Agenda packet, regular meeting — San Rafael City Council, March 7, 2022 (part 1 of 2)

AGENDA
SAN RAFAEL CITY COUNCIL – MONDAY, MARCH 7, 2022
REGULAR MEETING AT 7:00 P.M.

Watch on Webinar: https://tinyurl.com/cc-2022-03-07
Watch on YouTube: www.youtube.com/cityofsanrafael
Listen by phone: (669) 900-9128
ID: 817-3692-0337#
One Tap Mobile: US: +16699009128,,81736920337#
CORONAVIRUS (COVID-19) ADVISORY NOTICE
In response to Assembly Bill 361, the City of San Rafael is offering teleconference without complying with the procedural requirements of Government Code section 54953(b)(3). This meeting will be held virtually using Zoom and is being streamed to YouTube at www.youtube.com/cityofsanrafael.

How to participate in the meeting:
• Submit public comment in writing before 4:00 p.m. the day of the meeting to [email protected].
• Join the Zoom webinar and use the 'raise hand' feature to provide verbal public comment. • Dial-in to Zoom's telephone number using the meeting ID and provide verbal public comment.

Any member of the public who needs accommodations should contact the City Clerk (email [email protected] or phone at 415-485-3066) who will use their best efforts to provide reasonable accommodations to provide as much accessibility as possible while also maintaining public safety in accordance with the City procedure for resolving reasonable accommodation requests.

OPEN SESSION

1. None.

CLOSED SESSION

2. Closed Session: - None.

OPEN TIME FOR PUBLIC EXPRESSION
The public is welcome to address the City Council at this time on matters not on the agenda that are within its jurisdiction. Please be advised that pursuant to Government Code Section 54954.2, the City Council is not permitted to discuss or take action on any matter not on the agenda unless it determines that an emergency exists, or that there is a need to take immediate action which arose following posting of the agenda. Comments may be no longer than two minutes and should be respectful to the community.

CITY MANAGER’S REPORT:

3. City Manager’s Report:

COUNCILMEMBER REPORTS:
(including AB 1234 Reports on Meetings and Conferences Attended at City Expense)

4. Councilmember Reports:

CONSENT CALENDAR:

The opportunity for public comment on consent calendar items will occur prior to the City Council’s 2 vote on the Consent Calendar. The City Council may approve the entire consent calendar with one action. In the alternative, items on the Consent Calendar may be removed by any City Council or staff member, for separate discussion and vote.

5. Consent Calendar Items:
a. Approval of Minutes
Approve Minutes of City Council / Successor Agency Regular Meeting of Tuesday, February 22, 2022 (CC)
Recommended Action – Approve minutes as submitted
b. Use of Teleconferencing for Public Meetings During State of Emergency Resolution Pursuant to Assembly Bill 361 Making Findings and Confirming the Need for Continued Use of Teleconferencing to Hold Public Meetings of the San Rafael City Council and City Boards and Commissions During the Continuing State of Emergency Relating to the COVID-19 Pandemic (CA)
Recommended Action – Adopt Resolution
c. Amendment to the San Rafael Municipal Code Regarding Recycling of Organic Waste to Comply with Senate Bill 1383
Final Adoption of Ordinance 2004: An Ordinance Amending the San Rafael Municipal Code to Repeal Chapter 9.19 – Refuse and Recycled Materials Collection and Disposal and Replace It with New Chapter 9.19 – Solid Waste Collection and Disposal and Edible Food Recovery (CM)
Recommended Action – Approve final adoption of Ordinance 2004 d. Audit Services
Resolution Approving and Authorizing the City Manager to Execute an Agreement with Maze and Associates to Provide Auditing Services for the Fiscal Years Ending June 30, 2022 Through June 30, 2025, with Options for the Fiscal Years Ending June 30, 2026 and June 30, 2027 (Fin)
Recommended Action – Adopt Resolution
e. Canal Neighborhood Pedestrian Improvements Project
Accept Completion of the Canal Neighborhood Pedestrian Improvements Project (City Project No. 11381), and Authorize the City Clerk to File the Notice of Completion (PW) Recommended Action – Accept Completion and authorize City Clerk to file Notice of Completion f. 999 Third Street – Eden Housing/Vivalon Healthy Aging Center Approve Staff Recommendation for Terms of a Below Market Rate (“BMR”) Agreement Imposing Affordability Restrictions on the Property Located at 999 Third Street Being Developed as the Vivalon Healthy Aging Center (CD)
Recommended Action – Accept Report approving Staff’s recommendation SPECIAL PRESENTATIONS:

6. Special Presentations:
a. Presentation of Proclamation Supporting Women’s History Month (CC) b. Presentation of Proclamation Recognizing Stephen Mizroch, Retiring from Fire Commission (FD)
3 OTHER AGENDA ITEMS:

7. Other Agenda Items:
a. 2021 Affordable Housing NOFA Funding Recommendation
Resolution Authorizing the Expenditure of Funds in Fulfillment of the Affordable Housing Trust Fund 2021 Notice of Funding Availability (NOFA), And Supporting the Award of Funding from the County of Marin for Permanent Local Housing Allocation (PHLA) Funding to Projects Receiving City Funding (CD)
Recommended Action – Adopt Resolution
b. Cannabis Program – State Regulatory Updates
Resolution Amending the “Cannabis Business Operator License Program” (CBOL), and Restating It in Its Entirety (ED)
Recommended Action – Adopt Resolution
c. Interim Financial Update and Budget Amendments to Reflect Operational Activity; MidYear Personnel Changes i. Fiscal Year 2021-2022 Interim Financial Update
ii. Resolution Adopting Amendments to the 2021-2022 Budget and Approving Mid-Year Personnel Changes (Fin)
Recommended Action – Adopt Resolution
SAN RAFAEL SUCCESSOR AGENCY:

1. Consent Calendar: - None
ADJOURNMENT:

Any records relating to an agenda item, received by a majority or more of the Council less than 72 hours before the meeting, shall be available for inspection online. Sign Language interpreters may be requested by calling (415) 485-3066 (voice), emailing [email protected] or using the California Telecommunications Relay Service by dialing “711”, at least 72 hours in advance of the meeting. Copies of documents are available in accessible formats upon request.

Minutes subject to approval at the meeting of March 7, 2022

MINUTES
SAN RAFAEL CITY COUNCIL – TUESDAY, FEBRUARY 22, 2022
REGULAR MEETING AT 7:00 P.M.

Watch on Webinar: https://tinyurl.com/cc-2022-02-22
Watch on YouTube: www.youtube.com/cityofsanrafael
Listen by phone: (669) 900-9128
ID: 899-2635-9885#
One Tap Mobile: US: +16699009128,,89926359885#
CORONAVIRUS (COVID-19) ADVISORY NOTICE
In response to Assembly Bill 361, the City of San Rafael is offering teleconference without complying with the procedural requirements of Government Code section 54953(b)(3). This meeting will be held virtually using Zoom and is being streamed to YouTube at www.youtube.com/cityofsanrafael.

Present: Mayor Kate
Vice Mayor Kertz
Councilmember Bushey
Councilmember Hill
Councilmember Llorens Gulati

Absent: None
Also Present: City Manager Jim Schutz
City Attorney Robert Epstein
City Clerk Lindsay Lara

OPEN SESSION

1. None.

CLOSED SESSION

2. Closed Session: - None.

Mayor Kate called the meeting to order at 7:01 p.m. and invited City Clerk Lindsay Lara to call the roll. All members of the City Council were present.

Mayor Kate provided opening remarks, which included a land acknowledgment, gratitude to City staff and an update on in-person meetings.

City Clerk Lindsay Lara announced the process for Spanish interpretation tonight. She informed the community that the meeting would be streamed live to YouTube and through Zoom and 2 members of the public would provide public comment either on the telephone or through Zoom.

She explained the process for community participation on the telephone or through Zoom.

OPEN TIME FOR PUBLIC EXPRESSION
• Yavar Amidi and Erick Bejarano, Alcohol Justice, addressed the City Council regarding a current youth program campaign.
• Eva Chrysanthe, addressed the City Council regarding services at the Service Support Area.

CITY MANAGER’S REPORT:

3. City Manager’s Report:

City Manager Jim Schutz announced:
• Downtown Transit Center Update
• Photo exposition about lighting in the Canal to be held on February 26, 1-4 p.m.

Mayor Kate invited public comment; however, there was none.

COUNCILMEMBER REPORTS:
(including AB 1234 Reports on Meetings and Conferences Attended at City Expense)

4. Councilmember Reports:
• Councilmember Kertz reported on Chamber of Commerce Government Advisory Committee, Age-Friendly Committee, Point-in-Time Count, Marin Wildfire Prevention Authority (MWPA), and Community Conversation District 4 meetings, as well as, the Oakmont ribbon cutting.
• Councilmember Bushey reported on Central Marin Sanitation Agency, San Rafael Sanitation District, MCCMC Water Committee, Marin Municipal Water District and Community Conversation District 3 meetings.
• Councilmember Hill reported on MCCMC Water Committee, Marin Municipal Water District and Community Conversation District 2 meetings. • Councilmember Llorens Gulati reported on Canal Policy Working Group, Voces del Canal, Economic Development Subcommittee, Catalina speed calming, Marin Clean Energy (MCE) and MCCMC Economic Recovery meetings.
• Mayor Kate reported on MCCMC Economic Recovery, San Rafael Sanitation District, Canal Policy Working Group, SMART and Department of Energy meetings, as well as, a Mayor Kate walkabout.

Mayor Kate invited public comment.

Speakers: Eva Chrysanthe, Lori Schifrin
CONSENT CALENDAR:

Mayor Kate invited public comment; however, there was none.

Councilmember Llorens Gulati moved and Councilmember Hill seconded to approve the Consent Calendar.

5. Consent Calendar Items:
a. Approval of Minutes
3 Approve Minutes of City Council / Successor Agency Regular Meeting of Monday, February 7, 2022 (CC)
Approved minutes as submitted
b. Use of Teleconferencing for Public Meetings During State of Emergency Resolution Pursuant to Assembly Bill 361 Making Findings and Confirming the Need for Continued Use of Teleconferencing to Hold Public Meetings of the San Rafael City Council and City Boards and Commissions During the Continuing State of Emergency Relating to the COVID-19 Pandemic (CA)
Resolution 15036 - Resolution Pursuant to Assembly Bill 361 Making Findings and Confirming the Need for Continued Use of Teleconferencing to Hold Public Meetings of the San Rafael City Council and City Boards and Commissions During the Continuing State of Emergency Relating to the COVID-19 Pandemic
c. Amend City Council Appointments to Committees
Approve the Appointment of Mayor Kate Colin and Councilmember Maribeth Bushey to Serve on the Marin County Council of Mayors and Councilmembers City/County Services Subcommittee for 2022 (CC)
Approved Appointment
d. The Neighborhood at Los Gamos Ordinance
Ordinance No. 2003: An Ordinance of the City of San Rafael Approving a Zone Change (ZC 20-002) from Planned District - Hillside Development Overlay District (PD-H) and Residential – Hillside Development Overlay District (R2A-H) to Planned Development District (PD) (CD)
Approved Final Adoption of Ordinance No. 2003
e. Annual Audit of Federal Grant Expenditures
Single Audit Report for the Year Ended June 30, 2021 (Fin) Accepted report
f. SB 1383 Local Assistance Grant
Resolution Authorizing Submittal of Applications for All CalRecycle Grant and Payment Programs and Related Authorizations for Which the City of San Rafael is Eligible (CM) Resolution 15037 - Resolution Authorizing Submittal of Applications for All CalRecycle Grant and Payment Programs and Related Authorizations for Which the City of San Rafael is Eligible g. Annual Measure G Oversight Committee Report
Measure G Cannabis Business Tax Oversight Committee Report for Fiscal Year 2020-2021 (ED)
Accepted report
h. Land and Water Conservation Fund Application for Pickleweed Park Enhancement Project Resolution Approving the Application for Land and Water Conservation Fund for the Pickleweed Park Enhancement Project (LR)
Resolution 15038 - Resolution Approving the Application for Land and Water Conservation Fund for the Pickleweed Park Enhancement Project
AYES: Councilmembers: Bushey, Hill, Kertz, Llorens Gulati & Mayor Kate NOES: Councilmembers: None
ABSENT: Councilmembers: None
4 PUBLIC HEARINGS AT 7:30 PM:

6. Public Hearings:
a. 2021-2022 City Council Redistricting Process
Third Public Hearing on Existing Council District Lines and Possible Changes (CA) Lisa Goldfien, Assistant City Attorney introduced Chris Skinnell, Legal Counsel from Nielsen Merksamer. He and Kristen Parks, National Demographics Corporation presented the Staff Report.

Staff responded to questions from Councilmembers.

Mayor Kate invited public comment.

Speaker: Eva Chrysanthe
Staff responded to public comment.

Councilmembers provided comments.

Councilmember Kertz moved and Councilmember Llorens Gulati seconded to accept the report.

AYES: Councilmembers: Bushey, Hill, Kertz, Llorens Gulati & Mayor Kate NOES: Councilmembers: None
ABSENT: Councilmembers: None
Accepted report
b. Amendment to the San Rafael Municipal Code Regarding Recycling of Organic Waste to Comply with Senate Bill 1383
Consideration of an Ordinance Amending the San Rafael Municipal Code to Repeal Chapter

9.19 – Refuse and Recycled Materials Collection and Disposal and Replace It with New Chapter 9.19 – Solid Waste Collection and Disposal and Edible Food Recovery (CM) Coty Bytof, Sustainability Program Manager, Rose Radford, R3 and Elinor Nichols, Sustainability Fellow presented the Staff Report.

Staff recommended the following changes to the Ordinance:

Conduct Public Hearing and Pass to Print with the Following Additions (underlined) as Amendments:

9.19.110 Collection containers.

B. Except as otherwise provided by the city’s franchise agreement with the authorized collector, each dwelling unit shall be required to have a minimum garbage service of one (1) thirty-two (32) gallon cart for garbage collection; one (1) thirty-two (32) gallon cart for recyclable materials collection; and one (1) thirty-two (32) gallon cart for organic materials collection. Except in the case of multifamily dwellings of more than four (4) dwelling units, no two (2) or more dwelling units shall share communal waste collection services or approved collection containers except with the permission of the authorized collector. 5 Staff, including Marin Sanitary Service staff, responded to questions from Councilmembers.

Mayor Kate invited public comment.

Speakers: Andy Naja-Riese, Agricultural Institute of Marin, Bill Carney, Sustainable San Rafael, Belle Cole, Organizing for Action Marin/Marin Biomass Project, Arlin Benavidas, Sustainable San Rafael, Annika Osborn, Sustainable San Rafael, Eva Chrysanthe, Larry Minikes
Staff responded to public comment.

Councilmembers provided comments.

Councilmember Llorens Gulati moved and Councilmember Kertz seconded to pass Ordinance No. 2004 to print, with the edits as presented by staff.

Passed to print Ordinance No. 2004 Amending the San Rafael Municipal Code to Repeal Chapter

9.19 – Refuse and Recycled Materials Collection and Disposal and Replace It with New Chapter

9.19 – Solid Waste Collection and Disposal and Edible Food Recovery SAN RAFAEL SUCCESSOR AGENCY:

1. Consent Calendar: - None
ADJOURNMENT:

Mayor Kate adjourned the meeting at 9:48 p.m.
___________________________
LINDSAY LARA, City Clerk
APPROVED THIS _____DAY OF____________, 2022
_____________________________________
KATE COLIN, Mayor
____________________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 5.b
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: City Attorney
Prepared by: Lisa Goldfien,
Assistant City Attorney
City Manager Approval: ______________
TOPIC: USE OF TELECONFERENCING FOR PUBLIC MEETINGS DURING STATE OF

EMERGENCY
SUBJECT: RESOLUTION PURSUANT TO ASSEMBLY BILL 361 MAKING FINDINGS AND

CONFIRMING THE NEED FOR CONTINUED USE OF TELECONFERENCING TO

HOLD PUBLIC MEETINGS OF THE SAN RAFAEL CITY COUNCIL AND CITY BOARDS

AND COMMISSIONS DURING THE CONTINUING STATE OF EMERGENCY RELATING TO THE COVID-19 PANDEMIC
RECOMMENDATION:

Adopt the resolution pursuant to Assembly Bill 361 making findings and confirming the need for continued use of teleconferencing to hold public meetings of the San Rafael City Council and City boards and commissions during the continuing state of emergency relating to the COVID-19 pandemic BACKGROUND:

The Ralph M. Brown Act (“Brown Act”) requires that except as specifically provided, “meetings of the legislative body of a local agency shall be open and public, and all persons shall be permitted to attend any meeting of the legislative body”. (Gov. Code §54953(a).) For many years, the Brown Act has authorized members of a local agency’s legislative body to attend a public meeting by teleconference in compliance with strict procedural requirements. Under Government Code section 54953(b)(3), to use teleconferencing, at least a quorum of the legislative body must participate from locations within agency’s boundaries, and the agency must give notice of each teleconference location, post an agenda at each teleconference location, provide for public access to each teleconference location, and allow members of the public to address the Council at each teleconference location.

On March 4, 2020, Governor Newsom declared a statewide state of emergency in connection with the COVID-19 pandemic. Subsequently, on March 18, 2020, the Governor issued Executive Order No. N29-20 suspending the Brown Act’s requirements for in-person meetings and facilitating the use of teleconferencing for public meetings during the state of emergency. The Executive Order authorized public meetings to be held by teleconference only, provided that notice and accessibility requirements are met, members of the public are allowed to observe and address the legislative body at the meeting, and there is a procedure for receiving and swiftly resolving requests for reasonable accommodation for individuals with disabilities. This order has allowed the City Council and the City’s other formal boards SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
and commissions to hold their public meetings using teleconferencing technologies, with the requisite notice and public participation; however, the order was due to expire on September 30, 2021, and without legislative action, in-person meetings and the strict teleconferencing procedures of the Brown Act would again be required.

Because the statewide state of emergency continues and the COVID-19 pandemic still poses a health risk for public meetings, on September 16, 2021, Governor Newsom signed into law as an urgency measure Assembly Bill (AB) 361. AB 361 amends the Brown Act provisions governing the use of teleconferencing for public meetings of a local agency’s legislative bodies, allowing more liberal teleconferencing requirements to continue during the current and future state-declared emergencies.

ANALYSIS:

Executive Order N-29-20 has now expired, but AB 361 is now in effect, and its amendments to the Brown Act will allow the City to continue to hold its meetings using teleconferencing technology after September

30. Government Code section 54953, as amended by AB 361, now provides in new subsection (e)(1), that during the current and any future state-declared state of emergency, the legislative body of a local agency may use teleconferencing without complying with the procedural requirements of Government Code section 54953(b)(3) in any of three circumstances:
(A) The legislative body holds a meeting during a proclaimed state of emergency, and state or local officials have imposed or recommended measures to promote social distancing. (B) The legislative body holds a meeting during a proclaimed state of emergency for the purpose of determining, by majority vote, whether as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees. (C) The legislative body holds a meeting during a proclaimed state of emergency and has determined, by majority vote, pursuant to subparagraph (B), that, as a result of the emergency, meeting in person would present imminent risks to the health or safety of attendees.

Certain additional requirements would apply under the new law, however, including specific requirements as to how public comment must be allowed and heard, with which the City already complies. In addition:
• In the event of a disruption which prevents the City from broadcasting the meeting to members of the public using the call-in option or internet-based service option, or in the event of a disruption within the City’s control which prevents members of the public from offering public comments using the call-in option or internet-based service option, the legislative body shall take no further action on items appearing on the meeting agenda until public access to the meeting via the callin option or internet-based service option is restored. Actions taken on agenda items during a disruption which prevents the public agency from broadcasting the meeting may be challenged pursuant to Section 54960.1.
• If a state of emergency remains active, or state or local officials have imposed or recommended measures to promote social distancing, in order to continue to teleconference without compliance with paragraph (3) of subdivision (b), the legislative body shall, not later than 30 days after teleconferencing for the first time pursuant to subparagraph (A), (B), or (C) of paragraph (1), and every 30 days thereafter, make the following findings by majority vote:
o The legislative body has reconsidered the circumstances of the state of emergency. o Any of the following circumstances exist:

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
 (i) The state of emergency continues to directly impact the ability of the members to meet safely in person.
 (ii) State or local officials continue to impose or recommend measures to promote social distancing.

The resolution before the City Council is intended to comply with the requirement to make specified findings every 30 days. The resolution finds that the state of emergency continues in effect, that measures to promote social distancing are still being imposed or recommended by the state and county, and that the state of emergency directly impacts the ability of the public and the members of the City’s Council, boards, and commissions to meet safely in person. The proposed resolution confirms the City Council’s determination that all public meetings of the City’s legislative bodies (the Council and all formal boards and commissions) should continue to be held using only teleconferencing technology.

Staff plans to agendize the same type of resolution at each regular City Council meeting during the pendency of the statewide state of emergency, so that the Council may continue to reconsider these findings at least every 30 days.

The Brown Act amendments adopted by AB 361 will be operative until January 1, 2024, and will then expire unless extended by new legislation.

FISCAL IMPACT:

There is no fiscal impact associated with the adoption of the attached resolution.

OPTIONS:

The City Council has the following options to consider on this matter:

1. Adopt the resolution as proposed.

2. Adopt a modified resolution.

3. Direct staff to return with more information.

4. Take no action.

RECOMMENDED ACTION:

ATTACHMENTS:

1. Resolution
1 RESOLUTION NO.

RESOLUTION OF THE SAN RAFAEL CITY COUNCIL PURSUANT TO ASSEMBLY BILL 361

MAKING FINDINGS AND CONFIRMING THE NEED FOR CONTINUED USE OF

TELECONFERENCING TO HOLD PUBLIC MEETINGS OF THE SAN RAFAEL CITY COUNCIL

AND CITY BOARDS AND COMMISSIONS DURING THE CONTINUING STATE OF EMERGENCY RELATING TO THE COVID-19 PANDEMIC
WHEREAS, on March 4, 2020 Governor Newsom issued a proclamation pursuant to Government Code Section 8625 declaring a state of emergency in California due to the COVID19 pandemic; and WHEREAS, the Ralph M. Brown Act (Gov. Code §§ 54950 et seq.) (hereafter, the “Brown Act”) provides in Government Code section 54953 that “all meetings of the legislative body of a local agency shall be open and public, and all persons shall be permitted to attend any meeting of the legislative body of a local agency, except as otherwise provided by this chapter”; and WHEREAS, Government Code section 54953(b)(3) permits the legislative body of a local agency to use teleconferencing for the benefit of the public and the legislative body in connection with any meeting or proceeding authorized by law, subject to specified procedural requirements including, but not limited to, the posting of agendas at all teleconference locations, the opportunity for members of the public to address the legislative body directly at each teleconference location, and that at least a quorum of the members of the legislative body participate from locations within the boundaries of the territory over which the legislative body exercises jurisdiction; and WHEREAS, Government Code section 54953(e), added by Assembly Bill 361 effective September 16, 2021, provides, in section 54953(e)(1), that during a state of emergency proclaimed pursuant to Government Code section 8625, the legislative body of a local agency may hold a meeting using teleconferencing without complying with the procedural requirements of section 54953(b)(3), provided that the legislative body complies with the requirements of section 54953(e)(2); and
WHEREAS, pursuant to Government Code section 54953(e)(3), if a state of emergency remains active, or state or local officials have imposed or recommended measures to promote social distancing, then in order to continue to teleconference without compliance with the requirements of section 54953(b)(3), the legislative body shall make specified findings at least every 30 days; and
WHEREAS, the City Council has reconsidered the circumstances of the proclaimed COVID-19-related state of emergency and finds that it remains active; and WHEREAS, the City Council finds that state and/or local officials continue to impose or recommend measures to promote social distancing, including masking in certain indoor public settings; and
WHEREAS, the City Council finds that the state of emergency continues to directly impact the ability of the members of the City Council and other City boards and commissions to meet safely in person;
2 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of San Rafael that in order to protect the safety of the members of the public, the City Council and all City boards and commissions, for the 30 days following adoption of this resolution, public meetings of the City’s legislative bodies shall continue to be held using teleconferencing technology in compliance with the requirements of Government Code section 54953(e)(2) and all other applicable laws.

I, Lindsay Lara, Clerk of the City of San Rafael, hereby certify that the foregoing Resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of the City of San Rafael, held on Monday, the 7th day of March 2022, by the following vote, to wit:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

Lindsay Lara, City Clerk
Agenda Item 5.c

Page 1 of 24 ends

ORDINANCE NO. 2004

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL AMENDING THE SAN RAFAEL MUNICIPAL CODE TO REPEAL CHAPTER 9.19 -

REFUSE AND RECYCLED MATERIALS COLLECTION AND DISPOSAL AND REPLACE IT WITH NEW CHAPTER 9.19 - SOLID WASTE COLLECTION AND

DISPOSAL AND EDIBLE FOOD RECOVERY
WHEREAS, Article XI of the California Constitution and the California Public Resources Code allows cities to regulate refuse and recycling services and to collect a franchise fee from any provider of such services. Marin Sanitary Service (MSS) is our sole provider of refuse hauling and recycling services and performs these services in many surrounding communities as well; and
WHEREAS, in 2014, recognizing the negative impacts of organic materials decomposing in landfills on climate change, the State of California enacted Assembly Bill (AB) 1826 mandating that businesses with certain thresholds of refuse disposal compost their organic materials.

Beginning in 2022 Senate Bill (SB) 1383, enacted in 2017, will require that all residents and businesses divert their organic waste and recover edible food. SB 1383 will also place new requirements on local governments to implement, monitor and enforce participation in organic waste diversion programs, and the California Department of Resources Recycling and Recovery (CalRecycle) will be authorized to levy fines upon local governments that don’t comply; and WHEREAS, Chapter 9.19 of the San Rafael Municipal Code entitled “Refuse and Recycled Materials Collection and Disposal” adopted in 1993, must be updated and amended to comply with SB 1383;

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SAN RAFAEL AS FOLLOWS:

DIVISION 1. AMENDMENT OF SAN RAFAEL MUNICIPAL CODE.

Chapter 9.19 of the San Rafael Municipal Code is hereby repealed in its entirety, and replaced with a new Chapter 9.19 entitled “Solid Waste Collection and Disposal and Edible Food Recovery”, to read in its entirety as follows:

Chapter 9.19 SOLID WASTE COLLECTION AND DISPOSAL AND EDIBLE FOOD

RECOVERY
Article I. Purpose and Definitions

9.19.010 Purpose.

The purpose of this chapter is to prevent actual or potential public health hazards and nuisance within the city of San Rafael, Marin County, state of California, by regulating the accumulation, collection and disposal of solid waste, and to provide for the licensing and responsibilities of persons engaged therein. It is declared to be in the public interest that the

Page 2 of 24 ends

accumulation, storage and disposal of all such materials be handled in such a manner as to prohibit the harboring and breeding of rodents and insects, to reduce pollution of the air caused by burning, fermentation or putrefaction of such materials, to prevent the spread of disease, to reduce the hazards of fire, and to prevent unsightliness resulting in the depreciation of property values and the comfortable enjoyment of life.

9.19.020 Intent.

It is further the intention of the city by this chapter to provide for the source reduction, recycling and resource recovery of solid waste generated within the city to the maximum extent feasible and as required by state law. Therefore, this chapter establishes and includes an approved solid waste collection program for all persons in the city for the purpose of providing for the orderly and regular collection of solid waste.

9.19.030 Definitions.

A. As used in this chapter:

1. “Act” means the California Integrated Waste Management Act of 1989 (commencing with Section 40000 of the Public Resources Code), as amended by, including but not limited to, the Jobs and Recycling Act of 2011 (AB 341), SB 1016 (Chapter 343, Statutes of 2008 [Wiggins, SB 1016]), the Mandatory Commercial Organics Recycling Act of 2014 (AB 1826), and the Short-Lived Climate Pollutants Bill of 2016 (SB 1383), and as implemented by the regulations of the California Department of Resources Recycling and Recovery (“CalRecycle.”).

2. “Authorized collector” means such persons, firms or corporations collecting and delivering for disposal, recycling or processing solid waste (other than solid waste generated by a permitted building project) originating in the city and doing so under a contract or franchise agreement with the city.

3. “Bulky Waste” means large items of solid waste such as appliances (white goods), ewaste (except for universal waste), furniture, tires, carpets, mattresses and similar large items, large auto parts, trees, branches, stumps, and other oversize wastes whose large size precludes or complicates their handling by normal collection, processing, or disposal methods. It does not include abandoned vehicles or household hazardous waste.

4. “CalRecycle approved solid waste facility, operation, activity, or property” means a facility, operation or activity the use of which is deemed to constitute a reduction in landfill disposal in accordance with 14 CCR, Division 7, Chapter 12 for the purposes of this chapter.

5. “CCR” means the California Code of Regulations. CCR references in this Chapter are preceded with a number that refers to the relevant Title of the CCR (e.g., “14 CCR” refers to Title 14 of CCR).

6. “City manager” means the city manager of the city of San Rafael, or their designee, which may include city employees.

7. “Collection” means to take physical possession of solid waste at, and remove from, the place of generation for transport to a solid waste facility or other recovery activity.

8. “Commercial business” or “Commercial” means a firm, partnership, proprietorship, joint-stock company, corporation, or association, whether for-profit or nonprofit, strip

Page 3 of 24 ends

mall, industrial facility, or a multi-family dwelling, or as otherwise defined in 14 (CCR) Section 18982(a)(6). A multi-family dwelling that consists of (5) or more dwelling units is “Commercial”, for the purposes of this Chapter.

9. “Commercial Edible Food Generator” means a Tier One or a Tier Two Commercial Edible Food Generator as defined in 14 CCR Section 18982(a)(73) and (a)(74). Food recovery organizations and food recovery services are not commercial edible food generators.

10. “Community composting” means any activity that composts green material, agricultural material, food material, and vegetative food material, alone or in combination, and the total amount of feedstock and compost on-site at any one time does not exceed 100 cubic yards and 750 square feet, as specified in 14 CCR Section 17855(a)(4); or, as otherwise defined by 14 CCR Section 18982(a)(8).

11. “Composting” means the process of controlled biological decomposition of organic waste.

12. "Construction and demolition debris" or "C&D" means used or discarded materials resulting from construction, renovation, remodeling, repair, demolition, excavation or construction clean-up operations on any pavement or structure.

13. "Container" or "collection container" means, for the purpose of this Chapter, any bin, box or cart used for the purpose of holding solid waste for collection.

14. “Debris box” means any ten (10) to forty (40) cubic yard container, or any compactor provided by a solid waste generator, placed in the public right-of-way, on city property, private property, or elsewhere in the service area, which is procured by a solid waste generator for their use in the collection of their solid waste. Debris boxes are serviced by means of lifting the entire container, including all contents, onto a designated collection vehicle.

15. “Designee” means an entity that the city contracts with or otherwise arranges to carry out any of the city’s responsibilities of this ordinance as authorized in 14 CCR Section 18981.2. A Designee may be a government entity, a hauler, a private entity, or a combination of those entities.

16. “Disposal” means the final disposition of Solid Waste at a solid waste facility permitted for disposal.

17. “Diversion” means activities reducing or eliminating the amount of Solid Waste from Solid Waste Disposal, and which return these materials to use in the form of raw materials for new, reused, or reconstituted products, which meet the quality standards necessary for commercial use, or for other purposes of reuse.

18. “Dwelling unit” means one (1) or more rooms with internal access between all rooms, which provide complete independent living facilities for at least one (1) family, including provisions for living, sleeping, eating, cooking, bathing, and sanitary facilities.

19. “Edible food” means food intended for human consumption, or as otherwise defined in 14 CCR Section 18982(a)(18). For the purposes of this ordinance or as otherwise defined in 14 CCR Section 18982(a)(18), “Edible Food” is not Solid Waste if it is recovered and not discarded. Nothing in this chapter or in 14 CCR, Division 7, Chapter 12 requires or authorizes the Recovery of Edible Food that does not meet the food safety requirements of the California Retail Food Code.

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20. “Enforcement action" means an action of the city to address non- compliance with this ordinance including, but not limited to, issuing administrative notices, citations, fines, penalties, or using other remedies.

21. “Enforcement agency” means an entity with the authority to enforce part or all of this chapter as specified herein. Employees and agents of an enforcement agency may carry out inspections and enforcement activities pursuant to this chapter. Nothing in this chapter authorizing an entity to enforce its terms shall require that entity to undertake such enforcement except as agreed to by that entity and the city. The city is an enforcement agency for all Sections of this chapter. The city may choose to additionally delegate enforcement responsibility for certain sections, to other public entities, including the Marin Hazardous and Solid Waste Joint Powers Authority (Zero Waste Marin) and the County of Marin.

22. “Exempt waste” means biohazardous or biomedical waste, Hazardous Waste, medical waste, regulated radioactive waste, waste that is volatile, corrosive, or infectious, waste treatment or processing sludge, contaminated soil and dirt, contaminated concrete, contaminated asphalt, automobiles, automobile parts, boats, boat parts, boat trailers, internal combustion engines, lead-acid batteries, any matter or materials which are not acceptable for disposal at a solid waste landfill as defined in the California Integrated Waste Management Act of 1989 and subsequent legislation, and those wastes under the control of the Nuclear Regulatory Commission. , all as further defined in subsection 38 of this section.

23. “Food recovery organization” means an entity that engages in the collection or receipt of Edible Food from Commercial Edible Food Generators and distributes that Edible Food to the public for Food Recovery either directly or through other entities or as otherwise defined in 14 CCR Section 18982(a)(25), including, but not limited to:
a. A food bank as defined in Section 113783 of the Health and Safety Code; b. A nonprofit charitable organization as defined in Section 113841 of the Health and Safety code; and,
c. A nonprofit charitable temporary food facility as defined in Section 113842 of the Health and Safety Code.

24. “Food recovery service” means a person or entity that collects and transports Edible Food from a Commercial Edible Food Generator to a Food Recovery Organization or other entities for Food Recovery, or as otherwise defined in 14 CCR Section 18982(a)(26). A Food Recovery Service is not a Commercial Edible Food Generator for the purposes of this chapter and implementation of 14 CCR, Division 7, Chapter 12 pursuant to 14 CCR Section 18982(a)(7).

25. “Food waste” means food scraps and trimmings and other putrescible waste that result from food production, preparation, cooking, storage, consumption or handling.

Food Waste includes but is not limited to meat, fish and dairy waste, fruit and vegetable waste and grain waste. Food Waste does not include Exempt Waste.

26. “Garbage” means all non-recyclable packaging and other waste attributed to normal activities of a premise. Garbage must be generated by and at the service unit wherein the garbage is collected. Garbage does not include recyclable materials, organic materials, debris from construction and demolition, large items, e-waste, universal waste, hazardous waste, household hazardous waste or exempt waste.

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27. “Garbage container” has the same meaning as “Gray Container” in 14 CCR Section 18982(a)(28) and shall be used for the purpose of storage and collection of Garbage.

28. “Generators,” for the purpose of this Chapter, means a person or entity, including commercial generators and residential generators, that is responsible for the initial creation of organic materials, or as otherwise defined as “organic waste generator” in 14 CCR Section 18982(a)(48).

29. "Health officer" means the health officer of the county, acting as health officer for the city.

30. “Inspection” means a site visit where the city, its designee or Enforcement agency, reviews records, containers, and an entity’s collection, handling, recycling, or disposal of solid waste or edible food handling to determine if the entity is complying with requirements set forth in this ordinance, or as otherwise defined in 14 CCR Section 18982(a)(35).

31. "Organics container” has the same meaning as “Green Container” in 14 CCR Section 18982(a)(29) and shall be used for the purpose of storage and collection of source separated organic materials designated for organic materials processing, including food waste and landscape and pruning waste accepted in the city’s organic waste collection program, and other organic materials as determined by the city and authorized collector as acceptable for the organics container. The city and authorized collector shall have the right to promulgate changes to organic material types acceptable for the organics container.

32. “Organic material” or "organic waste" means solid wastes containing material originated from living organisms and their metabolic waste products, including but not limited to food waste, green material, landscape and pruning waste, organic textiles and carpets, lumber, wood, paper products, printing and writing paper, manure, biosolids, digestate, and sludges or as otherwise defined in 14 CCR Section 18982(a)(46).

33. “Organic material processing facility” means any facility selected by the authorized collector that is approved by the city, or specifically designated by the city, operated and legally permitted for the purpose of receiving and processing organic materials.

34. "Person" means any person or persons, firm, association, corporation or other entity acting as principal, agent or officer, servant or employee, for themselves or for any other person, firm or corporation. Person includes employees of the city of San Rafael.

35. "Premises" includes a tract or parcel of land with or without habitable buildings or appurtenant structures. (CCR, Section 17225.50) For purposes of this chapter the word premises includes Residential and Commercial uses of the land, whether owned, leased, rented or sub-let, including every dwelling house, dwelling unit, apartment house or multiple-dwelling building, trailer or mobile home park, store, restaurant, rooming house, hotel, motel, office building, department store, manufacturing, processing or assembling shop or plant, warehouse and every other place or premises where any person resides, or any business is carried on or conducted within the city.

36. “Prohibited container contaminants” means (1) discarded materials placed in the designated Recyclables container that are not identified as acceptable source separated recyclables for the city’s designated recyclables collection container; (2)

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discarded materials placed in the designated organic materials collection container that are not identified as acceptable source separated organic materials for the city’s designated organic materials collection container; and (3) discarded materials placed in the garbage container that are acceptable source separated recyclables and/or source separated organic materials to be placed in city’s designated organic materials collection container and/or designated recyclables collection container, and (4) Exempt Waste placed in any container.

37. "Recyclable (source separated) materials" or “recyclables” means any material designated to be segregated from the waste stream for purposes of recycling. This designation shall be made by the city and the authorized collector based on good public practice, ability to receive an acceptable economic return, and feasibility of separating the material from the waste stream at the point of collection. Recyclable materials are currently limited to paper, glass, cardboard, plastics, ferrous metal, and aluminum.

38. "Recycling" means the process of collecting, sorting, cleansing, treating and reconstituting materials that would otherwise become garbage and returning them for use or reuse in the form of raw materials for new, used or reconstituted products which meet the quality standard necessary to be used in the marketplace. Recycling does not include transformation as defined in Public Resources Code § 40201. (CCR, Title 14, Section 17225.54).

39. “Recycling container” has the same meaning as “Blue Container” in 14 CCR Section 18982.2(a)(5) and shall be used for the purpose of storage and collection of source separated recyclable materials. The city and authorized collector shall have the right to promulgate changes to recyclable material types acceptable for the recycling container.

40. “Residential” means, for the purposes of this chapter, any premises consisting of between one (1) and four (4) dwelling units, and onsite domestic uses accessory to these dwelling units. A multi-family dwelling that consists of fewer than (5) dwelling units is “Residential”, for the purposes of this Chapter.

41. “Self-hauler” means a person who hauls solid waste, organic waste or recovered material they have generated to another person. Self-hauler also includes a person who back-hauls waste, or as otherwise defined in 14 CCR Section 18982(a)(66). “Back-haul” means generating and transporting organic materials to a destination owned and operated by the generator using the generator’s own employees and equipment, or as otherwise defined in 14 CCR Section 189881(a)(66)(A). Self-Hauler does not include any hauling arrangement by which the owner or occupant of the Premises pays any compensation to a third party for such hauling, including any transaction or arrangement involving discounted fees for services.

42. "Solid waste" means all putrescible and non-putrescible solid and semisolid wastes, including garbage, recyclable materials, organic materials, trash, refuse, paper, rubbish, ashes, industrial wastes demolition and construction wastes, bulky waste, discarded home and industrial appliances, manure, vegetable or animal solid or semisolid wastes, and other discarded solid and semisolid wastes. Solid waste includes materials defined as such per the Public Resources Code Section 49503 and as amended. Solid waste does not include any of the following wastes: (1) Hazardous waste, as defined in the Public Resources Code Section 40141, (2) Radioactive waste regulated pursuant to the State Radiation Control Law (Chapter 8 (commencing with Section 114960) of Part 9 of Division 104 of the Health and Safety

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Code) (3) Medical waste regulated pursuant to the State Medical Waste Management Act (Part 14 (commencing with Section 117600) of Division 104 of the Health and Safety Code). Untreated medical waste shall not be disposed of in a Solid Waste landfill, as defined in Public Resources Code Section 40195.1. Medical waste that has been treated and deemed to be solid waste shall be regulated pursuant to Division 30 of the Public Resources Code. Recyclable materials and organic materials are a part of solid waste and (4) abandoned vehicles and parts thereof.

43. “Solid waste collection service” means collection of solid waste originating in the city, by persons, firms or corporations, and doing so under a contract or franchise agreement with the city. Solid waste collection service includes collection of source separated garbage, recyclable material and organic materials.

44. “Solid waste facility” or “facility” means a solid waste transfer or processing station including Material Recovery Facilities, a recycling facility, a composting facility, a gasification facility, a transformation facility, an Engineered Municipal Solid Waste conversion facility, and/or a disposal facility in compliance with the definitions, provisions and requirements set forth in the Act. Solid waste facility additionally includes a solid waste operation that may be carried out pursuant to an enforcement agency notification, as provided in regulations adopted by CalRecycle, or otherwise set forth in the Act.

45. “Source separate” means the process of removing recyclable materials and organic materials from Solid Waste at the place of generation, prior to Collection, and placing such materials into separate containers designated for recyclable materials and organic materials, or as otherwise defined in 14 CCR Section 17402.5(b)(4).

46. “Source reduction” means any action which causes a net reduction in the generation of solid waste. Source reduction includes, but is not limited to, reducing the use of nonrecyclable materials, replacing disposable materials and products with reusable materials and products, reducing packaging, reducing the amount of yard wastes generated, establishing garbage rate structures with incentives to reduce the amount of wastes that generators produce, and increasing the efficiency of the use of paper, cardboard, glass, metal, plastic, and other materials. Source reduction does not include steps taken after the material becomes solid waste or actions which would impact air or water resources in lieu of land, including, but not limited to, transformation.

47. “Tier One commercial edible food generator” means a Commercial Edible Food Generator that is one of the following as defined in 14 CCR Section 18982(a):
a. Supermarket with gross annual sales of $2,000,000 or more b. Grocery store with a total facility size equal to or greater than 10,000 square feet. c. Food service provider, which means an entity primarily engaged in providing food services to institutional, governmental, commercial, or industrial locations of others based on contractual arrangements with these types of organizations. d. Wholesale food vendor, which means a business or establishment engaged in the merchant wholesale distribution of food, where food (including fruits and vegetables) is received, shipped, stored, prepared for distribution to a retailer, warehouse, distributor, or other destination.

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e. Food Distributor, which means a company that distributes food to entities including, but not limited to, supermarkets and grocery stores.

48. “Tier Two commercial edible food generator” means a Commercial Edible Food Generator that is one of the following as defined in 14 CCR Section 18982(a):
a. Restaurant with 250 or more seats, or a total facility size equal to or greater than 5,000 square feet.
b. Hotel with an on-site food facility and 200 or more rooms. c. Health facility with an on-site food facility and 100 or more beds. d. Large Venue, which means a permanent venue facility that annually seats or serves an average of more than 2,000 individuals within the grounds of the facility per day of operation of the venue facility. For purposes of this ordinance and implementation of 14 CCR, Division 7, Chapter 12, a venue facility includes, but is not limited to, a public, nonprofit, or privately owned or operated stadium, amphitheater, arena, hall, amusement park, conference or civic center, zoo, aquarium, airport, racetrack, horse track, performing arts center, fairground, museum, theater, or other public attraction facility. For purposes of this ordinance and implementation of 14 CCR, Division 7, Chapter 12, a site under common ownership or control that includes more than one Large Venue that is contiguous with other Large Venues in the site, is a single Large Venue. e. Large Event, which means an event, including, but not limited to, a sporting event or a flea market, that charges an admission price, or is operated by a local agency, and serves an average of more than 2,000 individuals per day of operation of the event, at a location that includes, but is not limited to, a public, nonprofit, or privately owned park, parking lot, golf course, street system, or other open space when being used for an event..
f. A state agency with a cafeteria with 250 or more seats or total cafeteria facility size equal to or greater than 5,000 square feet.
g. A local education agency facility with an on-site food facility. “Local Education Agency” means a school district, charter school, or county office of education that is not subject to the control of city or county regulations related to Solid Waste, or as otherwise defined in 14 CCR Section 18982(a)(40).

49. “User disposal containers” are containers inside a business for the collection of source separated organic materials, source separated recyclables and garbage for employees, contractors, tenants, customers and other users of the business.

Article II. Storage and Disposal

9.19.040 General.

It is the intent of the city that every person residing or conducting business in this city shall subscribe to and participate in solid waste collection service approved by the city and provided by an authorized collector. Nothing in this chapter shall prevent generators from self-hauling to a CalRecycle approved solid waste facility, operation, activity, or property in addition to their solid waste collection service, consistent with the requirements set forth in this chapter; or from

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utilizing a temporary debris box service, consistent with section 9.19.320. The City Council may from time-to-time adopt by resolution policies and procedures to implement this Ordinance.

Any references to the California Code of Regulations (CCR) language shall automatically conform to the current CCR in case of amendment by the State.

9.19.050 Prohibited accumulation and disposal.

Except as authorized in this chapter, it is unlawful for any person to:

A. Throw, bury, deposit, or cause to be thrown or deposited, any solid waste, or allow any collection of same to remain in or upon any private property, public right-of-way, alley, sidewalk, park, watercourse, waterway, levees or banks of watercourses or waterways, or upon any premises whatsoever other than a CalRecycle approved solid waste facility, operation, activity, or property. Any material not disposed of as aforesaid shall be placed in collection containers for collection.

B. Place or cause to be placed in any public receptacle owned or rented by the city and located upon public streets or in public places, any solid waste originating within or from any private property of more than one-half cubic foot.

C. Deposit any garbage in a recycling container or organics container.

D. Dump, place or bury solid waste in any lot, land or street or alley within the city, without first having obtained a solid waste facility permit or exemption from that permit issued by the local enforcement agency (LEA) of Marin County and concurred with by CalRecycle.

Under no circumstances whatsoever shall recyclable materials be dumped, placed or buried, as above. This chapter shall not preclude or prohibit the city from siting and permitting a recycling facility consistent with the provisions of the general plan provided that necessary variances are obtained from the California Department of Toxic Substances Control.

E. Allow any solid waste to accumulate or remain in or upon the building, lot or premises, in a manner that creates a public nuisance. The owner of any premises, business establishment, industry, or other property, vacant or occupied, shall be deemed the responsible party and therefore ultimately responsible for the safe and sanitary storage of all solid waste accumulated on the property. Collection containers shall be filled in a manner that prevents the contents from overflowing and allows the cover to fit securely.

Garbage containers, recycling containers, and organics containers shall be of an adequate size and of sufficient numbers to contain without overflowing, all the solid waste that the premise generates within the designated removal period. Overflowing solid waste is a public health violation. It shall be the responsibility of the owner of any building, lot or premises to notify the authorized collector promptly when necessary to increase solid waste collection service, to prevent solid waste from overflowing existing containers. If the city or authorized health officer determines that inadequate service causes a public nuisance or health problem, they may order the generator to increase service. The authorized collector shall increase collection service immediately upon notice.

F. Deliberately burn solid waste within the city.

9.19.060 Transportation of solid waste.

No person shall move, convey or transport or cause or permit to be moved, conveyed or transported any solid waste upon or along any public street or alley or other public place in the Created: 2021-06-23 14:21:07 [EST]

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city; provided, however, the provisions of this section shall not apply to any person conveying solid waste collected outside the city, nor to any person employed by the city who shall be assigned to the work of solid waste removal while acting within the scope of their employment or to any person or entity with whom the city has entered into or may hereafter enter into a contract for the collection, removal or disposal of solid waste or to any employee of such contractor during such time as such contract shall be in force. Nor shall this section be deemed to prohibit an individual from exercising their rights as described in section 9.19.200, which establishes requirements for self-hauling to a CalRecycle approved solid waste facility, operation, activity, or property, and section 9.19.210 which establishes the right to divert recyclable material or organic materials so long as the diversion otherwise complies with this chapter.

9.19.070 Obligation of solid waste collection service.

A. Except as otherwise provided by this chapter, all occupied premises shall subscribe for solid waste collection service with the authorized collector as herein specified, and for such service a charge shall be collected as per a schedule of maximum rates as shall be set by resolution of the city council.

B. Every property owner, commercial generator, residential generator, or other organic material generator within the city shall have the obligation for disposal of solid waste as provided in this chapter through the designated authorized collector and shall pay the authorized collector for the solid waste collection service at the rates provided therefor.

Failure of receipt of a bill does not obviate responsibility for payment. In each instance, the property owner shall be primarily responsible for the payment of the charges provided for herein. The city or authorized collector may cause a lien to be placed upon the real property for failure to compensate the authorized collector for services rendered.

C. Generators shall arrange for a size, quantity and collection frequency of containers to adequately store all solid waste generated in connection with the premise, and subject to collection in garbage containers, recycling containers and organics containers, between the times designated for collection service. The city shall have the right to review the number, size and location of such collection containers to evaluate the adequacy, capacity and collection frequency of containers for each type of collection service and to review the source separation and containment of materials. Generators shall adjust the size of containers, number of containers and/ or collection frequency for their collection services as requested by the city in order to meet the standards set forth in this chapter.

D. Generators shall place source separated organic materials, including food waste, in the organics container; place source separated recyclable materials in the recycling container; and place garbage in the garbage container. The city and authorized collector shall have the right to promulgate changes to material types acceptable for each type of collection container. Generators shall not place prohibited container contaminants into the garbage container, organics container or recycling container.

E. The authorized collector shall give written notice to the city manager of the address of any occupied premise within the city which is not subscribing to the collection and disposal service provided by the authorized collector.

F. The owner of each occupied premise shall subscribe for solid waste disposal services within seven (7) days of the occupancy of the premises. If the owner fails to subscribe for service, the authorized collector shall give the owner written notification that such service is required.

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G. Generators shall provide or arrange for access during all inspections and investigations (with the exception of the interior of a private residential dwelling unit) and cooperate with the city manager or authorized collector during such inspections and investigations as described in section 9.19.390.

9.19.080 Commercial generator requirements.

A. Commercial business owners including multi-family residential dwellings with five (5) or more dwelling units, shall provide or arrange for garbage container, organics container and recycling container collection service for employees, contractors, tenants and customers, and supply and allow access to adequate number, size and location of collection containers with sufficient labels or colors as noted in subsection (B)(1) and (B)(2) below or, if self-hauling, in compliance with self-hauling requirements set forth in this chapter.

B. Commercial businesses that are not multi-family residential dwellings shall provide containers for the collection of source separated organic materials and source separated recyclable materials in all areas where the commercial business provides disposal containers for employees, contractors, tenants, customers and other users of the premises (“User Disposal Containers”). Such user disposal containers do not need to be provided in restrooms. If a commercial business does not generate, or has a waiver pertaining to, any of the materials that would be collected in one type of user disposal container, then the business does not have to provide that particular type of container in all areas where user disposal containers are provided. Pursuant to 14 CCR Section 18984.9(b), the user disposal containers provided by the business shall have either:

1. A body or lid that conforms with the following container colors, with either lids conforming to these color requirements or bodies conforming to these color requirements, or both lids and bodies conforming to these color requirements: gray or black containers for garbage, blue containers for source separated recyclable materials, and green containers for source separated organic materials.

Notwithstanding the foregoing, a commercial business is not required to replace functional containers, including containers purchased prior to January 1, 2022, that do not comply with the color requirements of this section prior to the end of the useful life of those containers, or prior to January 1, 2036, whichever comes first; or

2. Container labels that include language or graphic images, or both, indicating the primary materials accepted and the primary materials prohibited in that container, or containers with imprinted text or graphic images that indicate the primary materials accepted and primary materials prohibited in the container. The container labeling requirements are required on new containers commencing January 1, 2022.

C. Excluding multi-family residential dwellings, to the extent practical through education, training, inspection, and/or other measures, prohibit employees from placing materials in a container not designated for those materials per the recycling container, organics container, and garbage container collection service.

D. Excluding multi-family residential dwellings, periodically inspect recycling containers, organics containers, and garbage containers for contamination and inform employees if containers are contaminated and of the requirements to keep contaminants out of those containers.

E. Including multi-family residential dwellings with five (5) or more dwelling units, annually provide information to employees, contractors, tenants, building residents, and

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customers about organic waste recovery requirements and about proper sorting of organic materials and recyclable materials. A copy of such information shall be provided to the authorized collector or city manager, upon request.

F. Including multi-family residential dwellings with five (5) or more dwelling units, provide information before or within fourteen (14) days of new occupation of the premises to new tenants and no less than fourteen (14) days before tenants move out of the premises, unless a tenant does not provide fourteen (14) or more days’ notice to before moving out, that describes requirements to keep organic materials subject to collection in the organics container and recycling container separate from each other and from garbage, the location of containers, and the rules governing their use at the premises.

G. Including multi-family residential dwellings with five (5) or more dwelling units, prominently post and maintain one or more signs where recyclable materials and/or organic waste are collected and/or stored that set forth what materials are required to be source separated, in addition to collection procedures for such materials.

H. Commercial businesses that are commercial edible food generators, as defined in Section 9.19.030, shall comply with commercial edible food generator requirements, pursuant to Section 9.19.220.

9.19.090 Storage.

Generators shall store solid waste on their property or premises or shall require it to be stored or handled in such manner so as not to promote the propagation, harborage or attraction of animals or the creation of nuisance. (CCR, Section 17312). Each property owner shall keep the area where collection container(s) are located in a clean, safe and sanitary condition.

9.19.100 Solid waste collection areas.

Each commercial business shall:

A. Designate space on the property to be used for storage of collection containers required by this chapter.

B. Post a sign clearly identifying all garbage, recycling, and organics container collection areas and the materials accepted therein shall be posted adjacent to all points of access to the collection area(s).

C. Commercial businesses which share collection services and containers located in a centralized collection area shall provide and maintain space within or adjacent to each waste enclosure, or adjacent to each approved garbage container(s) for placement of sufficient approved organics container(s) and recycling container(s).

9.19.110 Collection containers.

A. It shall be the duty of every property owner, occupant and tenant of any premises within the city to store all solid waste in collection containers supplied by the authorized collector. These collection containers shall be constructed of metal or an approved plastic material and type which shall be watertight, nonabsorbent, animal resistant, durable, easily cleanable, equipped with handles, and having tight fitting covers such that the containers hold the solid waste without spillage and leakage, escape of odors or access of flies to the contents thereof.

B. Except as otherwise provided by the city’s franchise agreement with the authorized collector, each dwelling unit shall be required to have a minimum garbage service of one

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(1) thirty-two (32) gallon cart for garbage collection; one (1) thirty-two (32) gallon cart for recyclable materials collection; and one (1) thirty-two (32) gallon cart for organic materials collection. Except in the case of multifamily dwellings of more than four (4) dwelling units, no two (2) or more dwelling units shall share communal waste collection services or approved collection containers except with the permission of the authorized collector.

9.19.120 Collection container maintenance.

Each collection container and its cover shall be kept clean, and the cover shall not be removed except to place solid waste therein or to empty the same. Only the authorized collector shall be authorized to maintain or repair the collection containers, and the authorized collector will maintain or replace collection containers as needed.

9.19.130 Collection container placement.

A. No collection container, other than those owned or rented by the city or authorized collector, shall be placed or kept in or on any public street, sidewalk, footpath, or any public place whatsoever, or remain in public view from any public right-of-way except as herein provided, but shall be maintained on the premises, except as may be provided for removing and emptying by the authorized collector on the day(s) and in the location designated for collection. No person shall place a collection container so that either the sidewalk or street gutter is obstructed.

B. Collection containers are permitted to be placed in public view and on a public street, sidewalk or footpath only during the forty-eight-hour period commencing at 12:01 a.m. on the day preceding the day of scheduled pick-up and terminating at 12:01 a.m. on the day following such pick-up.

C. For curbside collection service, the approved location for collection shall be the street curb line adjacent to such premises and collection containers shall be placed in the location by the occupant of such premises for collection by the authorized collector.

9.19.140 Ownership of solid waste.

Solid waste subject to collection by the authorized collector shall become the property of the authorized collector subject to this chapter after such time as the authorized collector takes possession of the wastes (CCR, Section 17334).

9.19.150 Unauthorized removal and ownership of recyclable materials and organic materials.

A. All recyclable materials and organic materials, upon being placed by the generator into a collection container and placed at an approved location for collection, shall become the property of the authorized collector owning the collection container, unless otherwise provided in a contract, license, or franchise agreement.

B. No person, other than the generator, authorized collector or city, shall remove recyclable material or organic materials from a collection container placed at the location for collection.

Created: 2021-06-23 14:21:07 [EST]
(Supp. No. 33)

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9.19.160 Tampering.

No person shall tamper with, modify, remove from or deposit solid waste in any collection container which has not been provided for their use at a collection site, without permission from the city or authorized collector. Nor shall any person tamper with any collection container or any recyclable materials on any premises, or collect, remove or dispose of the same, other than in the manner specified by this chapter.

9.19.170 Collection intervals.

All solid waste accumulated at any residential generator or commercial generator’s property or premise shall be collected at regular intervals of at least once each week, except that from any place which has solid waste from which foul odors arise, or which is a menace to public health, such solid waste shall be collected at such intervals as necessary for proper sanitation. Nothing in this chapter shall be deemed to prohibit the removal and hauling by any person of materials ordered by the health officer, fire chief or code enforcement officer to be removed upon the ground that the same constitute a health menace, fire hazard or public nuisance.

9.19.180 Collection schedule.

Solid waste shall be collected as provided by this chapter at regular intervals on a schedule established by the authorized collector and approved by the city. The schedule may be changed as deemed necessary by the authorized collector and/or the city.

9.19.190 Waivers.

A. Pursuant to 14 CCR Section 18984.11, the city may grant waivers to commercial businesses for physical space limitations and/or de minimis volumes. Commercial businesses seeking a waiver shall submit their request in a form specified by the city manager. After reviewing the waiver request, and after an on-site review, if applicable, the city manager may either approve or deny the following waiver requests:

1. De Minimis Waivers: The city may waive a commercial business’ obligation to comply with some or all the organic material collection service requirements if the commercial business meets the following requirements:
a. Submits an application specifying the type of waiver requested and provides documentation as described below.
b. Provides documentation that either:
i. The commercial business receives two or more cubic yards of weekly solid waste collection service and disposed organic materials subject to collection in the organics container or recycling container comprises less than 20 gallons per week of the business’ total weekly solid waste volume; or ii. The commercial business receives less than two cubic yards of weekly solid waste collection service and disposed organic materials subject to collection in the organics container or recycling container comprises less than 10 gallons per week of the business’ total weekly solid waste volume.

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iii. For the purposes of subsections (i) and (ii) above, weekly solid waste collection shall be the sum of weekly garbage container volume, recyclable container volume and organics container volume, measured in cubic yards. c. Notifies the city if circumstances change such that volume of commercial business’ disposed organic materials exceeds threshold required for waiver, in which case the waiver will be rescinded.
d. Provides written verification of eligibility for de minimis waiver every five years if the city has approved de minimis waiver.

2. Physical Space Waivers: The city may waive a commercial business’ obligations (including multi-family dwellings) to comply with some or all of the recyclable materials and/or organic materials collection service requirements if the city has evidence from its own staff, authorized collector, licensed architect, or licensed engineer demonstrating that the premises lacks adequate space for the collection containers required for compliance with the organic materials collection requirements. A commercial business or property owner may request a physical space waiver through the following process:
a. Submit an application form specifying the type(s) of collection services for which they are requesting a waiver from mandatory collection service. b. Provide documentation that the premises lacks adequate space for the recycling containers and/ or organics containers including documentation from the authorized collector, licensed architect, or licensed engineer. c. Provide written verification to the city that it is still eligible for physical space waiver every five years if the city has approved application for a physical space waiver.

9.19.200 Self-hauling.

A. Self-Haulers shall source separate all recyclable materials and organic materials (materials that the city otherwise requires generators to source separate for collection in recycling containers or organics containers) generated on-site from solid waste in a manner consistent with 14 CCR Sections 18984.1 and 18984.2.

B. Self-Haulers shall haul their source separated recyclable materials to a facility that recovers those materials; and haul their source separated organic materials to a CalRecycle approved solid waste facility, operation, activity, or property that processes or recovers source separated organic materials.

C. Self-Haulers that are commercial businesses (including multi-family residential dwellings) shall keep a record of the amount of organic material delivered to each CalRecycle approved solid waste facility, operation, activity, or property that processes or recovers organic materials; this record shall be subject to inspection by the city. The records shall include the following information:

1. Delivery receipts and weight tickets from the entity accepting the waste.

2. The amount of material in cubic yards or tons transported by the generator to each entity.

3. If the material is transported to an entity that does not have scales on-site, or employs scales incapable of weighing the Self-Hauler’s vehicle in a manner that allows it to determine the weight of materials received, the Self-Hauler is not required

Page 16 of 24 ends

to record the weight of material but shall keep a record of the entities that received the organic materials.

D. Self-Haulers must keep records, including dates of self-haul activities, amounts of selfhauled materials, and names and location(s) of the CalRecycle approved solid waste facility, operation, activity, or property where the material was hauled, and make those records available for inspection upon request by the City or Cal Recycle for a period of five years of any self-haul activity.

E. The City may restrict or prohibit self-hauling by a generator if the City determines, after providing notice and an opportunity for a hearing, that the generator’s self-hauling activities violate the provisions of this section or any other applicable law or regulation.

F. A residential organic waste generator that self-hauls organic materials is not required to meet the requirements of Section 9.19.200 (C), (D), and (E).

9.19.210 Right to divert recyclable material and organic materials.

A. Nothing in this chapter limits the right of any person to donate, sell, or otherwise remove their recyclable materials so long as the removal otherwise complies with an authorized collector’s franchise agreement and the provisions this chapter. The foregoing notwithstanding, the provisions of this chapter and an authorized collector’s franchise agreement do not permit any hauling arrangement by which the generator pays any compensation to a third party for such removal, including any transaction or arrangement involving discounted or net fees for services provided in this chapter.

B. Organic materials may be fed to animals on the premises where such organic materials is produced, provided that the premises are always kept in a sanitary condition to the satisfaction of the city manager; and provided further that the keeping and feeding of such animals shall at all times conform to the applicable law including applicable regulations of those entities governing the same now in force or which thereafter may be enacted or promulgated.

C. Nothing in this chapter prohibits a generator from preventing or reducing waste generation, managing organic waste on site, or using a community composting site, provided that such operation conforms to the applicable regulations of those entities governing the same now in force or which thereafter may be enacted or promulgated.

Article III. Edible Food Recovery Requirements

9.19.220 Commercial edible food generator requirements.

A. Tier one commercial edible food generators must comply with the requirements of this section commencing January 1, 2022, and tier two commercial edible food generators must comply commencing January 1, 2024, pursuant to 14 CCR Section 18991.3.

B. Large venue or large event operators not providing food services, but allowing for food to be provided by others, shall require food facilities operating at the large venue or large event to comply with the requirements of this section, commencing January 1, 2024.

C. Commercial edible food generators shall comply with the following requirements:

1. Arrange to recover the maximum amount of edible food that would otherwise be disposed.

Page 17 of 24 ends

2. Contract with or enter into a written agreement with food recovery organizations or food recovery services for: (a) the collection of edible food for food recovery; or (b) acceptance of the edible food that the commercial edible food generator self-hauls to the food recovery organization for food recovery.

3. Shall not intentionally spoil edible food that is capable of being recovered by a food recovery organization or food recovery service.

4. Allow the city’s designated enforcement agency to access the premises and review records pursuant to 14 CCR Section 18991.4.

5. Keep records that include the following information, or as otherwise specified in 14 CCR Section 18991.4:
a. A list of each food recovery organization or food recovery service that collects or receives its edible food pursuant to a contract or written agreement established under 14 CCR Section 18991.3(b).
b. A copy of all contracts or written agreements established under 14 CCR Section 18991.3(b).
c. A record of the following information for each of those food recovery organizations or food recovery services:
i. The name, address and contact information of food recovery organization or food recovery service.
ii. The types of food that will be collected by or self-hauled to the food recovery organization or food recovery service.
iii. The established frequency that food will be collected or self-hauled. iv. The quantity of edible food, measured in pounds recovered per month, collected or self-hauled to a food recovery organization or food recovery service.

D. Nothing in this chapter shall be construed to limit or conflict with the protections provided by the California Good Samaritan Food Donation Act, the Federal Good Samaritan Act, or share table and school food donation guidance pursuant to Senate Bill 557, Chapter 9 of Part 27 of Division 4 of Title 2 of the Education Code, the California Health and Safety Code, relating to food safety, as amended, supplemented, superseded and replaced from time to time.

9.19.230 Food recovery organization and food recovery services requirements.

A. Food recovery services collecting or receiving edible food directly from commercial edible food generators, via a contract or written agreement established under 14 CCR Section 18991.3(b), shall maintain the following records, or as otherwise specified by 14 CCR Section 18991.5(a)(1):

1. The name, address, and contact information for each commercial edible food generator from which the service collects edible food.

2. The quantity in pounds of edible food collected from each commercial edible food generator per month.

3. The quantity in pounds of edible food transported to each food recovery organization per month.

Page 18 of 24 ends

4. The name, address, and contact information for each food recovery organization that food recovery service transports edible food to for food recovery.

B. Food recovery organizations collecting or receiving edible food directly from commercial edible food generators, via a contract or written agreement established under 14 CCR Section 18991.3(b), shall maintain the following records, or as otherwise specified by 14 CCR Section 18991.5(a)(2):

1. The name, address, and contact information for each commercial edible food generator from which the organization receives edible food.

2. The quantity in pounds of edible food received from each commercial edible food generator per month.

3. The name, address, and contact information for each food recovery service that the organization receives edible food from for food recovery.

C. Food recovery organizations and food recovery services that have their primary address physically located in the city and contract with or have written agreements with one or more commercial edible food generators pursuant to 14 CCR Section 18991.3(b) shall annually report to the city the total pounds of edible food recovered in the previous calendar year from the tier one and tier two commercial edible food generators they have established a contract or written agreement with pursuant to 14 CCR Section 18991.3(b) no later than April 1.

D. In order to support edible food recovery capacity planning assessments or other studies conducted by the county, city, or designated entity, food recovery services and food recovery organizations operating in the city shall provide information and consultation to the city, upon request, regarding existing, or proposed new or expanded, food recovery capacity that could be accessed by the city and commercial edible food generators. A food recovery service or food recovery organization contacted by the city shall respond to such request for information within 60 days unless a shorter timeframe is otherwise specified by the city.

Article IV. License or Contract

9.19.240 Contract.

The city may after a duly noticed public hearing, with or without having invited bids therefor, enter a contract, including an exclusive franchise agreement, with any responsible person, firm or corporation for the collection, removal or disposal of solid waste accumulated within the city.

Such authorized person, firm or corporation shall be the authorized collector for the collection, removal or disposal of solid waste accumulated within the city as set forth in this chapter. The term of the contract, rates of collection, and other provisions of the contract shall be as provided by resolution of the governing body of the city. Where such a contract has heretofore been or hereafter is entered into between the city and a contractor for the collection, removal and disposal of solid waste, and the contractor shall have satisfactorily performed such contract, the city may, after a duly noticed public hearing, without inviting bids or proposals therefor, either prior to or after the expiration of such contract, extend or renew the same for such a period and on such terms and conditions as the city shall provide by resolution. The contractor shall be known as the authorized collector.

Page 19 of 24 ends

9.19.250 Service.

A. Unless otherwise authorized by the city, the authorized collector must provide solid waste collection service in accordance with section 9.19.320 to all persons situated within the areas specified in such contract, provided payment for such service is made.

The service shall be provided in a competent, efficient, clean and courteous manner.

B. The use of recycling facilities and organic material processing facilities must comply with requirements set forth in section 9.19.310; and use of such facilities must be approved, in writing, by the city manager.

C. The city may designate one or more intermediary transfer or processing stations of its choice and direct any authorized collector to deposit collected recyclable material, organic materials, and/or solid waste in said facility.

9.19.260 Minimum provisions.

The provisions of this chapter shall be the minimum requirements for the protection of the public health, safety, convenience and general welfare.

9.19.270 Authorized collector.

The authorized collector, in accordance with this chapter, shall be considered as and shall be an independent contractor and shall be responsible to the city for the result of the work to be done, but shall act under their own directions as to the manner of performing the work; and shall keep themself and all of their employees insured under California's worker's compensation insurance requirements, and shall be insured against public liability and property damage, to be not less than twenty million dollars ($20,000,000) plus any additional coverage required from time to time by the city (including all such liability for use or operation of motor vehicles used in the performance of work hereunder). Evidence of such insurance shall be filed with the city listing the city as additional insured.

9.19.280 Exclusive right.

The award of a contract hereunder shall grant the authorized collector during the term of the contract the exclusive right to collect, transport and dispose of all solid waste collected within the city except as otherwise expressly provided in this chapter; provided further, however, that debris box service for construction and temporary cleanup purposes may be provided by persons other than the authorized collector.

9.19.290 Performance bonds.

The person or entity to whom such contract shall be awarded shall file with the city a bond for the faithful performance of the contract in the sum of one hundred thousand dollars ($100,000.00). The bond shall be immediately paid to the city upon determination, as provided in Section 9.19.350 hereof, that the authorized collector has failed to fully perform in a competent, efficient, clean and courteous manner all of the services provided by this chapter or the contract between the city and the authorized collector. In lieu of a performance bond the authorized collector may furnish alternate financial security approved by the finance director and city attorney.

Created: 2021-06-23 14:21:07 [EST]

Page 20 of 24 ends

9.19.300 Exceptions.

With the exception that the sanitary requirements of this chapter must be complied with, the provisions hereof shall not apply to persons collecting dead animals, bones or meat scraps for tallow plants or medical wastes.

Article V. Responsibilities of Authorized Collector

9.19.310 Regulations.

A. Except as otherwise permitted by this chapter, and except for self-hauling which is not in lieu of regular weekly service, it is unlawful for any person to collect or carry solid waste through the streets of the city without first having entered a contract or obtained a permit from the city to do so.

B. The authorized collector shall not permit any solid waste to fall or remain on any public street or private premises in the city, shall close all gates used by it in collection service, and shall operate as quietly as the circumstances allow.

C. Collection and transportation equipment shall be maintained and utilized consistent with CCR, Sections 17341 through 17345.

D. The authorized collector shall further abide by all applicable laws and the regulations and orders of the county health department or officer, and ordinances and general regulations of the city, now or hereafter adopted.

9.19.320 Periodic service.

Unless otherwise authorized by the city or by state law, the collector shall provide not less than weekly service to each owner, resident or tenant within the city. The authorized collector may terminate service to any owner, resident or tenant for nonpayment of the established rates if not fully paid for a period of two (2) months from and after the date such payment is due. Prior to termination of such service, the authorized collector shall notify the city and customer, in writing, of the proposed date of termination and the reason therefor. Such notice shall be given by the authorized collector to the city no less than ten days prior to the date of termination of service. The customer may request temporary suspension of service if the premises are to be vacated for a reasonable period, to be not less than two (2) weeks and to occur no more than three (3) times in a one (1) year period. The customer is also required to provide the authorized collector with a resumption date for service.

9.19.330 Liability.

The authorized collector and the city shall be exempt from responsibility and liability for tampering or misuse of any items left at curbside for collection and/or recycling should spillage or other mishap occur prior to possession by the authorized collector. Once the authorized collector takes possession of the solid waste, the authorized collector then assumes responsibility and liability.

Created: 2021-06-23 14:21:08 [EST]
(Supp. No. 33)

Page 21 of 24 ends

9.19.340 Assignment.

Neither the collection contract nor any part thereof shall be assigned, either voluntarily or by operation of law, except upon the consent expressed by a resolution of the city.

9.19.350 Termination.

If the authorized collector refuses or neglects to comply with the terms of the contract or of any laws, ordinances or regulations above referred to, for a period of thirty (30) days after being notified in writing to do so by the legislative body of the city, then, after a hearing upon not less than ten (10) days' written notice to the authorized collector, the city shall be entitled to terminate the contract.

Article VI. Rates

9.19.360 Charge for service.

A charge shall be collected by the authorized collector at maximum rates to be established between the city and the authorized collector, the rates to be subject to change upon approval of an agreement between the city and the authorized collector. The property owner is responsible for all charges for solid waste removal, including recyclable materials. The rates shall provide to the authorized collector a fair and reasonable compensation and return.

9.19.370 Payment of rates.

It is unlawful for any person to refuse to pay the rates fixed for the collection of solid waste.

Nonpayment may result in cessation of service, a violation punishable by law, and/or a lien against the property. It is unlawful for any person to dispose of solid waste, from premises owned, occupied or leased by them, other than by and through the authorized collector, except as provided in this chapter.

9.19.380 Disputed rates.

In any case where a dispute shall arise as to the rate or amount to be paid to the authorized collector, the city shall have the power of final determination of such dispute, and both the authorized collector and the owner, resident or tenant shall be bound thereby. In no event shall the city be obligated in any way to the authorized collector or any owner, resident or tenant for the collection of disputed accounts.

Article VII. Inspections and Enforcement

9.19.390 Inspections.

A. The city manager, authorized collector, or designee is authorized to conduct any inspections, remote monitoring, or other investigations as reasonably necessary to further the goals of this chapter, subject to the provisions of the authorized collector’s franchise agreement and applicable laws. This may include inspections and investigations, at random or otherwise, of any collection container, collection vehicle load, or transfer, processing, or disposal facility to confirm compliance with this chapter

Page 22 of 24 ends

and the provisions of the franchise agreement, subject to applicable laws. This section does not allow entry in a private residential dwelling unit for inspection. For the purposes of inspecting collection containers for compliance, the city manager or authorized collector may conduct container inspections for prohibited container contaminants using remote monitoring, and generators shall accommodate and cooperate with the remote monitoring.

B. A person subject to the requirements of this chapter shall provide or arrange for access during all inspections (with the exception of the interior of a private residential dwelling unit) and shall cooperate with the city manager, authorized collector or designee during such inspections and investigations. Such inspections and investigations may include confirmation of proper placement of materials in collection containers, inspection of edible food recovery activities, review of required records, or other verification or inspection to confirm compliance with any other requirement of this chapter. Failure to provide or arrange for: (i) access to the premises; (ii) installation and operation of remote monitoring equipment, if a remote monitoring program is adopted; or (iii) access to records for any inspection or investigation is a violation of this chapter and may result in penalties.

C. Any records obtained by the city manager, authorized collector, or designee, during inspections, investigations, remote monitoring and other reviews shall be subject to the requirements and applicable disclosure exemptions of the California Public Records Act as set forth in Government Code Section 6250 et seq.

D. The city, authorized collector or designee shall accept written complaints from persons regarding an entity that may be potentially non-compliant with this chapter.

9.19.400 Violation—Penalty.

A. Any violation of this chapter may be enforced either as an infraction or as a misdemeanor, or by any remedy available to the city under this code, or under state law.

B. Enforcement actions under this chapter may include issuance of an administrative citation and assessment of a fine. The city’s procedures on imposition of administrative citations and fines as contained in chapter 1 shall govern the imposition, enforcement, collection, and review of administrative citations and fines issued to enforce this chapter and any rule or regulation adopted pursuant to this chapter. Any section of this chapter may be enforced by the city of San Rafael or, if agreed to, by its designated enforcement agency.

C. A violation may be punishable by:

1. A fine not exceeding one hundred dollars for a first violation;

2. A fine not exceeding two hundred dollars for a second violation of the same provision of this code within any twelve consecutive month period;

3. A fine not exceeding five hundred dollars for each additional violation of the same provision of this code within any twelve consecutive-month period. Any citation issued after the issuance of a third citation or violation of the same provision of this code within any twelve consecutive-month period may be charged as a misdemeanor pursuant to the provisions of chapter 1.

D. Other remedies allowed by law may be used, including civil action. The city may pursue civil actions in the California courts to seek recovery of unpaid administrative citations, and fines. The city may choose to delay court action until such time as a sufficiently large

Page 23 of 24 ends

number of violations, or cumulative size of violations exist such that court action is a reasonable use of city staff and resources.

9.19.410 Damages.

In any civil action by an authorized collector against a person alleged to have violated Public Resources Code, Section 41950, the court may either allow trebled damages, as measured by the value of the material removed, or award a civil penalty of not more than one thousand dollars ($1,000.00), whichever is greater, for each unauthorized removal, against the unauthorized person removing the recyclable material.

DIVISION 2. CEQA
The City Council finds that this Ordinance is exempt from the California Environmental Quality Act ("CEQA") pursuant to State CEQA Guidelines Sections 15061(b)(3) and 15308 on the grounds that it can be seen with certainty that the enhanced solid waste regulations, as provided for in this Ordinance will not have a significant effect on the environment and that the new requirements, which strengthen requirements for the handling of solid waste, represent actions by a regulatory agency (the City) for the protection of the environment.

DIVISION 3. SEVERABILITY
If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining portions of this Ordinance.

The Council hereby declares that it would have adopted the Ordinance and each section, subsection, sentence, clause, or phrase thereof, irrespective of the fact that any one or more section, subsection, sentence, clause, or phrase be declared invalid.

DIVISION 4. PUBLICATION; EFFECTIVE DATE
A summary of this ordinance shall be published and a certified copy of the full text of this Ordinance shall be posted in the office of the City Clerk at least five (5) days prior to the Council meeting at which it is adopted.

This ordinance shall be in full force and effect thirty (30) days after its final passage, and the summary of this ordinance shall be published within fifteen (15) days after the adoption, together with the names of those Councilmembers voting for or against same, in the Marin Independent Journal, a newspaper of general circulation published and circulated in the City of San Rafael, County of Marin, State of California.

Within fifteen (15) days after adoption, the City Clerk shall also post in the office of the City Clerk, a certified copy of the full text of this ordinance along with the names of those Councilmembers voting for or against the ordinance.

KATE COLIN, Mayor
ATTEST:

LINDSAY LARA, City Clerk

Page 24 of 24 ends

The foregoing Ordinance No. 2004 was introduced at a Regular Meeting of the City Council of the City of San Rafael, held on the 22nd day of February 2022 and ordered passed to print by the following vote, to wit:

AYES: COUNCILMEMBERS: Bushey, Hill, Kertz, Llorens Gulati & Mayor Kate NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
and will come up for adoption as an Ordinance of the City of San Rafael at a Regular Meeting of the Council to be held on the 7th day of March 2022.

LINDSAY LARA, City Clerk
SUMMARY OF ORDINANCE NO. 2004

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL

AMENDING THE SAN RAFAEL MUNICIPAL CODE TO REPEAL
CHAPTER 9.19 - REFUSE AND RECYCLED MATERIALS COLLECTION AND DISPOSAL AND REPLACE IT WITH NEW CHAPTER 9.19 - SOLID

WASTE COLLECTION AND DISPOSAL AND EDIBLE FOOD RECOVERY
This Summary concerns a proposed Ordinance of the City Council of the City of San Rafael, designated as Ordinance No. 2004, which will amend Chapter 9.19 of the San Rafael Municipal Code, as detailed in the complete text of Ordinance No. 2004.

Ordinance No. 2004 is scheduled for adoption by the San Rafael City Council at its regular meeting of March 7, 2022. The City Clerk has been directed to publish this Summary pursuant to City Charter and California Government Code section 36933(c)(1).

SUMMARY OF AMENDMENT TO MUNICIPAL CODE
This Ordinance amends the City’s Municipal Code to comply with Senate Bill 1383, the Short-Lived Climate Pollutants law. The ordinance repeals chapter 9.19 - Refuse and Recycled Materials Collection and Disposal and replaces it with new Chapter

9.19 - Solid Waste Collection and Disposal and Edible Food Recovery. The purpose of the chapter is to prevent actual or potential public health hazards and nuisance within the City of San Rafael by regulating the accumulation, collection and disposal of solid waste, and to provide for the licensing and responsibilities of persons engaged therein. As required by the new law, this amendment provides for additional regulation of organic waste and places requirements on residents and businesses to subscribe to organics collection services and source-separate materials into the appropriate collection containers. Provisions for waivers are included for certain reasons. Self-haul provisions are included as well, pursuant to specific conditions and reporting requirements. Certain businesses are subject to food recovery requirements. Fines and penalties are prescribed for non-compliance, including contamination of organics collection containers.

For a complete copy of the text of the Ordinance amending the Municipal Code, please contact the Sustainability Program at (415) 485-3407 or by email:

[email protected]. Copies of the Ordinance containing this Municipal Code amendment are also available for public review by contacting the City Clerk’s office by email to [email protected]
___________________________

LINDSAY LARA,
San Rafael City Clerk
Dated: 02/23/2022
____________________________________________________________________________________

FOR CITY CLERK ONLY
File No.: _______________________________
Council Meeting: _______________________
Disposition: ___________________________
Agenda Item No: 5.d
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Finance
Prepared by: Nadine Atieh Hade,
Finance Director
City Manager Approval: ______________
TOPIC: AUDIT SERVICES
SUBJECT: A RESOLUTION APPROVING AND AUTHORIZING THE CITY MANAGER TO

EXECUTE AN AGREEMENT WITH MAZE & ASSOCIATES TO PROVIDE AUDITING SERVICES FOR THE FISCAL YEARS ENDING JUNE 30, 2022 THROUGH JUNE 30, 2025, WITH OPTIONS FOR THE FISCAL YEARS ENDING JUNE 30, 2026 AND JUNE 30, 2027
RECOMMENDATION:

Adopt Resolution approving and authorizing the City Manager to execute an agreement with Maze & Associates.

BACKGROUND:

As required by local code, state law and its bond covenants, the City of San Rafael undergoes an annual audit of its financial activities and produces audited financial statements in the form of an annual report.

In October 2014, the City conducted a competitive Request for Proposals (RFP) process and selected the accounting firm Maze & Associates Accountancy Corporation to perform auditing services. Maze & Associates performed all services requested for the first three years of the agreement and for the two additional option years, along with a Council-approved one-year extension to the contract for FY 2020- 21 due to the impacts of the COVID-19 pandemic.

In keeping with good business practices of soliciting independent auditing services, the Finance Department issued an RFP in November 2021. The RFP was published on the City website, shared with the California Society of Municipal Finance Officers (CSMFO) network, and sent directly to four wellregarded audit firms. Seven firms submitted responses to the RFP by the due date of December 31, 2021.

The proposals were evaluated on the firm’s technical and qualitative ability to provide reports in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of the Office of Management and Budget Circular A-133, Audits of State and Local Government and Non-Profit Organizations.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
ANALYSIS:

The evaluation of the proposals consisted of five factors to help ascertain which proposing firm best met the needs of the City. This included the firm’s expertise and experience, adequacy of staffing, and technical support structure. The Finance Director conducted the first review of the proposals and selected three finalists using the objective factors. Subsequently, the proposals of the three finalists were reviewed by the Audit Proposal Committee, which consisted of the Accounting Manager, Principal Accountant, and Management Analyst from Public Works.

The following is a summary of the average technical scores of the three finalists after evaluation by the Finance Director and Audit Proposal Committee.

Firm Name
Average
Technical Score
(Max of 100 pts.)
Eide Bailly LLP 77.9
Maze & Associates 94.4
Badawi & Associates 88.0
The firm of Maze & Associates scored above the other firms in their proposal presentation and technical knowledge. A copy of Maze & Associates’ proposal is attached as Exhibit B to the proposed agreement (Attachment 2). Maze & Associates is a well-known regional audit firm in California with a focus on local governments. They have a total of fifty-seven employees including twenty California Certified Public Accountants (CPAs). The firm’s audit team for the City would consist of an Engagement Partner, an Alternate/Technical Review Partner and Childcare Audit Partner, a Manager, and a Supervisor. Three of the four team members are CPAs.

FISCAL IMPACT:

The annual cost for the audit contract will be included in the budget development process for the next four years with annual payments from the City as follows. The annual costs include a 3% maximum CPI increase annually beginning in FY 2022-23.

For fiscal year ending June 30
2022 2023 2024 2025
Optional
2026
Optional
2027
Total Annual Cost $77,706 $80,035 $82,437 $84,911 $87,458 $90,082 A copy of Maze & Associates’ pricing proposal is included in their proposal in Exhibit B.

OPTIONS:

The City Council may choose to:

1. Accept the staff recommendation and authorize the execution of the agreement Maze & Associates for the four fiscal years ending June 30, 2022 through fiscal year ending June 30, 2025, with an option for two additional years.

2. Reject staff recommendation and restart the proposal process for auditing services.

ACTION REQUIRED:

Staff recommends the Council accept the report and adopt the Resolution as presented.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
ATTACHMENTS:

1. A Resolution of the City Council of the City of San Rafael Approving and Authorizing the City Manager to Execute an Agreement with Maze & Associates to Provide Auditing Services For the Fiscal Years Ending June 30, 2022 through June 30, 2025, with Options for the Fiscal Years Ending June 30, 2026 and June 30, 2027.

2. Proposed Professional Services Agreement, with Exhibit A: Request for Proposals Issued by the City of San Rafael, and Exhibit B: Proposal from Maze & Associates RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL

APPROVING AND AUTHORIZING THE CITY MANAGER TO EXECUTE AN

AGREEMENT WITH MAZE & ASSOCIATES TO PROVIDE AUDITING SERVICES FOR THE FISCAL YEARS ENDING JUNE 30, 2022 THROUGH JUNE 30, 2025, WITH OPTIONS FOR THE FISCAL YEARS ENDING JUNE 30, 2026 AND JUNE 30, 2027 WHEREAS, in November 2021 the City’s Finance Department issued a Request for Proposals for independent auditing services needed for the City to meet its audit obligations; and
WHEREAS, out of seven proposals received, staff recommends contracting with Maze & Associates Accountancy Corporation (“Maze & Associates”) for the necessary auditing services;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of San Rafael that the City Manager is authorized to execute, on behalf of the City of San Rafael, a four-year agreement with Maze & Associates for independent auditing services, in the form included with the staff report for this resolution, subject to final approval as to form by the City Attorney.

I, LINDSAY LARA, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday, the 7th day of March, 2022, by the following vote, to wit:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:
_______________________________
LINDSAY LARA, City Clerk

AGREEMENT FOR PROFESSIONAL SERVICES WITH

MAZE AND ASSOCIATES TO PROVIDE PROFESSIONAL AUDITING

SERVICES TO THE CITY OF SAN RAFAEL
This Agreement is made and entered into this _ _ day of February, 2022, by and between the CITY OF SAN RAFAEL (hereinafter "CITY"), and MAZE AND AS SOCIA TES ACCOUNTING CORPORATION (hereinafter "CONSUL TANT").

RECITALS
WHEREAS, the CITY has determined the need for professional auditing services; and WHEREAS, the CONSULT ANT has agreed to render such services.

AGREEMENT
NOW, THEREFORE, the pai1ies hereby agree as follows:

1. PROJECT COORDINATION.

A. CITY. The City Manager shall be the representative of the CITY for all purposes under this Agreement. The Administrative Services Director, Nadine Atieh Hade, is hereby designated the PROJECT MANAGER for the CITY, and said PROJECT MANAGER shall supervise all aspects of the progress and execution of this Agreement.

B. CONSULTANT'S Project Director. CONSULTANT shall assign a single PROJECT DIRECTOR to have overall responsibility for the progress and execution of this Agreement for CONSULT ANT. Amy Meyer, Audit Partner, is hereby designated as the PROJECT DIRECTOR for CONSULT ANT. Should circumstances or conditions subsequent to the execution of this Agreement require a substitute PROJECT DIRECTOR for any reason, the CONSULT ANT shall notify the CITY within ten (10) business days of the substitution.

2. DUTIES OF CONSULTANT.

CONSULT ANT shall perform the duties and/ or provide services as described in the Request for Proposal for Audit Services (attached Exhibit A) and pursuant to the CONSULTANT'S Proposal dated December 31, 2021 (attached Exhibit B) and incorporated herein.

3. DUTIES OF CITY.

CITY shall cooperate with CONSULTANT in their perfo1111ance under this agreement and shall compensate CONSULT ANT as provided herein.

4. COMPENSATION.

For the full performance of the services described herein by CONSULTANT, CITY shall pay CONSUL TANT pursuant to the Schedule of Fees and Expenses reflected in the CONSULT ANT'S Proposal ( attached Exhibit B), dated December 21 , 2021.

The total compensation payable to CONSULT ANT hereunder shall not exceed the following amounts.

FY 21-22 FY 22-23 FY 23-24 FY 24-25 FY 25-26
Total Cost $77,706 $80,035 $82,437 $84,911 $87,458
Payment will be made monthly upon receipt by PROJECT MANAGER of itemized invoices submitted by CONSULT ANT.

5. TERM OF AGREEMENT.

FY 26-27
$90,082
The term of this Agreement shall be for four consecutive years for auditing fiscal years ending June 30, 2022 through June 30, 2025. Upon mutual agreement of the parties, and subject to the approval of the City Council, the term of this Agreement shall be extended for an additional period of two years for auditing fiscal years ending June 30, 2026 and June 30, 2027.

6. TERMINATION.

A. Discretionary. Either party may terminate this Agreement without cause upon thirty (30) days written notice mailed or personally delivered to the other party.

B. Cause. Either party may terminate this Agreement for cause upon fifteen (15) days written notice mailed or personally delivered to the other patty, and the notified patty's failure to cure or correct the cause of the termination, to the reasonable satisfaction of the paity giving such notice, within such fifteen (15) day time period.

C. Effect of Termination. Upon receipt of notice of termination, neither party shall incur additional obligations under any provision of this Agreement without the prior written consent of the other.

D. Return of Documents. Upon termination, any and all CITY docwnents or materials provided to CONSULTANT and CONSULT ANT's documents and materials prepared for or relating to the performance of its duties under this Agreement, other than CONSULTANT'S audit documentation, shall be delivered to CITY as soon as possible, but not later than thirty (30) days after termination.

7. OWNERSHIP OF DOCUMENTS.
2 Except for CONSULT ANT'S audit documentation, which shall remain the sole property of CONSULTANT, the written documents and materials prepared by the CONSULTANT in connection with the performance of its duties under this Agreement, shall be the sole property of CITY. CITY may use said property for any purpose, including projects not contemplated by this Agreement.

8. INSPECTION AND AUDIT.

Upon reasonable notice, CONSUL TANT shall make available to CITY, or its agent, for inspection and audit, all documents and materials maintained by CONSUL TANT in connection with its performance of its duties under this Agreement. CONSULTANT shall fully cooperate with CITY or its agent in any such audit or inspection.

9. ASSIGNABILITY.

The parties agree that they shall not assign or transfer any interest in this Agreement nor the performance of any of their respective obligations hereunder, without the prior written consent of the other party, and any attempt to so assign this Agreement or any rights, duties or obligations arising hereunder shall be void and of no effect.

10. INSURANCE.

A. Scope of Coverage. During the tenn of this Agreement, CONSULT ANT shall maintain, at no expense to CITY, the following insurance policies:

1. A commercial general liability insurance policy in the minimum amount of one million dollars ($1 ,000,000) per occurrence/two million dollars ($2,000,000) aggregate, for death, bodily injury, personal injury, or property damage.

2. An automobile liability (owned, non-owned, and hired vehicles) insurance policy in the minimum amount of one million dollars ($1,000,000) dollars per occmTence.

3. If any licensed professional performs any of the services required to be perfonned under this Agreement, a professional liability insurance policy in the minimum amount of one million dollars ($1,000,000) per occurrence/two million dollars ($2,000,000) aggregate, to cover any claims arising out of the CONSULT ANT's performance of services under this Agreement.

Where CONSULT ANT is a professional not required to have a professional license, CITY reserves the right to require CONSULT ANT to provide professional liability insurance pursuant to this section.

4. If it employs any person, CONSULTANT shall maintain worker's compensation insurance, as required by the State of California, with statutory limits, and employer's liability insurance with limits of no less than one million dollars ($1 ,000,000) per accident for bodily injury or disease. CONSUL TANT's worker's compensation insurance shall be specifically endorsed to waive any right of subrogation against CITY. 3 B. Other Insurance Requirements. The insurance coverage required of the CONSULT ANT in subparagraph A of this section above shall also meet the following requirements:

1. Except for professional liability insurance or worker's compensation insurance, the insurance policies shall be specifically endorsed to include the CITY, its officers, agents, employees, and volunteers, as additional insureds (for both ongoing and completed operations) under the policies.

2. The additional insured coverage under CONSULT ANT'S insurance policies shall be "primary and noncontributory" with respect to any insurance or coverage maintained by CITY and shall not call upon CITY's insurance or self-insurance coverage for any contribution. The "primary and noncontributory" coverage in CONSULTANT'S policies shall be at least as broad as ISO form CG20 010413.

3. Except for professional liability insurance or worker's compensation insurance, the insurance policies shall include, in their text or by endorsement, coverage for contractual liability and personal injury.

4. By execution of this Agreement, CONSULTANT hereby grants to CITY a waiver of any right to subrogation which any insurer of CONSULT ANT may acquire against CITY by virtue of the payment of any loss under such insurance. CONSULTANT agrees to obtain any endorsement that may be necessary to effect this waiver of subrogation, but this provision applies regardless of whether or not CITY has received a waiver of subrogation endorsement from the insurer.

5. If the insurance is written on a Claims Made Form, then, following termination of this Agreement, said insurance coverage shall survive for a period of not less than five years.

6. The insurance policies shall provide for a retroactive date of placement coinciding with the effective date of this Agreement.

7. The limits of insurance required in this Agreement may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of CITY (if agreed to in a written contract or agreement) before CITY'S own insurance or self-insurance shall be called upon to protect it as a named insured.

8. It shall be a requirement under this Agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be available to CITY or any other additional insured party. Furthermore, the requirements for coverage and limits shall be: (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured; whichever is greater. No representation is made that the minimum Insurance requirements of this agreement are sufficient to cover the obligations of the CONSULT ANT under this agreement.
4 C. Deductibles and SIR's. Any deductibles or self-insured retentions in CONSUL TANT's insurance policies must be declared to and approved by the PROJECT MANAGER and City Attorney and shall not reduce the limits of liability. Policies containing any self-insured retention (SIR) provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or CITY or other additional insured party. At CITY's option, the deductibles or self-insured retentions with respect to CITY shall be reduced or eliminated to CITY's satisfaction, or CONSULTANT shall procure a bond guaranteeing payment of losses and related investigations, claims administration, attorney's fees and defense expenses.

D. Proof of Insurance. CONSULTANT shall provide to the PROJECT MANAGER or CITY'S City Attorney all of the following: (1) Certificates of Insurance evidencing the insurance coverage required in this Agreement; (2) a copy of the policy declaration page and/or endorsement page listing all policy endorsements for the commercial general liability policy, and (3) excerpts of policy language or specific endorsements evidencing the other insurance requirements set forth in this Agreement. CITY reserves the right to obtain a full certified copy of any insurance policy and endorsements from CONSULT ANT. Failure to exercise this right shall not constitute a waiver of the right to exercise it later. The insurance shall be approved as to form and sufficiency by PROJECT MANAGER and the City Attorney.

11. INDEMNIFICATION.

A. Except as otherwise provided in Paragraph B., CONSULTANT shall, to the fullest extent permitted by law, indemnify, release, defend with counsel approved by CITY, and hold harmless CITY, its officers, agents, employees and volunteers (collectively, the "City lndemnitees"), from and against any claim, demand, suit, judgment, loss, liability or expense of any kind, including but not limited to attorney's fees, expert fees and all other costs and fees of litigation, (collectively "CLAIMS"), arising out of CONSULTANT'S performance of its obligations or conduct of its operations under this Agreement. However, to the extent that liability is caused by the negligence or willful misconduct of the City Indemnitces, the CONSUL TANT's indemnification obligation shall be reduced in proportion to the City Indemnitces' share of liability for the negligence or willful misconduct. In addition, the acceptance or approval of the CONSULTANT's work or work product by the CITY or any of its directors, officers or employees shall not relieve or reduce the CONSULTANT's indemnification obligations. In the event the City Indcmnitccs are made a party to any action, lawsuit, or other adversarial proceeding arising from CONSULTANT'S performance of or operations under this Agreement, CONSULTANT shall provide a defense to the City Indcmnitccs or at CITY'S option reimburse the City Indcmnitccs their costs of defense, including reasonable attorneys' fees, incurred in defense of such claims.

B. Where the services to be provided by CONSULTANT under this Agreement are design professional services to be performed by a design professional as that term is defined under Civil Code Section 2782.8, then, to the extent permitted by law including without limitation, Civil Code sections 2782, 2782.6 and 2782.8, CONSULT ANT shall indemnify and hold harmless the CITY and its officers, officials, and employees ( collectively City Indcmnitccs) from and against damages, liabilities or costs (including incidental damages. Court costs, reasonable attorney's fees as may be determined by the Court, litigation expenses and fees of expert witnesses incurred in 5 connection therewith and costs of investigation) to the extent they are caused by the negligence, recklessness, or willful misconduct of CONSULTANT, or any subconsultants, or subcontractor or anyone directly or indirectly employed by them, or anyone for whom they are legally liable (collectively Liabilities). Such obligation to hold harmless and indemnify any indemnity shall not apply to the extent that such Liabilities are caused in part by the negligence or willful misconduct of such City Indemnitee.

C. The defense and indemnification obligations of this Agreement are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained in this Agreement, and shall survive the termination or completion of this Agreement for the full period of time allowed by law.

12. NONDISCRIMINATION.

CONSULTANT shall not discriminate, in any way, against any person on the basis of age, sex, race, color, religion, ancestry, national origin or disability in connection with or related to the performance of its duties and obligations under this Agreement.

13. COMPLIANCE WITH ALL LAWS.

CONSULT ANT shall observe and comply with all applicable federal, state and local laws, ordinances, codes and regulations, in the performance of its duties and obligations under this Agreement. CONSULTANT shall perfmm all services under this Agreement in accordance with these laws, ordinances, codes and regulations. CONSUL TANT shall release, defend, indemnify and hold harmless CITY, its officers, agents and employees from any and all damages, liabilities, penalties, fines and all other consequences from any noncompliance or violation of any laws, ordinances, codes or regulations.

14. 0 THIRD PARTY BENEFICIARIES.

CITY and CONSULTANT do not intend, by any provision of this Agreement, to create in any third party, any benefit or right owed by one party, under the terms and conditions of this Agreement, to the other party.

15. NOTICES.

All notices and other communications required or permitted to be given under this Agreement, including any notice of change of address, shall be in writing and given by personal delivery, or deposited with the United States Postal Service, postage prepaid, addressed to the parties intended to be notified. Notice shall be deemed given as of the date of personal delivery, or if mailed, upon the date of deposit with the United States Postal Service. Notice shall be given as follows:

TO CITY's Project Manager:
6 Nadine Atieh Hade
City of San Rafael
1400 fifth Avenue
San Rafael, CA 94915
TO CONSULT ANT's Project Director:

16. INDEPENDENT CONTRACTOR.

Amy L. Meyer, CPA
Maze and Associates
3478 Buskirk Avenue, Suite 215
Pleasant Hill, CA 94523
For the purposes, and for the duration, of this Agreement, CONSULTANT, its officers, agents and employees shall act in the capacity of an Independent Contractor, and not as employees of the CITY. CONSULT ANT and CITY expressly intend and agree that the status of CONSULT ANT, its officers, agents and employees be that of an Independent Contractor and not that of an employee of CITY.

17. ENTIRE AGREEMENT -- AMENDMENTS.

A. The tenns and conditions of this Agreement, all exhibits attached, and all documents expressly incorporated by reference, represent the entire Agreement of the parties with respect to the subject matter of this Agreement.

B. This written Agreement shall supersede any and all prior agreements, oral or written, regarding the subject matter between the CONSULTANT and the CITY.

C. No other agreement, promise or statement, written or oral, relating to the subject matter of this Agreement, shall be valid or binding, except by way of a written amendment to this Agreement.

D. The terms and conditions of this Agreement shall not be altered or modified except by a written amendment to this Agreement signed by the CONSULT ANT and the CITY.

E. If any conflicts arise between the tenns and conditions of this Agreement, and the terms and conditions of the attached exhibits or the documents expressly incorporated by reference, the terms and conditions of this Agreement shall control.

18. SET-OFF AGAINST DEBTS.

CONSUL TANT agrees that CITY may deduct from any payment due to CONSULTANT under this Agreement, any monies which CONSULT ANT owes CITY under any ordinance, agreement, contract or resolution for any unpaid taxes, fees, licenses, assessments, unpaid checks or other amounts.

19. WAIVERS.

The waiver by either party of any breach or violation of any te1m, covenant or condition of this Agreement, or of any ordinance, law or regulation, shall not be deemed to be a waiver of any 7 other term, covenant, condition, ordinance, law or regulation, or of any subsequent breach or violation of the same or other term, covenant, condition, ordinance, law or regulation. The subsequent acceptance by either party of any fee, performance, or other consideration which may become due or owing under this Agreement, shall not be deemed to be a waiver of any preceding breach or violation by the other party of any term, condition, covenant of this Agreement or any applicable law, ordinance or regulation.

20. COSTS AND ATTORNEY'S FEES.

The prevailing party in any action brought to enforce the terms and conditions of this Agreement, or arising out of the performance of this Agreement, may recover its reasonable costs (including claims administration) and attorney's fees expended in connection with such action.

21. CITY BUSINESS LICENSE/ OTHER TAXES.

CONSULT ANT shall obtain and maintain during the duration of this Agreement, a CITY business license as required by the San Rafael Municipal Code. CONSULT ANT shall pay any and all state and federal taxes and any other applicable taxes. CITY shall not be required to pay for any work performed under this Agreement, until CONSUL TANT has provided CITY with a completed Internal Revenue Service Form W-9 (Request for Taxpayer Identification Number and Certification).

22. SURVIVAL OF TERMS.

Any terms of this Agreement that by their nature extend beyond the term (or termination) of this Agreement shall remain in effect until fulfilled and shall apply to both Parties' respective successors and assigns.
?..., --'· APPLICABLE LAW.

The laws of the State of California shall govern this Agreement.

24. COUNTERPARTS AND ELECTRONIC SIGNATURE.

This Agreement may be executed by electronic signature and in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one document.

Counterpart signature pages may be delivered by telecopier, email or other means of electronic transmission.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day, month and year first above written.
8 CITY OF SAN RAFAEL
JIM SCHUTZ, City Manager
ATTEST:

LINDSAY LARA, City Clerk
APPROVED AS TO FORM:

ROBERT F. EPSTEIN, City Attorney
9 CONSULTANT
By ;t;?t~
Name: /l IV) 'I 1--. M f?Y{f (2-
[If CONSULTANT is a corporation, add signature of
second corporate officer]
By: _________ __ _
Name: -----------
Title:
------------

CITY OF SAN RAFAEL
JIM SCHUTZ, City Manager
ATTEST:

LINDSAY LARA, City Clerk
APPROVED AS TO FORM:

ROBERT F. EPSTEIN, City Attorney
9 CONSULTANT
By: _ ___ ___ _ ___ _
Name: - ------ ----
Title: -----------
[If CONSULTANT is a corporation, add signature of
second corporate officer]
By:-+-- c:ZZ --=----------- ~-
Name: _ _,_~__......b~r~1~s_f!i~v=n~f __ _
Title: _ _ C_,...=0-----'- . ....... o'-------

REQUEST FOR PROPOSALS (RFP) FOR PROFESSIONAL AUDITING SERVICES Date Issued: November 24, 2021
Updated December 1, 2021
Proposals Due: December 31, 2021
The City of San Rafael is seeking proposals for the preparation of both financial and compliance audit reports covering the City and its related operations from qualified firms of certified public accountants.

Respondents to this RFP shall submit completed proposals electronically by 5:00 p.m. on December 31, 2021 to the following email address:

Claire Coleman
Senior Management Analyst
City of San Rafael
1400 Fifth Avenue, Room 204
San Rafael, CA 94901
[email protected]
Please contact Claire Coleman if you have any questions:

Email: [email protected]
Phone: (415) 451-2474
Request for Proposals (RFP) for Professional Auditing Services 2 Table of Contents
Introduction..................................................................................................................................................3 About the City of San Rafael ....................................................................................................................4 Scope of Auditor Services.........................................................................................................................5 Proposal Submission Requirements .......................................................................................................6 Questionnaire..............................................................................................................................................7 Evaluation of Proposals and Selection Process....................................................................................9 Timing and Schedule...............................................................................................................................10 Additional Information..............................................................................................................................11 Request for Proposals (RFP) for Professional Auditing Services 3 Introduction
The City of San Rafael (“City”) is requesting proposals for Professional Auditing Services. All proposals must be sent electronically to [email protected] by no later than 5:00 p.m. on December 31, 2021. Late proposals will not be considered. The proposals shall be clearly marked Proposal for Professional Auditing Services.

Proposals must be responsive to City’s request. The City will select a firm on the basis of demonstrated competence and on the professional qualifications necessary for the satisfactory performance of the services required. Cost alone shall not be the determinative factor.

The request for proposals does not obligate the City to award a contract, and the City reserves the right to cancel the request for proposals if deemed in its best interest. Responding firms shall be solely responsible for any expenses incurred in preparing proposals in response to this request.

Request for Proposals (RFP) for Professional Auditing Services 4 About the City of San Rafael
The City of San Rafael was incorporated in 1874 and became a charter city in 1913. The City operates under the Council/Manager form of government and is governed by a five-member City Council, which comprises four districted councilmembers and an at-large mayor. The City’s mission is to enhance the quality of life and to provide for a safe, healthy, prosperous and livable environment in partnership with the community. The City has a staff of about 412 full-time employees and is a full-service city, which includes the following departments:
• City Attorney’s Office
• City Clerk’s Office
• City Manager’s Office
• Community Development
• Digital Service and Open Government
• Economic Development and Innovation
• Human Resources
• Finance
• Fire
• Library and Recreation (includes Parks, Recreation, Library, and Childcare) • Parking Services
• Police
• Public Works
• San Rafael Sanitation District
The City’s fiscal year begins on July 1 and ends on June 30. For Fiscal Year 2021-22, the City of San Rafael has a total operating budget of approximately $128 million for all funds and the General Fund makes up approximately $89.5 million of that total. While City operations generate revenue from various public services, such as licensing, permitting, and building activity, the three primary sources of revenue for the General Fund are sales tax, property tax, and transaction and use tax (TUT). See the City website https://www.cityofsanrafael.org/departments/finance/ for the most recent City Operating and Capital Improvement Program Budget and the Comprehensive Annual Financial Report (CAFR).

Request for Proposals (RFP) for Professional Auditing Services 5 Scope of Auditor Services
The objective of this RFP is to receive proposals for professional audit services. Services shall include, but are not necessarily limited to, the following described below.

The City of San Rafael desires the auditor to express an opinion on the fair presentation of its basic financial statements in conformity with generally accepted accounting principles. The audit shall include an examination of all City funds by certified public accountants duly authorized to practice as such by the State of California. The auditor shall also be responsible for performing certain limited procedures involving required supplementary information required by the Governmental Accounting Standards Board, as mandated by generally accepted auditing standards.

The auditor shall review and verify all trial balance worksheets and summary schedules including balance sheets, revenues, expenditures, and changes in fund balance for each City fund. The data source for the schedules will be the financial statements supplied by the City. An initial draft of the CAFR will be prepared by City staff and will be given to the auditors during the final stage of the audit. Final report preparation and necessary editing shall be the responsibility of the Auditor.

The auditor shall submit for management review a draft of all reports. The final reports are subject to review by the City Council. The auditor shall incorporate, as part of the basic proposal, meeting time with staff and City Council for the purpose of discussing the audits or management letter and its conclusions.

Reports To Be Issued
- Comprehensive Annual Financial Report (CAFR), including a web-ready CAFR PDF to be issued on the fair presentation of the financial statements in conformity with generally accepted accounting principles.
- Management and SAS 114 Letters, which includes findings, statements, observations, opinion, comments, or recommendations, related to:
o Systems of internal control based upon the auditors’ understanding of the control structure and assessment of control risk.
o Compliance with applicable laws and regulations.
o Accounting systems, functions, procedures, and processes, especially regarding cost effectiveness.
- Single Audit Report which includes a City prepared Schedule of Expenditures of Federal Awards
- Child Development Program Audit Report
- Transportation Development Act (TDA) Program Audit Report - Agreed-Upon Procedures Performed Related to the calculation of the Gann Appropriations Limit
Request for Proposals (RFP) for Professional Auditing Services 6 Proposal Submission Requirements
The proposal shall be organized and submitted with the following elements:
• Cover page
• Table of Contents
• Questionnaire
o Proposer shall provide responses and information to fully satisfy each item in the Questionnaire (see section below). Each question item should be presented before the proposer’s response.
• Attachments
o A report on firm’s most recent external quality review, any findings discovered as part of that review and actions taken to correct those findings. ▪ The firm also must disclose information on the circumstances and status of any disciplinary action taken or pending against the firm during the past three (3) years with state regulatory bodies or professional organizations, as well as any pending or settled litigation within the past three (3) years. o Any other attachments deemed relevant.

Please keep your proposal to no more than twenty (20) pages in length. This page limit includes the cover page, table of contents, executive summary, questionnaire, and any supplemental attachments.

Request for Proposals (RFP) for Professional Auditing Services 7 Questionnaire
A. Company and General Information
• Company name and address.
• Letter of transmittal signed by an individual authorized to bind the respondent, stating that the respondent has read and will comply with all terms and conditions of the RFP. • General information about the primary contact who would be able to answer questions about the proposal. Include name, title, telephone number and email address of the individual.

B. Qualifications and Experience of the firm
• Describe your firm’s history and organizational structure. Include the size of the firm, location of offices, years in business, organizational chart, and name(s) of owner(s) and principal parties.
• Identify partners, manager, and seniors who will be assigned to work on this project and the firm’s office in which they are each located. Include brief summaries of their background (including if they hold a current CPA license) and experience in auditing cities, as well as their assigned responsibilities under the proposal. • What is your firm’s experience in public sector accounting and auditing? • Comment on other areas that may make your firm different from your competitors.

C. Questions/Response to Scope of Services
• Describe the audit approach and methodology to be used to perform the services. This may include a discussion of:
i. Approach to selection of sample size;
ii. Use of specialized software;
iii. Analytical procedures;
iv. Approach to internal control structure;
v. Approach to determining laws / regulations subject to audit test work; vi. Identification of any anticipated problems, or special assistance required from city staff; and
vii. The format of the report.

D. Fees
• Provide your fees for the proposed service.
• Detail costs and hourly billing rates, as well as any proposed method of adjustment in the cost of services for subsequent years of the engagement, if applicable. • Outline billing and payment expectations, including timing and method of payment. • Describe any remaining fees not already detailed above. • Present a specific “not to exceed” fixed fee, including associated fees (i.e., printing costs, attendance at meetings, travel) and all direct and indirect costs.

Request for Proposals (RFP) for Professional Auditing Services 8 E. References
• Provide a list of the municipal agencies for which the respondent has provided audit services for the past three calendar years.
• Provide the following information for three client cities that are similar in size and scope to the project requested by this proposal:
o Name of Public Agency
o Name and title of contact person
o Telephone number and email address of contact person
o Brief description of the scope of the audit performed F. Implementation Schedule
• Include a work schedule and note key project milestones and timelines for deliverables. Identify any assumptions used in developing the schedule. Any assumptions regarding turnaround time for City Staff review should be clearly noted. o Please note that auditor is responsible for identifying required review times for the City input and must account for printing and distribution within any timelines identified in this RFP.

Request for Proposals (RFP) for Professional Auditing Services 9 Evaluation of Proposals and Selection Process
Evaluation of Proposals
The project’s core team, composed of City staff, will evaluate all proposals in accordance with the criteria listed below. The City team members, in applying the major criteria to the proposals, may consider additional criteria beyond those listed. In addition to evaluating written proposals, twentyminute oral interviews may be requested to allow for a formal presentation by the proposer.

The final selection will be the firm which, in the City’s opinion, is the most responsive and responsible, meets the City’s requirements in providing this service, and is in the City's best interest. The City maintains the sole and exclusive right to evaluate the merits of the proposals received.

Proposals will be evaluated based on the following criteria:
• Thoroughness and understanding of the tasks to be completed • Background and experience in professional audit and accounting services • Staff expertise and overall experience of personnel assigned to the work • Responsiveness to requirements of the project
• Recent public sector experience, preferably in a municipal setting conducting similar work • Costs
Although price for the services will be an important part of the consideration for award of the project, the City will consider the consultant’s qualifications, expertise and level of professional service in the award of the project.

Request for Proposals (RFP) for Professional Auditing Services 10 Timing and Schedule
We will make every effort to administer the RFP process in accordance with the terms and dates outlined below. However, we reserve the right to modify the RFP process and dates as deemed necessary.

Event Time Date
RFP Published and distributed November 24, 2021
Proposal submission deadline 5:00 PM December 31, 2021
Proposals reviewed and evaluated by staff January 3 - 14, 2022 Recommendation to City Council with
Agreement January 17, 2022
Contract work begins January 24, 2022
Request for Proposals (RFP) for Professional Auditing Services 11 Additional Information
All responses to this RFP will become the property of the City of San Rafael.

This RFP does not commit the City to award a contract or to pay any costs incurred in the preparation of the company’s proposal. The City reserves the right to modify or cancel this RFP in part or in its entirety and to accept or reject any or all proposals received if they do not meet the minimum requirements of this RFP. The City also reserves the right to negotiate with the selected firm to revise the scope of services if necessary, including modifying the services requested to more closely match City needs.

If your firm is awarded the contract, your services (as well as those provided by other members of the team) will be subject to the terms of a Professional Services Agreement. Your company should review the terms of the Agreement to ensure that the proposal is consistent with its provisions and include in the proposal an acknowledgement of acceptance of those provisions, including requirements for indemnification and insurance. If your company takes exception to any of the terms, such concerns or exceptions must be expressly stated in the proposal.

Insurance and Business License
The firm receiving the contract for audit services shall procure and maintain, for the duration of the contract, insurance as required in the City’s standard professional services agreement. The firm selected must have a valid City of San Rafael business license while conducting any work under this contract for each year of the contract term. Additional information regarding the City’s business license program may be obtained by calling (415) 485-3051.

Standards To Be Followed
To meet the requirements of this request for proposal, these audits are to be performed in accordance with all applicable and generally accepted auditing standards including, but not limited to: the standards set forth for financial audits by the Government Accounting Standards Board (GASB), in the General Accounting Office’s (GAO) Government Auditing Standards, and in the U.S. Office of Management (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

Special Considerations
The City of San Rafael has received awards from the Government Finance Officers Association (GFOA) for the “Certificate of Achievement for Excellence in Financial Reporting” for the past nine years. The City of San Rafael anticipates that it will continue to send its Annual Comprehensive Financial Report to GFOA for review in their Certificate of Achievement for Excellence in Financial Reporting program. The format of reports shall allow the City to meet the requirements of that program. This also requires that the auditor ensure that the audit report and financial statements are completed in time for submission to GFOA. The auditor shall also assist with developing responses to any comments or deficiencies noted by GFOA.

Request for Proposals (RFP) for Professional Auditing Services 12 Working Paper Retention and Access to Working Papers All working papers and reports must be retained at the auditor's expense for a minimum of three (3) years, unless the firm is notified in writing by the City of San Rafael of the need to extend the retention period. The auditor will be required to make working papers available to the City of Rafael or any government agencies included in the audit of federal grants. In addition, the firm shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance.

Contract Term
The contract shall be for four consecutive years for auditing fiscal years ending June 30, 2022 through June 30, 2025. Upon mutual agreement of the parties, and subject to the approval of the Agency, the term of this Agreement shall be extended for an additional period of two years for auditing fiscal years ending June 30, 2026 and June 30, 2027.

December 31, 2021
Claire Coleman
Senior Management Analyst
City of San Rafael
1400 Fifth Avenue, Room 204
San Rafael, CA 94901
[email protected]
Dear Ms. Coleman:

In response to the City’s request for proposals for professional auditing services, we are pleased to enclose one electronic copy of our Proposal to continue to provide Professional Auditing Services for the City of San Rafael.

Yours very truly,
Amy L. Meyer, CPA
Audit Partner
AM:saa
Enclosures
This Page Left Intentionally Blank
Claire Coleman
Senior Management Analyst
City of San Rafael
1400 Fifth Avenue, Room 204
San Rafael, CA 94901
[email protected]
Amy L. Meyer, CPA
3478 Buskirk Ave, Suite 215
P (925) 930-0902
F (925) 930-0135

PROFESSIONAL

AUDITING

SERVICES

PROPOSAL

12.31.21 PREPARED FOR
This Page Left Intentionally Blank

CITY OF SAN RAFAEL

PROFESSIONAL AUDITING SERVICES PROPOSAL

TABLE OF CONTENTS
Page

QUESTIONNAIRE
A. COMPANY AND GENERAL INFORMATION
Letter of Transmittal ................................................................................................................................................ 1 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM
Overview ................................................................................................................................................................. 3 Organization Chart .................................................................................................................................................. 3 Audit Team .............................................................................................................................................................. 4 Resumes of Staff Assigned to Your Audit .............................................................................................................. 4 Experience .............................................................................................................................................................. 6 Capacity and Resources ........................................................................................................................................ 6 Professional Activities ............................................................................................................................................. 7 Staff Training ........................................................................................................................................................... 7 C. QUESTIONS/RESPONSES TO SCOPE OF SERVICES
Overview ................................................................................................................................................................. 8 Specific Audit Strategy – Interim ............................................................................................................................ 8 Laws, Regulations and Compliance ...................................................................................................................... 8 System Controls, Transaction Cycle Processing Verification and Sample Sizes ................................................ 8 Remote Audit Considerations ................................................................................................................................ 9 Assessing Risks – Interim Phase ........................................................................................................................... 9 Client Tailored Risk Assessment ......................................................................................................................... 10 Assessing Risks – Final Phase ............................................................................................................................ 10 Communication, Coordination, Prompt Service and Delivery of Reports ........................................................... 11 Internal Quality Assurance System ...................................................................................................................... 11 D. FEES
Total Cost of Audit ................................................................................................................................................ 12 What our Price Includes ....................................................................................................................................... 12 Cost Rationale ...................................................................................................................................................... 12 Fees and Billings (Method of Payment) ............................................................................................................... 12 Total All Inclusive Maximum Price Summary ...................................................................................................... 13 GASB No. 87, Leases, and Potential Increase in Audit Scope ........................................................................... 13 E. REFERENCES
City and Town Clients ........................................................................................................................................... 14 References ............................................................................................................................................................ 15 F. IMPLEMENTATION SCHEDULE
Timeline for Audit Work ........................................................................................................................................ 16

ATTACHMENTS
External Quality Control Review/Peer Review .................................................................................................... 18 Federal or State Desk or Field Reviews .............................................................................................................. 18 Litigation ................................................................................................................................................................ 18 License to Practice in California ........................................................................................................................... 18 This Page Left Intentionally Blank

A. COMPANY AND GENERAL INFORMATION
December 31, 2021
Claire Coleman
Senior Management Analyst
City of San Rafael
1400 Fifth Avenue, Room 204
San Rafael, CA 94901
[email protected]
Dear Ms. Coleman:

We appreciate this opportunity to submit our proposal to continue to provide Professional Auditing Services for the City of San Rafael. We have read the request for proposals (RFP) and agree to comply with all terms and conditions of the RFP. We understand we will audit the City’s Basic Financial Statements and assist with the Annual Comprehensive Financial Report for the four fiscal years beginning with the fiscal year ending June 30, 2022, with the option to extend for an additional two years. We will also perform additional procedures and complete the other assurance services as specified in the City’s RFP within the time periods established by the City.

We are quite certain we are the most qualified firm to be your independent accountants. As our founder, Scott Maze, first coined over forty years ago, “We are in Business to Help Our Clients Succeed!” Since that time, we have rigorously employed this philosophy along with our commitment to continual improvement. Our clients know from experience we employ a variety of techniques, technologies and strategies to maximize effective and efficient audits without shifting our work onto our client’s staff. We’ve summarized these techniques, technologies and strategies below and explained them in more depth in our proposal.  We are the best-known regional municipal audit firm in Northern California. Our firm has been in business over 40 years, and over that time we have achieved national recognition with the consistently high quality of our work and with our leadership on issues such as GASB Statements 34, 68 and 75, and internal control enhancements. We frequently speak at CSMFO and CSDA events and webinars.  The municipal industry is our main business. We believe we have the necessary qualifications to perform your audit.
 Annually, we serve over 200 municipalities including special districts, joint powers authorities, successor agencies, housing authorities and financing authorities in the San Francisco Bay Area.
 We currently have over forty City or Town clients ranging in size from small towns to large complex cities. We are proud to say that over forty of our clients publish award-winning Annual Comprehensive Financial Reports, the majority of which we have provided assistance in compiling reports.
 We conduct over three dozen Single Audits annually.
 Our Partners are actively involved in planning, conducting and completing the audit in our client’s offices, and our Partners are available when you need them. We resolve issues on the spot while the audit is going on.
 We have a long-term track record of client retention beyond our client’s original contract terms because of the quality of our service.
1  We are properly licensed to practice in California. All key staff assigned to this audit possess California CPA licenses.
 Everyone on our audit staff averages approximately 80 hours of training in municipal auditing and accounting and 1500 hours of municipal audit experience each year. This means you do not train our staff!
 Our fee includes one free day of training. Starting in 2016, we implemented the annual Maze Live training.

This will provide you with knowledge of upcoming GASB pronouncements and changes in the municipal field.

Past classes included topics such as year two of GASB Statement 68, GASB Update, Implementation of GASB Statements 74 and 75, Fraud Environment, Cybersecurity and Single Audit under Uniform Guidance.

Future Classes will focus on similar topics as well as the information to prepare for the implementation of GASB Statement 87.
 Our Closing Checklists help you prepare in advance for both our interim and year-end audits. These Checklists do away with last-minute requests for schedules and analyses at year-end and help identify potential problems early in the process. We will coordinate them with the work papers you are already preparing, so you don’t have to prepare workpapers only for the auditors.

As with all our audits, we are committed to providing timely, quality audit services to the City of San Rafael. We have no doubt that we are the firm best qualified to perform the services described in the RFP. After you have analyzed our proposal and - most important - talked with our references, we are quite confident you will agree.

Amy Meyer, Vice President ([email protected]), and Katherine Yuen, Vice President ([email protected]), are authorized to represent, sign for and contractually obligate Maze & Associates, a Professional Corporation, located at 3478 Buskirk Avenue, Suite 215, Pleasant Hill, CA, 94523, P(925) 930-0902, F(925) 930-0135. The proposal is a firm and irrevocable offer for 90 days.

We look forward to the opportunity to continue to provide audit services for the City of San Rafael! Yours very truly,
Amy L. Meyer, CPA
Audit Partner
AM:saa

2 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM
RFP QUESTION: Describe your firm’s history and organizational structure. Include the size of the firm, location of offices, years in business, organizational chart, and name(s) of owner(s) and principal parties.

OVERVIEW - We are a professional services corporation located in Pleasant Hill, California. We presently have a total of fifty-seven people including the following:
 Seven Shareholders, including five Audit Partners:
 Tim Krisch, CEO  David Alvey
 Chris Hunt, COO  Vikki Rodriguez
 Amy Meyer  Grace Zhang
 Katherine Yuen
 Three Directors
 Six Managers
 Six Audit Supervisors
Twenty of our professional staff are California Certified Public Accountants, and three additional staff members are in the process of completing their applications for licensure. Thirty of our professional staff members comprise our governmental audit staff, as our firm’s emphasis is on governmental auditing and accounting.

Several of our professional staff have national accounting firm experience, which we have blended with the more personal approach of a smaller firm.

All staff assigned to this engagement are full-time staff of our firm. We anticipate assigning two partners, one manager, one supervisor, two to three audit associates and administrative support staff to this engagement. The location of the office from which work on this engagement will be performed is Pleasant Hill, California. Our mailing address is 3478 Buskirk Avenue, Suite 215, Pleasant Hill, CA 94523. Phone: 925-930-0902 Fax: 925-930-0135 The majority of our clients are cities, special districts, or other municipal entities and we do this work twelve months of the year. We limit our practice in other areas and focus on being the best municipal audit firm in Northern California. Our clients include several cities similar to the City in size. Our audit strategy is tailored to municipalities and is quite different from the traditional approach adapted from commercial clients by general practice accounting firms. We have focused on municipalities since 1986. We are active in GFOA, CSMFO, CSDA and CMTA, and our Partners have been speakers at GFOA, CSMFO, CSDA and CMTA functions.

We are in business to help our clients succeed. We help you use the ever-growing tangle of accounting rules properly, but to your best advantage, by helping you keep out of trouble and helping you do the right thing. We stay in touch throughout the year to keep you informed of municipal accounting developments and to help you avoid problems, instead of coming in afterwards to assess the damage. We rotate our audit emphasis based on our planning meetings with you so areas that concern you can be addressed as a normal part of the audit at no extra cost.

ORGANIZATION CHART - We are organized as follows:
3 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM (Continued) RFP QUESTION: Identify partners, manager, and seniors who will be assigned to work on this project and the firm’s office in which they are each located. Include brief summaries of their background (including if they hold a current CPA license) and experience in auditing cities, as well as their assigned responsibilities under the proposal.

AUDIT TEAM - We are proposing to assign Amy Meyer, CPA, as Engagement Partner, Katherine Yuen, CPA, as Alternate/Technical Review Partner and Childcare Audit Partner, Whitney Crockett, CPA, as Manager, and Kristine Manansala as Supervisor. We have selected this team based on their extensive municipal audit experience.

We will balance out our resources with our Senior Associates and Associates to form a fully leveraged team. All of our audit staff are experienced with audits of Basic Financial Statements, enterprise operations, retirement plans, capital assets and infrastructure, long term debt, including swaps and related compliance and continuing disclosures, and all other aspects of municipal accounting and financial reporting.

All personnel who are assigned to work on this engagement and the firm office in which they are located is Pleasant Hill, California.

RESUMES OF STAFF ASSIGNED TO YOUR AUDIT (NOTE – client lists listed below have been edited to include only City clients and exclude special district and authority clients – if you would like to see our team members’ full resumes, we will be happy to provide them.) AMY MEYER, CPA, Engagement Partner – Amy graduated from the University of the Pacific in 1993 with a B.S. in Accounting and a minor in Information Systems and has worked with Maze & Associates since 1993. Amy is a California CPA and is a member of the California Society of CPAs and the American Institute of Certified Public Accountants.

Amy has assisted several of our clients with their computer applications and is very comfortable using a variety of systems. She has been involved with a number of accounting and GASB implementation training classes customized to our clients’ needs.

Amy is also our PC applications expert. Amy currently serves on the Governmental Accounting and Auditing Committee of the California Society of Certified Public Accountants, which provides practical guidance to CPAs in the area of governmental accounting and auditing in an effort to improve the quality of financial reporting on governmental entities. Amy is also an Annual Comprehensive Financial Report reviewer for GFOA. She has accumulated three hundred and four hours of continuing education during the last three years as an in-house instructor and participant. She has gained valuable experience on the audits of the following:

City of Alameda City of Livermore Town of San Anselmo
City of Albany Town of Los Gatos City of San Carlos
City of American Canyon City of Manteca City of Modesto Town of Atherton City of Martinez City of San Pablo
City of Belmont City of Milpitas City of San Rafael
City of Brentwood City of Mountain View City of Santa Clara City of Concord City of Oakley City of Saratoga
City of Daly City City of Palo Alto City of South San Francisco City of Dublin City of Rancho Cordova City of Tracy
City of El Cerrito City of Richmond City of Turlock
City of Elk Grove City of Rio Vista City of Vallejo
City of Hercules City of Rocklin City of Waterford
City of Lathrop City of Roseville City of Woodland
4 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM (Continued) KATHERINE YUEN, CPA, Alternate/Technical Review Partner and Childcare Audit Partner – Katherine is a year-round municipal auditor and has been with Maze & Associates since 1996. Over the years, she has taught classes both externally and internally on topics including GASB Statements implementation, auditing techniques under the Government Auditing Standards, and internal controls environment. She currently serves on the Governmental Accounting and Auditing Committee of the California Society of Certified Public Accountants, which provides practical guidance to CPAs in the area of governmental accounting and auditing in an effort to improve the quality of financial reporting on governmental entities. She is also a member of the American Institute of Certified Public Accountants and the California Society of Certified Public Accountants.

She holds a Bachelor of Science degree in Business Administration from the University of California, at Berkeley. She is a Certified Public Accountant in the State of California. Her relevant audit experience includes:

City of Alameda City of Los Banos City of Rancho Cordova Town of Atherton Town of Los Gatos City of Roseville
City of Belmont City of Manteca City of San Carlos
City of Benicia City of Martinez City of San Leandro
City of Campbell City of Millbrae City of San Mateo
City of Concord City of Milpitas City of San Rafael
City of Daly City City of Monterey City of San Rafael Child Development Program
City of Davis Town of Moraga City of San Ramon
City of Dublin City of Mountain View City of Sausalito
City of Emeryville City of Napa City of South Lake Tahoe Town of Fairfax City of Newark City of South San Francisco City of Galt City of Orinda City of Tracy
City of Hayward City of Oxnard City of Walnut Creek
City of Lafayette City of Palo Alto City of Woodland
Town of Larkspur City of Petaluma Town of Woodside
City of Lathrop City of Pinole
City of Los Altos City of Pleasant Hill
WHITNEY L. CROCKETT, CPA, Manager – graduated from Washington State University with a Bachelor of Arts in Business Administration in Accounting in May 2011 and received a Masters of Accounting Degree in August 2012. She is a Certified Public Accountant in the State of California. Whitney has received over 240 hours of continuing education in the past three years and has participated in the following audits:

City of Alameda City of Larkspur City of Richmond
Town of Atherton City of Los Banos City of Roseville
City of Brisbane City of Manteca City of Santa Clara
City of Concord City of Martinez City of San Pablo
City of Daly City City of Mountain View City of San Rafael City of Dublin City of Pittsburg City of Sausalito
City of East Palo Alto City of Milpitas City of Vallejo City of El Cerrito Town of Moraga City of Watsonville
Town of Fairfax City of Oakley City of West Sacramento
City of Hayward City of Pacifica Town of Woodside
City of Lafayette City of Petaluma

5 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM (Continued) KRISTINE MANANSALA, Supervisor – Kristine graduated from St Mary’s College of California in 2013 with a Bachelor of Science in Accounting, when she joined our firm.

Kristine has received over 240 hours of continuing education in the last three years.

Her audit experience includes the following:

City of Alameda City of Milpitas City of Richmond
City of Brentwood Town of Moraga City of San Leandro
City of Davis City of Mountain View City of San Rafael
City of Galt City of Oakley City of South San Francisco City of Hayward City of Orinda City of Tracy
City of Lafayette City of Petaluma City of Turlock
City of Livermore City of Pittsburg City of Vallejo
City of Los Banos City of Pleasanton
City of Manteca City of Rancho Cordova
RFP QUESTION: What is your firm’s experience in public sector accounting and auditing? EXPERIENCE - Our practice includes over forty city and town clients and more than fifty special districts, including over forty Comprehensive Annual Financial Report award winners—more award winners than any other Northern California accounting firm or international firm branch office. Eighty percent of our practice is municipal auditing, accounting and consulting, continuing throughout the entire year. Our growth can be seen in the graph below, which shows the growth in the number of our total municipal entity clients in blue, City audit clients in green and Comprehensive Annual Financial Report award winners in red. 0 10
20 30
40 50
60 70
80 90
100
110
120
130
140
150
160
170
180
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Every one of the above Comprehensive Annual Financial Reports won awards from GFOA and/or CSMFO.

As you can see from the client list in the References - City and Town Clients Section below, we have a winning combination that has resulted in strong client loyalty and retention. Several clients who left have returned after seeing the difference between our firm and our competitors. Others have remained our clients after completing a full-blown proposal process, most recently Cities of Brentwood, Milpitas, Oakley, Pittsburg, Santa Clara and South San Francisco.

RFP QUESTION: Comment on other areas that may make your firm different from your competitors.

CAPACITY AND ASSISTIVE RESOURCES - We have consistently demonstrated the ability of our capacity and resources to meet the demands of our clients. We have never missed a reporting deadline for any of our clients.

6 B. QUALIFICATIONS AND EXPERIENCE OF THE FIRM (Continued) Over the years we have made substantial additional investments in our people and our systems. We have continued our policy of at least doubling the required amount of Continuing Education we provide our people.

We have moved most of our clients from a manual input of their general ledger data to a fully mechanized computer upload of that data direct to our Excel-based financial statement formats. At the same time, we have added significant numbers of internal data controls to financial statement formats. This strategy has virtually eliminated input errors, increased efficiency, and allowed our clients to spend less time reviewing and approving the financial statements. Not only does our direct upload produce fund-basis financial statements, it produces the Entity-wide financial statements. And these improvements have been made without a hiccup - we consistently deliver final draft financial statements and reports to our clients within a week of the last day of our fieldwork.

Our client support is unmatched by any other firm. As a San Francisco Bay Area municipal audit niche firm with five audit partners, we are positioned perfectly to provide staff and Council with a wide variety of resources. Support ranges from turnkey financial statement drafts with linked footnotes and direct download-based financial statements to professional continuing education sessions. We are active in professional organizations affecting local government and have a strong presence in neighboring local governments which keeps our knowledge current that we readily share with our clients. And we do not charge extra for the five-minute phone calls throughout the year.

PROFESSIONAL ACTIVITIES - We are active members of the Government Finance Officers Association and the California Society of Municipal Finance Officers as well as the American Institute of Certified Public Accountants and the California Society of Certified Public Accountants. We are also a member of the Association of California Water Agencies (ACWA). We are frequent speakers at various organizations.

We attend CSMFO Northern California chapter meetings on a regular basis, and we have served as speakers on various occasions. We also attend the CSMFO Annual Conference, at which our Partners and IT Director have been speakers. We have also attended the League of California Cities’ annual Financial Management Seminars.

Amy Meyer, Partner, and Katherine Yuen, Partner, serve on the Governmental Accounting and Auditing Committee of the California Society of CPAs. David Alvey, Partner, serves on the Accounting Procedures and Assurance Services Committee of CalCPA and the Professional Standards Committee of CSMFO. Amy Meyer and David Alvey are Annual Comprehensive Financial Report reviewers for the Comprehensive Annual Financial Report Award Program of the Government Finance Officers Association.

STAFF TRAINING - We believe the level of training we provide is unmatched by any other accounting firm. Our audit staff receives an average of 80 hours of continuing education annually, including an average of over 48 hours of municipal audit and accounting training. These are twice the amount required by professional standards.

Our program places heavy emphasis on governmental accounting and auditing classes conducted by our own staff, supplemented by courses offered by the California Society of Certified Public Accountants, the American Institute of Certified Public Accountants, the Government Finance Officers Association, the California State Municipal Finance Officers Organization and the Association of California Water Agencies.

We accomplish this task by reserving up to two weeks each year solely for staff training. Our training is very specific and very participatory; lectures are almost non-existent as people are involved in a continual giveand-take format designed to educate while it helps us improve our services. We deal with specific clients and situations, we solve problems and do case studies, and we train people for real-life situations through role-play exercises. Everyone is equal in these exercises and everyone contributes their own experience in the field and the ideas they have formulated from that experience. Suggestions coming out of staff training sessions are the source of most of the service improvements and refinements we make each year.

7 C. QUESTIONS/RESPONSE TO SCOPE OF SERVICES
RFP QUESTION: Describe the audit approach and methodology to be used to perform the services.

OVERVIEW - Our audit strategy is designed specifically for municipalities. We perform half our audit well before year-end so we can identify problems early. Our strategy maximizes our efficiency and lessens the load on our clients. When engaged to prepare the financial statements, we prepare proformas of them for your review, well before year-end and we give you detailed interim and final-phase checklists of all the items we will need from you months in advance. We have integrated GASB 34 requirements into our strategy so that there is a seamless transition to the entity-wide statements.

We will plan the audit in detail and prepare an Audit Plan which details the information we will need from you to complete our interim and year-end audits, along with the person responsible for preparing it and the date they will have it ready. We tailor it to refer directly to the schedules you already prepare.

We do not require special reports or reconciliations just for our audit. We have found that coordinating our team and our client’s staff works very well because it helps minimize the impact on your staff at year end. This way the Audit Plan includes most data we need from you so you and your staff can plan and schedule your work accordingly. Our clients know from prior experience with our firm, that we excel at minimizing our impact on your staff.

SPECIFIC AUDIT STRATEGY – INTERIM - Unlike older-style firms, we perform most of our important work at interim, well before the end of the fiscal year. We use our interim work to identify and solve problems and plan the year-end closing and audit in detail. Well before we begin our interim work, we will send you a list of the items we need, so you will have time to prepare.

We forecast many year-end amounts at interim, so that we can limit the amount of work required at year-end and concentrate instead on areas of concern. For example, we normally perform all our cash and investment testing at interim, including sending confirmation letters to depositories and determining financial statement categorizations.

Performing these last two steps at interim allows plenty of time to follow up on confirmations or resolve questions about the proper categorization of an investment without delaying the audit. As another example, we test long-term debt at interim and forecast year-end balances and transactions for each debt issue.

We use remote inquiry as much as possible at interim, in order to increase our efficiency and reduce our impact on your staff. We can download Council minutes and other documents from your website for review. Combining these abilities with our checklists has allowed us to perform larger portions of the audit in our own offices and reduce our questions to writing so that you have more time to deal with them.

LAWS, REGULATIONS AND COMPLIANCE - Our audits are designed to ensure that we test transactions for compliance with the Single Audit Act and other applicable laws and regulations, including the California Government Code, provisions of applicable grant guidelines, California Constitution Gann Limit requirements, requirements of local measures, Transportation Development Act requirements, etc. We identify applicable laws and regulations as part of our audit planning each year.

To the extent possible, we also begin our tests of compliance with laws and regulations at interim, including use of the Uniform Guidance and the OMB Compliance Supplement and any other applicable compliance guidelines. Even if the work cannot begin until year-end, we determine the applicable laws and regulations for our compliance testing so that we may incorporate the necessary information into our year-end closing checklist. Our audit samples for purposes of compliance vary based on the grant or compliance guidelines and are program-specific. The samples are stratified to ensure we test transactions that are representative of the costs charged to grants.

SYSTEM CONTROLS, TRANSACTION CYCLE PROCESSING VERIFICATION AND SAMPLE SIZES - With any data processing system upon which we intend to rely as a means of reducing substantive testing, we perform a variety of tests to verify the accuracy of transaction processing, the reliability of system control points and authorization controls, appropriateness of profile structures including Super-User rights access, and automated functionality such as sub-ledger integration and auto-journal entry validity and set up controls.

Gaining an understanding of the design of relevant procedures, controls and authorization levels is integrated with our risk assessment procedures discussed under the Client Tailored Risk Assessment section below. As part of our risk assessment process, we identify those transaction cycles we intend to rely on. Both processing procedures and controls that are to be relied on are tested with our audits. 8 C. QUESTIONS/RESPONSE TO SCOPE OF SERVICES (Continued) Transaction cycle processing and control tests typically involve sampling techniques. Most of our transaction samples are selected and tested during the interim portion of our work. Each sample will run from twenty-five to sixty transactions in size. We use interval and judgment sampling techniques with a high degree of stratification.

Most municipalities operate more than one major revenue system. Therefore, we typically determine which revenue transactions are processed with common procedures and controls and deem that to be a single population and subject it to a single sample. Other revenue cycles processed with separate controls are tested with their own samples. For example, it is common for separate samples to be selected for governmental receipts and each major enterprise fund. Transaction cycles we sample are dependent on materiality to each client’s financial statements but typically include, payroll, disbursements, receipts, loans receivable, investments and budget transactions and in accordance with the requirements of Statement of Auditing Standards #99 we also sample journal entries. Samples from each grant audit or major federal award program are also made. Samples are triple purpose samples and we test for correct recording, compliance with applicable policy or regulation and key control attributes – both manual and automated. This includes verification of sub-ledger integration and auto-journal entry validity, if needed.

REMOTE AUDIT CONSIDERATIONS - With the global pandemic and related subsequent shelter-in-place mandates that we all experienced in early 2020, we found that we needed to expand our remote audit abilities.

Our client’s audits could not be deferred, even with the various extensions of filing deadlines that were allowed.

While many firms may have been caught off guard, we were already equipped to provide our clients with a very smooth transition to remote audits. We had already transitioned to paperless audit workpapers over ten years ago, already experienced with the use of secure client data transfer portals (LeapFile and SharePoint) that we have used for a number of years, and our IT staff had been working on the implementation of Microsoft Teams – that meant we were immediately able to conduct remote audits and shortly after that we were able to conduct virtual meetings with our audit teams and with our clients. In the event a client did not have or was not able to use Microsoft Teams, we also obtained a Zoom account to provide flexibility in that area. Of course, there were a small number of clients that did not have the technological resources and/or personnel capacity to accommodate a remote audit, and we made arrangements to conduct those audits onsite with the use of applicable safety measures.

Now that the State and most counties are relaxing the restrictions, we still find that many of our clients are not open to the public or are not able to provide an area to accommodate our entire audit team. We have also found that some clients prefer to continue to conduct the audit remotely or a hybrid-remote audit. With the hybrid-remote audit, we conduct a good portion of the audit remotely and our audit team or only a few team members, depending on the ability to maintain safe social distancing, visit the client’s offices to review any documents or processes that are not readily available electronically. We are also working to obtain feedback from our clients regarding the remote audit tools and processes that worked and those that could use improvement.

As with all of our services, we want to ensure that our clients receive the best possible quality of service, whether in-person or remote on a computer screen.

ASSESSING RISKS – INTERIM PHASE - We have consistently employed a risk-based concept from our firm’s inception. Our audit checklists and programs were originated by reference to Audits of Local Governments published by the Practioners’ Publishing Company (PPC), a third-party vendor specializing in producing audit guides for unique industries. But we have not simply used their guide as our approach. We have customized it further for the simple reason that California municipalities have many unique risks not faced by municipalities in other states. As you know, California state law and applicable regulations cover a wide variety of areas such as cash and investment management, redevelopment compliance, transportation development act programs, and child development programs.

Our primary objective in an audit of each client’s financial statements is to opine on whether the financial statements, including disclosures, are free of material misstatement. Our opinion must be based on sufficient, appropriate audit evidence that we obtain, and this evidence must be documented. To achieve this objective, we further refine our approach to be responsive to each individual audit. We may reduce the scope of our substantive audit tests provided we conclude there are effective specific controls in place which would detect and correct misstatements due to errors or fraud.
9 C. QUESTIONS/RESPONSE TO SCOPE OF SERVICES (Continued) CLIENT TAILORED RISK ASSESSMENT - Our strategy to assessing risk begins with a brainstorming session of our audit team where they review your prior year financial statements and operations to identify areas of major audit risk. We also incorporate our consideration of other factors such as the risk of fraud, the economy, regulatory complexities or changes, credit market conditions and others into our initial assessment. We may also compare unusual transactions and estimates to those used by other municipalities or to current trends and issues.

Since we are a niche firm specializing in California municipalities this is relatively easy. For example, certain development agreements are unique to municipalities. These agreements usually contain complex financial transactions and legal restrictions. With so much experience in this area we can quickly design an efficient response to these risks.

Major audit risks are further evaluated through consideration of relevant assertions to determine inherent risk due to error or fraud. For example, cash on hand has a relative higher inherent risk of loss due to theft than an infrastructure asset. High and medium inherent risk audit areas are further evaluated to determine relevant internal controls needed to prevent, detect and correct errors or fraud.

We start our evaluation of your internal controls by interviewing staff and meeting with Department heads as needed. We review policies and procedure manuals and other documentation to determine the design of procedures and controls. As part of our evaluations, we document narrative memoranda outlining the duties of each pertinent person as well as our GRID evaluation of the important nexus control points. The GRID is our own design; it is a two-axis chart we use to identify potential conflicts of duties in your controls. We enhance our evaluation by reviewing system profile reports, paying special attention to super-user rights. This data is then used to determine the presence or absence of compensating controls designed to mitigate conflicts of duties vested in a single individual.

We then test to verify that procedures and controls are operating effectively such that they reduce the risk that errors or fraud could occur and go undetected and uncorrected. We use a variety of techniques to verify controls are effective including: sampling, observation, documentation of reviews, examining system access reports and comparisons with other data.

After this has been completed, we assess the risk of material misstatement which is determined by the relative inherent risk of an area and the associated control risk to plan our substantive tests. That is, the risk that controls are not in place or are not operating effectively. Areas with a low risk of material misstatement assessment may receive limited substantive procedures while those with a high risk of material misstatement will receive significant substantive procedures. We then design our final phase audit plan to ensure we obtain sufficient appropriate evidence about the financial statements and disclosures. Specific audit procedures are developed and documented in our audit programs and we develop potential internal control points for further evaluation as to significance and communicate those to staff.

ASSESSING RISKS – FINAL PHASE - Although the majority of our evaluations and testing of internal controls is completed with our interim testing, it is during the final phase that actual year end balances, transactions and disclosures are known, and our substantive procedures are employed. These procedures and data often reveal unusual or unexpected results that must be considered in the risk assessment process. Risk assessment processes are iterative and cumulative. That is, we must continually re-evaluate our assessments based on information and procedures gathered. It is not uncommon for an initial assessment and the corresponding substantive audit work to be restructured as a result of new data. Indeed, it is the intent of current audit standards that the audit be responsive to risks.

Our substantive procedures are selected to be responsive to the assessed risk and relevant assertion and typically involve analytical procedures, third-party confirmation, estimation techniques, mini-max tests, trend analyses, recomputations, corroboration with other tests, tests in total, sampling and comparisons to data gathered in other municipal audits.

Risk assessment procedures would be incomplete without an evaluation of the adequacy of our evidence obtained including internal control tests, any significant deficiencies or material weaknesses and substantive test results. These factors are considered prior to the release of our opinion in a final re-assessment process that includes our quality assurance review.
10 C. QUESTIONS/RESPONSE TO SCOPE OF SERVICES (Continued) COMMUNICATION, COORDINATION, PROMPT SERVICE AND DELIVERY OF REPORTS - We will meet with you at the start of each phase of work and conduct an exit conference at the end of each phase of work. This will ensure you know everything we do, with plenty of time to address any issues.

Two key objectives for a well-run audit are to ensure timely communication of the audit results and to provide for seamless coordination of the external auditors with staff. The concept is virtually identical to our Accounting Issues Memorandum and detailed Interim and Closing Checklists that we typically prepare for our clients. The Accounting Issues Memorandum concept was originated by one of our staff over two decades ago to function as a partner’s brief of an engagement’s status. It worked so well we expanded it to all our audits and share it with our clients. It has proven to be an indispensable communication and coordination tool ever since. This informal memo condenses and summarizes the audit status and issues as of the end of our interim work. It includes housekeeping matters, major and minor potential findings, scheduled audit fieldwork start and finish dates, etc.

We produce this memo right in your office before the conclusion of our interim work, so you have an idea of what we’ve found so far and whether there are areas that need work.

Our Memorandum on Internal Control is drafted at year-end and may include significant issues raised with our interim phase Accounting Issues Memorandum as well as issues arising from our year-end work. We review a draft with you, so that you will have plenty of time to consider the facts and discuss our findings before the audit results are presented to the Council.

We have always focused on reducing financial statement turn-around time. Our audit strategy emphasizes detail planning and coordination of our staff and client staff to complete the audit as efficiently as possible. We have found that completing all our work and our reports, if possible, as part of our fieldwork dramatically reduces the time required to issue final reports to our clients. Our strategy allows our clients ample time to review all report drafts before issuance, while ensuring that all reports are issued timely.

INTERNAL QUALITY ASSURANCE SYSTEM - Every one of our audit and assurance engagements has an Engagement Partner responsible for the successful completion of the work as well as ensuring we maintain quality levels that satisfy professional standards. We specifically structure our work for on-site Engagement Partner participation while the audit is being conducted. This structure is by design to ensure we have active on the job oversight of staff and timely completion of the work.

We have always subjected our audit and assurance engagements to a second Quality Assurance Review. This is performed by a second partner that is not involved with the audit.

11 D. FEES
RFP QUESTION: Provide your fees for the proposed service.

Detail costs and hourly billing rates, as well as any proposed method of adjustment in the cost of services for subsequent years of the engagement, if applicable.

TOTAL COST OF AUDIT - Our All-Inclusive Maximum Prices for the services specified in the Request for Proposal for the fiscal years ending June 30, 2022 through June 30, 2027, are detailed on the next page. Our Total All-inclusive Maximum Not to Exceed Prices for the services specified in the RFP are firm fixed fees.

WHAT OUR PRICE INCLUDES - Our price includes all the basic audit work and reports, statements and other deliverables specified in your request for proposal. Our price also includes the items below at no additional cost:
1) Year-round support and telephone consultation on pertinent issues affecting your City. 2) Copies of our journal entries and our leadsheets used to support the amounts in your financial statements. 3) A Study Session for the Council and/or Audit Committee to discuss the audit process, financial statements and recommendations.
4) Active Partner involvement in your work every year.
5) Our typed Interim Audit Checklist.
6) Our typed Annual Closing Checklist.
7) Our typed interim Accounting Issues Memorandum.
8) Preliminary draft financial statements and/or suggested revisions to the City’s financial statement disclosures at interim.
9) Overviews and summaries of upcoming pronouncements and regulation affecting the audited financial statements.
10) Direct upload of general ledger data into our ProSystems trial balance software which is fully linked to financial statement formats.

COST RATIONALE - We have always completed our work in the time budgeted and for the agreed upon fee. We have never requested additional fees for work within the scope of the audit after our work was completed. As always, we finish what we start, regardless of the accuracy of our budgets.

RFP QUESTION: Outline billing and payment expectations, including timing and method of payment.

FEES AND BILLINGS (METHOD OF PAYMENT) - Our fees are firm fixed prices. In determining our fees, we understand that the City’s records will be in condition to be audited; that is, transactions will be properly recorded in the general ledger and subsidiary records, these accounting records and the original source documents will be readily available to use, we will be furnished with copies of bank reconciliations and other reconciliations and analyses prepared by the City and City personnel will be reasonably available to explain procedures, prepare audit correspondence and obtain files and records.

Progress billings will be sent on the basis of actual audit work completed during the course of the engagement.

Interim billings do not cover a period of less than a calendar month. We do not bill for out-of-pocket expenses as they are included in our stated all-inclusive maximum price.

We do not post separate rate structures for municipal audit work. We view this work as being every bit as important and valuable as the work we perform for other clients and we put our best people on it. Any consulting work you request will be performed at the same rates as our audit work.

12 D. FEES (Continued)
RFP QUESTION: Describe any remaining fees not already detailed above.

GASB No. 87, Leases, and Potential Increase in Audit Scope Our consistent approach is to provide our clients with advance identification of new GASBs as they are issued. With every audit, we provide overviews of new pronouncements including effective dates and we review these with City staff and, in the year of implementation, we proforma new disclosures and add on additional data requests to our interim and closing checklists. However, for the upcoming implementation of GASB Pronouncement 87, Leases, in fiscal year 2022, we anticipate there will be an increase in the audit scope. We will not know the extent of the potential increase in audit scope, if any, until we have additional conversations with City staff, and that change in scope could increase (or even decrease) between now the end of and fiscal year 2022 if the City enters into new lease agreements or terminates existing agreements. Therefore, once that information is known for fiscal year 2022, we will provide a cost estimate and addendum to the engagement letter that will be based upon our standard hourly rates.

TOTAL ALL-INCLUSIVE MAXIMUM PRICE SUMMARY AND

TOTAL ESTIMATED HOURS PER FISCAL YEAR
Optional Extension
Audit Services 2021-22 2022-23 (1) 2023-24 (1) 2024-25 (1) 2025-26 (1) 2026-27 (1) City Audit (Annual Comprehensive Financial Report),
including web-ready ACFR PDF, Memorandum on
Internal Control (management letter) and SAS 114 letter $56,870 $58,576 $60,333 $62,143 $64,007 $65,927 Single Audit (one major program) (2) 4,760 4,903 5,050 5,202 5,358 5,519 Child Development Program Audit 6,605 6,803 7,007 7,217 7,434 7,657 Tranportation Development Act Report (TDA) 2,820 2,905 2,992 3,082 3,174 3,269 Appropriations (Gann) Limit Agreed Upon Procedures 916 943 971 1,000 1,030 1,061 Out-of-pocket expenses (3)
Total (all-inclusive maximum "not to exceed") $71,971 $74,130 $76,353 $78,644 $81,003 $83,433 Optional Services (4):

City's Annual Report of Financial Transactions (State
Controller's Report) $4,920 $5,068 $5,220 $5,377 $5,538 $5,704 San Rafael Joint Powers Financing Authority State
Controller's Report $815 $839 $864 $890 $917 $945

ESTIMATED STANDARD

ANNUAL HOURLY
POSITION HOURS (5) RATES
Partners 46.50 $325.00
Managers 50.50 205.00
Supervisor 122.00 135.00
Associates 309.00 95.00
Administrative Staff 8.50 80.00
Total Annual Hours 536.50
NOTES:
(1) Our policy is to attempt to keep our clients fees constant after inflation. The current CPI for San Francisco Bay Area Services Sector of the U.S. Department of Labor, Bureau of Labor Statistics for the San Francisco-Oakland Area is 1.4% Therefore, fees for years subsequent to 2021 will be adjusted by the actual CPI, up to a maximum of 3%. (2) Fee is per tested (major) program.
(3) Out-of-pocket expenses are included in our standard hourly rate. (4) The compilation of these reports was included in the engagement services in fiscal year 2021, but not included in the RFP. (5) The RFP did not include a request for the breakdown of the hours by proposed engagement segment.

We would be happy to provide such a schedule, upon request. 13 E. REFERENCES
RFP QUESTION: Provide a list of the municipal agencies for which the respondent has provided audit services for the past three calendar years.

CITY AND TOWN CLIENTS - The following table summarizes our most recent experience with audits of cities and towns. We are responsible for all phases of the work on these clients. All of this work represents recurring annual audit and related work; all this work and that presented in the table was completed on or before the deadline from the first year listed for each client. Please also see the References Section for names and current phone numbers for contacts on work quality and performance.

Client Name Scope of Work
Client Start
Date
Annual
Comprehensive
Financial Report
Submission GFOA Award Single Audit
Concord Audits of City financial statements, Successor Agency, Healthcare District, Financing Authority, Single Audit 2019 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Daly City
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Transportation Measure, JPAs audits
1992 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Hayward
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Transportation Measure, Financing Corporation Audit
2011 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Santa Clara
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Silicon Valley Power Audit
2012 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Alameda Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Transportation Measures 2018 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Atherton Audit of Basic Financial Statements, Single Audit 2009 ‐ Present * * ✓ Yes
Belmont Audit of City financial statements, Successor Agency, Single Audit, Transportation Measure 1998 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Belvedere Audit of Ciy financial statements 2018 ‐ Present ✓ Yes
✓
Yes *
Benicia Audit of City financial statements, Single Audit, Transportation Development Act Audit 2011 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Brentwood Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit 2007 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Brisbane Audit of City financial statements, Successor Agency 2011 ‐ Present * * * Burlingame Audit of City financial statements, Single Audit, Transportation Development Act Audit, 2016 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Davis Audit of City financial statements, Single Audit 2015 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Elk Grove Audit of City financial statements and Single Audit 2017 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Fairfax Audit of Basic Financial Statements 2009 ‐ Present * * * Half Moon Bay Audit of City financial statements, Single Audit, Transportation Development Act Audit 2014 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Lathrop Audit of City financial statements, Single Audit 2011 ‐ 2020 ✓ Yes
✓
Yes
✓
Yes
Los Altos Audit of City financial statements, Single Audit, Transportation Measure 2014 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Los Altos Hills Audit of City financial statements and North County Library Authority, Single Audit, Transportation Development Audit 2016 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Manteca Audit of City financial statements, Successor Agency, Single Audit, Financing Authority Audit 1986 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Martinez Audit of City financial statements, Single Audit, Transportation Development Act Audit 2001 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Milpitas
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Financing Corporation Audit
1995 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Moraga Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit 2012 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Mill Valley Audits of City Basic Financial Statements and Sewerage Agency of Southern Marin 2020 ‐ Present * * *
Morgan Hill Audit of City financial statements, Single Audit, Transportation Development Act Audit 2015 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Population > 100,000
Population < 100,000
14 E. REFERENCES (Continued)
CITY AND TOWN CLIENTS (Continued)
As you can see from the client list above, we have a winning combination that has resulted in strong client loyalty and retention. Several clients who left have returned after seeing the difference between our firm and our competitors. Others have gone through a full proposal process and retained us such as the cities of Brentwood, Milpitas, Oakley, Pittsburg, Santa Clara and South San Francisco.

RFP QUESTION: Provide the information (Name of Agency, Name and Title of Contact Person, Brief Description of Scope of Services), for three client cities that are similar in size and scope to the project requested by this proposal.

REFERENCES- Our references are listed below. Please contact these clients for further information if you wish or call any of our clients for a reference (we would be happy to provide contact information for any of our current or previous clients).

Client Name Scope of Work
Client Start
Date
Annual
Comprehensive
Financial Report
Submission GFOA Award Single Audit
Oakley Audit of City financial statements, Successor Agency, Single Audit 2000 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Orinda Audit of City financial statements, Single Audit, Transportation Development Act Audit 2015 ‐ Present ✓
Yes
✓
Yes
✓
Yes
Pacifica Audit of City financial statements,  Single Audit, Transportation Development Act Audit, Transportation Measure 2015 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Pleasanton Audit of City financial statements,  Single Audit, Transportation Development Act Audit 2016 ‐ 2020 ✓
Yes
✓
Yes
✓
Yes
Pittsburg Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Retirement Plan Audit 2011 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Portola Valley Audit of Basic Financial Statements and Transportation Measure 2005 ‐ Present * * * Redwood City
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Audit of Port of Redwood City, Audits of Joint Power Authorities
2019 ‐ Present ✓
Yes
✓
Yes
✓
Yes
San Bruno Audit of City financial statements, Single Audit, Transportation Development Act Audit 2016 ‐ Present ✓
Yes
✓
Yes
✓
Yes
San Carlos Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act 2016 ‐ Present ✓
Yes
✓
Yes
✓
Yes
San Leandro Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Transportation Measures 2011 ‐ Present ✓ Yes
✓
Yes
✓
Yes
San Pablo Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit 1995 ‐ Present ✓
Yes
✓
Yes
✓
Yes
San Rafael Audit of City financial statements, Successor Agency, Single Audit 2007 ‐ Present ✓ Yes
✓
Yes
✓
Yes
South San Francisco
Audit of City financial statements, Successor Agency, Single Audit, Transportation Development Act Audit, Transportation Measure 2004 ‐ Present ✓ Yes
✓
Yes
✓
Yes
Sutter Creek Audit of Basic Financial Statements, Single Audit 2015 ‐ Present * * ✓ Yes
Turlock
Audit of Basic Financial Statements, Successor Agency,  Single Audit, Transportation Development Act Audit, Financing
Authority Audit, Abandoned Vehicle Abatement Program
2013 ‐ Present * * ✓
Yes
Watsonville Audit of the City financial statements, Single Audit 2017 ‐ Present ✓ Yes
✓
Yes
✓
Yes
15 E. REFERENCES (Continued)
City of Brentwood – A client since 2007
Address – 150 Park Way, Brentwood, CA 94513
Engagement Partner – Katherine Yuen (previously Amy Meyer) Principal Contact – Kerry Breen, City Treasurer/Director of Finance & Information Systems, (925) 516-5436
Work Scope and Reports
Comprehensive Annual Financial Report (GFOA Award Winner) Memorandum on Internal Control and Required Communications Single Audit Act Report
Transportation Development Act Audit Report
Proposition 111 Agreed Upon Procedures Report
Annual Reports of Financial Transactions for the City (State Controller’s Report) City of Daly City – A client since 1992
Engagement Partner – Amy Meyer
Principal Contact – Tim Nevin, Director of Finance and Administrative Services, (650) 991-8040 Daneca Halvorson, Financial Services Manager, (650) 991-8047 Work Scope and Reports:

Comprehensive Annual Financial Report (GFOA Award Winner) Memorandum on Internal Control and Required Communications Single Audit Act Report
Proposition 111 Agreed Upon Procedures Report
Measures A and W Compliance Reports
San Mateo County Pre-hospital Emergency Medical Services Group JPA Financial Statements Annual Report of Financial Transactions for the City (State Controller’s Report) Transportation Development Act Audit
City of Belmont – A client since 1998
Engagement Partner – Amy Meyer
Principal Contact – Grace Castaneda, Finance Director, (650) 595-7436 Work Scope and Reports:

Comprehensive Annual Financial Report (GFOA Award Winner) Memorandum on Internal Control and Required Communications Single Audit Act Report
Belmont San Carlos Fire Department Financial Statements Transportation Development Act Audit
Measures A and W Compliance Reports
Measure I Compliance Report (Local Measure)
Proposition 111 Agreed Upon Procedures Reports for the City and for the Belmont Fire Protection District Annual Reports of Financial Transactions for the City, Belmont San Carlos Fire Department, Belmont Fire Protection District and the Joint Powers Financing Authority (State Controller’s Reports) F. IMPLEMENTATION SCHEDULE
RFP QUESTION: Include a work schedule and note key project milestones and timelines for deliverables. Identify any assumptions used in developing the schedule. Any assumptions regarding turnaround time for City Staff review should be clearly noted.

TIMELINE FOR AUDIT WORK - We have timed our audit to complete all your reports so that they are ready to print by your deadlines. Of course, our timetable may be adjusted to fit your needs. We will start our work as soon as you appoint us as your auditors, with an entrance conference once the contract is executed.

The interim and year-end phases of the audit will take approximately one to two weeks. In the first year of the audit, we may schedule an additional week for our staff to review long-term agreements and prepare our audit workpapers to ensure a smooth transition throughout the audit process. And, the timing of the Single Audit work will be coordinated with the year-end field work, but the length of time needed for that work will depend upon the number of tested programs.

16 F. IMPLEMENTATION SCHEDULE (Continued)
The schedule below is a summarized version based on our previous timeline established with the City’s Finance Department staff, but of course it can be modified to fit the City’s needs:
 March and April
o Interim Audit Fieldwork (interim checklist sent to the City at least two weeks prior to the start of fieldwork)
o Interim Audit Exit Conference
o Maze will go over the Interim Accounting Issues Memo
o Maze to conduct Interim Fieldwork for Childcare Audit  May, June and July
o Maze will provide the Closing Checklist
o Maze will provide confirmation templates and markups to letters o City will provide signed copies of the confirmation letters to Maze o City to provide listing of Attorneys used in FY2022 along with amounts paid to each o City to provide Attorney letter confirmations to Maze’s office to send out, after Maze makes selection of Attorney letters to be sent
 TBD (Prior to Year End Fieldwork)
o Maze to audit GASB 68 and 75 information prepared and provided by the City o Maze to conduct final TDA audit for FY 22, if needed
 August 29:
o City to email trial balance to Maze
 Week of September 5 (September 5th is a Holiday):
o Maze to prepare analytical review and send to the City o City to upload final checklist items to Maze’s secure file sharing portal  Weeks of September 12 and September 19:
o Final phase of financial statement audit
o Maze to conduct Childcare final phase audit
o Maze to provide the fund financial statements draft for the City to review  Weeks of September 20 and October 3:
o Maze to provide financial statements roll-up for City to review o City to provide draft of transmittal letter, statistical section and introductory section of the Annual Comprehensive Financial Report
o Maze to provide Annual Comprehensive Financial Report draft (will incorporate GFOA comments except for those related to City prepared documents in Annual Comprehensive Financial Report) and Open Items List
 Week of October 10:
o Maze to provide the following report drafts to the City:
 Memorandum of Internal Control (MOIC)
 Gann Appropriations Limit AUP
 Transportation Development Act (TDA)
 Childcare Financial Statements
 Draft of management representation letters for (City, TDA and Childcare) o City to provide the following to Maze:
 Edits for Annual Comprehensive Financial Report
 MD&A for Annual Comprehensive Financial Report ready for Maze to tick and tie and review
o San Rafael Sanitary District (SRSD) to provide a copy of the Basic Financial Statements with signed audit opinion and Management Letter (if any)
o Maze to perform input of SRSD information
o Maze to send reports to internal Pre-Issuance Review (PIR)  Weeks of October 17 and 24:
o City to provide:
 Edits to the following reports:
 Memorandum on Internal Control (MOIC)
 Transportation Development Act (TDA)
 Childcare FS Draft
 Management responses to MOIC, and findings for Childcare (if any) 17 F. IMPLEMENTATION SCHEDULE (Continued)
Audit Timeline (Continued):
 Weeks of October 17 and 24 (Continued):
o Maze will also incorporate PIR changes for all reports and edits from City on all reports o Maze to provide the following:
 Proposed edits on the MD&A
 Revised Annual Comprehensive Financial Report draft
o Maze to provide the following revised report drafts to the City:
 Memorandum of Internal Control (MOIC)
 Gann Appropriations Limit AUP
 Transportation Development Act (TDA)
 Childcare FS draft
o City to provide:
 Final edits to all reports
 Signed management representation letters (City, TDA and Childcare)  TBD in October:
o City to visit on-site at Maze office to review final draft and Maze to provide revised draft the next day
o Maze to provide final drafts with page numbers
o City to review final report and provide any pagination edits o City to approve issuance of reports
 Week of October 31:
o Maze to provide PDFs of reports.
 By November 7 and 14, respectively:
o City to provide the Schedule of Federal Expenditure Award (SEFA) to Maze o Maze to provide single audit checklist to the City to prepare for the single audit fieldwork  TBD in November:
o Presentation of reports to the Council
o Maze to provide bound copies of reports and 1 web-ready PDF.  Week of December 5:
o Maze to complete single audit fieldwork

ATTACHMENTS
EXTERNAL QUALITY CONTROL REVIEW/PEER REVIEW - We are members of the Quality Review Program of the AICPA, which means we subject ourselves to a peer review of our workpapers and quality control procedures every three years by independent accountants specializing in such work. Our most recent peer review was completed in 2021; we again received a rating of pass, the highest level of assurance possible. This peer review included a review of several governmental and non-profit audit engagements. A copy of or most recent peer review opinion is located at the end of this section.

A copy of our most recent external peer review report can be found here: https://www.mazeassociates.com/wpcontent/uploads/2021/10/2020-Peer-Review.pdf FEDERAL OR STATE DESK OR FIELD REVIEWS - We have not been subject to any State Desk or Field Reviews of our audits during the past three years. In addition, we have not received any disciplinary action taken or pending action against us during the past three years with state regulatory bodies or professional organizations.

LITIGATION - We have not been sued over poor work quality, nor have we paid any such claims out of court in the past three years, and there are no current and we are not aware of any potential lawsuits.

LICENSE TO PRACTICE IN CALIFORNIA - We are properly licensed California Certified Public Accountants. We are members of the Government Finance Officers Association (GFOA) and the California Society of Municipal Finance Officers (CSMFO) as well as the American Institute of Certified Public Accountants (AICPA) and the California Society of Certified Public Accountants (CalCPA). 18 ____________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 5.e
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Public Works
Prepared by: Bill Guerin,
Director of Public Works
City Manager Approval: _________
TOPIC: CANAL NEIGHBORHOOD PEDESTRIAN IMPROVEMENTS PROJECT SUBJECT: ACCEPT COMPLETION OF THE CANAL NEIGHBORHOOD PEDESTRIAN IMPROVEMENTS PROJECT (CITY PROJECT NO. 11381), AND AUTHORIZE THE

CITY CLERK TO FILE THE NOTICE OF COMPLETION
RECOMMENDATION: Accept completion of the Canal Neighborhood Pedestrian Improvements Project and authorize the City Clerk to file the Notice of Completion.

BACKGROUND: Pedestrian safety is of paramount importance to the City of San Rafael. Over the past two years, the City received multiple grants from the Transportation Authority of Marin (TAM) to address pedestrian safety by improving crosswalks at key locations in the Canal neighborhood and on Mission Avenue behind San Rafael High School. These improvements and safety enhancements include installations of accessible curb ramps, rectangular rapid flashing beacons (RRFB’s), quick-build bulb-outs, street lighting, and restriping of crosswalks with new, high visibility striping at nine locations throughout the Canal neighborhood and on Mission Avenue behind San Rafael High School.

On March 25, 2021, the project was advertised in accordance with San Rafael’s Municipal Code, and sealed bids were publicly opened and read aloud April 20, 2021. On May 3, 2021, the City Council adopted a resolution authorizing the City Manager to enter into an agreement with the low bidder, Team Ghilotti, Inc., in the amount of $673,141 and approving a construction contingency of $86,859 for a total appropriation of $760,000. The project was successfully completed on February 4, 2022.

ANALYSIS: Pursuant to Civil Code Section 3093, the City is required to record a Notice of Completion upon City acceptance of the improvements. This acceptance initiates a time period during which project subcontractors may file Stop Notices seeking payment from the City from the funds owed to the Contractor for the project work.

FISCAL IMPACT: No fiscal impact is associated with this informational report.

RECOMMENDED ACTION: Accept completion of the Canal Neighborhood Pedestrian Improvements Project and authorize the City Clerk to file the Notice of Completion.

ATTACHMENTS:

1. Notice of Completion
Canal Neighborhood Ped Improvements 2021 Form NOTICE OF COMPLETION Project #11381 Page 1
Recording Requested By:

The City of San Rafael
When Recorded Mail To:

Lindsay Lara, City Clerk
1400 Fifth Avenue
San Rafael, CA 94901

EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE §§ 6103, 27383
SPACE ABOVE THIS LINE IS FOR RECORDER’S USE

NOTICE OF COMPLETION
Civil Code §§ 8182, 8184, 9204, and 9208
NOTICE IS HEREBY GIVEN THAT:

1. The undersigned is the agent of the owner of the Project described below.

2. Owner’s full name is the City of San Rafael (“City”)

3. City’s address is 1400 5th Ave, San Rafael, CA 94901

4. The nature of City’s interest in the Project is:
__ Fee Ownership __ Lessee X Other Public Right of Way Easement

5. Construction work on the Project performed on City’s behalf is generally described as follows: The construction of ADA curb ramps, installation of rectangular rapid flashing beacons (RRFB’s), quick-build bulb outs, street lighting, and restriping of crosswalks with new, high visibility striping

6. The name of the original Contractor for the Project is: Team Ghilotti, Inc.

7. The Project was accepted as complete on: February 4, 2022.

8. The Project is located at: Various crosswalk throughout the Canal Neighborhood and on Mission Avenue.

Verification: In signing this document, I, the undersigned, declare under penalty of perjury under the laws of the State of California that I have read this notice, and I know and understand the contents of this notice, and that the facts stated in this notice are true and correct. __________________________ ________________________________ Date and Place Signature
________________________________
Bill Guerin, Director of Public Works

EXEMPT FROM NOTARY ACKNOWLEDGMENT REQUIREMENTS PER GOVERNMENT CODE § 27287 AND CIVIL CODE § 9208
____________________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 5.f
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Community Development
Prepared by: Alicia Giudice, Director
Alexis Captanian, Housing Analyst
Jacob Noonan, Housing Manager
City Manager Approval: ______________
TOPIC: 999 THIRD STREET – EDEN HOUSING/VIVALON HEALTHY AGING CENTER SUBJECT: APPROVE STAFF RECOMMENDATION FOR TERMS OF A BELOW MARKET RATE (“BMR”) AGREEMENT IMPOSING AFFORDABILITY RESTRICTIONS ON THE PROPERTY LOCATED AT 999 THIRD STREET BEING DEVELOPED AS THE

VIVALON HEALTHY AGING CENTER
EXECUTIVE SUMMARY:

On March 23, 2020, the City Council adopted Resolution No. 14776, which granted Environmental and Design Review and other land use entitlements to applicants BioMarin, Vivalon and Eden Housing for development of property owned by BioMarin at 999 Third Street as a research and development building for BioMarin and a 67-unit 100% affordable senior housing and healthy aging center for Vivalon and Eden Housing. A condition of approval of the Vivalon/Eden Housing project requires that prior to the issuance of a building permit, a City-approved Below Market Rate Agreement (“BMR Agreement”) must be recorded against the property, restricting the rent for the residential units in the project to affordable levels. The City’s typical BMR Agreement restricts “affordable units” to low-income levels at occupancy according to percentage of the Area Median Income (AMI) as determined by the United States Department of Housing and Urban development (HUD).

In connection with financing requirements imposed on the Vivalon/Eden Housing project by their lenders, the City is in the process of negotiating a slightly different form of BMR Agreement that would phase-in affordability restrictions as follows:
• Phase 1: During construction, the project would be subject to affordability restrictions at 80% Area Median Income (AMI) using the rent schedule established by the California Tax Credit Allocation Committee (TCAC), which would not meet HUD’s low-income standard. • Phase 2: At occupancy and thereafter for the 55-year term, the project would be subject to affordability restrictions at very low and low income rents established by TCAC, which would meet HUD’s low-income standard and the requirements for density bonuses granted pursuant to the State Density Bonus Law and the City’s Municipal Code. Specifically, the proposed BMR Agreement would ensure that, at occupancy following the completion of construction, the project SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
would be subject to affordability restrictions based on TCAC which will require 14 units rented at 30% AMI, 16 units rented at 40% AMI, and the remaining 36 affordable units rented at 60% AMI.

For comparison, 60% AMI using TCAC is approximately 80% AMI using HUD. Therefore, the project would comply with State Density Bonus Law which allows up to 80% of the units at 80% AMI using HUD rents.

Staff recommends using this phased agreement as Staff believes this approach satisfies the City’s affordability requirements and the density bonus provisions in state law, while providing the flexibility the applicants require for their financing. Therefore, Staff is seeking City Council concurrence in this approach by acceptance of this report and approval of the Staff recommendation.

RECOMMENDATION:

Accept report approving Staff’s recommendation to permit a phased BMR Agreement as described in the report.

BACKGROUND:

On March 23, 2020, the City Council adopted Resolution No. 14776, which approved Environmental and Design Review and other land use entitlements to applicants BioMarin, Vivalon and Eden Housing for development of property owned by BioMarin at 999 Third Street as a research and development building for BioMarin and a 67-unit 100% affordable senior housing and healthy aging center for Vivalon and Eden Housing. Pursuant to that approval, the property was subsequently subdivided, and BioMarin conveyed a parcel at the northwestern corner of the property (now designated as 999 Third Street) to Vivalon.

Vivalon and Eden housing have agreed that Eden Housing will construct the approved building and related improvements, and that Vivalon will own the first two floors, to be occupied by the healthy aging center, and Eden Housing will own the third through fifth floors, which will hold one manager’s unit and 66 affordable residential rental units for seniors. Condition 29 of the Environmental and Design Review approval required Vivalon/Eden Housing to record a City-approved BMR Agreement against their property prior to construction, restricting the rent for the residential units in the project to affordable levels.

At the time of the approvals, the governing law allowed 25 units on the project site. Prior to amendments to the San Rafael Municipal Code (“SRMC”) adopted in early March of 2021, SRMC Section 14.16.030 required development projects with residential units to reserve 20 percent (20%) of the units for rental at rents affordable to and occupied by households earning “very low” and “low” income. The City has traditionally used the rent schedules maintained by the Marin Housing Authority and based on the median income for Marin County as calculated by the United States Department of Housing and Urban Development (“HUD”).

Therefore, when this project was processed, to achieve the 100% affordable housing project, the housing project sponsor (Eden Housing) requested and received a density bonus under the State Density Bonus Law in California Government Code Sections 65915 et seq. The sponsor also requested two discretionary concessions/waivers which were considered major concessions and subject to SRMC Section

14.16.030.H.3.b.v, which allowed the City Council, in its sole discretion, to approve the concessions if the applicant demonstrated through a financial pro forma the concessions were needed to make the project financially feasible. The applicant provided the financial pro forma demonstrating the need for the approximate additional 130-percent bonus (in addition to the state law allowed 35-percent bonus), and the additional 4-feet of height to achieve the proposed 70-feet height for the building in order to achieve the 66 affordable units and one manager unit proposed.

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ANALYSIS:

As discussed above, City Council Resolution No. 14776 approved the BioMarin/Vivalon/Eden Housing project. The Vivalon/Eden Housing project included a 67-unit affordable senior housing project. The zoning at the time allowed 25 units on the project site. Vivalon/Eden Housing requested a 35% density bonus and two concessions in exchange for meeting the City’s 20% low income affordability requirements. The requested concessions included:

1. Additional units to achieve a total of 67

2. A height bonus to allow the additional height
In making the findings for approval of the project the City Council concluded that the project met the City’s affordable housing requirements because they committed to 100 percent of the units as affordable or “below market rate” which was above the 20% required by the City. In addition, the applicant demonstrated that they qualified for a bonus of 35% under State Density Bonus Law by having at least 20% of the units dedicated to low income.

Environmental and Design Review Permit condition of approval 29 recognizes that the applicant effectively received and the City approved a density bonus beyond what was required by the State Density Bonus Law and also required the applicant to enter into a BMR Agreement that would commit the units as affordable to seniors at low and very low income levels. There was no indication as to the number of units to be required of each and no indication as to the source of the data to be used to qualify the units as low and very low. However, according to State Density Bonus Law, for 100% affordable housing developments, at occupancy, the rent for at least 20% of the units must meet the rent standards of Health and Safety Code Section 50053, and the remaining units may instead meet Low Income Housing Tax Credit rent standards (also known as TCAC). Health and Safety Code Section 50053 uses HUD as the source of rent standards.

The City’s BMR Agreements are typically recorded right before occupancy, which is when the State Density Bonus Law requires recordation. However, in line with condition of approval 29, and because the City has approved a loan for this project, staff is requiring recordation of a BMR Agreement prior to signing off on the loan documents. Upon recordation, the lien of the BMR Agreement would be in first place, also referred to as “senior position”, and will be ahead of all other financing liens and restrictions on the property.

To support the applicant in securing funding from other sources, the applicant is requesting that the City allow the affordability restrictions to be eased during the construction phase to 80% AMI using TCAC rent schedules. This would translate to approximately 100% AMI using HUD rent schedules, which is classified as moderate income rather than low income under the HUD definitions. However, as noted above, more restrictive TCAC rents (14 units rented at 30% AMI, 16 units rented at 40% AMI, and the remaining 36 affordable units rented at 60% AMI) will apply at completion of construction and prior to occupancy, which is when State Density Bonus Law restrictions must apply and when City restrictions typically apply.

Additionally, the project will include HOME funding, and subject to the HOME program’s regulatory agreement a certain number of units will be restricted at affordable income levels following the HUD rent schedule, which will provide yet a deeper level of affordability. Layered on the two sets of restrictions, all affordable units in the project will receive a project-based voucher from the Marin Housing Authority.

These subsidy vouchers will provide an even deeper level of affordability in the project by providing a portion of the rent paid by each tenant, allowing the project to support tenants who earn incomes lower than the 30%, 40%, and 60% AMI limit provided by TCAC.

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Thus, while the proposed phased BMR Agreement is a departure from the City’s usual practice, staff believes that a BMR Agreement with the proposed phasing-in of restrictions as described above is consistent with the approvals under Resolution No. 14776 and with State Density Bonus Law requirements. Since this approach will satisfy the applicant’s other funding sources, staff is recommending that the City agree to this phased approach and by this report seeks the City Council’s concurrence with staff’s recommendation. Approval of the recommendation would be through acceptance of this report.

COMMUNITY OUTREACH:

Extensive community outreach was conducted by the applicant and the City while the project was under review and during the City approval process. The BMR Agreement satisfies a condition of that project approval.

FISCAL IMPACT:

There is no fiscal impact to the city.

OPTIONS:

The City Council has the following options to consider on this matter:

1. Accept Report approving staff’s recommendation to proceed with negotiations for a phased BMR Agreement.

2. Reject Report and direct staff to proceed with a BMR Agreement using prior procedures. This could jeopardize the project’s funding.

RECOMMENDATION:

Accept the report approving Staff’s recommendation to permit a phased BMR Agreement as described.

PROCLAMATION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL

PROCLAIMING THE MONTH-LONG CELEBRATION OF
WOMEN’S HISTORY MONTH IN MARCH
WHEREAS, Each year, Women’s History Month offers an important opportunity for us to shine a light on the extraordinary legacy of trailblazing American women and girls who have built, shaped, and improved upon our nation; and WHEREAS, throughout history, extraordinary women have made significant contributions to the growth and strength of our city, state, and nation in countless ways; and WHEREAS, through leadership, innovation, and ingenuity, generations of women have made significant contributions in science, medicine, technology, business, politics, entrepreneurship, and arts and culture; and
WHEREAS, women have been leaders in securing their own rights of suffrage and equal opportunity; and in the abolitionist, emancipation, industrial labor, civil rights, and peace movements, creating a more fair and just society for all; and WHEREAS, whether serving in elected positions across America, leading groundbreaking civil rights movements, venturing into unknown frontiers, or programming revolutionary technologies, generations of women that knew their gender was no obstacle to what they could accomplish have long stirred new ideas and opened new doors, having a profound and positive impact on our community; and
WHEREAS, despite their contributions, the role of women in history has been consistently overlooked and undervalued in literature, education, and culture; and WHEREAS, this month, we celebrate countless pioneering women and their victories, and we continue our work to build a society where all children have equal possibilities.

NOW, THEREFORE, the City Council of the City of San Rafael Hereby Proclaims the month of March 2022 as Women’s History Month and recognizes the many accomplishments women have historically achieved and the many ongoing contributions they make to our society and our local community across Marin County and San Rafael.

Kate Colin
Mayor
City of San Rafael
Proclamation
Presented to
Stephen Mizroch
WHEREAS, Stephen Mizroch has served as both a member and during the last eight years, Chairperson, of the San Rafael Fire Commission; and WHEREAS, during his three plus decades of tenure on the Fire Commission, the City of San Rafael and adjacent communities have benefitted tremendously from his collaborative mindset and direct engagement with public safety professionals, numerous committees and working groups; and
WHEREAS, Stephen Mizroch has contributed countless hours of volunteer time to improve the San Rafael Fire Department and promote the highest level of customer interaction the department has with its community; and
WHEREAS, Stephen Mizroch has served as a member of the San Rafael Fire Foundation since its inception and continued to expand his influence and commitment to the San Rafael Fire Department and the members’ operational, safety and specialized equipment needs; and WHEREAS, in recognition of his incomparable experience and dedication to the San Rafael Fire Commission, we honor Stephen Mizroch with Fire Commissioner Emeritus status; and
NOW, THEREFORE, I, Kate Colin, Mayor of San Rafael, do hereby proclaim my sincere appreciation to
Stephen Mizroch
for his many important contributions and community service to the City of San Rafael.

Kate Colin
Mayor
____________________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 7.a
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Community Development
Prepared by: Alicia Giudice, Director
Alexis Captanian, Housing Analyst
Jacob Noonan, Housing Manager
City Manager Approval: ______________
TOPIC: 2021 AFFORDABLE HOUSING NOFA FUNDING RECOMMENDATION SUBJECT: RESOLUTION AUTHORIZING THE EXPENDITURE OF FUNDS IN FULFILLMENT OF THE AFFORDABLE HOUSING TRUST FUND 2021 NOTICE OF FUNDING

AVAILABILITY (NOFA), AND SUPPORTING THE AWARD OF FUNDING FROM THE

COUNTY OF MARIN FOR PERMANENT LOCAL HOUSING ALLOCATION (PHLA) FUNDING TO PROJECTS RECEIVING CITY FUNDING.

EXECUTIVE SUMMARY: On November 12, 2021, the City issued a Notice of Funding Availability (NOFA) for development or preservation of affordable housing. The application period ended at 5:00PM on December 23, 2021, with four responses received. Staff reviewed the responses and confirmed all four projects meet the requirements for consideration for funding. The four responses were reviewed by a staff panel that assisted in the development of the funding recommendation provided in this report for consideration by the City Council.

RECOMMENDATION:

Adopt a resolution authorizing:
1) The expenditure of $1,750,000 in funds from the Affordable Housing In-Lieu Fee Fund (Fund #243) and $850,000 from the Low / Moderate Fund (Fund #495) and funds from each account to complete all documents associated with funding the loans for four 100% affordable housing projects in fulfillment of the Affordable Housing Trust Fund 2021 NOFA, 2) Supporting the award of funding from the County of Marin for Permanent Local Housing Allocation (PLHA) Funds to the projects that receive funding from the City and have applied for the County PLHA funds, and
3) Authorizing the City Manager to execute all documents incident to issuing the funds, in a form approved by the City Attorney.

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BACKGROUND:

The City of San Rafael is committed to creating and maintaining housing that is affordable to the San Rafael workforce, including lower and moderate-income individuals, as well as families and older adults, and community members currently or formerly experiencing homelessness. To support the efforts of affordable housing developers, the City maintains an Affordable Housing Trust Fund and periodically issues a NOFA to receive responses and evaluate the needs of sponsors seeking funding from the City for the development and preservation of affordable housing.

Affordable Housing Trust Fund
Presently, the City has two funds in the Affordable Housing Trust Fund, the Housing In-Lieu Fee Fund (Fund #243), and the Low/Moderate Fund (Fund #495). Collectively these funds are the City’s Affordable Housing Trust Fund. Each fund is summarized below.
• Housing In-Lieu Fee Fund. The Housing In-Lieu Fee Fund receives monies paid by developers of market-rate housing in-lieu of including below market rate units in a residential project. This fund also receives monies paid by developers of certain commercial projects to offset the new need for affordable housing that the new commercial use is anticipated to create. The Housing In-Lieu Fee Fund has a current balance of $4,388,147, which includes an $800,000 loan authorized on October 5, 2020, from the 2020 NOFA, for Eden Housing at 999 Third Street “Vivalon.” Therefore, the unencumbered balance is currently $3,588,147.
• City of San Rafael Successor Agency Low/Moderate Fund. On February 1, 2012, the State Legislature enacted AB 26, which dissolved all California Redevelopment Agencies and provided for Successor Agencies to assume the rights, powers, and duties of the former redevelopment agencies. The City of San Rafael is the Successor Agency to the former San Rafael Redevelopment Agency, and the City Council acts as the governing board of the Successor Agency. Pursuant to AB 26, the San Rafael Oversight Board is responsible for overseeing the operation of the San Rafael Successor Agency as it administers the former Redevelopment Agency’s closing operations and obligations. The Low/Moderate fund is available for the development of housing affordable to and occupied by households earning 80 percent or less of the area median income, with at least 30 percent of these remaining funds expended for the development of rental housing affordable to and occupied by households earning 30 percent or less of the area median income and no more than 20 percent of these remaining funds expended for the development of housing affordable to and occupied by households earning between 60 percent and 80 percent of the area median income.

Currently the Low/Moderate fund has a balance of $861,169.

Other Local Funding (PLHA)
The Marin County Permanent Local Housing Allocation (PLHA) Fund is managed by the County of Marin and not by the City. A project that is awarded funds from the City’s Affordable Housing Trust Fund is eligible to apply for PLHA funding, when funds are available. Senate Bill 2 (SB2), adopted in 2017, established a permanent source of funding intended to increase the affordable housing stock in California, a permanent local housing allocation (PLHA). Marin County is eligible for non-competitive, entitlement funds. The five-year plan for these funds allocates funds to match local housing trust funds for acquisition, predevelopment, development, and preservation of multi-family projects, with an emphasis on projects for households that are at or under 60 percent Area Median Income (AMI). PLHA funding awards are made on the same timeline and following the same process as CDBG and HOME funds, with the City Council forwarding its recommendation to the County Board of Supervisors for consideration. The fund has a current balance of approximately $1.2 million and applications submitted SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
by February 17, 2022, will be considered for a PLHA match. The Marin County Community Development Agency will present the PLHA recommendations for the San Rafael City Council consideration on March 21, 2022.
2021 NOFA – Affordable Housing
On November 12, 2021, the Community Development Department issued a Notice of Funding Availability (NOFA) for the acquisition/rehabilitation or new development of 100% affordable rental or ownership housing projects in the amount of two and a half million dollars ($2,500,000) and invited qualified affordable housing sponsors to submit requests for funding for construction or preservation of affordable rental housing for seniors, families, and individuals and families with special needs including individuals and families who formerly experienced homelessness. The NOFA allows the City Council to authorize additional funding above the published $2,500,000 amount at its discretion. The application deadline for this NOFA was December 23, 2021, by 5:00pm.

Considerations for Funding. The NOFA provided the following considerations for awarding funding:
• The project meets all requirements provided in the Guidelines. • Developer team demonstrates site control or ability to achieve site control, including but not limited to a purchase and sale agreement, executed deed, or letter from a public agency or other entity agreeing to convey property and including the terms and conditions of such a transfer. • Budget demonstrates capacity to provide the greatest return on the City’s investment by maximizing number of affordable units created through the creative use of design, materials, construction techniques, and financing.
• Financing plan includes reasonable per unit City subsidy coupled with other funding sources based on target population, project type and cost effectiveness (cost per person, externalities, reserves, leveraging).
• Ability of the project to contribute toward meeting the City’s goals for new housing development and the Regional Housing Needs Allocation (RHNA).

Additional Funding Considerations. In addition to the stated considerations for funding, the NOFA included two further considerations:
• Project readiness in the form of approved entitlements and building permits and awarded state and federal funding.
• Projects located within a quarter mile of transit, or that provide units for larger families, or serve very-low- and/or extremely-low-income households or include 20% or more permanent supportive housing.

The City received four (4) responses to the NOFA totaling just under four million dollars. The four responses are summarized in the chart on the following page.

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2021 Affordable Housing NOFA – Responses Received
Request Address Project Type Units Applicant Estimated
Project Cost
Prior
Award
2021 NOFA
Request
Acquisition Belvedere St Acquisition/
Rehabilitation TBD Canal Alliance $6,708,000 -- $800,000 Gap 999 Third St New
Construction 67 Eden
Housing $47,266,587 $800,000 $1,000,000
Gap 3301 Kerner Blvd Adaptive
Reuse 40 Eden
Housing $30,000,000 $1,251,663 $1,843,315
Gap 190 Mill St New
Construction 32 Homeward
Bound $10,872,000 $750,000 $350,000
Totals 1391 $2,801,663 $3,993,315
Three of the projects previously received funding from the City. These included 999 Third Street (Vivalon), 3301 Kerner Boulevard, and 190 Mill Street. In the case of 3301 Kerner, the City had awarded a grant to the County of Marin, which leveraged the City’s funding to obtain HomeKey funds which the County used to acquire the site. The funding recommendation would result in the completion or rehabilitation and preservation of more than 139 deed-restricted affordable housing units1.

In January 2022, the Community Development Department assembled a panel of City staff to review and evaluate the responses using the criteria listed in Section 5 of City Council Resolution No. 14760, Guidelines for the Administration of the Affordable Housing Trust Fund. The panel included the City’s Community Development Director, Chief Building Official, Finance Director, and Economic Development Director. The panel met on January 24 and evaluated each response and formed a preliminary recommendation. The panel also identified needs for additional information. Community Development staff then held follow-up meetings with the respondents in early February to gather the additional information. A final preliminary evaluation was circulated to the panel prior to presenting the recommendation to the City Manager. The City Council ad hoc subcommittee on Homelessness, which consists of the Mayor and Council Member Kertz, received the preliminary recommendation and provided comments to staff on February 23, 2022.

Funding Recommendation
The funding recommendation for the 2021 Affordable Housing NOFA is provided in the following two charts. Funding is recommended from both the Low/Moderate Fund (#495) and the Affordable Housing In-Lieu Fee fund (#243). The recommendation includes adding to the loan principal the City’s legal costs associated with processing each of the loans, which are estimated to be approximately $5,000 per loan, however legal costs could be greater than this depending on the complexity of the project.

The funding recommended from the Low/Moderate Fund is as follows.

Recommended Funding - Low/Moderate Fund (#495)
Address Type Sponsor Total Cost 2021
Request
Prior
Award Recommendation Total City Funding(Per Unit)
3301
Kerner Blvd
Gap
Funding
Eden
Housing $30,000,000 $1,843,315 $1,251,663 $850,000 $2,101,663 ($52,542) Total $850,000
1 The sponsor for the Belvedere St. acquisition, Canal Alliance, is negotiating for site control and units for this project are not yet included in the total count. Canal Alliance anticipates the Belvedere St. site will have between 25 and 35 units for a grand total of between 164 and 174 units.

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The funding recommended from the Affordable Housing In-Lieu Fee Fund is as follows:

Recommended Funding - Affordable Housing In-Lieu Fee Fund (#243) Address
(Project Type) Request Sponsor Total Cost 2021 Request
Prior
Award Recommendation Total City Funding(Per Unit)
Belvedere St
(Acq/Rehab) Acquis Canal
Alliance $6,708,000 $800,000 -- $400,0002 $400,000
($TBD)
999 Third St
(New Const)
Gap
Funding
Eden
Housing $47,266,587 1,000,000 $800,000
($12,000) $1,000,000 1,800,000
(26,866)
190 Mill Street
(New Const)
Gap
Funding
Homeward
Bound $10,872,000 $350,000 $750,000($23,500) $350,000 $1,100,000 ($34,375) Total 1,750,000
The funding recommendation for Belvedere also includes support for the Canal Alliance application to the County of Marin PLHA fund in an amount matching the City funding award. If awarded by the County Board of Supervisors, the full funding request will be met with half of the funding ($400,000) awarded from the City and an in-kind match of funds awarded ($400,000) from the County PLHA fund.

ANALYSIS:

Each request for funding received was evaluated using the criteria and guidelines provided in the NOFA and the City’s affordable housing guidelines document. Summaries for each project and justification for each funding award is provided below.
3301 Kerner Boulevard ($850,000, Fund #495)
On January 21, 2020, the City Council adopted resolution No. 14760 approving up to $1,540,000 grant from fund #243 to support the purchase of the property. The City ultimately provided a grant in the amount of $1,251,663 to the County. The County used the grant to receive $5,940,000 in Homekey funds in order to purchase the property.

The project sponsor (Eden Housing) is preparing to apply for State Tax Credits this year. The additional funding provided by the City in the project will improve the project’s competitiveness for tax credits and bonds, which tend to be highly competitive and often receive more requests than the funding available.

The City’s funding support is therefore especially important since the project site is located in what is considered a “Low Resource” area for tax credit and bond funding purposes. The California Tax Credit Allocation Committee (CTCAC) and California Debt Limit Allocation Committee (CDLAC) allocate state and federal funding in part based on location, with locations in low resource areas scoring lower than moderate, high, and highest resources areas.

The recommendation to use #495 Low/Moderate funds in this project aligns with the uses for the funds and supports the sponsor’s application for additional funding. AB 2224 which amended Section 34176 of the Health and Safety Code provides that Low/Moderate funds be used to address homelessness and affordable housing. $250,000 can be spent on homeless prevention and the rest on affordable housing projects that meet specific criteria. (For the development of housing affordable to and occupied 2 The staff recommendation includes a recommendation that the City Council support a matching award of $400,000 Permanent Local Housing Allocation (PLHA) funding for the Belvedere St. project. If awarded, the full funding request of $800,000 will be met.

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by households earning 80 percent or less of the area median income, with at least 30 percent of these remaining funds expended for the development of rental housing affordable to and occupied by households earning 30 percent or less of the area median income and no more than 20 percent of these remaining funds expended for the development of housing affordable to and occupied by households earning between 60 percent and 80 percent of the area median income.) 3301 Kerner Boulevard will create 40 studio and 1-bedroom units of permanent supportive housing. This project aligns with the City’s goals to create additional supportive housing for the City’s most vulnerable population. The site’s proximity to services including the Marin Health & Wellness Campus further increases the project’s capacity to best meet the needs of the community. 3301 Kerner Blvd Permanent Supportive Housing
– Sources of Funding Status Amount
San Rafael/Marin County Land & Building Donation Committed $7,250,000 No Place Like Home (NPLH) Funds Committed $4,981,492
City of San Rafael Gap Loan (2021 NOFA) Pending $850,000 Limited Partner Capital Pending $14,841,133
Projected Funding Gap $1,120,665
Total Sources $29,043,290
The Low/Moderate Fund (#495) balance as of the date of this report is $861,169. Funding this request will result in a remaining balance of $11,169.

Belvedere St. ($400,000, Fund #243, and $400,000 County PLHA Funds) This request is an opportunity to preserve affordable housing. The sponsor (Canal Alliance) has requested $800,000 to purchase an existing apartment complex. The sponsor is currently in negotiations on a multi-family site which was first completed in the mid-1960’s and includes multiple buildings and between 25 and 30 units. The City affordable housing trust fund would be used to leverage additional capital to purchase the property. Any gap in the funds needed for acquisition could be covered with a loan from Canal Alliance. Once the property is acquired, additional funding will be obtained to complete any rehabilitation needed and to potentially add up to four additional units.

The project would ultimately be restricted to an average building AMI of at or below 60% of Marin County Area Median Income set by the United States Department of Housing and Urban Development (HUD AMI) as published by the Marin Housing Authority. The average affordability, however, would be achieved over time as households move. At acquisition the building would qualify for the loan if the in-place tenant household income average is at or below an average of up to 80% AMI. Upon vacancy, units would be income restricted to households earning at or below 60% AMI. In this way, the project would prevent displacement while preserving the affordability of an existing building in an area experiencing rising rents.

Future plans could include converting the apartments to affordable ownership, at which time the City’s loan would be repaid and the units would be restricted as affordable in perpetuity through the Below Market Rate (BMR) housing program.

The recommendation is to provide $400,000 in funds from the Affordable Housing In-Lieu Fund and to support an award of matching PLHA funds from the County of Marin. These funds would be used to leverage additional funding to buy the property. Next year, the sponsor intends to apply for a Community Development Block Grant (CDBG) to complete envisioned rehabilitation. Canal Alliance will have 24 months to use the funds to purchase the site. During this time period and upon request from Canal Alliance the City Council may award the funding to an alternative site at its sole discretion. If the funding is not used in this time period, the funds will be returned to the trust fund.

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Belvedere Street
– Sources of Funding Status Amount
City of San Rafael (2021 NOFA) Pending $400,000
Permanent Local Housing Allocation Fund (PLHA) Pending $400,000 Other funding sources (Being determined) Pending $5,908,000 Total Sources $6,708,000
190 Mill Street ($350,000, Fund #243)
In 2020, the project sponsor (Homeward Bound) initially requested $750,000 to help close a $2 million funding gap for the project. Since this initial request, the sponsor has brought in additional funding and has narrowed the gap to a remaining $350,000. Awarding the funding to close the remaining gap assures the project is completed and placed in service on schedule. When completed, 190 Mill Street (“the Mill Street Center”) will include 32 single-room occupancy (SRO) units of supportive housing.

The recommendation is to fully fund the request at $350,000 which aligns with the City goal to create additional housing for people experiencing homelessness supported with wraparound services.

Mill Street Center Permanent Supportive Housing
– Sources of Funding Status Amount
Partnership HealthPlan Awarded $1,567,065
No Place Like Home Technical Assistance Awarded $100,000 No Place Like Home (Non-competitive) Awarded $1,551,535 No Place Like Home (Competitive) Awarded $2,903,585
Homeless Emergency Aid Program Awarded $564,620
Marin Community Foundation Awarded $1,000,000
Nancy H. and James Kelso Fund Awarded $666,667
Anonymous Individual Gift Deposited $1,320,000
City of San Rafael (2020 NOFA – grant) Deposited $750,000 City of San Rafael – Development Impact Fee Waiver Awarded $132,000 City of San Rafael Gap Funding Request - grant Pending $350,000 Individual Gifts - Capital Campaign Deposited $495,000
Tamalpais Pacific - Challenge Grant Awarded $100,000
Tamalpais Pacific - Predevelopment Funds Awarded $25,000 Hellman Foundation Awarded $50,000
Remick Family Foundation Awarded $25,000
County of Marin Affordable Housing Trust with
Permanent Local Housing Allocation Match Awarded $459,528 Total Sources $10,872,000
999 Third Street ($1,000,000, Fund #243)
The Vivalon Healthy Aging Campus will include 66 one-bedroom and studio units for older adults and one manager’s unit. Approximately 20% of the units will be supportive housing. The sponsor has secured SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 8
project-based vouchers from the Marin Housing Authority for all 66 affordable units. When completed, the project will help meet the housing needs for older adults and formerly homeless older adults. The Healthy Aging Campus, which will be operated by Vivalon, will provide services and support for older adults living in the building and in the greater area.

In 2020, the project sponsor (Eden Housing) initially requested a $1 million loan to close a $4.8 million gap in project funding. The City Council awarded $800,000 to the project. Since this initial request the sponsor has brought in $4 million in additional funding from the Housing Trust of Silicon Valley. This award would have closed the gap; however, costs have increased since 2020. Also, an additional $450,000 cost was incurred for a vapor intrusion mitigation system (VIMS) required by the Department of Toxic Substances Control. Although the initial City award and the Housing Trust Silicon Valley award have narrowed the funding gap, there remains an additional $1 million need. The additional funding award would close the gap assuring the project is completed in an expeditious manner. 999 Third Street
– Sources of Funding Status Amount
Predevelopment Loan (Eden Housing Line of Credit) Committed $3,144,6213 First Mortgage – Tranche A Committed $7,664,000
First Mortgage – Tranche B Committed $5,478,000
Housing Trust Silicon Valley – Apple Loan Awarded $4,000,000 Marin County – HOME & CDBG Awarded $896,371
City of San Rafael (2020 NOFA) Awarded $800,000
City of San Rafael gap funding request (2021 NOFA) Pending $1,000,000 Sponsor Loan (Marin Community Foundation Grant) Awarded $450,000 Commercial Loan (Vivalon Construction Loan) Committed $6,579,504 Limited Partner @ 99.99% Committed $20,348,067
Total Sources $47,215,942
Affordable Housing In-Lieu Fee Fund Balance
The following chart provides a history of revenues and expenditures from the Affordable Housing In-Lieu Fee fund for the last two years. During this time period the fund received two payments of $1,843,200 each from the Village at Loch Lomond Marina townhome project along with other smaller in-lieu fee payments. The funding recommendation will result in the completion or rehabilitation and preservation of more than 139 deed-restricted affordable housing units4 .

Affordable Housing In-Lieu Fee Fund (#243)
NOFA
(Date) Address Transaction Entity Amount Fund Balance
$1,730,760
(9-10-2020) Revenue Pymt 1 MVA – Loch L $1,843,200
$3,573,960
$1.6M
(10-5-2020)
999 3rd St Loan ($800,000) } ($1,550,000) 190 Mill St Grant Homeward Bound ($750,000) 3 The Eden Housing line of credit is not included in total project cost. The line of credit represents projects costs that will be included in the permanent financing on the project, and the line of credit will be paid off. 4 The Belvedere St. project is anticipated to yield between 25 and 35 additional units for a total of 164 to 174 units.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 9
NOFA
(Date) Address Transaction Entity Amount Fund Balance
$2,023,960
(11-2-2020) 3301 Kerner Grant Marin Cy ($1,251,663)
$772,297
(4-12-2021) Revenue Pymt 2 MVA – Loch L $1,843,200
$2,615,497
Revenue Misc Pymts Rev’d $972,650
$3,588,147
$2.5M
(3-21-2022)
150 Belvedere Loan Canal Alliance ($400,000) } ($1,750,000) 190 Mill St Homeward Bound ($350,000) 999 3rd St Loan Eden Housing ($1,000,000)
Remaining Balance After Awarding the Funding Recommendation $1,838,147 COMMUNITY OUTREACH:

The NOFA was announced on the City’s website and notices were provided to local and regional affordable housing owners and developers.

FISCAL IMPACT:

Approval of the recommendation will result in a fiscal impact to the Affordable Housing In-Lieu Fee Fund, Fund #243, of $1,750,000. Presently there is $3,588,147 available in the Affordable Housing In-Lieu Fee Fund. If the recommendation is funded in full, this will leave $1,838,147 unencumbered in the fund. The fund receives revenues in the form of payments made in-lieu of including affordable housing in new residential projects subject to the City’s affordable housing requirements. The fund also receives affordable housing linkage fee payments from certain commercial projects based on the projected affordable housing need created by the new commercial project.

Approval of the recommendation will result in a fiscal impact to the Low/Moderate Fund, Fund #495, of $850,000. Presently there is $861,169 available in the Low/Moderate Fund. If the recommendation is funded in full, this will leave $11,169 in the fund.

The funding approved by the City Council will be issued through residual receipt loans at 3.0% simple interest during construction or rehabilitation, and between 1.5% to 3.0% simple interest, depending on the financing needs of the project, for a minimum affordability term of 55 years following. Repayment of each loan and accrued interest will depend on the amount of net proceeds remaining each year after allowable projects costs. The total life of each loan will up to 57 years, including up to a two-year construction/rehabilitation period followed by a 55-year affordability term. Each loan will be due in full along with any interest accrued at the end of the affordability term. The City’s loan documents will include a clause that if excess fund remain once the project is completed that those funds be used to pay down the City’s loan. The City may waive it’s right upon request from the sponsor to use the funds to pay down other debt in the project.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 10
OPTIONS:

The City Council has the following options to consider on this matter:

1. Staff’s recommended action, which is to adopt the resolution.

2. Adopt a modified resolution

3. Direct staff to provide additional information

4. Take no action
RECOMMENDED ACTION:

Adopt the resolution
ATTACHMENTS:

1. Resolution

Page 1 of 3 ends

RESOLUTION NO.

RESOLUTION AUTHORIZING THE EXPENDITURE OF $1,750,000 IN FUNDS FROM THE AFFORDABLE HOUSING IN-LIEU FEE FUND (FUND #243) AND EXPENDITURE OF $850,000 FROM THE LOW/MODERATE FUND (FUND #495) ALONG WITH FUNDS FROM EACH SOURCE

FOR THE ATTORNEY FEES INCURRED BY THE CITY TO COMPLETE ALL DOCUMENTS ASSOCIATED WITH THE FUNDING FOR FOUR 100% AFFORDABLE HOUSING PROJECTS IN FULFILLMENT OF THE AFFORDABLE HOUSING TRUST FUND 2021 NOFA, SUPPORTING THE

AWARD OF FUNDING FROM THE COUNTY OF MARIN FOR PERMANENT LOCAL HOUSING

ALLOCATION (PHLA) FUNDS TO THE PROJECTS RECEIVING CITY FUNDING, AND

AUTHORIZING THE CITY MANAGER TO EXECUTE ALL DOCUMENTS INCIDENT TO THE

FUNDING IN A FORM APPROVED BY THE CITY ATTORNEY
WHEREAS, on January 21, 2020, the City Council adopted Resolution No. 14760, establishing Guidelines for the Administration of the Affordable Housing Trust Fund; and WHEREAS, on November 11, 2021, the City issued a Notice of Funding Availability (NOFA) for two million five-hundred thousand dollars ($2,500,000) of funding from the Housing In-Lieu Fee Fund to support affordable housing, with an application deadline of December 23, 2021 by 5:00pm; and WHEREAS, the NOFA allows the City Council to issue loans in excess of the published available funding amount; and
WHEREAS, the City received four responses to the NOFA totaling $4 million in funding requests; and
WHEREAS, applications were reviewed using the evaluation criteria listed in Section 5 of the Guidelines for the Administration of the Affordable Housing Trust Fund; and WHEREAS, based upon this evaluation criteria and the needs for local support for the development of affordable housing, a funding recommendation has been developed that exceeds the amount of funds published in the NOFA using funds from the Low / Moderate Fund, which is a separate fund established for affordable housing; and
WHEREAS, the City has sufficient funds in the Housing In-Lieu Fee Fund #243 to issue the loans included in the recommendation and the funding requests included in the funding recommendation meet the criteria for use of the funds; and WHEREAS, the County of Marin maintains the Permanent Local Housing Allocation (PLHA) Fund and issues loans from the fund to support affordable housing following the program rules and guidelines provided by the State of California Housing and Community Development Department in coordination with the Cities of San Rafael and Novato through the Priority Setting Committee.

WHEREAS, the Priority Setting Committee, which consists of elected members of Marin County and the Cities of San Rafael and Novato, convenes to make recommendations for expending CDBG, HOME, and PLHA funds, and the Committee recommendation is considered the approval of such funding requests.

Page 2 of 3 ends

NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of San Rafael as follows:

Section 1. The City Council authorizes the following affordable housing expenditures from the Housing In-Lieu Fee Fund, subject to City requirements for issuing loans for affordable housing:
i. $400,000 loan from the Housing In-Lieu Fee Fund (#243) for the Canal Alliance for acquisition of Belvedere St. The project will be restricted at an average of at or below 60% of Marin County Area Median Income set by the United States Department of Housing and Urban Development (HUD AMI) as published by the Marin Housing Authority. The average affordability in the project, however, will be achieved over time through attrition as households move. At acquisition, the building shall qualify for the loan if the in-place tenant household income average is at or below an average of up to 80% AMI. Upon vacancy, units shall be income restricted to individuals and households earning at or below 60% AMI. Canal Alliance will have 24 months to use the funds to purchase the site. During this time period and upon request from Canal Alliance the City Council may award the funding to an alternative site at its sole discretion. If the funding is not used in this time period, the funds shall be returned to the Fund.
ii. $350,000 grant from the Housing In-Lieu Fee Fund (#243) for the Homeward Bound of Marin project at 190 Mill Street for 32 units of permanent supportive housing for people who are homeless, chronically homeless, or at risk of chronic homelessness, at rents affordable to households earning 30% of Area Median Income or less. The funds will be issued as a grant. iii. $1,000,000 loan from the Housing In-Lieu Fee Fund (#243) for the Eden Housing project at 999 Third Street for 67 units of low- and very low-income housing for older adults. iv. $850,000 loan from the Low/Moderate Fund (#495) for the Eden Housing adaptive reuse project at 3301 Kerner Boulevard for 40 units of permanent supportive housing for homeless or formerly homeless households with mental illness, at rents affordable to very low-income households.

Section 2. The City Council authorizes the funding to be issued in the form of residual receipts loans at a simple interest rate of three percent (3%, simple) during pre-development, and construction or rehabilitation for new construction, adaptive reuse or acquisition/rehabilitation projects. The loan or grant principal shall be used to cover the City’s legal costs associated with processing all documents incident to the agreements, which are estimated to be approximately $5,000 per loan. The predevelopment and construction phases may last up to 24 months and can be extended with prior authorization in writing from the City. When construction or rehabilitation is completed the interest rate for loans shall convert to between simple one-and-one-half percent (1.5%, simple) and simple three percent (3.0%, simple) depending on the needs of the financing structure in the project for the duration of the affordability term. Interest accrued during the pre-development and construction phases shall be rolled into the principal loan balance at conversion to permanent financing. The conversion date for new construction and adaptive/reuse projects is the date the project receives a temporary or final certificate of occupancy. The conversion date for acquisition/rehabilitation projects is the date when all completed rehabilitation work has been approved by the City. The affordability term shall last for 55 years following the date of conversion. If excess funds remain at project completion those funds shall be used to pay down the City loan. The City may waive it’s right upon request from the sponsor to use the funds to pay down other debt in the project.

Page 3 of 3 ends

Section 3. The City Council recommends that the Priority Setting Committee recommend and that the Marin County Board of Supervisors approve any request for PLHA funding submitted for the projects receiving funding through this resolution. If a project receives PLHA funding based on the match of the City’s Housing In-Lieu Fee Funds and the award results in the funding request being overfunded, the amount of Housing In-Lieu Fee Funds shall be reduced to match the sponsor request.

Section 4. The City Council authorizes the City Manager to execute all documents and related documents required and including the additional requirements associated with expending the funds, and to execute all other documents required in connection with the agreements, in a form to be approved by the City Attorney.

I, LINDSAY LARA, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a regular meeting of the City Council of said City held on Monday the 7th day of March 2022, by the following vote, to wit:

AYES: COUNCILMEMBERS:

NOES: COUNCILMEMBERS:

ABSENT: COUNCILMEMBERS:
______________________
LINDSAY LARA, City Clerk
____________________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 7.b
Meeting Date: March 7, 2022
TOPIC: CANNABIS PROGRAM – STATE REGULATORY UPDATES
SUBJECT: RESOLUTION AMENDING THE “CANNABIS BUSINESS OPERATOR LICENSE PROGRAM” (CBOL), AND RESTATING IT IN ITS ENTIRETY
RECOMMENDATION:

Adopt the resolution.

BACKGROUND:

In November 2018, the City of San Rafael began a pilot medical cannabis licensing program. In April 2019, the City expanded the program to also include adult-use cannabis licensure. Since the start of this program, the City’s Economic Development Department has been responsible for licensure, revenue collection, and tracking the State’s regulatory framework for changes. Periodically, the City’s Cannabis Business Operator License (CBOL) procedures and policies resolution (the “CBOL Program”) requires amendments to sync-up local regulations with new or revised State regulations. The last amendments to the CBOL Program were adopted on November 16, 2020 by Resolution No. 14877.

For a quick review, San Rafael’s commercial cannabis licenses are limited and require a merit-based application process. The City’s cannabis program permits four different license categories for commercial activity within the city limits, in permitted zones. These categories include:
• Standalone Distribution-wholesale, state license Type 11 or Type 13 • Cannabis manufacturing license types, 6, N, and/or S
• Delivery, non-storefront retail, state license Type 9 • Testing laboratories, state license Type 8
ANALYSIS:

The State of California’s Bureau of Cannabis Control (BCC) and the Department of Public HealthCalCannabis, have merged into a new regulatory agency, now called the Department of Cannabis Control

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Economic Development
Prepared by: Danielle O’Leary,
Economic Development Director
City Manager Approval: ______________
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
(DCC). The DCC is now the overarching state agency regulating all commercial cannabis activity in California.

Staff is bringing forward an updated CBOL Program resolution that reflects the new regulatory agency Department of Cannabis Control (DCC), as well as a definition change from “cannabis infused manufacturing” to “cannabis manufacturing” to reflect the zoning code updates made by Ordinance No. 1996, adopted with the General Plan 2040 adoption in August of 2021, as shown below:

For ease of reference the proposed resolution would amend and completely restate the CBOL Program last approved by Resolution No. 14877.

FISCAL IMPACT:

Not applicable.

OPTIONS:

The City Council has the following options to consider on this matter:

1. Adopt the resolution as presented.

2. Adopt resolution with modifications.

3. Direct staff to return with more information.

4. Take no action.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
RECOMMENDED ACTION:

Adopt the resolution.

ATTACHMENTS:

1.) Resolution Amending the San Rafael “Cannabis Business Operator License Program” and Restating it in its Entirety
Cannabis Business Operator License Resolution 1 | Page
RESOLUTION NO.

RESOLUTION OF THE SAN RAFAEL CITY COUNCIL AMENDING THE SAN RAFAEL “CANNABIS BUSINESS OPERATOR LICENSE PROGRAM” AND RESTATING IT IN ITS

ENTIRETY
WHEREAS, in 2015, the State Legislature adopted the “Medical Marijuana [now “Cannabis”] Regulation and Safety Act” (MCRSA) establishing a state licensing process for “commercial cannabis activity,” defined as including “cultivation, possession, manufacture, processing, storing, laboratory testing, labeling, transporting, distribution, or sale of medical cannabis or a medical cannabis product, except as permitted for qualifying patients and primary caregivers;” and
WHEREAS, on November 8, 2016, the voters of the State of California enacted Proposition 64, the “Control, Regulate and Tax Adult Use of Marijuana Act” (AUMA), to allow for nonmedical adult use of cannabis, and implementing regulations were subsequently developed by the state agencies for this act as well; and
WHEREAS, in July 2017, the Governor signed Senate Bill 94, entitled the “Medical and Adult-Use Cannabis Regulation and Safety Act” (MAUCRSA), which took effect immediately. The MAUCRSA directed that the MCRSA’s medical cannabis regulations be coordinated with AUMA’s nonmedical cannabis regulations; and
WHEREAS, on December 4, 2017, the City Council enacted Ordinance No. 1949, an urgency ordinance adding new Chapter 10.96 to the San Rafael Municipal Code to limit the commercial cannabis activities that will be allowed in the City of San Rafael starting on January 1, 2018, to those determined by the City Council to be beneficial rather than detrimental to the residents, workers and visitors in the City; and
WHEREAS, San Rafael Municipal Code section 10.96.050 provides that the City Council shall, by resolution, adopt reasonable regulations for a licensing process for commercial medical cannabis activities permitted within the City, and for the number of each license type to be issued; and
WHEREAS, on January 16, 2018, the City Council adopted Resolution No. 14455 approving a Medical Cannabis Business Operator License Pilot Program and policies, practices and procedures for administering and enforcing the program, including the number of each license type to be issued; and
WHEREAS, on May 21, 2018, the City Council adopted Resolution No. 14508 amending and restating the Medical Cannabis Business Operator License Pilot Program policies, practices, and procedures; and
WHEREAS, on March 18, 2019, the City Council adopted Ordinance No. 1968 to amend San Rafael Municipal Code Chapter 10.96 to expand its provisions to authorize, by license, both medical and adult-use commercial cannabis activities in San Rafael; and Cannabis Business Operator License Resolution 2 | Page
WHEREAS, on March 4, 2019, the City Council expanded and amended the Medical Cannabis Business Operator License Pilot Program to also apply to the commercial adult-use licenses authorized by Ordinance No. 1968, and renaming it as the “Cannabis Business Operator License Pilot Program”; and
WHEREAS, on November 16, 2020, the City Council adopted Resolution No. 14877 amending the Cannabis Business Operator License Program to make policy adjustments to (1) allow licensed manufacturers and delivery companies access to a secondary wholesale distribution license; to successfully execute their business and manage their product with more autonomy, (2) incorporate new state manufacturer license Type S and “Shared-use” manufacturing facilities; and
WHEREAS, in the July 2021 Budget Trailer Bill, Governor Newsom consolidated three state cannabis programs to form a single new state department called the Department of Cannabis Control (DCC), all references to the former Bureau of Cannabis Control (BCC) and the Department of Public Health—Cal Cannabis, will now be amended and restated to reflect the new state regulatory Department of Cannabis Control (DCC)”; and WHEREAS, for ease of reference the City Council wishes to restate herein the entirety of the program and its policies, practices and procedures as so amended; NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby amends and restates the Cannabis Business Operator License Program in its entirety as follows:

SECTION 1. PURPOSE AND INTENT
It is the purpose and intent of this resolution to regulate commercial cannabis activity within San Rafael city limits, to promote the health, safety, and general welfare of residents and businesses within the City. This resolution governs the establishment and operation of cannabis testing laboratories, cannabis manufacturers, cannabis delivery, and cannabis distribution.

SECTION 2. DEFINITIONS
For the purposes of this Program, the definitions below shall apply:
(a) “Applicant” person applying for a City of San Rafael Cannabis Business Operator License (CBOL).
(b) “City License” means owner of a City Cannabis Business Operator License (CBOL). (c) “Cannabis” means all parts of the plant Cannabis sativa Linnaeus, Cannabis Indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. “Cannabis” also means the separated resin, whether crude or purified, obtained from cannabis. “Cannabis” does not include the mature stalks of Cannabis Business Operator License Resolution 3 | Page
the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this division, “cannabis” does not mean “industrial hemp” as defined by Section 11018.5 of the Health and Safety Code.
(d) “Cannabis Delivery” means “Type 9 State License” as defined by Business and Professions Code section 26001(o), and in accordance with the State’s Department of Cannabis Control (DCC) licensing regulations. Type 9 licenses can transfer commercial cannabis or cannabis products to a customer. “Delivery” also includes the use by a retailer of any technology platform. Type 9 non-storefront retailers shall be authorized to conduct retail sales exclusively by delivery as defined by Business and Professions Code section 26001(o). The licensed premises of a non-storefront retailer licensee shall be closed to the public. (e) “Cannabis Distribution Transport” means “Type 13 State License” distributors can move cannabis and cannabis products between cultivation, manufacturing or distribution premises in accordance with the State’s Department of Cannabis Control (DCC) regulations.
(f) “Cannabis Manufacturing Type 6” means a “Type 6 State License” may: (1) conduct extractions using mechanical methods or nonvolatile solvents as defined by the Department of Cannabis Control (DCC) regulations, (2) conduct infusion operations on the licensed premises, (3) conduct packaging and labeling of cannabis products on the licensed premises; and (4) register and operate the licensed premises as a shared-use facility in accordance with Department of Cannabis Control (DCC) regulations. (g) “Cannabis Manufacturing Type N” means a “Type N State license” may: (1) Make cannabis products through infusion (2) Conduct packaging and labeling of cannabis products on the licensed premises; and (3) Register and operate the licensed premises as a shared-use facility in accordance with Department of Cannabis Control (DCC) regulations.
(h) “Cannabis Manufacturing Type S” means a “Type S State License” may: (1) Extract cannabis using butter or cooking oils (2) Make cannabis products through infusion (3) Package and label cannabis in accordance with Department of Cannabis Control (DCC) regulations in a licensed shared-use facility.
(i) “Cannabis Testing Laboratory” means “Type 8 State License” as defined by Business and Professions Code 26000(av), and in accordance with the State’s Department of Cannabis Control (DCC) licensing regulations.
(j) “Cannabis Wholesale Distribution” means a “Type 11 State License” as defined by Business and Professions Code section 26001(r)(s) for the procurement, sale, and Cannabis Business Operator License Resolution 4 | Page
transport of cannabis and cannabis products between entities licensed in accordance with the State’s Department of Cannabis Control (DCC) regulations. (k) “DCC” means the State of California’s Department of Cannabis Control (l) “Mechanical extraction” uses pressure, heat or cold to extract cannabinoids instead of using chemicals. Examples include: rosin presses or dry ice in accordance with the Department of Cannabis (DCC) regulations.
(m)“Medicinal Cannabis Patient” includes both a qualified patient as defined in the Health and Safety Code section 11362.7 and a person in possession of a valid identification card issued under Health and Safety Code section 11362.71“Licensee” means any person holding a City Cannabis Business Operator License (CBOL). (n) “Operator License” means a City of San Rafael Cannabis Business Operator License. (o) “Owner” means any of the following, as defined in Section 26001 of the Business and Professions Code:
1) A person with an aggregate ownership interest of 20 percent or more in the person applying for a license or a licensee, unless the interest is solely a security, lien, or encumbrance.
2) The chief executive officer of a nonprofit or other entity 3) A member of the board of directors of a nonprofit
4) An individual who will be participating in the direction, control, or management of the person applying for a license.
(p) “Person” includes any individual, firm, partnership, joint venture, association, corporation, Limited Liability Company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit, and the plural as well as the singular in accordance with the Department of Cannabis (DCC) regulations.
(q) “Purchaser” means the customer who is engaged in a transaction with a licensee for purposes of obtaining cannabis or cannabis products.
(r) “Sell”, “sale,” and “to sell” include any transaction whereby, for any consideration, title to cannabis or cannabis products is transferred from one person to another and includes the delivery of cannabis or cannabis products pursuant to an order placed for the purchase of the same and soliciting or receiving an order for the same. (s) “Shared Use Facility” means a Shared-use facility/place where multiple Type S manufacturers rotate on a schedule and share space and equipment, similar to a commercial kitchen in accordance with the Department of Cannabis (DCC) regulations.

Cannabis Business Operator License Resolution 5 | Page
(t) “State License” means a state issued license under the Department of Cannabis Control (DCC).

SECTION 3. LICENSING PROCESS
(a) Any person seeking to sell and or distribute, deliver, manufacture, or provide laboratory testing services located in San Rafael city limits must first obtain a Cannabis Business Operator License (CBOL) prior to operating.
(b) The CBOL Program will make the following limited license allotment:
• Cannabis Testing Laboratory State License Type 8 (4 licenses) • Cannabis Manufacturing State License Type 6, Type N, and/or State License Type S (10 licenses)
• Non-retail Storefront Cannabis Delivery State License Type 9 (8 licenses) • Standalone Cannabis Wholesale Distribution State License Type 11, and/or Type 13 Distribution/Transport (4 licenses)
SECTION 4. REVIEW AND ACTION ON APPLICATIONS; APPEAL
(a) The CBOL Application Review Committee includes the Police Chief, Fire Chief, Community Development Director and Economic Development Director, and/or their designees, to review and rank applications.
(b) The CBOL application ranking process shall consist of the following areas of evaluation:
• Business Plan (25 POINTS -MAXIMUM)
• Safety & Security Plan (25 POINTS - MAXIMUM)
• Gross Receipts Activity (25 POINTS - MAXIMUM)
• Qualifications of Principals (25 POINTS - MAXIMUM)
An application is required to receive a total of 80 points to move forward. The Committee shall rank all the applications and shall issue a written decision setting forth the ranking for each application, the ranking of each application in each of the ranking categories, and an explanation of the facts and reasoning supporting the rankings. The Committee shall serve a copy of its written decision on each applicant by email. (c) Appeal. An applicant who has received a ranking of less than 80 points may appeal that decision to the City Manager or his or her designee, by filing a written appeal with the City Manager’s office within five (5) business days after the date of service of the written ranking decision on the applicant. The appeal shall not be accepted for filing unless accompanied by an appeal fee in an amount determined by resolution of the City Council. In determining the appeal, the City Manager/designee will review the Committee’s written decision on the appellant’s application and the application itself. In addition, within five (5) business days after the filing of the appeal, the City Manager/designee shall set a time for a hearing, not to exceed two hours in length, at which the appellant may appear to review the Committee’s Cannabis Business Operator License Resolution 6 | Page
decision and to present evidence or argument why the Committee’s ranking should be modified. The hearing shall occur no later than thirty (30) days following the filing of the appeal unless another time is agreed to by the appellant. The hearing may be recorded by audiotape or written minutes.

Within ten (10) business days after completion of the hearing on the appeal, the City Manager/designee shall issue a written decision on the appeal shall either confirming or modifying the ranking given by the Committee. The decision shall be in served upon the appellant by email, or regular mail through the United States Post Office. The City Manager’s decision will be final, with no appeal to the City Council, and shall be subject to judicial review according to the provisions and time limits set forth in Code of Civil Procedure Section 1094.6; however, the filing of any such action shall not stay any lottery or subsequent award of operator licenses as provided herein.

After the appeal period has run without the filing of any appeals, or after the final decision by the City Manager on any and all appeals, if the Committee determines that the number of pre-screened and ranked applicants exceeds 100% of the maximum number of licenses available, then a lottery will be conducted after the ranking round. (d) Operator Selection. Within 120 days of written and e-mail notification, operators will have the ability to look for sites within permitted zoning districts and return with an identified site to apply for zoning clearance, San Rafael cannabis industry tax registration, and operator license issuance. Failure to secure a San Rafael location within 120 days shall be grounds for the City to revoke the award of a San Rafael cannabis business operating license. (e) Zoning Clearance, Background Check, Cannabis Industry Tax Registration, and Operator permit issued. Once the operator has found a business location, and has an executed lease agreement, or signed application by the property owner, planning staff will confirm zoning clearance, and the City will conduct a background check for circumstances requiring disqualification under Business and Professions Code section 26057. Upon successful completion of those steps, the applicant can then proceed with registering for the Cannabis Industry Tax pursuant to San Rafael Municipal Code Chapter 3.40, and the operator license will be issued.

SECTION 5. FEES
The Cannabis Business Operator License application and renewal fees are based on a costrecovery model for application intake, processing, and compliance monitoring. All fees are nonrefundable. Cannabis Operator License Application Fee shall be as follows, or as modified from time to time by resolution of the City Council:

Process Steps Staff Coordination Per Applicant Cost
Application Intake Economic Development
Director/Senior
Management Analyst
Review Time: 1-2
hours
$200
Cannabis Business Operator License Resolution 7 | Page
Criminal Background
Check
Police Review Time: 1
hour
$100
Application Review and
Ranking
Econ. Development
Director, Police Chief, Fire
Chief, Community
Development Director
Review Time: 3-4
hours
$2000
Operator Notification Econ. Development
Senior Management
Analyst/Director
Review Time: 1
hour
$100
Zoning Clearance,
Business Tax
Certificate, Operator
License Issuance
Senior Planner, Economic
Development Senior
Management Analyst
Economic Development
Director
Review Time: 2-3
hours
$300
Compliance Inspections Senior Code Enforcement
Officer
Review Time: 3-4
hours
$500
Gross Receipts Audits Contract with Outside
Agency
Review Time 3-4
hours
$900
Total License Fee $4100
Cannabis Business Operator License Renewal Fee:

Process Steps Staff Coordination Per Applicant Cost
Application Intake &
Review
Economic Development
Senior Management
Analyst, Economic
Development Director
Review Time: 1-2
hours
$500
Cannabis Business Operator License Appeal Fee:

Process Steps Staff Coordination Per Applicant Cost
Appeal Intake & Review,
Staff Preparation
Review City Manager Review Time: 4
hours
$836
Appeal Hearing &
Written Decision
Review City Manager Review Time: 4
hours $836
Total Appeal Fee $1,672
Cannabis Business Operator License Resolution 8 | Page
SECTION 6. OPERATING REQUIREMENTS
All cannabis business operator licensees shall comply with all the following operating requirements:
(a) The licensee shall meet all operating requirements of the Medicinal and Adult-use Cannabis Regulation and Safety Act (MAUCRSA), and requirements set forth by the Department of Cannabis Control (DCC).
(b) The licensee shall obtain and maintain the State of California license for the equivalent State cannabis license type and maintain all other required State and local licensees, permits, or approvals.
(c) Odor Control. No cannabis odors shall be detectable outside the commercial facility. (d) Advertising and Marketing Restrictions. All signage shall meet the sign requirements of Title 14 of the San Rafael Municipal Code and shall not advertise any activity related to cannabis.
(e) Operating Hours. A licensee may operate between the hours of:
1) Cannabis Delivery: 9AM to 9PM up to seven days a week, unless modified as condition of license to address site specific conditions. 2) Cannabis Testing Labs: 7AM – 7PM up to seven days a week, unless modified as condition of license to address site specific conditions. 3) Cannabis Manufacturing: 7 AM – 7PM, evenings available as a condition of the license; up to seven days a week, unless modified as condition of license to address site specific conditions.
4) Cannabis Distribution: 7AM – 7PM, up to seven days a week, unless modified as condition of license to address site specific conditions. (f) Contact Person. A licensee shall provide the City with the name and phone number of an on-site community relations staff person or designee to whom one can provide notice if there are operating concerns. The licensee shall make a good faith effort to encourage residents to call this person to try to solve operating concerns before any calls or complaints are made to the City.

SECTION 7. TERMS OF LICENSE
(a) Licenses issued under this resolution shall be valid for 12 months from the date of issuance.
(b) Licensees may submit a license renewal form no sooner than 60 and no later than 30 calendar days before the license expires.

Cannabis Business Operator License Resolution 9 | Page
SECTION 8. WITHDRAWAL OF APPLICATION
(a) An applicant may withdraw an application at any time prior to the City’s issuance of a license or denial of a license.
(b) Requests to withdraw an application must be submitted to the City in writing, dated and signed by the applicant.
(c) The City will not refund application fees for a withdrawn application after application intake window closes.

SECTION 9. GROUNDS FOR LICENSE DENIAL OR RENEWAL
(a) The City may deny an application for license or for renewal of a license for any reason specified in Business and Professions Code section 26057, as amended from time to time. (b) Written Notice Required. Upon denial of a license or denial of renewal of a license pursuant to subsection (a) of this section, the Economic Development Director, or designee, shall notify the applicant of the reasons for denial in the manner provided Section 10(b) of this Resolution.
(c) Appeal. Upon denial of a license of denial of renewal of a license, the applicant may file a written appeal of that decision with the Economic Development Director within ten (10) business days after the date of service of the written decision. The appeal shall not be accepted for filing unless accompanied by an appeal fee in an amount determined by resolution of the City Council.
(d) Hearing. The Economic Development Director, or designee, shall appoint a hearing officer and set an appeal hearing, to be held no less than ten (10) days and no more than sixty (60) days after the service of the written notice required in subsection (b). The hearing and notice of decision shall be as provided in Sections 10(c) and (d) of this Resolution.

SECTION 10. LICENSE SUSPENSION, MODIFICATION AND REVOCATION (a) Any license issued under the terms of this resolution may be suspended, modified, or revoked by the Economic Development Director, or his or her designee, for cause including but not limited to violation of any the requirements or provisions of this resolution, loss of licensure with the State’s Department of Cannabis Control, or conflicts with State law.
(b) Written Notice Required. The Economic Development Director, or designee, before revoking or suspending any Cannabis Business operator license shall serve the licensee Cannabis Business Operator License Resolution 10 | Page with written notice of revocation or suspension, provided in the manner set forth in Section 1.08.060 of the San Rafael Municipal Code, of the alleged grounds for revocation or suspension and the date for a hearing, to be held no less than ten (10) days and no more than sixty (60) days after the service of the written notice, to consider whether the Cannabis Business operator license shall be revoked or suspended. (c) Hearing. The Economic Development Director, or designee, shall appoint a hearing officer to hear and consider all evidence at the hearing. The hearing may, after being commenced within the time specified pursuant to subsection (b) of this section, be continued for good cause by the hearing officer from time-to-time. The hearing officer may require such legal briefing as may be required to address any issues raised at the hearing.
(d) Notice of Decision; Judicial Review. Within a reasonable time, but not more than thirty (30) days following the conclusion of the hearing, the hearing officer shall issue a written decision as to whether the Cannabis Business operator license shall be revoked or suspended, supported by factual findings and determinations referenced by supporting evidence. The written decision shall be served on the operator licensee as provided in Code of Civil Procedure Section 1094.6, with a copy submitted to the city clerk and the city attorney. The written decision of the hearing officer shall be final and shall be subject to judicial review according to the provisions and time limits set forth in Code of Civil Procedure Section 1094.6.

SECTION 11. TRANSFER OF LICENSE
(a) A licensee shall not operate under the authority of a Cannabis Business Operator License at any location other than the address stated in the application for the license. (b) The Cannabis Business Operator Licenses are not transferrable or assignable to another person or owner. In the event of the sale or transfer of the business or operations covered by the licensee, changes in ownership shall be made in accordance with the following:
1) If one or more of the owners of a license change, but at least one existing owner is not transferring their ownership interest, and will remain as an owner under the new ownership structure, then the new owners shall submit a new application to the City for review of qualifications, background checks and to determine whether the change would constitute grounds for denial of the license.
2) If all owners will be transferring ownership interest, the business shall not operate under the new ownership structure until a new license application has been submitted and approved by the City, and all application and licensing fees have been paid.

Cannabis Business Operator License Resolution 11 | Page SECTION 12. ENFORCEMENT
(a) It is unlawful for any person to violate any provision or fail to comply with any of the requirements of this resolution, and any such violation shall be enforceable in accordance with the provisions of Chapters 1.40, 1.42, 1.44, and 1.46 of the San Rafael Municipal Code.
(b) In accordance with Section 26013, Business and Professions Code. The City, and its authorized representative, shall have full and immediate access to inspect and:
1) Enter onto any premises license by the City.
2) Any inspection, investigation or review, or audit of a licensed premises shall be conducted anytime the licensee is exercising privileges under the license, or as otherwise agreed to by the City and licensee or its agents, employees, or representatives.
3) Prior notice of an inspection, investigation, review or audit is not required.

BE IT FURTHER RESOLVED that any amendments to the Cannabis Business Operator Licensing Program Policies, Practices and Procedures as deemed necessary from time-to-time shall require an amendment to this resolution by City Council action.

BE IT FURTHER RESOLVED that the amendments made in this Resolution shall take effect immediately upon its adoption.

I, LINDSAY LARA, City Clerk of the City of San Rafael, hereby certify that the foregoing resolution was adopted at a regular meeting of the City Council on the 7th day of March 2022, by the following vote to wit:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

Lindsay Lara, City Clerk
____________________________________________________________________________________

FOR CITY CLERK ONLY
Council Meeting:

Disposition:

Agenda Item No: 7.c
Meeting Date: March 7, 2022

SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: FINANCE
Prepared by: Nadine Atieh Hade,
Finance Director
City Manager Approval: _____________
TOPIC: INTERIM FINANCIAL UPDATE AND BUDGET AMENDMENTS TO REFLECT OPERATIONAL ACTIVITY; MID-YEAR PERSONNEL CHANGES
SUBJECT: (1) FISCAL YEAR 2021-2022 INTERIM FINANCIAL UPDATE (2) RESOLUTION ADOPTING AMENDMENTS TO THE 2021-2022 BUDGET AND

APPROVING MID-YEAR PERSONNEL CHANGES
RECOMMENDATION: Adopt the Resolution.

BACKGROUND: The Finance Department performs an ongoing review of the City’s financial performance and provides updates on the City’s financial condition to City Management. This report presents the City’s financial condition in the current fiscal year (2021-2022) based on actual revenue and expenditure performance for the period July 1 through December 31, 2021, and budget actions taken through February 22, 2022, as compared to the budget approved by City Council on June 21, 2021.

Based on this review and analysis, revisions are recommended to address the following categories:
(1) Revenue projections
(2) Expenditure plan changes
In addition, personnel changes are being recommended for mid-year implementation.

ANALYSIS:

GENERAL FUND:

Revenues and Other Sources:

There have been no recommended changes to revenue and other funding sources since the budget was approved. Based on the activity of the first six months of the fiscal year, staff is forecasting increased revenues of approximately $5,060,000.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
This increase is attributed to:

1. Higher than anticipated sales and use tax receipts received for the first five months of the fiscal year as a result of strong auto sales, building and construction activities, and continued elevated allocations from the County Pool from online sales. In addition, General and Consumer Goods, Restaurant and Hotels, and Fuel and Service Station sectors are mounting a comeback as we move from a pandemic environment towards an endemic environment and restrictions previously imposed to curb the spread of coronavirus begin to lapse. Staff anticipates an additional $2.7 million in sales tax and $2 million in transaction and use tax.

2. Larger than anticipated property tax roll for both secured and unsecured property resulting from the hot housing market pushing the median sale price of a home in San Rafael to $1.4 million, an 18% increase year-over-year. Staff anticipates an additional $250,000 in secured property tax and $110,000 in unsecured property tax in the current year.

Expenditures and Other Uses:

Although revenues are expected to increase by an estimated $5 million, at this point staff continues to stay within its originally budgeted appropriations limit except for a few outstanding items.

1. During the first quarter of the fiscal year City Council determined that imposed furloughs enacted during the fiscal year ended June 30, 2021, would be retroactively repaid following the preliminary results of the annual audit. As such, staff requests additional appropriations totaling $533,374 for the increase in FY 2021-22 payroll expenditures.

2. As a result of staffing shortages experienced in Public Safety largely due to COVID leave, injuries and vacant positions, the departments are projected to require further appropriations for overtime by fiscal year end. Staff recommends appropriating an additional $500,000 to ensure adequate funding for Public Safely as we navigate the transition to an endemic environment.

3. Staff have identified a need for specialized wellness resources and services for Public Safety employees provided by professionals with experience providing wellness services to first responders. Staff is proposing a new contract for an Employee Assistance Program (EAP) and a critical incident stress management program to provide additional mental health support services.

An additional appropriation of $50,000 is proposed to fund the enhanced and new services, expected to be paid for by additional sales and use taxes.

4. Similar to the last two years, recreation is projecting a budget shortfall as a result of continued adverse effects of the coronavirus pandemic on operations. Staff is proposing an increased appropriation for transfers out of the general fund of $250,000 to support continued operations through the end of the fiscal year.

Over the past several months, as the rate of inflation has increased, the additional cost of goods and services have been absorbed in the current budget. At its next meeting on March 16, the Federal Reserve is expected to increase short-term interest rates in an effort to combat inflation, with further rate increases expected throughout the year. However, if the desired impact is not achieved and the increase in inflation continues, staff may request to increase appropriations at year-end to cover this unbudgeted economic pressure.

Operating Results:

The proposed increase to revenues of $5,060,000, in addition to the proposed increase in appropriations of $1,333,374, brings the recommended revised budget to a net positive result of $3,779,994 for Fiscal Year 2021-22. With the replenishment to the Emergency reserve fund in the amount of $768,611, net unassigned funds, otherwise known as surplus, at year-end are expected to be increased by $3,544,757 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
and assigned balances reduced by $533,374. Given the positive activity in revenues, staff will continue to financially plan for and invest in the City’s goals and objectives. This may result in the request of additional appropriation throughout the remainder of the year. See Table 1 for additional details.

Table 1 Summarizes the status of the General Fund.

Table 1
The changes to General Fund Resources and Appropriations are summarized in Tables I and II of Exhibit I to the attached Resolution.

OTHER FUNDS:

The adopted budgeted appropriations for Other Funds, including carryforward of funds approved in prior years and changes approved since July 1, 2021, total $92,366,781. These expenditures are primarily in the areas of infrastructure and maintenance (e.g., streets, storm drain and buildings). Key projects contributing to the use of funds are: Third Street Rehabilitation and Construction on Fire Stations 54 and

55. Proposed changes to the Other Funds revenues, expenditures and transfers are detailed in Table 2:

Table 2
Resources:

Total proposed changes to revenues/transfers in:

Public Safety enhancement to mental health services – Funds transferred in from the general fund to enhance the EAP and add a critical incident stress management program

$50,000
Recreation – to offset a budget shortfall as a result of continued adverse effects of the coronavirus pandemic on operations
250,000
Total proposed changes to revenues/transfers in: $300,000 Uses:

Funds reserved for additional mental health services 56,250 Total proposed changes to uses/transfers out: $56,250
General Fund
Adopted Budget
FY 2021-22
Approved
Changes Current Budget
Proposed
Changes Revised Budget
Revenues 87,861,080 - 87,861,080 5,060,000 92,921,080
Transfers in 1,755,022 1,755,022 - 1,755,022
Total Resources 89,616,102 - 89,616,102 5,060,000 94,676,102 Expenditures 87,562,734 - 87,562,734 1,083,374 88,646,108 Operating Transfer out 2,000,000 - 2,000,000 250,000 2,250,000 Total Appropriations 89,562,734 - 89,562,734 1,333,374 90,896,108 Net Result 53,368 - 53,368 3,726,626 3,779,994
Allocations
Use/(Source) of Emergency
Reserves (720,651) - (720,651) (47,960) (768,611)
Use of Prior Period funds - - - 533,374 533,374
Unassigned Funds Available (667,283) - (667,283) 4,212,040 3,544,757 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 4
Net proposed changes to Other Funds (Resources less Uses): $243,750 Expenditures and Transfers out as adopted fiscal year 2021-22 $56,240,958 Expenditures and Transfers out as adjusted through Feb 22, 2022 $92,366,781 Expenditures and Transfers out with proposed changes $92,423,031 The net impact of all proposed changes on Other Funds is $243,750. The changes are comprised of transfers in from the general fund of $300,000 offset by additional appropriations for mental health services largely for Public Safety.

Table 3 presents the adopted budget, approved changes and proposed changes to the FY 2021-22 Other Funds budget.

Table 3
These proposed changes to Other Fund Sources and Appropriations are presented in Table III of Exhibit I to the attached Resolution.

CITY-WIDE APPROPRIATIONS SUMMARY:

The following table summarizes the impact of the recommended appropriation and transfer out changes across all funds. The approved changes reflect the updates made during the fiscal year by specific staff reports and resolutions approved by Council.

Table 4
Status of American Rescue Plan Act (ARPA) Funds
In March of 2021 ARPA was enacted into law which provided State and Local Fiscal Recovery Funds to State and Local governments. San Rafael was awarded $16 million which is payable in two equal tranches, the first of which was received in June of 2021 and the second is expected to be received in Other Funds
Adopted Budget
FY 2021-22
Approved
Changes Current Budget
Proposed
Changes Revised Budget
Revenues 50,163,304 - 50,163,304 50,000 50,213,304
Transfers in 2,085,000 - 2,085,000 250,000 2,335,000
Total Resources 52,248,304 - 52,248,304 300,000 52,548,304 Expenditures 54,400,936 36,125,823 90,526,759 56,250 90,583,009 Transfers out 1,840,022 - 1,840,022 - 1,840,022
Total Appropriations 56,240,958 36,125,823 92,366,781 56,250 92,423,031 Net Results (3,992,654) (36,125,823) (40,118,477) 243,750 (39,874,727) All Funds
Adopted Budget
FY 2021-22
Approved
Changes Current Budget
Proposed
Changes Revised Budget
General Fund 89,562,734 - 89,562,734 1,333,374 90,896,108 Other Funds 56,240,958 36,125,823 92,366,781 56,250 92,423,031 Total Expenditures and
transfers 145,803,692 36,125,823 181,929,515 1,389,624 183,319,139 SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 5
the Summer of 2022. To date the City has utilized these monies for two projects; The service support area program and the Homelessness Case Management program. As of January 31, 2022, $249,204 has been expended in support of the SSA program and $258,812 in support of the Homelessness Case Management Program. City Council has approved an informational report recommending the use of ARPA funds for the San Quentin Pump Station that is expected to begin in the fourth quarter of fiscal 2021-22 with costs estimated in the amount of $3.2 million.

Staff will evaluate revenues and appropriations related to ARPA funds at year-end and provide any specific recommendations necessary for proper reporting at that time. The impact will be an increase to revenues that will be offset by approved expenditures and assignment of any unused portion.

Proposed Personnel Changes:

This section of the report seeks Council consideration of recommended personnel actions. Periodically, the Human Resources Department seeks to establish, reallocate, or delete positions to reorganize or restructure staffing to most effectively and efficiently serve the community and city goals.

During this mid-year budget review, Staff is recommending:

1. The Public Works department is requesting the addition of a Public Works inspector position to keep up with the increasing volume of encroachment, grading and other Public Works projects requiring inspections. In the past, the City used consultant services on an as needed basis but the increase in volume requires a full-time position to meet the needs. This request will increase headcount by one and the fully burdened cost of this position has a range of $100,000 - $125,000 which will be funded by gas tax receipts.

2. The approval of two new job descriptions and related salary - a Permit Technician I/II/III and a Permit Services Supervisor with salary ranges of up to $7,036 and $9,429 respectively. As a result of the prior year hiring freezes and through attrition, the Community Development department has three vacant positions of which two are Building Technician positions. In working with Municipal Resource Group, LLC, it has been determined that instead of rehiring the Building Technician and Senior Building Technician classifications, a Permit Technician series and a Permit Services Supervisor classification are more suitable for the services offered to the public and internal duties performed within the department. Staff requests approval for the creation of these positions and will incorporate them into the rehiring plan with no increases to headcount or budget.

3. The approval of updates made to the Permit Services Coordinator job description to better align with the Permit Technician I/II/III and Permit Services Supervisor job descriptions.

The SEIU bargaining unit has been noticed of this intent of personnel change and staff will meet all requirements of the Meyers Milias Brown Act (MMBA) prior to implementing this change.

OPTIONS:

The City Council has the following options to consider on this matter:

1. Adopt the resolution as presented.

2. Adopt resolution with modifications.

3. Direct staff to return with more information.

4. Take no action.

RECOMMENDED ACTION: Adopt Resolution.

SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 6
ATTACHMENTS:
• Resolution with attached Exhibit “I”
• Proposed personnel changes
o SEIU salary schedule
o Public Works Inspector job description
o Permit Technician I/II/III series job description
o Permit Services Supervisor job description
o Updated Permit Services Coordinator job description (with redline updates)

Page 1 of 2 ends

San Rafael City CouncilMarch 7, 2022

San Rafael City Council
March 7, 2022