall be posted on the city's webpage on the same date as the decision is made. Notices to property owners and residents within 500' of the project site shall be sent within the timeframe provided in the Design Standards and Application Requirements.
(k) Appeals. The applicant or any person who is a property owner or resident within 500' of the project site may appeal any decision by the Director to approve or deny an application for a wireless permit. Appeals must be filed with the City Clerk within ten calendar days following the Director's decision. Payment of the appeal hearing fee pursuant to the City’s Adopted Comprehensive Fee Schedule must be made prior to the scheduling of the appeal hearing. The appeal for hearing before a hearing officer shall be set at the next available date, or otherwise within a time frame needed to comply with all applicable state or federal laws.

Appeals from an approval will not be permitted to the extent that the appeal is based on environmental effects from RF emissions that comply with all applicable FCC regulations, or as provided in the City Council Policy. The hearing officer shall review the appeal de novo, with the appellant having the burden of proof to establish the basis for seeking a reversal of the Director's decision, and issue a decision at the hearing. The hearing officer’s decision shall be final and not subject to any further administrative appeals.

Section 7. Section 17.10.080 of the San Mateo Municipal Code is amended as follows:

17.10.080 Standard Conditions of Approval
(d) Standard Conditions. All wireless facilities, whether approved by the Director or deemed approved or deemed granted by law shall be automatically subject to all standard conditions of approval as provided in the City Council Policy and/or the Design Standards and Application Requirements. (e) Modifications to Standard Conditions. The Director (or the hearing officer on appeal) shall have discretion to modify or amend any standard conditions of approval on a case-by-case basis as may be necessary 436 of 563
(l) or appropriate to protect and promote the public health, safety and welfare, allow for the proper operation of the approved wireless facility, maintain compliance with applicable laws and/or to advance the goals or policies in the General Plan and any specific plan, the San Mateo Municipal Code and/or this Chapter.

Section 8. Section 17.10.090 of the San Mateo Municipal Code is amended as follows:

17.10.090 Revocation; Abandonment
(f) Revocation. Any wireless permit, or other authorized use of the public right-of-way granted under this Chapter may be revoked or modified for cause in accordance with the provisions of this Section. (1) Revocation proceedings may be initiated by the Director. (2) Action. The Director shall act on the proposed revocation after the time for any appeal has lapsed. (3) Required Findings. The Director may revoke or modify the permit, City pole license, or right to use, if it makes any of the findings provided in the Design Standards and Application Requirements. (4) Notice of Action. The Director shall issue a written determination of revocation and mail the determination to the permittee within the timeframe provided in the Design Standards and Application Requirements.
(5) A permittee whose permit or right has been revoked may have the revocation reviewed, upon written appeal to the Director as set forth in this Chapter. (g) Abandonment. Wireless facilities no longer used to provide service shall be removed by the last known owner of record of such facility, at the sole cost of said owner and to the satisfaction of the City.

Section 9. Section 17.10.120 of the San Mateo Municipal Code is amended as follows:

17.10.120 Review of Ordinance
Wireless communications technology is currently subject to rapid change. Innovations may render the need for specific sections of this Chapter to be reviewed and revised. The City Council may amend this Chapter by ordinance or its rules and policies by resolution after a change to the FCC's regulations or standards, or any applicable state or federal laws.

Section 10. Section 17.10.130 of the San Mateo Municipal Code is repealed.

Section 11. Environmental Determination. In accordance with California Environmental Quality Act (CEQA) Guidelines, Section 15061(b)(3), this action is exempt from CEQA review, in that it can be seen with certainty that there is no possibility that this ordinance amendment may have a significant effect on the environment. 437 of 563
Section 12. Severability. In the event any section, clause or provision of this ordinance shall be determined invalid or unconstitutional, such section, clause or provision shall be deemed severable and all other sections or portions hereof shall remain in full force and effect.

Section 13. Publication. This Ordinance shall be published in summary in a newspaper of general circulation, posted in the City Clerk's Office, and posted on the City's website, all in accord with Section 2.15 of the City Charter.

Section 14. Legislative History and Effective Date. This ordinance was introduced on Clerk to complete., and adopted on Clerk to complete., and shall be effective 30 days after its adoption. 438 of 563
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CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 20 Section Name: CONSENT CALENDAR Account Number: 36-3133 File ID: 24-9367 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: December 09, 2024
SUBJECT:

New Beginnings Supportive Housing Project at 831 Monte Diablo Avenue — Agreement RECOMMENDATION:

Authorize the City Manager to execute a Regulatory Agreement, Loan Agreement, Deed of Trust, and Promissory Note with Saint James Community Development Corporation for the New Beginnings Supportive Housing Project and to make any appropriate changes that do not differ from the terms previously approved by the City Council.

BACKGROUND:

Permanent Local Housing Allocation Grant Program
The Permanent Local Housing Allocation (PLHA) grant program provides a permanent source of funding to all local governments in California to help cities and counties implement plans to increase housing affordability. PLHA is a flexible funding source administered by the California Department of Housing and Community Development (HCD) that can be used for a wide range of activities, from increasing the housing supply to providing supportive services.

As PLHA revenue is derived from real estate transactions, the amount of funding fluctuates from year to year, and jurisdictions are required to reapply annually for their allocation. In addition, to receive funds, a jurisdiction must adopt a five-year plan (Five-Year Plan) to allocate its PLHA spending. To date, the City has received three years of PLHA allocations, totaling $1,458,103: $341,894 in the first year (FY 21-22); $531,409 in the second year (FY 22-23); and $584,800 in the third year (FY 23-24).

The City received its fourth-year allocation award letter from HCD on October 8, 2024 in the amount of $293,103, and on November 18, 2024, the City Council approved a Resolution to appropriate $293,103 into the City’s FY 2024-25 operating budget. To receive the funds from HCD, the final step staff must take is to submit the Request for Funds (RFF), which includes a detailed description of the above-mentioned organizations and activities with their respective funding amounts.

New Beginnings Supportive Housing Project – Loan Documents For its third-year allocation (2023-24), the City committed to providing funding for the New Beginnings supportive housing project located at 831 Monte Diablo Avenue by St. James African Methodist Episcopal Zion Church (St. James) in the form of a forgivable, zero-interest predevelopment loan in the amount of $377,212. St. James proposed to develop four to six affordable units of supportive housing for former foster-youth between the ages of 18-24 (transitional age). This forgivable loan award will provide funding to allow the project to move forward with design, predevelopment activities, and construction once permits are approved.

The City Council approved Resolution No. 18 (2024) on February 20, 2024, to approve a loan to the St. James Community Development Corporation for this project in the amount of $377,212. However, this Resolution did not contain the form of loan documents for approval. Under PLHA regulations, a jurisdiction providing any type of loan to a housing development 447 of 563

CITY OF SAN MATEO
must provide these executed documents to HCD for review. Attached to this report are the Regulatory Agreement, Loan Agreement, Deed of Trust and Promissory Note. These are provided as Attachments 1, 2, 3 and 4, respectively.

BUDGET IMPACT:

The $377,212 commitment to the New Beginnings supportive housing project was previously made as part of the third year PLHA allocation and appropriated into the City’s FY 2023-24 operating budget. Approval of the loan documents has no impact on the budget.

ENVIRONMENTAL DETERMINATION:

This agreement is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Regulatory Agreement
Att 2 – Loan Agreement
Att 3 – Short Form Deed of Trust
Att 4 – Promissory Note

STAFF CONTACT
Rachel Horst, Housing Manager
[email protected]
(650) 522-7223
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LOAN AGREEMENT
(New Beginnings Supportive Housing Project)
This Loan Agreement (the "Agreement") is dated as of December__, 2024 (the "Effective Date"), and is between the City of San Mateo, a California municipal corporation (the "City"), and Saint James Community Development Corporation, a California corporation ("Borrower").

RECITALS
A. In addition to defined terms in these recitals, defined terms used, but not defined, in these recitals are as defined in Article 1 of this Agreement.

B. Borrower owns the real property commonly known as 831 Monte Diablo Avenue in the City of San Mateo San Mateo, CA 94401, as more particularly described in Exhibit A (the "Property"), and the Borrower desires to construct five (5) units of supportive housing on the Property for transition-aged former foster youth on the Property (the "Development"). The Development and any additional improvements constructed on the Property are referred to as the "Improvements.”
C. The City desires to award a portion of its Permanent Local Housing Allocation (PLHA) grant funds to increase the supply of affordable housing made available to special needs populations. On February 20, 2024, via Resolution No. 18, the City Council, authorized a forgivable loan in the amount of Three Hundred Seventy-Seven Thousand Two Hundred and Twelve Dollars ($377,212) in PLHA funds for planning and construction of the Development.

D. The Loan is evidenced by the Note, the Regulatory Agreement, and is secured by the Deed of Trust. The Loan is being made solely to finance the predevelopment of the Development, and is intended to increase the supply of affordable housing within the City. Due to the assistance provided Borrower through the Loan, the City is requiring the Borrower to enter into the Regulatory Agreement.

The Parties therefore agree as follows:
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AGREEMENT
ARTICLE 1.

DEFINITIONS AND EXHIBITS
Section 1.1 Definitions. The following terms have the following meanings:
(a) "Agreement" means this Loan Agreement.
(b) "Annual Report" shall mean the Borrower's annual report to the City regarding the Borrower's compliance with the Program Requirements. A form of the Annual Report is attached as Exhibit D.
(c) "Approved Development Budget" means the proforma budget for the construction of the Development, including sources and uses of funds, as approved by the City, and attached hereto and incorporated herein as Exhibit B. (d) “Business Day” means a day of the week on which the City of San Mateo is open to the public for carrying on substantially all business functions. In no event shall a Saturday or Sunday be considered a Business Day.
(e) "City" means the City of San Mateo, a municipal corporation. (f) “Day” means a calendar day unless otherwise specified. (g) "Deed of Trust" means the Short Form Deed of Trust and Assignment of Rents of even date herewith among Borrower, as Trustor, First American Title Company Title Company, as trustee, and the City, as beneficiary, that will encumber the Property to secure repayment of the Loan and performance of the covenants of the Loan Documents. (h) "Default Rate" means the lesser of the maximum rate permitted by law and ten percent (10%) per annum.
(i) "Development" has the meaning set forth in Paragraph C of the Recitals. (j) "Event of Default" has the meaning set forth in Section 5.1. (k) "Hazardous Materials" means: (1) any substance, material, or waste that is petroleum, petroleum-related, or a petroleum by-product, asbestos or asbestos-containing material, polychlorinated biphenyls, flammable, explosive, radioactive, freon gas, radon, or a pesticide, herbicide, or any other agricultural chemical; and (2) any waste, substance or material defined as or included in the definition of "hazardous substances", "hazardous wastes", "hazardous materials", "toxic materials", "toxic waste", "toxic substances", or words of similar import under any Hazardous Materials Law.
(l) "Hazardous Materials Claims" means with respect to the Property: (1) any and all enforcement, cleanup, removal or other governmental or regulatory actions instituted, completed or threatened against Borrower or the Property pursuant to any Hazardous Materials Law; and (2) all claims made or threatened by any third party against Borrower or the Property 450 of 563
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relating to damage, contribution, cost recovery compensation, loss or injury resulting from any Hazardous Materials.
(m) "Hazardous Materials Law" means any federal, state or local laws, ordinances, or regulations relating to any Hazardous Materials, health, industrial hygiene, environmental conditions, or the regulation or protection of the environment, and all amendments thereto as of this date and to be added in the future and any successor statute or rule or regulation promulgated thereto.
(n) "Improvements" has the meaning set forth in Paragraph C of the Recitals. (o) "Loan Documents" means this Agreement, the Note, the Regulatory Agreement, and the Deed of Trust.
(p) "Loan" has the meaning set forth in Paragraph D of the Recitals. (q) "Note" means the promissory note of even date herewith that evidences Borrower's obligation to repay the Loan.
(r) "Property" has the meaning set forth in Paragraph C of the Recitals. (s) "Regulatory Agreement" means the Agreement Containing Covenants Affecting Real Property, of even date herewith, between the City and Borrower related to the Loan, to be recorded against the Property.
(t) "Senior Loan" has the meaning set forth in Section 2.5. (u) "Term" means the term of the Loan which shall commence on the Effective Date and shall terminate on the earlier of: (i) the full forgiveness of the Loan by the City, in accordance with the Note; (ii) the full repayment of the Loan; or (iii) issuance of a Certificate of Occupancy.
(v) "Transfer" has the meaning set forth in Section 3.8 below.

Section 1.2Exhibits.

The following exhibits are attached to this Agreement and incorporated into this Agreement by this reference:

Exhibit A: Legal Description of the Property
Exhibit B: Approved Development Budget
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ARTICLE 2.

LOAN PROVISIONS
Section 2.1 Loan.

Upon satisfaction of the conditions set forth in Section 2.6 of this Agreement, the City shall lend to Borrower the Loan for the purposes set forth in Section 2.3 of this Agreement.

Borrower's obligation to repay the Loan is evidenced by the Note.

Section 2.2 Interest.
(a) Loan. Subject to the provisions of subsection (b) below, no interest will accrue on the outstanding principal balance of the Loan.

Section 2.3 Use of Loan Funds.

Borrower shall use the Loan for the predevelopment of the Development consistent with the Approved Development Budget. Borrower may not use the Loan proceeds for any other purposes without the prior written consent of the City.

Section 2.4 Security.

In consideration of the Loan, Borrower shall: (a) secure its obligation to repay the Loan, as evidenced by the Note, by executing the Deed of Trust, and cause or permit it to be recorded as a lien against the Property, and (b) execute the Regulatory Agreement, and cause or permit it to be recorded against the Property.

Section 2.5 Subordination.
(a) Any agreement by the City to subordinate the Deed of Trust to an encumbrance securing and/or evidencing any loan obtained by Borrower to finance the Development (each, a "Senior Loan") shall be subject to the satisfaction of each of the following conditions:
(1) All of the proceeds of the Senior Loan, less any transaction costs, are used to provide acquisition, construction and/or permanent financing for the Development. (2) The lender of the Senior Loan is a state or federally chartered financial institution, a nonprofit corporation or a public entity that is not affiliated with Borrower or any of Borrower's affiliates, other than as a depositor or a lender. (3) Borrower demonstrates to the City's satisfaction that subordination of the Deed of Trust and the Regulatory Agreement is necessary to ensure the viability of the Development, as required by the Loan Documents. To satisfy this requirement, Borrower must provide to the City, in addition to any other information reasonably required by the City, evidence demonstrating that the proposed amount of the Senior Loan is necessary to provide adequate acquisition, construction, and/or permanent financing to ensure the viability of the Development, and adequate financing for the Development would not be available without the proposed subordination.
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(1) The subordination agreement(s) is structured to minimize the risk that the Deed of Trust and the Regulatory Agreement will be extinguished as a result of a foreclosure by the holder of the Senior Loan. To satisfy this requirement, the subordination agreement must provide the City with adequate rights to cure any defaults by Borrower, including: (i) providing the City or its successor with copies of any notices of default at the same time and in the same manner as provided to Borrower; and (ii) providing the City with a cure period of at least sixty (60) days to cure any default. (2) The subordination(s) of the Loan is effective only during the original term of the Senior Loan and any extension of its term that is approved in writing by the City.
(3) The subordination does not limit the effect of the Deed of Trust and the Regulatory Agreement before a foreclosure, nor require the consent of the holder of the Senior Loan prior to the City exercising any remedies available to the City under the Loan Documents.
(a) Upon a determination by the City Manager that the conditions in this Section have been satisfied, the City Manager, or his/her designee, will be authorized to execute the approved subordination agreement without the necessity of any further action or approval.

Section 2.6Conditions Precedent to Disbursement of Loan Funds. (a) Conditions to Disbursement. The total disbursements made pursuant to this Section 2.6 may not exceed Three Hundred Seventy-Seven Thousand Two Hundred and Twelve Dollars ($377,212). The City is not obligated to disburse any portion of the Loan, or to take any other action under the Loan Documents unless all of the following conditions have been and continue to be satisfied:
(1) There exists no Event of Default nor any act, failure, omission or condition that would constitute an Event of Default under the Loan Documents; (2) Borrower holds title to the Property or is acquiring title to the Property simultaneously with the disbursement of the Loan proceeds; (3) Borrower has delivered to the City a copy of a corporate resolution authorizing Borrower to obtain the Loan, and execute the Loan Documents; (4) There exists no material adverse change in the financial condition of Borrower from that shown by the financial statements and other data and information furnished by Borrower to the City prior to the Effective Date; (5) Borrower has furnished the City with evidence of the insurance coverage meeting the requirements of Section 3.8 below; (6) Borrower has executed and delivered to the City the Loan Documents and has caused all other documents, instruments, and policies required under the Loan Documents to be delivered to the City, as more particularly set forth below; 453 of 563
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(4) The Deed of Trust and the Regulatory Agreement have been recorded against the Property in the Office of the Recorder of the County of San Mateo; (5) A title insurer reasonably acceptable to the City is unconditionally and irrevocably committed to issuing an LP-10 2006 ALTA Lender's Policy of title insurance insuring the priority of the Deed of Trust in the amount of the Loan, subject only to such exceptions and exclusions as may be reasonably acceptable to the City, and containing such endorsements as the City may reasonably require. To the extent applicable, the Borrower shall provide whatever documentation (including an indemnification agreement), deposits or surety is reasonably required by the title company in order for the City's Deed of Trust to be senior in lien priority to any mechanics liens in connection with any start of work that has occurred prior to the recordation of the Deed of Trust against the Property;
(6) The City has received a written draw request from Borrower, including certification that the condition set forth in Section 2.6(a)(1) continues to be satisfied, and setting forth the proposed uses of funds consistent with this Agreement, the amount of funds needed, and, where applicable, a copy of the bill or invoice covering a cost incurred or to be incurred.

Section 1.3Repayment Schedule.
(a) Loan Forgiveness. The entire Loan amount shall be forgiven upon completion of construction, as evidenced by a Certificate of Occupancy, and the following shall occur: (i) this Agreement shall terminate; (ii) the City shall mark the Note as "Cancelled" and return the original Note to the Borrower; and (iii) the City shall cause the reconveyance of the Deed of Trust.
(b) Payment in Full of Loan. Borrower shall pay all outstanding principal and accrued interest on the Loan, in full, on the earliest to occur of: (i) any Transfer other than as permitted pursuant to Section 3.7; or (ii) an Event of Default. (c) Prepayment. Borrower may prepay the Loan at any time without premium or penalty.

Section 1.4Non-Recourse.

Except as provided below, Borrower shall not have any direct or indirect personal liability for payment of the principal of, and interest on, the Loan. Following recordation of the Deed of Trust, the sole recourse of the City with respect to the principal of, or interest on, the Note will be to the property described in the Deed of Trust; provided, however, that nothing contained in the foregoing limitation of liability limits or impairs the enforcement of all the rights and remedies of the City against all such security for the Note, or impairs the right of City to assert the unpaid principal amount of the Note as demand for money within the meaning and intendment of Section 431.70 of the California Code of Civil Procedure or any successor provision thereto. The foregoing limitation of liability is intended to apply only to the obligation to repay the principal and interest on the Note. Except as hereafter set forth; nothing contained herein is intended to relieve Borrower of its obligation to indemnify the City under this Agreement, or liability for: (i) loss or damage of any kind resulting from waste, fraud or willful 454 of 563
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misrepresentation; (ii) the failure to pay taxes, assessments or other charges which may create liens on the Property that are payable or applicable prior to any foreclosure under the Deed of Trust (to the full extent of such taxes, assessments or other charges); (iii) the fair market value of any personal property or fixtures removed or disposed of by Borrower other than in accordance with the Deed of Trust; and (iv) the misappropriation of any proceeds under any insurance policies or awards resulting from condemnation or the exercise of the power of eminent domain or by reason of damage, loss or destruction to any portion of the Property.

Section 1.2Compliance with Laws. Borrower shall cause all work performed in connection with the Development to be performed in compliance with:
(m) All applicable laws, codes, ordinances, rules and regulations of federal, state, City or municipal governments or agencies now in force or that may be enacted hereafter; and
(n) All directions, rules and regulations of any fire marshal, health officer, building inspector, or other officer of every governmental agency now having or hereafter acquiring jurisdiction. Borrower may permit the work to proceed only after procurement of each permit, license, or other authorization that may be required by any governmental agency having jurisdiction, and Borrower is responsible to the City for the procurement and maintenance thereof.

Section 1.3State Prevailing Wages.
(m) To the extent required by applicable law, Borrower shall:
(1) pay, and shall cause any consultants or contractors to pay, prevailing wages for the construction of the Development as those wages are determined pursuant to California Labor Code Sections 1720 et seq.; (2) cause any consultants or contractors to employ apprentices as required by California Labor Code Section 1777.5 et seq., and the implementing regulations of the Department of Industrial Relations (the "DIR"), and to comply with the other applicable provisions of California Labor Code Sections 1720 et seq., 1777.5 et seq., and implementing regulations of the DIR;
(3) keep and retain, and shall cause any consultants and contractors to keep and retain, such records as are necessary to determine if such prevailing wages have been paid as required pursuant to California Labor Code Section 1720 et seq., and apprentices have been employed are required by California Labor Code Section 1777.5 et seq.; (4) post at the Property, or shall cause the contractor to post at the Property, the applicable prevailing rates of per diem wages. Copies of the currently applicable current per diem prevailing wages are available from DIR; (5) cause contractors and subcontractors performing work on the Property to be registered as set forth in California Labor Code Section 1725.5; 455 of 563
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(6) cause its contractors and subcontractors, in all calls for bids, bidding materials and the construction contract documents for work on the Property to specify that:
(A) no contractor or subcontractor may be listed on a bid proposal nor be awarded a contract for work on the Property unless registered with the DIR pursuant to California Labor Code Section 1725.5; and
(B) the work at the Property is subject to compliance
monitoring and enforcement by the DIR;
(7) provide the City all information required by California Labor Code Section 1773.3 as set forth in the DIR's online form PWC-100 within 2 days of the award of any contract (https://www.dir.ca.gov/pwc100ext/);
(8) cause its contractors to post job site notices, as prescribed by regulation by the DIR; and
(9) cause its contractors to furnish payroll records required by California Labor Code Section 1776 directly to the Labor Commissioner, at least monthly in the electronic format prescribed by the Labor Commissioner. (a) Borrower shall indemnify, hold harmless and defend (with counsel reasonably acceptable to the City) the City against any claim for damages, compensation, fines, penalties or other amounts arising out of the failure or alleged failure of any person or entity (including Borrower, its contractor and subcontractors) to pay prevailing wages as determined pursuant to California Labor Code Section 1720 et seq., to employ apprentices pursuant to California Labor Code Section 1777.5 et seq., to meet the conditions of California Labor Code Section 1771.4, and implementing regulations of the DIR, or to comply with the other applicable provisions of California Labor Code Sections 1720 et seq., 1777.5 et seq., and 1771.4, and the implementing regulations of the DIR, in connection with the work undertaken at the Property.

The requirements in this Section survive the repayment of the Loan, and the reconveyance of the Deed of Trust.

Section 2.7Accessibility.

Borrower shall cause the Development to be constructed in compliance with all applicable federal and state disabled persons accessibility requirements including but not limited to the Americans with Disabilities Act; and Title 24 of the California Code of Regulations (collectively, the "Accessibility Requirements"). Borrower shall indemnify, hold harmless and defend (with counsel reasonably acceptable to the City) the City against any claim for damages, compensation, fines, penalties or other amounts arising out of the failure or alleged failure of any person or entity (including Borrower, its architect, contractor and subcontractors) to construct the Development in accordance with the Accessibility Requirements. The requirements in this Section survive repayment of the Loan and the reconveyance of the Deed of Trust.

Section 2.8Equal Opportunity.
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During the construction of the Development, discrimination on the basis of race, color, creed, religion, age, sex, sexual orientation, marital status, national origin, ancestry, or disability in the hiring, firing, promoting, or demoting of any person engaged in the construction work on the Property is not allowed.

Section 1.4Change in Development; Progress Reports.

Following the Effective Date, the Borrower shall not make any change to the total square footage of the Development or any other change that will result in the reduction of the number of units without the City's prior written consent, which shall not be unreasonably withheld, delayed, or conditioned. Until such time as Borrower has received a certificate of occupancy from the City for the Development, Borrower shall provide the City with quarterly progress reports regarding the Property.

Section 1.5Inspections.

Borrower shall permit and facilitate, and shall require its contractors to permit and facilitate, observation and inspection at the Development by the City and by public authorities during reasonable business hours during the Term, for the purposes of determining compliance with this Agreement.

Section 1.6Approved Development Budget; Revisions to Budget.

As of the Effective Date, the City has approved the Approved Development Budget set forth in Exhibit B. Borrower shall submit any required amendments to the Approved Development Budget to the City for approval within five (5) days after the date Borrower receives information indicating that actual costs of the Development vary or will vary from the costs shown on the Approved Development Budget. Written consent of the City will be required to amend the Approved Development Budget.

Section 1.7Commencement and Completion of Construction.

Borrower shall make best efforts to commence construction of the Development on or prior to January 1, 2027, provided, however, in no event shall Borrower cause any construction work to be performed on the Property unless and until the Borrower has obtained all necessary permits for such work from the City and/or any other applicable governmental authority.

Borrower acknowledges that nothing in this Agreement obligates the City to issue any permit to the Borrower or for any proposed work on the Property. Borrower shall make best efforts to diligently prosecute such work to completion by no later than January 1, 2028.

ARTICLE 3.

LOAN REQUIREMENTS
Section 3.1 Hazardous Materials.
(a) Borrower shall keep and maintain the Property (including but not limited to, soil and ground water conditions) in compliance with all Hazardous Materials Laws and may 457 of 563
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not cause or permit the Property to be in violation of any Hazardous Materials Law. Borrower may not cause or permit the use, generation, manufacture, storage or disposal of on, under, or about the Property or transportation to or from the Property of any Hazardous Materials, except such of the foregoing as may be customarily used in projects like the Development or kept and used in and about property of this type.
(m) Borrower shall immediately advise the City in writing if at any time it receives written notice of any Hazardous Materials Claims, and Borrower's discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Property that could cause the Property or any part thereof to be subject to California Health and Safety Code, Section 25220 et seq., or any regulation adopted in accordance therewith, or to be otherwise subject to any restrictions on the ownership, occupancy, transferability or use of the Property under any Hazardous Materials Law.
(n) The City has the right to join and participate in, as a party if it so elects, and be represented by counsel acceptable to the City (or counsel of its own choice if a conflict exists with Borrower) in any legal proceedings or actions initiated in connection with any Hazardous Materials Claims and to have its reasonable attorneys' fees in connection therewith paid by Borrower.
(o) Borrower shall indemnify and hold harmless the City and its Council members, supervisors, directors, officers, employees, agents, successors and assigns from and against any loss, damage, cost, fine, penalty, judgment, award, settlement, expense or liability, directly or indirectly arising out of or attributable to: (1) any actual or alleged past or present violation of any Hazardous Materials Law; (2) any Hazardous Materials Claim; (3) any actual or alleged past or present use, generation, manufacture, storage, release, threatened release, discharge, disposal, transportation, or presence of Hazardous Materials on, under, or about the Property; (4) any investigation, cleanup, remediation, removal, or restoration work of site conditions of the Property relating to Hazardous Materials (whether on the Property or any other property); and (5) the breach of any representation of warranty by or covenant of Borrower in this Section 3.5, and Section 4.1(l). Such indemnity shall include, without limitation: (A) all consequential damages; (B) the costs of any required or necessary investigation, repair, cleanup or detoxification of the Property and the preparation and implementation of any closure, remedial or other required plans; and (z) all reasonable costs and expenses incurred by the City in connection with clauses (A) and (B), including but not limited to reasonable attorneys' fees and consultant fees except to the extent caused by the City’s active negligence or willful misconduct.

This indemnification applies whether or not any government agency has issued a cleanup order.

Losses, claims, costs, suits, liability, and expenses covered by this indemnification provision include, but are not limited to: (1) losses attributable to diminution in the value of the Property, (2) loss or restriction of use of rentable space on the Property, (3) adverse effect on the marketing of any rental space on the Property, and (4) penalties and fines levied by, and remedial or enforcement actions of any kind issued by any regulatory agency (including but not limited to the costs of any required testing, remediation, repair, removal, cleanup or detoxification of the Property and surrounding properties). This obligation to indemnify will survive termination of this Agreement and will not be diminished or affected in any respect as a result of any notice, disclosure, knowledge, if any, to or by the City of Hazardous Materials. 458 of 563
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(p) Without the City's prior written consent, which will not be unreasonably withheld, Borrower may not take any remedial action in response to the presence of any Hazardous Materials on, under or about the Property, nor enter into any settlement agreement, consent decree, or other compromise in respect to any Hazardous Material Claims, which remedial action, settlement, consent decree or compromise might, in the City's judgment, impair the value of the City's security hereunder; provided, however, that the City's prior consent is not necessary in the event that the presence of Hazardous Materials on, under, or about the Property either poses an immediate threat to the health, safety or welfare of any individual or is of such a nature that an immediate remedial response is necessary and it is not reasonably possible to obtain the City's consent before taking such action, provided that in such event Borrower shall notify the City as soon as practicable of any action so taken. The City agrees not to withhold its consent, where such consent is required hereunder, if: (i) a particular remedial action is ordered by a court of competent jurisdiction; (ii) Borrower will or may be subjected to civil or criminal sanctions or penalties if it fails to take a required action; (iii) Borrower establishes to the reasonable satisfaction of the City that there is no reasonable alternative to such remedial action which would result in less impairment of the City's security hereunder; or (iv) the action has been agreed to by the City.
(q) Borrower hereby acknowledges and agrees that: (1) this Section is intended as the City's written request for information (and Borrower's response) concerning the environmental condition of the Property as required by California Code of Civil Procedure Section 726.5; and (2) each representation and warranty in this Agreement (together with any indemnity obligation applicable to a breach of any such representation and warranty) with respect to the environmental condition of the Property is intended by the Parties to be an "environmental provision" for purposes of California Code of Civil Procedure Section 736. (r) In the event that any portion of the Property is determined to be "environmentally impaired" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(3)) or to be an "affected parcel" (as that term is defined in California Code of Civil Procedure Section 726.5(e)(1)), then, without otherwise limiting or in any way affecting the City's or the trustee's rights and remedies under the Deed of Trust, the City may elect to exercise its rights under California Code of Civil Procedure Section 726.5(a) to: (1) waive its lien on such environmentally impaired or affected portion of the Property; and (2) exercise, (A) the rights and remedies of an unsecured creditor, including reduction of its claim against Borrower to judgment, and (B) any other rights and remedies permitted by law. For purposes of determining the City's right to proceed as an unsecured creditor under California Code of Civil Procedure Section 726.5(a), Borrower will be deemed to have willfully permitted or acquiesced in a release or threatened release of Hazardous Materials, within the meaning of California Code of Civil Procedure Section 726.5(d)(1), if the release or threatened release of Hazardous Materials was knowingly or negligently caused or contributed to by any lessee, occupant, or user of any portion of the Property and Borrower knew or should have known of the activity by such lessee, occupant, or user which caused or contributed to the release or threatened release. All costs and expenses, including (but not limited to) attorneys' fees, incurred by the City in connection with any action commenced under this paragraph, including any action required by California Code of Civil Procedure Section 726.5(b) to determine the degree to which the Property is environmentally impaired, plus interest thereon at the Default Rate, until paid, will be 459 of 563
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added to the indebtedness secured by the Deed of Trust and is due and payable to the City upon its demand made at any time following the conclusion of such action.

Section 1.8Maintenance; Damage and Destruction.
(m) During the course of construction and operation of the Development Borrower shall maintain the Development and the Property in good repair and in a neat, clean and orderly condition. If there arises a condition in contravention of this requirement, and if Borrower has not cured such condition within thirty (30) days after receiving a City notice of such a condition, then in addition to any other rights available to the City, the City may perform all acts necessary to cure such condition, and to establish or enforce a lien or other encumbrance against the Property, subject to the provisions provided in subsection (b) below. (n) Subject to the requirements of senior lenders, and if economically feasible in the City's judgment after consultation with Borrower, if any improvement now or in the future on the Property is damaged or destroyed, then Borrower shall, at its cost and expense, diligently undertake to repair or restore such improvement consistent with the plans and specifications approved by the City with such changes as have been approved by the City. Such work or repair is to be commenced no later than the later of one hundred twenty (120) days, or such longer period approved by the City in writing, after the damage or loss occurs or thirty (30) days following receipt of the insurance proceeds, and is to be complete within one (1) year thereafter.

Any insurance proceeds collected for such damage or destruction are to be applied to the cost of such repairs or restoration and, if such insurance proceeds are insufficient for such purpose, then Borrower shall make up the deficiency. If Borrower does not promptly make such repairs then any insurance proceeds collected for such damage or destruction are to be promptly delivered by Borrower to the City as a special repayment of the Loan, subject to the rights of the senior lenders, if any.

Section 1.9Fees and Taxes.

Borrower is solely responsible for payment of all fees, assessments, taxes, charges, and levies imposed by any public authority or utility company with respect to the Property or the Development, and shall pay such charges prior to delinquency. However, Borrower is not required to pay and discharge any such charge so long as: (a) the legality thereof is being contested diligently and in good faith and by appropriate proceedings; and (b) if requested by the City, Borrower deposits with the City any funds or other forms of assurance that the City in good faith from time to time determines appropriate to protect the City from the consequences of the contest being unsuccessful.

Section 1.10 Transfer.

For purposes of this Agreement, "Transfer" means any sale, assignment, or transfer, whether voluntary or involuntary, of: (i) any rights and/or duties under this Agreement; and/or (ii) any interest in the Development, including (but not limited to) a fee simple interest, a joint tenancy interest, a life estate, a partnership interest, a leasehold interest, a security interest, or an 460 of 563
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interest evidenced by a land contract by which possession of the Development is transferred and Borrower retains title.
(m) No Transfer is permitted without the prior written consent of the City, which the City may withhold in its sole discretion. Notwithstanding any provision to the contrary, the Loan will automatically accelerate and be due in full upon any Transfer made without the prior written consent of the City. In the event of any conflict between this subsection and any other provision of the Loan Documents, this subsection shall prevail. (n) The City hereby approves the grant of the security interests in the Development for any deed of trust to which the City has agreed to subordinate.

Section 1.5Insurance Requirements.
(a) Borrower shall maintain the following insurance coverage throughout the Term of the Loan:
(1) Workers' Compensation insurance to the extent required by law, including Employer's Liability coverage, with limits not less than One Million Dollars ($1,000,000) each accident.
(2) Commercial General Liability insurance with limits not less than Two Million Dollars ($2,000,000) each occurrence combined single limit for Bodily Injury and Property Damage, including coverages for Contractual Liability, Personal Injury, Broadform Property Damage, Products and Completed Operations.
(3) Automobile Liability insurance with limits not less than One Million Dollars ($1,000,000) each occurrence combined single limit for Bodily Injury and Property Damage, including coverages for owned, non-owned and hired vehicles, as applicable. (4) Builders' Risk insurance during the course of construction and upon completion, property insurance covering the Development, in a form appropriate for the nature of such property, covering all risks of loss, excluding earthquake, for one hundred percent (100%) of the replacement value, with deductible, if any, acceptable to the City, naming the City as a Loss Payee, as its interests may appear. Flood insurance must be obtained if required by applicable federal regulations.
(5) Commercial crime insurance covering all officers and employees, for loss of Loan proceeds caused by dishonesty, in an amount approved by the City, naming the City a Loss Payee, as its interests may appear which insurance shall be maintained only until the entire balance of the Loan has been disbursed.
(b) Borrower shall cause any general contractor, agent, or subcontractor working on the Development under direct contract with Borrower or subcontract to maintain insurance of the types and in at least the minimum amounts described in subsections (1), (2), and (3) above, except that the limit of liability for commercial general liability insurance for subcontractors must be One Million Dollars ($1,000,000), and must require that such insurance will meet all of the general requirements of subsections (d) and (e) below. 461 of 563
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(o) The required insurance must be provided under an occurrence form, and Borrower shall maintain the coverage described in subsection (a) continuously throughout the Term. Should any of the required insurance be provided under a form of coverage that includes an annual aggregate limit or provides that claims investigation or legal defense costs be included in such annual aggregate limit, such annual aggregate limit must be three times the occurrence limits specified above.
(p) Commercial General Liability, Automobile Liability and Property insurance policies must be endorsed to name as an additional insured the City and its officers, agents, employees and members of the City Council.
(q) All policies and bonds are to contain: (i) the agreement of the insurer to give the City at least thirty (30) days' notice prior to cancellation (including, without limitation, for non-payment of premium) or any material change in said policies; (ii) an agreement that such policies are primary and non-contributing with any insurance that may be carried by the City; (iii) a provision that no act or omission of Borrower shall affect or limit the obligation of the insurance carrier to pay the amount of any loss sustained; and (iv) a waiver by the insurer of all rights of subrogation against the City and its authorized parties in connection with any loss or damage thereby insured against.

ARTICLE 4.

REPRESENTATIONS AND WARRANTIES OF BORROWER
Section 4.1 Representations and Warranties.

Borrower hereby represents and warrants to the City as follows and acknowledges, understands, and agrees that the representations and warranties set forth in this Article are deemed to be continuing during all times when any portion of the Loan remains outstanding:
(a) Organization. Borrower is duly organized, validly existing and in good standing under the laws of the State of California and has the power and authority to own its property and carry on its business as now being conducted. (b) Authority of Borrower. Borrower has full power and authority to execute and deliver this Agreement and to make and accept the borrowings contemplated hereunder, to execute and deliver the Loan Documents and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Agreement, and to perform and observe the terms and provisions of all of the above.
(c) Authority of Persons Executing Documents. This Agreement and the Loan Documents and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Agreement have been executed and delivered by persons who are duly authorized to execute and deliver the same for and on behalf of Borrower, and all actions required under Borrower's organizational documents and applicable governing law for the authorization, execution, delivery and performance of this Agreement and the Loan Documents and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Agreement, have been duly taken. 462 of 563
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(r) Valid Binding Agreements. The Loan Documents and all other documents or instruments executed and delivered pursuant to or in connection with this Agreement constitute or, if not yet executed or delivered, will when so executed and delivered constitute, legal, valid and binding obligations of Borrower enforceable against it in accordance with their respective terms.
(s) No Breach of Law or Agreement. Neither the execution nor delivery of the Loan Documents or of any other documents or instruments executed and delivered, or to be executed or delivered, pursuant to this Agreement, nor the performance of any provision, condition, covenant or other term hereof or thereof, will: (i) conflict with or result in a breach of any statute, rule or regulation, or any judgment, decree or order of any court, board, commission or agency whatsoever that is binding on Borrower, or conflict with any provision of the organizational documents of Borrower, or conflict with any agreement to which Borrower is a party; or (ii) result in the creation or imposition of any lien upon any assets or property of Borrower, other than liens established pursuant hereto. (t) Compliance with Laws; Consents and Approvals. The construction of the Development will comply with all applicable laws, ordinances, rules and regulations of federal, state and local governments and agencies and with all applicable directions, rules and regulations of the fire marshal, health officer, building inspector and other officers of any such government or agency.
(u) Pending Proceedings. Borrower is not in default under any law or regulation or under any order of any court, board, commission or agency whatsoever, and there are no claims, actions, suits or proceedings pending or, to the knowledge of Borrower, threatened against or affecting Borrower or the Development, at law or in equity, before or by any court, board, commission or agency whatsoever which might, if determined adversely to Borrower, materially affect Borrower's ability to repay the Loan or impair the security to be given to the City pursuant hereto.
(v) Title to Land. At the time of recordation of the Deed of Trust, Borrower will have good and marketable fee title to the Development and there will exist thereon or with respect thereto no mortgage, lien, pledge or other encumbrance of any character whatsoever other than liens for current real property taxes and liens in favor of the City or approved in writing by the City.
(w) Financial Statements. The financial statements of Borrower and other financial data and information furnished by Borrower to the City fairly and accurately present the information contained therein. As of the date of this Agreement, there has not been any material adverse change in the financial condition of Borrower from that shown by such financial statements and other data and information.
(x) Taxes. Borrower and its subsidiaries have filed all federal and other material tax returns and reports required to be filed, and have paid all federal and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their income or the Property otherwise due and payable, except those that are being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with generally accepted accounting principles. There is no proposed tax assessment 463 of 563
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against Borrower or any of its subsidiaries that could, if made, be reasonably expected to have a material adverse effect on the property, liabilities (actual or contingent), operations, condition (financial or otherwise) or prospects of Borrower and its subsidiaries, taken as a whole, or which could result in: (i) a material impairment of the ability of Borrower to perform under any loan document to which it is a party; or (ii) a material adverse effect upon the legality, validity, binding effect or enforceability against Borrower of any Loan Document. (y) Hazardous Materials. To the best of Borrower's knowledge, except as disclosed in writing by Borrower to the City prior to the Effective Date: (i) no Hazardous Material has been disposed of, stored on, discharged from, or released to or from, or otherwise now exists in, on, under, or around, the Property; (ii) neither the Property nor Borrower is in violation of any Hazardous Materials Law; and (iii) neither the Property nor Borrower is subject to any existing, pending or threatened Hazardous Materials Claims.

ARTICLE 5.

DEFAULT AND REMEDIES
Section 5.1 Events of Default.

Any one or more of the following constitutes an "Event of Default" by Borrower under this Agreement:
(a) Failure to Complete Work. If Borrower fails to obtain the necessary permit(s), or Borrower otherwise fails to comply with the requirements of this Agreement. (a) Breach of Covenants. If Borrower fails to duly perform, comply with, or observe any other condition, term, or covenant contained in this Agreement, or in any of the other Loan Documents, and Borrower fails to cure such default within thirty (30) days after receipt of written notice thereof from the City to Borrower, or if such breach cannot be cured within such 30 day period, Borrower shall not be in breach so long as Borrower is diligently undertaking to cure such breach and such breach is cured within sixty (60) days; provided, however, that if a different period or notice requirement is specified under any other section of this Article, the specific provisions shall control.
(b) Default Under Other Loans. If a default is declared under any other financing for the Development by the lender of such financing and such default remains uncured following any applicable notice and cure period.
(c) Insolvency. If a court having jurisdiction makes or enters any decree or order: (1) adjudging Borrower to be bankrupt or insolvent; (2) approving as properly filed a petition seeking reorganization of Borrower, or seeking any arrangement for Borrower under the bankruptcy law or any other applicable debtor's relief law or statute of the United States or any state or other jurisdiction; (3) appointing a receiver, trustee, liquidator, or assignee of Borrower in bankruptcy or insolvency or for any of their properties; (4) directing the winding up or liquidation of Borrower if any such decree or order described in clauses (1) to (4), inclusive, is unstayed or undischarged for a period of ninety (90) days; or (5) Borrower admits in writing its inability to pay its debts as they fall due or will have voluntarily submitted to or filed a petition 464 of 563
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(z) seeking any decree or order of the nature described in clauses (1) to (4), inclusive. The occurrence of any of the Events of Default in this paragraph will act to accelerate automatically, without the need for any action by the City, the indebtedness evidenced by the Note. (d) Assignment; Attachment. If Borrower assigns its assets for the benefit of its creditors or suffers a sequestration or attachment of or execution on any substantial part of its property, unless the property so assigned, sequestered, attached or executed upon is returned or released within ninety (90) days after such event or, if sooner, prior to sale pursuant to such sequestration, attachment, or execution. The occurrence of any of the events of default in this paragraph shall act to accelerate automatically, without the need for any action by the City, the indebtedness evidenced by the Note.
(e) Suspension; Termination. If Borrower voluntarily suspends or terminates its business.
(f) Liens on Property and the Development. If any claim of lien (other than liens approved in writing by the City) is filed against the Development or any part thereof, or any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds of the Loan and the continued maintenance of said claim of lien or notice to withhold for a period of twenty (20) days, without discharge or satisfaction thereof or provision therefor (including, without limitation, the posting of bonds) satisfactory to the City. (g) Condemnation. If there is a condemnation, seizure, or appropriation of all or the substantial part of the Property and the Development. (h) Unauthorized Transfer. If any Transfer occurs other than as permitted pursuant to this Agreement.
(i) Representation or Warranty Incorrect. If any Borrower representation or warranty contained in this Agreement, or in any application, financial statement, certificate, or report submitted to the City in connection with any of the Loan Documents, proves to have been incorrect in any material respect when made.

Section 1.6Remedies.

Upon the occurrence of an Event of Default and until such Event of Default is cured or waived, the City is relieved of any obligation to disburse any portion of the Loan. In addition, upon the occurrence of an Event of Default and following the expiration of all applicable notice and cure periods the City may proceed with any and all remedies available to it under law, this Agreement, and the other Loan Documents. Such remedies include but are not limited to the following:
(a) Acceleration of Note. The City may cause all indebtedness of Borrower to the City under this Agreement and the Note, together with any accrued interest thereon, to become immediately due and payable. Borrower waives all right to presentment, demand, protest or notice of protest or dishonor. The City may proceed to enforce payment of the indebtedness and to exercise any or all rights afforded to the City as a creditor and secured party under the law including the Uniform Commercial Code, including foreclosure under the Deed of 465 of 563
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Trust. Borrower is liable to pay the City on demand all reasonable expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses) paid or incurred by the City in connection with the collection of the Loan and the preservation, maintenance, protection, sale, or other disposition of the security given for the Loan. (aa) Specific Performance. The City has the right to mandamus or other suit, action or proceeding at law or in equity to require Borrower to perform its obligations and covenants under the Loan Documents or to enjoin acts on things that may be unlawful or in violation of the provisions of the Loan Documents.
(bb) Right to Cure at Borrower's Expense. The City has the right (but not the obligation) to cure any monetary default by Borrower under a loan other than the Loan. Upon demand therefor, Borrower shall reimburse the City for any funds advanced by the City to cure such monetary default by Borrower, together with interest thereon from the date of expenditure until the date of reimbursement at the Default Rate.

Section 1.7Right of Contest.

Borrower may contest in good faith any claim, demand, levy, or assessment the assertion of which would constitute an Event of Default hereunder. Any such contest is to be prosecuted diligently and in a manner unprejudicial to the City or the rights of the City hereunder.

Section 1.8Remedies Cumulative.

No right, power, or remedy given to the City by the terms of this Agreement or the other Loan Documents is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy is cumulative and in addition to every other right, power, or remedy given to the City by the terms of any such instrument, or by any statute or otherwise against Borrower and any other person. Neither the failure nor any delay on the part of the City to exercise any such rights and remedies will operate as a waiver thereof, nor does any single or partial exercise by the City of any such right or remedy preclude any other or further exercise of such right or remedy, or any other right or remedy.

ARTICLE 6.

GENERAL PROVISIONS
Section 6.1 Relationship of Parties.

Nothing contained in this Agreement is to be interpreted or understood by any of the Parties, or by any third persons, as creating the relationship of employer and employee, principal and agent, limited or general partnership, or joint venture between the City and Borrower or its agents, employees or contractors, and Borrower will at all times be deemed an independent contractor and to be wholly responsible for the manner in which it or its agents, or both, perform the services required of it by the terms of this Agreement. Borrower has and retains the right to exercise full control of employment, direction, compensation, and discharge of all persons assisting in the performance of services under the Agreement. In regards to the demolition or construction work, and operation of the Development, Borrower is solely responsible for all matters relating to payment of its employees, including compliance with Social Security, 466 of 563
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withholding, and all other laws and regulations governing such matters, and must include requirements in each contract that contractors are solely responsible for similar matters relating to their employees. Borrower is solely responsible for its own acts and those of its agents and employees.

Section 1.11 No Claims.

Nothing contained in this Agreement creates or justifies any claim against the City by any person that Borrower may have employed or with whom Borrower may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the work, or the operation of the Development, and Borrower shall include similar requirements in any contracts entered into for the construction or operation of the Development.

Section 1.12 Amendments.

No alteration or variation of the terms of this Agreement is valid unless made in writing by the Parties.

Section 1.13 Indemnification.

Borrower shall indemnify, defend and hold the City and its Council members, directors, officers, employees, agents, successors and assigns harmless against any and all claims, suits, actions, losses and liability of every kind, nature and description made against it and expenses (including reasonable attorneys' fees) which arise out of or in connection with this Agreement, including but not limited to the construction, marketing and operation of the Development, except to the extent such claim arises from the gross negligence or willful misconduct of the City, its agents, and its employees. The provisions of this Section will survive the expiration of the Term and the reconveyance of the Deed of Trust.

Section 1.14 Non-Liability of City Officials, Employees and Agents.

No member, official, employee or agent of the City is personally liable to Borrower in the event of any default or breach of this Agreement by the City or for any amount that may become due from the City pursuant to this Agreement.

Section 1.15 No Third Party Beneficiaries.

There are no third party beneficiaries to this Agreement.

Section 1.16 Discretion Retained By City.

The City's execution of this Agreement in no way limits any discretion the City may have in the permit and approval process related to the construction of the Development.

Section 1.17 Notices, Demands and Communications.
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Formal notices, demands and communications between the City and the Borrower shall be sufficiently given if, and shall not be deemed given unless, (a) dispatched by certified mail, 468 of 563
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postage prepaid, return receipt requested, or (b) sent by express delivery or overnight courier service, or (c) sent via email to the email address set forth below, with a copy of such notice concurrently sent by either of the methods set forth in the preceding clauses (a) or (b), to the office of the Parties shown as follows, or such other address as the Parties may designate in writing from time to time:

City: City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attn: City Manager
Borrower: Saint James Community Development Corporation 825 Monte Diablo Ave.

San Mateo, CA 94401
Such written notices, demands and communications may be sent in the same manner to such other addresses as the affected party may from time to time designate by mail as provided in this Section. Receipt will be deemed to have occurred on the date shown on a written receipt as the date of delivery or refusal of delivery (or attempted delivery if undeliverable).

Section 1.18 Applicable Law.

This Agreement is governed by the laws of the State of California.

Section 1.19 Parties Bound.

Except as otherwise limited herein, this Agreement binds and inures to the benefit of the parties and their heirs, executors, administrators, legal representatives, successors, and assigns.

This Agreement is intended to run with the land and to bind Borrower and its successors and assigns in the Property and the Development for the entire Term, and the benefit hereof is to inure to the benefit of the City and its successors and assigns.

Section 1.20 Attorneys' Fees.

If any lawsuit is commenced to enforce any of the terms of this Agreement, the prevailing party will have the right to recover its reasonable attorneys' fees and costs of suit from the other party.

Section 1.21 Severability.

If any term of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions will continue in full force and effect unless the rights and obligations of the parties have been materially altered or abridged by such invalidation, voiding or unenforceability.

Section 1.22 Force Majeure.
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In addition to specific provisions of this Agreement, performance by either party will not be deemed to be in default where delays or defaults are due to war, insurrection, strikes, lockouts, riots, floods, earthquakes, fires, quarantine restrictions, freight embargoes, lack of transportation, or court order. An extension of time for any cause will be deemed granted if notice by the party claiming such extension is sent to the other within ten (10) days from the commencement of the cause and such extension of time is not rejected in writing by the other party within ten (10) days after receipt of the notice. In no event will the City be required to agree to cumulative delays in excess of one hundred eighty (180) days.

Section 1.23 City Approval.

The City has authorized the City Manager, or his or her designee, to execute the Loan Documents and deliver such approvals or consents as are required by this Agreement, and to execute estoppel certificates concerning the status of the Loan and the existence of Borrower defaults under the Loan Documents.

Section 1.24 Waivers.

Any waiver by the City of any obligation or condition in this Agreement must be in writing. No waiver will be implied from any delay or failure by the City to take action on any breach or default of Borrower or to pursue any remedy allowed under this Agreement or applicable law. Any extension of time granted to Borrower to perform any obligation under this Agreement does not operate as a waiver or release from any of its obligations under this Agreement. Consent by the City to any act or omission by Borrower may not be construed to be consent to any other or subsequent act or omission or to waive the requirement for the City's written consent to future waivers.

Section 1.25 Title of Parts and Sections.

Any titles of the sections or subsections of this Agreement are inserted for convenience of reference only and are to be disregarded in interpreting any part of the Agreement's provisions.

Section 1.26 Entire Understanding of the Parties.

The Loan Documents constitute the entire agreement of the parties with respect to the Loan. This Agreement shall not be construed as if it had been prepared by one of the Parties, but rather as if both Parties had prepared it. The Parties have read and reviewed this Agreement and agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party (including but not limited to Civil Code Section 1654 as may be amended from time to time, or any other state law, or common law principle) shall not apply to the interpretation of this Agreement.

Section 1.27 Multiple Originals; Counterpart.

This Agreement may be executed in multiple originals, each of which is deemed to be an original, and may be signed in counterparts.
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Signature page
City Loan Agreement
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23 IN WITNESS WHEREOF, this Agreement has been executed by the Parties as of the Effective Date.

CITY:

CITY OF SAN MATEO, a California municipal
corporation
By: ___________________________________
Name: Alex Khojikian
Its: City Manager
BORROWER:

APPROVED AS TO FORM ST. JAMES COMMUNITY DEVELOPMENT
CORPORATION, a California corporation
By: By: __________
Name: Prasanna W. Rasiah________ Name: Rev. Dr. Marlyn Bussey_______________ Its: City Attorney_____________ Its: Executive Director and CEO___________ 472 of 563
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EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
Lot 4, Block 46, as delineated upon that certain Map entitled “Map of Howard Addition No. 1 to the City of San Mateo, San Mateo County, California,” filed for Record in the Office of the Recorder of the County of San Mateo, State of California, on October 3, 1907 in Book 5 of Maps, at Page 33.

APN: 033-065-130
JPN: 033-006-065-13
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EXHIBIT B

APPROVED DEVELOPMENT BUDGET
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: Community Development Department

NO FEE FOR RECORDING PURSUANT
TO GOVERNMENT CODE SECTION 27383

SPACE ABOVE THIS LINE FOR RECORDER'S USE

SHORT FORM DEED OF TRUST AND ASSIGNMENT OF RENTS
This Deed of Trust, made as of December __, 2024, between, St. James Community Development Corporation, herein called Trustor,
whose address is: 825 Monte Diablo Avenue
SAN MATEO, CA 94401
First American Title Company, a California corporation, herein called Trustee, and the City of San Mateo, a California municipal corporation, herein called Beneficiary,
Witnesseth: That Trustor IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS to TRUSTEE IN TRUST, WITH POWER OF SALE, That property located at 831 Monte Diablo Avenue, California, 94401, described as follows:

SEE EXHIBIT A, incorporated herein by this reference
TOGETHER WITH the rents, issues and profits thereof, SUBJECT, HOWEVER, to the right, power and authority given to and conferred upon Beneficiary by paragraph (10) of the provisions incorporated herein by reference to collect and apply such rents, issues and profits.

For the Purpose of Securing:

1. Performance of each agreement of Trustor incorporated by reference or contained herein. 2. Payment of the indebtedness evidenced by one promissory note of even date herewith, and any extension or renewal thereof, in the principal sum of up to three hundred seventy-seven thousand two hundred and twelve dollars ($377,212) executed by Trustor in favor of Beneficiary or order. 3. Payment of such further sums as the then record owner of said property hereafter may borrow from Beneficiary, when evidenced by another note (or notes) reciting it is so secured. 476 of 563
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To Protect the Security of This Deed of Trust, Trustor Agrees: By the execution and delivery of this Deed of Trust and the note secured hereby, including the provisions set forth in EXHIBIT B of this Deed of Trust, which are incorporated by this reference, and the provisions (1) to (14) inclusive, of the fictitious deed of trust recorded in San Mateo County, in the book and at the page of Official Records in the office of the county recorder of the county where said property is located, noted below opposite the name of the county, viz.:

COUNTY BOOK PAGE
Alameda 435 684
Alpine 1 250
Amador 104 348
Butte 1145 1
Calaveras 145 152
Colusa 296 617
Contra Costa 3978 47
Del Norte 78 414
El Dorado 568 456
Fresno 4626 572
Glenn 422 184
Humboldt 657 527
Imperial 1091 501
Inyo 147 598
Kern 3427 60

COUNTY BOOK PAGE
Kings 792 833
Lake 362 39
Lassen 171 471
Los AngelesT2055 899
Madera 810 170
Marin 1508 339
Mariposa 77 292
Mendocino 579 530
Merced 1547 538
Modoc 184 851
Mono 52 429
Monterey 2194 538
Napa 639 86
Nevada 305 320
Orange 5889 611

COUNTY BOOK PAGE
Placer 895 301
Plumas 151 5
Riverside 3005 523
Sacramento 4331 62
San Benito 271 383
San Bernardino5567 61
San FranciscoA332 905
San Joaquin 2470 311
San Luis Obispo1151 12
San Mateo 4078 420
Santa Barbara1878 860
Santa Clara 5336 341
Santa Cruz 1431 494
Shasta 684 528
San Diego Series2 Book
1961, Page 183887

COUNTY BOOK PAGE
Sierra 29 335
Siskiyou 468 181
Solano 1105 182
Sonoma 1851 689
Stanislaus 1715 456
Sutter 572 297
Tehama 401 289
Trinity 93 366
Tulare 2294 275
Tuolumne 135 47
Ventura 2062 386
Yolo 653 245
Yuba 334 486
(which provisions, identical in all counties, are printed on attached herewith) hereby are adopted and incorporated herein and made a part hereof as fully as though set forth herein at length; that Trustor will observe and perform said provisions; and that the references to property, obligations and parties in said provisions shall be construed to refer to the property, obligations, and parties set forth in this Deed of Trust. 477 of 563
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TRUSTOR:

St. James Community Development Corporation
By: ___________________________
Name: Rev. Dr. Marlyn Bussey
Its: Executive Director and CEO
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I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
_________________________________________
Name: __________________________________
Notary Public
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
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Exhibit A
Property Description
Lot 4, Block 46, as delineated upon that certain Map entitled “Map of Howard Addition No. 1 to the City of San Mateo, San Mateo County, California,” filed for Record in the Office of the Recorder of the County of San Mateo, State of California, on October 3, 1907 in Book 5 of Maps, at Page 33.

APN: 033-065-130
JPN: 033-006-065-13
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TO BE REMOVED PRIOR TO RECORDATION:
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Exhibit B
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PROMISSORY NOTE
(St. James Community Development Corporation)
$377,212 San Mateo, California
December __, 2024
FOR VALUE RECEIVED, ST. JAMES COMMUNITY DEVELOPMENT
CORPORATION, a California Corporation ("Borrower"), promises to pay to the City of San Mateo, a California municipal corporation ("Holder"), the principal sum of Three Hundred Seventy Seven Two Hundred And Twelve Dollars ($377,212) plus interest thereon pursuant to Section 2 below. All capitalized terms used but not defined in this Promissory Note (the "Note") have the meanings set forth in the Loan Agreement (as defined below).

1. Borrower's Obligation. This Note evidences the Borrower's obligation to pay the Holder the principal amount of Three Hundred Seventy Seven Two Hundred And Twelve Dollars ($377,212) loaned to Borrower by Holder pursuant to that certain Loan Agreement between Borrower and Holder of even date herewith (the "Loan Agreement").

2. Interest. Except as otherwise set forth herein, this Note does not bear interest. If a Default occurs, interest on the principal balance will begin to accrue as of the date of Default (following expiration of applicable notice and cure periods) and continuing until such time as the Loan funds are repaid in full or the Default is cured, at which time the accrued interest shall be automatically forgiven at the default rate of the lesser of ten percent (10%), compounded annually, or the highest rate permitted by law.

3. Term and Repayment Requirements. Annual forgiveness and payments due under this Note, if any, are due in accordance with this Note and as set forth in Section 2.7 of the Loan Agreement.

4. No Assumption. This Note is not assumable by the successors and assigns of Borrower without the prior written consent of the Holder, except as may be otherwise set forth in the Loan Agreement.

5. Security. This Note is secured by that certain Short Form Deed of Trust and Assignment of Rents (the "Deed of Trust") wherein the Borrower is the trustor and the Holder is the beneficiary.

6. Terms of Payment.
(i) Borrower shall make all payments due under this Note in currency of the United States of America to Holder at the City of San Mateo, 330 W. 20th Avenue, San Mateo, CA 94403, Attn: Community Development Department, or such other place as Holder may from time to time designate.
(a) All payments on this Note are without expense to Holder. Borrower shall pay all costs and expenses, including reconveyance fees and reasonable attorney's fees of Holder, 483 of 563
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(ii)incurred in connection with the payment of this Note and the release of any security hereof. (b) Notwithstanding any other provision of this Note, or any instrument securing the obligations of Borrower under this Note, if, for any reason whatsoever, the payment of any sums by Borrower pursuant to the terms of this Note would result in the payment of interest that exceeds the amount that Holder may legally charge under the laws of the State of California, then the amount by which payments exceed the lawful interest rate will automatically be deducted from the principal balance owing on this Note, so that in no event is Borrower obligated under the terms of this Note to pay any interest that would exceed the lawful rate. (c) The obligations of Borrower under this Note are absolute and Borrower waives any and all rights to offset, deduct or withhold any payments or charges due under this Note for any reason whatsoever.
(d) Upon recordation of the Deed of Trust, this Note will be nonrecourse to the Borrower, pursuant to and except as provided in Section 2.8 of the Loan Agreement.

7. Default.
(a) The entire unpaid principal balance, together with all interest thereon, and together with all other sums payable under this Note, shall at the option of the Holder become immediately due and payable without further demand, upon occurrence of:
(i) Any failure of Borrower to pay, in full, any payment required under this Note within five (5) days after receipt of written notice that such payment is due; (ii) Any failure in the performance by the Borrower of any other term, condition, provision or covenant set forth in this Note subject to the notice and cure period set forth in the Loan Agreement;
(iii) The occurrence of any Default under any of the Loan Documents, or other instrument securing the obligations of the Borrower under this Note or under any other promissory notes hereafter issued by the Borrower to the Holder pursuant to the Loan Agreement or the Deed of Trust, subject to notice and cure periods, if any, set forth therein. (b) The Holder's failure to exercise the remedy set forth in Subsection 7(a) above or any other remedy provided by law upon the occurrence of a default will not constitute a waiver of the right to exercise any remedy at any subsequent time in respect to the same or any other default. The acceptance by Holder hereof of any payment which is less than the total of all amounts due and payable at the time of such payment will not constitute a waiver of the right to exercise any of the foregoing remedies or options at that time or at any subsequent time, or nullify any prior exercise of any such remedy or option, without the express consent of the Holder, except as and to the extent otherwise provided by law. 484 of 563
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Waivers.
(a) Borrower hereby waives diligence, presentment, protest and demand, and notice of protest, notice of demand, notice of dishonor and notice of non-payment of this Note.

Borrower expressly agrees that this Note or any payment hereunder may be extended from time to time, and that Holder may accept further security or release any security for this Note, all without in any way affecting the liability of Borrower. (b) Any extension of time for payment of this Note or any installment hereof made by agreement of Holder with any person now or hereafter liable for payment of this Note must not operate to release, discharge, modify, change or affect the original liability of Borrower under this Note, either in whole or in part.

8. Miscellaneous Provisions.
(a) All notices to Holder or Borrower are to be given in the manner and at the addresses set forth in the Loan Agreement, or to such addresses as Holder and Borrower may therein designate.
(b) Borrower promises to pay all costs and expenses, including reasonable attorney's fees, incurred by Holder in the enforcement of the provisions of this Note, regardless of whether suit is filed to seek enforcement.
(c) This Note may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification or discharge is sought.
(d) This Note is governed by the laws of the State of California. (e) The times for the performance of any obligations hereunder are to be strictly construed, time being of the essence.
(f) The Loan Documents, of which this Note is a part, contain the entire agreement between the parties as to the Loan. This Note may not be modified except upon the written consent of the parties.

Remainder of Page Left Intentionally Blank
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IN WITNESS WHEREOF, this Promissory Note is executed by Borrower and is effective as of the date first written above.

BORROWER:

ST. JAMES COMMUNITY DEVELOPMENT

CORPORATION,
a California Corporation________________
By: _______________________
Name: Rev. Dr. Marlyn Bussey
Its: Executive Director and CEO ______
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City of San Mateo
330 W. 20th Avenue
San Mateo, CA 94403
Attention: Community Development Department

NO FEE FOR RECORDING PURSUANT
TO GOVERNMENT CODE SECTION 27383

AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
(New Beginnings Supportive Housing Project)
This Agreement Containing Covenants Affecting Real Property (this "Agreement") is made and entered into as of December __, 2024 (the "Effective Date"), by and between the City of San Mateo, a California municipal corporation (the "City"), and ST. JAMES COMMUNITY DEVELOPMENT CORPORATION, a California corporation (the “Owner”), with reference to the following facts, purposes, and understandings.

RECITALS
A. The Owner owns certain real property located at 831 Monte Diablo Avenue in the City of San Mateo San Mateo, CA 94401 in the City of San Mateo, County of San Mateo, State of California, as more particularly described in Exhibit A (the "Property").

B. The Owner will construct five (5) units of supportive housing on the Property, as more particularly described in Exhibit A (the “Development”).

C. The Owner and the City are parties to that certain Loan Agreement dated as of December ___, 2024 (the "Loan Agreement"). Pursuant to the Loan Agreement, the City has made a loan to the Owner in the amount of Three Hundred Seventy-Seven Thousand Two Hundred and Twelve Dollars ($377,212) (the "Loan") for the Development.

D. In addition to this Agreement, the Loan is evidenced by certain loan documents, as more particularly set forth in the Loan Agreement (collectively, the "Loan Documents"), including, but not limited to a deed of trust executed by the Owner, as trustor, in favor of the City, as beneficiary, recorded against the Property (the "Deed of Trust") in the official records of the County of San Mateo (the "Official Records"). The City and the Owner desire to enter into this Agreement to set forth their mutual understandings regarding the use of a portion of the Property for the Development.
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THEREFORE, for good and valuable consideration, the receipt of which is hereby acknowledged, the City and the Owner (each a "Party", and, collectively, the "Parties") hereby agree as follows.

Section 1. Use Restriction. The Development shall be used as a supportive housing project for transition-age foster youth whose income does not exceed thirty percent (30%) of area median income for the County of San Mateo, in accordance with the Loan Documents (the "Permitted Use"). No other use of the Improvements that is inconsistent with the Permitted Use is permitted by this Agreement. The Owner acknowledges that the City made the Loan pursuant to the Loan Documents, in consideration for, and in reliance on, the Owner's obligation to restrict the Development for the Permitted Use, in accordance with this Agreement, and that the City would not have agreed to make the Loan without the Owner's execution of, and obligation to comply with, this Agreement.

Section 2. Term of Agreement. The term of this Agreement shall commence as of the Effective Date and shall expire on the day that is fifty-five (55) years from the Effective Date (the "Term"). This Agreement shall automatically terminate (without further action of the Parties) upon the expiration of the Term, as evidenced by the reconveyance of the Deed of Trust; provided, however, upon the written request of the Owner, following the expiration of the Term, the City shall promptly execute a release, termination or similar document necessary to cause the release of this Agreement as encumbrance from the Property. The Owner shall be solely liable and responsible for all costs and expenses related to the removal of this Agreement as an encumbrance against the Property following the expiration of the Term. Any damage to, or destruction of, the Development shall have no impact on the Term. The Permitted Use shall terminate upon expiration of the Term or in the event of default, after the tenant default and lender cure period described below.

Section 3. Violations by Owner. The use of the Development for any use other than the Permitted Use, in accordance with the requirements of this Agreement, shall be a violation of this Agreement. The failure of the Owner to cure any default in the Owner’s obligations under the terms of this Agreement within thirty (30) days after the delivery of a written notice of default from the City, or such longer period of time up to an additional sixty (60) days as may be necessary to remedy such default, provided that the Owner has commenced action during the thirty (30) days necessary to remedy such default, and the Owner is proceeding with reasonable diligence to remedy such default, will constitute a default under this Agreement.

Section 4. Remedies.
(a) Subject to the applicable notice and cure period set forth above, the City may exercise any and all remedies available to it under the Loan Documents, or otherwise available at law or equity, with respect to the Owner's failure to satisfy the terms of this Agreement. Owner acknowledges that any breach in performance of Owner’s obligations under this Agreement would frustrate the public policy objectives desired by the City pursuant to the Loan Documents, and shall cause irreparable harm to the City. Therefore, Owner agrees that the City is entitled to equitable relief in the form of specific performance, and that an award of damages may not be adequate to compensate the City for Owner’s failure to perform according 488 of 563
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to the terms of this Agreement. The City, in its sole and absolute discretion, may elect the appropriate remedy for Owner’s default under this Agreement. The City, in its sole and absolute discretion, may elect the appropriate remedy for Owner’s default under this Agreement. (b) The City may exercise any and all remedies available to it at law or equity with respect to Owner’s failure to have the Development used for the Permitted Use for the Term of this Agreement.

Section 5. Covenants to Run With the Land. The Parties hereby declare their express intent that the covenants and restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title to the Property, provided, however, that on the expiration of the Term said covenants and restrictions shall expire. Throughout the Term, each and every contract, deed or other instrument hereafter executed covering or conveying the Property or any portion thereof shall be held conclusively to have been executed, delivered and accepted subject to such covenants and restrictions, regardless of whether such covenants or restrictions are set forth in such contract, deed or other instrument, unless the City expressly releases such conveyed portion of the Property from the requirements of this Agreement. All of the provisions of this Agreement shall be enforceable as equitable servitudes and shall constitute covenants running with the land pursuant to applicable laws, including without limitation Section 1468 of the California Civil Code. Each covenant to do, or to refrain from doing, some act on the Property hereunder: (a) is for the benefit of the Property and is a burden on the Property, (b) runs with the Property, and (c) is binding upon each Party and each successive Owner during its operation of the Development at the Property or any portion thereof, and shall be a benefit to and a burden upon each Party and the Property hereunder and each other person or entity succeeding in an interest to the Property.

Section 6. Recording and Filing. The Parties shall cause this Agreement, and all amendments and supplements to it (if any), to be recorded against the Property in the Official Records.

Section 7. Amendments, Modifications, and Waivers. This Agreement may not be amended, modified or changed, nor shall any waiver of any provision hereof be effective, except by an instrument in writing and signed by the Parties.

Section 8. Waiver. In accordance with Section 7 above, the City may (but shall not be obligated to) waive any obligation imposed on the Owner pursuant to this Agreement; provided, however, the City's waiver of any term, covenant, or condition shall not be deemed to be a waiver of such term, covenant or condition of any subsequent breach of the same or any other term, covenant or condition. The City's failure to exercise any right, option or privilege hereunder shall not be deemed a waiver of such right, option or privilege nor shall it relieve the Owner from: (1) its obligation to perform each and every covenant and condition on its part to be performed, or (2) from any damages or other remedy for failure to perform the obligations of this Agreement.

Section 9. Entire Understanding of the Parties. This Agreement constitutes the entire understanding and agreement of the Parties with respect to the use of the Improvements on the Property. In the event of any conflict between the terms of this Agreement and the Loan 489 of 563
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Documents, the terms of this Agreement shall prevail. The Parties and their counsel have read and reviewed this Agreement and agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party (including, but not limited to Civil Code Section 1654, as may be amended from time to time) shall not apply to the interpretation of this Agreement.

Section 10. Severability. If any term, provision, covenant or condition of this Agreement is held in a final disposition by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall continue in full force and effect.

Section 11. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without reference to conflict of laws principles. In the event that suit shall be brought by either Party to this Agreement, the Parties agree that venue shall be exclusively vested in the state courts of the County of San Mateo, and the Parties consent to the personal and exclusive jurisdiction and venue of such court.

Section 12. Time. In all matters under this Agreement, the Parties agree that time is of the essence. References in this Agreement to days shall be to calendar days, unless otherwise indicated. If the last day of any period to give or reply to a notice, meet a deadline or undertake any other action occurs on a day that is not a day of the week on which the City of San Mateo is open to the public for carrying on substantially all business functions (a "Business Day"), then the last day for giving or replying to such notice, meeting such deadline or undertaking any such other action shall be the next succeeding Business Day. In no event shall a Saturday or Sunday be considered a Business Day.

San Mateo City CouncilDecember 9, 2024

San Mateo City Council
December 9, 2024