Agenda packet — City Council and Authorities Concurrent, July 5, 2022 (part 4 of 5)

project is anticipated to save 22 million hours of time, 10,300 tons of greenhouse gas emissions, and 2.8 million gallons of fuel. These benefits achieve goals within the City of Santa Clara General Plan, the Valley Transportation Authority Congestion Management Program, and the Metropolitan Transportation Commission Regional Transportation Plan/Sustainable Communities Strategy.

• Fire Station Microgrid Project – The City of Santa Clara’s electric utility, Silicon Valley Power, has developed a multi -benefit Fire Station Microgrid Pr oject which would accelerate microgrid technologies that provide community benefits through decarbonization and climate resiliency.

This integrated Fire Station Microgrid Project includes battery energy storage, photovoltaic (PV) solar, and Electrical Vehi cle (EV) charging infrastructure. The project would provide environmental benefits through the reduction of greenhouse gases and criteria pollutants while also creating resiliency and reliability through centralized emergency services that support City operations and the community during catastrophic events, including those caused by climate change.

• Anna Drive Neighborhood Flood Protection Project - This Anna Drive Flood Protection project is one of the highest priority flood protection storm drain system improvement projects identified in the City’s Storm Drain Master Plan. The Anna Drive neighborhood east of San Tomas Aquino Creek has experienced frequent minor flooding during annual storm events. Hundreds of residents and businesses will benefit by receiving enhanced flood protection from the project. The project will meet current flood protection requirements by upsizing the existing storm drain system at Anna Drive east of San Tomas Aquino Creek.

These funds would transform the City of Santa Clara and provide long -term benefits to residents, businesses, and visitors, as well as to the broader Silicon Valley region. For these reasons, I ask that you give positive consideration to the City’s requests for funding.

Sincerely,

Lisa M. Gillmor
Mayor, City of Santa Clara

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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

April 26, 2022

The Honorable Ro Khanna
United State House of Representatives
306 Cannon House Office Building
Washington, DC 20515

Re: Support for the City of Santa Clara Fiscal Year 2023 Appropriations Request – Anna Drive Neighborhood Flood Protection Project

Dear Congressman Khanna:

I am writing to express my strong support for the City of Santa Clara’s Anna Drive Neighborhood Flood Protection project for which we are seeking funding.

The Anna Drive Neighborhood Flood Protection project is one of the highest priority flood protection storm drain system improvement projects identified in the City’s Storm Drain Master Plan. The Anna Drive neighborhood east of San Tomas Aquino Creek has experienced frequent minor flooding during annual storm events. The project will meet current flood protection requirements by upsizing an existing storm drain system at Anna Drive east of San Tomas Aquino Creek in which approximately 4,000 linear feet of storm drain pipeline ranging in diameters between 12 -inch and 48-inch will be improved.

Hundreds of residents and businesses will benefit and receive flood protection from the project and local waterbodies will be protected by the reduction of sanitary sewer overflows.

These funds would transform the City of Santa Clara and provide long-term benefits to residents and businesses, as well as to the broader Silicon Valley region. For these reasons, I ask that you give positive consideration to the City’s request for funding.

Sincerely,

Lisa M. Gillmor
Mayor, City of Santa Clara

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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

June 1, 2022

The Honorable Phil Ting
Chair, Assembly Budget Committee
1021 O Street, Suite 8230
Sacramento, CA 95814

The Honorable Nancy Skinner
Chair, Senate Budget Committee
1021 O Street, Suite 8630
Sacramento, CA 95814

RE: May Revise – Excess ERAF Trailer Bill Language -- OPPOSE

Dear Chairperson Ting and Chairperson Skinner:

On behalf of the City of Santa Clara, I write to convey opposition to a revised proposed trailer bill released in connection with the May Budget Revision currently titled “Act to Amend Section 97.70 of Revenue and Taxation Code relating to taxation and making an appropriation therefor.” This proposed trailer bill, like a previous version, would change current law in a way that would significantly harm cities and counties by permanently “capping” the Education Revenue Augmentation Fund (ERAF) money that would be returned to them after schools have been fully funded and, instead, use such local tax revenues to pay the State’s in-lieu Vehicle License Fee (VLF) obligation.

In 2004, the State p ermanently lowered the VLF, which reduced funding for cities and counties by approximately $4.4 billion (in 2004 dollars). To mitigate this impact, the State agreed to backfill the lost VLF revenues dollar -for-dollar by reducing property tax revenues that are required to be shifted from cities, counties, and special districts to the countywide ERAF by the amount of the countywide VLF adjustment amount, knows as the VLF Swap. However, in those instances where there are insufficient funds to cover the VLF adj ustment, the state has provided annual appropriations to make up for the revenue shortfalls.

The law that codified this compromise and remains in effect, explicitly provides that cities and counties’ excess ERAF monies are not available to pay the State’s VLF obligation. When this compromise was reached, neither local agencies nor the Legislature anticipated that the two funding sources to pay the State’s in-lieu VLF obligation would ever be insufficient to do so. In recent years, however, VLF revenue shortfalls have occurred and, as a result, cities and counties have been required to make special appropriation requests to receive their full amount of VLF in arrears.

The State is now proposing to address this shortfall by taking local agencies’ own funds t o pay for the State’s VLF obligation. Specifically, this bill would amend Revenue & Taxation Code § 97.70(f)(1) to reverse the current statutory restriction on using local agencies’ excess ERAF and instead permanently cap it so that future growth can be used to fund the State’s VLF obligation. This fundamental change runs counter to the 2004 agreement that resulted in Proposition 1A. It also goes against constitutional provisions City of
Santa Clara
The Cente:r ofWhat11 Possible
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Letter of Support May Revise – Excess ERAF Trailer Bill Language -- OPPOSE June 1, 2022

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approved by the voters, including Proposition 1A and 22, that prohibit the Sta te from using local agency funds to pay for its responsibilities. Indeed, the act would penalize local agencies that seek to defend their constitutional rights by including a provision to immediately terminate State funding for shortfalls if its cap on excess ERAF is invalidated in Court.

As such, we urge you to reject this trailer bill language so that none of its amendments to Revenue and Taxation Code § 97.70 are enacted into law.

The City of Santa Clara strongly opposes the proposed trailer bill offered in the May Revise. The trailer bill reneges on commitments that the State previously enacted into law regarding the source of VLF funding, violates State constitutional provisions that prohibit such raids of local funds and the 2004 budget compromise b etween the State and local agencies. The State must fund its VLF obligation without diverting funds from local agencies’ budgets.

Sincerely,

Lisa M. Gillmor
Mayor

cc: The Honorable Alex Lee, California State Assembly
The Honorable Bob Wieckowski, California State Senate

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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

March 25, 2022

The Honorable Timothy S. Grayson
California State Assembly
State Capitol
1021 O Street, Room 5510
Sacramento, CA 95814

RE: SUPPORT AB 2179 (Grayson & Wicks) – Extending State Eviction Protections

Dear Assemblymember Grayson:

I am writing on behalf of the City of Santa Clara in support of Assembly Bill 2179 (Grayson & Wicks) that will extend eviction protections through June 30.

As you know, AB 832 protected tenants who had unpaid rent between March 1, 2020 to March 31, 2022, from being evicted from their homes. These protections are set to expire on April 1, which will cause many families in vulnerable situations to lose their housing. AB 2179 would provide City of Santa Clara residents who have followed the procedural protec tions in AB 832 and applied for State rent relief – or whose landlords have applied on their behalf – with more time to pay back rent and to remain in their homes.

The City of Santa Clara supports state efforts to help mitigate the economic impacts from the coronavirus on the City’s residents. Early in the pandemic the City passed a local eviction moratorium, supported County relief efforts, and created a $1.6 million local emergency rental assistance program to help tenants that were struggling due to COVID-19 related hardships. Unfortunately, these efforts will not be enough to prevent an eviction cliff if protections expire at the end of the month.

In the City of Santa Clara, 1,666 households have applied for State rent relief. However, as of March 25, 2022, only 570 households have received funding thus far, leaving over 1,000 households in jeopardy of being evicted as the AB 832 expiration date approaches.

For these reasons, the City of Santa Clara supports Assembly Bill 2179 (Grayson & Wicks).

Sincerely,

Lisa M. Gillmor
Mayor
City of Santa Clara

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Re: SUPPORT AB 2179 (Grayson & Wicks) – Extending State Eviction Protections March 25, 2022

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cc:

Members, Assembly Judiciary Committee
Members, Senate Judiciary Committee
The Honorable Anthony Rendon, California State Assembly, Assembly Speaker The Honorable Toni G. Atkins, California State Senate, Senate President Pro Tempre Governor Gavin Newsom
The Honorable Marc Berman, California State Assembly
The Honorable Josh Becker, California State Senate
Seth Miller, League of California Cities, Regional Public Affairs Manager [email protected] Meg Desmond, League of California Cities, [email protected] City Council
CM, CA- Interim, ACM-COO, ACM-CDD, ACDD, Housing Manager, ATCM-Gilmore

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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

March 25, 2022

The Honorable Buffy Wicks
California State Assembly
State Capitol
1021 O Street, Room 4240
Sacramento, CA 95814

RE: SUPPORT AB 2179 (Grayson & Wicks) – Extending State Eviction Protections

Dear Assemblymember Wicks:

I am writing on behalf of the City of Santa Clara in support of Assembly Bill 2179 (Grayson & Wicks) that will extend eviction protections through June 30.

For these reasons, the City of Santa Clara supports Assembly Bill 2179 (Grayson & Wicks).

Sincerely,

Lisa M. Gillmor
Mayor
City of Santa Clara

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Assemblymember Wicks
Re: SUPPORT AB 2179 (Grayson & Wicks) – Extending State Eviction Protections March 25, 2022

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cc:

April 13, 2022

Re: Support for Caltrain Electrification Funding

Dear Caltrain Delegation Member,

As Mayors representing the communities along the Caltrain corridor, we are writing to express our strong support for the Caltrain Electrification Project. The Project will be transformational to our communities as the State of California’s first electrified commuter rail system, spanning 51- miles between San Francisco and San Jose. The project will modernize the 150-year-old rail corridor, replacing 75% of the existing aging diesel fleet with high-performance electric trains and lay the foundation for the State’s future high-speed rail system.

The Infrastructure Investment and Jobs Act (IIJA) is a historic investment in our nation’s infrastructure which will support clean transportation, mitigate climate change impacts, and lead to the creation of thousands of jobs. The Caltrain Electrification Project (Project) embodies all these priorities, is currently under construction and can be delivered within this Administration.

Passengers will be riding the state-of-the-art electric system in 2024 if Caltrain can secure additional resources to complete the Project. Caltrain needs $410M of additional funding to bring electrified commuter rail service to the San Francisco Bay Area residents and workers.

Creating Jobs in 36 States
The Project has already created thousands of jobs in California and contributed to job creation in 36 States across the county. With additional resources to complete the project, over 30,000 direct and indirect jobs will be sustained and created over the next few years.

Not only does the Caltrain Electrification Project support manufacturing jobs, it also contributes to the continued economic growth of Silicon Valley and the greater San Francisco Bay Area. ,. ~

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Caltrain serves some of the world’s most innovative and fastest-growing companies who contribute economic strength to the national economy.

Reducing Greenhouse Gas Emissions
Single occupancy vehicles are one of the most significant contributors to greenhouse gas emissions in California. Caltrain Electrification and the future Caltrain Service Vision expansion will deliver tremendous environmental benefits to the region by replacing an aging, polluting diesel fleet with electric trains and expanding capacity to carry more riders.

When the Caltrain corridor becomes an entirely zero-emission corridor (as articulated in the Service Vision), it will support ridership of 180,000 Caltrain passengers every weekday — the equivalent of adding 5.5 new freeway lanes worth of capacity to US 101, reduce 110 metric tons of greenhouse gas emissions every day and take nearly a million vehicle miles off Bay Area roads.

Advancing Equity & Diversifying Ridership
Before the pandemic, Caltrain was the 7th largest commuter rail system in the country and the most efficient commuter railroad in terms of its farebox recovery and passengers carried per mile. Caltrain has made service changes to recapture ridership and is working to serve a more diverse group of riders beyond traditional commuter rail customers. In fall 2021, Caltrain changed the schedule to provide more service throughout the day and during off-peak hours that is more relevant and useful to the needs of lower income riders and essential workers who do not always travel during peak commute times. With electrified service, Caltrain will be able to provide even more trains throughout the day to serve all riders along the corridor.

Creating the First Electrified Segment of the California High Speed Rail System The Project’s success will shape the future of rail in the region, state, and nation. The core of California High-Speed Rail Authority’s (CHSRA) northern section will run from San Francisco to San Jose and will blend with Caltrain operations. In the future, CHSRA will operate on Caltrain’s tracks and use the new overhead contact system being installed for the Caltrain Electrification project. Essentially, the Caltrain corridor will be the first electrified section of the statewide California High-Speed Rail project.

Entering the Last Phase of Construction
Caltrain has made significant progress on the Electrification Project that began construction in 2017 and continued throughout the pandemic. The civic work is now complete. In January 2022, the last of all 3,092 foundations was installed. In the spring, the first high-performance electric trains will arrive on the corridor after extensive testing at 110 mph in Pueblo, Colorado. Full corridor testing will start in 2023 and passenger service on the Caltrain corridor is on track for 2024.

Closing the Funding Gap
The total project cost is $2.44 billion, with over 58% secured by local and State sources. Federal sources (Federal Transit Administration’s Capital Investment Grant Program, formula, and American Rescue Plan) accounts for 42% of the total project costs.

Recently, Caltrain identified a $410 million funding gap due to delays and cost increases arising from the COVID-19 pandemic, unforeseen site conditions, and resolution of commercial disputes with the contractor on the signal system scope and outstanding change orders.

Securing supplemental federal funds is imperative as local funds need to be prioritized for

operations and maintaining a safe system. Funding from the IIJA would help Caltrain meet the funding gap and deliver a legacy project for the nation.

This transformational project is close to the finish line. We look forward to working closely with you to ensure this project is delivered to our residents in 2024. Thank you in advance for your consideration of our important request.

Sincerely,

London N. Breed
Mayor, City and County of San Francisco
Sam Liccardo
Mayor, City of San Jose

Julia Mates
Mayor, City of Belmont

Coleen Mackin
Mayor, City of Brisbane
Ricardo Ortiz
Mayor, City of Burlingame

Marie Blankley
Mayor, City of Gilroy

Betsy Nash
Mayor, City of Menlo Park

Rich Constantine
Mayor, City of Morgan Hill
Lucas Ramirez
Mayor, City of Mountain View

Patrick Burt
Mayor, City of Palo Alto
Giselle Hale
Mayor, City of Redwood City

Rico E. Medina
Mayor, City of San Bruno

Sara McDowell
Mayor, City of San Carlos

Rick Bonilla
Mayor, City of San Mateo

Lisa M. Gillmor
Mayor, City of Santa Clara

Mark Nagales
Mayor, City of South San Francisco

cc: Michelle Bouchard, Acting Executive Director, Caltrain Peninsula Corridor Joint Powers Board of Directors

1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

April 1, 2022

California Congressional Delegation
Washington, DC

Subject: Support for Capitol Corridor Joint Powers Authority’s (CCJPA) Federal Earmark Request - Agnew Siding Track Infrastructure Project, Silicon Valley

Dear Senator or Representative,

On behalf of the City of Santa Clara, I am writing in support of CCJPA’s federal funding request in the amount of $6 million for the Agnew Siding project as a part of the Fiscal Year (FY) 2023 appropriations process. The Agnew Siding will be developed in Santa Clara County in the City of Santa Clara, California, on the Union Pacific Railroad (UP) track immediately south of Levi’s Stadium and the Great America Station. The new siding will be located in the middle of a 12-mile stretch of single-track territory, providing an opportunity for a critical passing point through this long section. CCJPA leads the project in partnership with UP which, when completed, will improve the reliability of service for Capitol Corridor, Altamont Commuter Express (ACE), Amtrak long-distance, and Caltrain passenger trains, as well as UP freight trains, with cascading benefits extending throughout the Northern California Megaregion.

Agnew Siding will provide numerous economic, environmental, safety, and service reliability benefits for the region, including:

• Stimulation of economy through the creation of approximately 170 jobs; • Improvement in air quality by mitigating GHG emissions from idle trains; • Reduction in passenger and freight train delays impacting a complex network of systems; • Strengthened passenger and train operator safety with reduced train-to-train conflicts; • Reduction of noise pollution for surrounding residential communities; • Increased ridership through improved service reliability; and • Storage of special train equipment for high volume sports and entertainment events.

As part of the region’s transportation network, Capitol Corridor and other passenger train services provide vital economic linkages not only to events, but on a daily basis with low-carbon intensive access to jobs, business meetings, and leisure trips for individuals and families of all ages. The Agnew Siding project is a solution to train congestion in Silicon Valley that will accrue across the rail network extending from Sacramento to Stockton, California.

For these reasons, we strongly support the CCJPA’s request for federal funds to support the Agnew Siding project.

City of
Santa Clara
The Cente:r ofWhat11 Possible
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Support for Capitol Corridor Joint Powers Authority’s (CCJPA) Federal Earmark Request - Agnew Siding Track Infrastructure Project, Silicon Valley
April 1, 2022

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If you have any questions, please reach out to Christine Jung, Assistant to the City Manager, at [email protected].

Sincerely,

Lisa M. Gillmor
Mayor, City of Santa Clara

1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

May 10, 2022

President Pro Tempore Toni Atkins
1021 O Street, Suite 8518
Sacramento, CA 95814

Speaker Anthony Rendon
State Capitol, Room 219
Sacramento, CA 95814

Re: Letter of Support for $4.2 bond appropriation for California High-Speed Rail

Dear President Pro Tempore Atkins and Speaker Rendon,

On behalf of the City of Santa Clara, I am writing to urge the California State Legislature to approve the $4.2 billion voter-approved bond appropriation for the California High-Speed Rail project included in Governor Newsom’s Fiscal Year 2022/2023 Budget.

The ongoing spike in gas prices shows that California voters were wise to vote in favor of Prop 1A in 2008. High-speed rail is how we break free from oil – as well as the enormous burdens it places on consumers, communities and the climate.

Fourteen years later, the majority of California voters continue to support the high-speed rail project.

According to a new Los Angeles Times - Berkeley poll, 56% of registered voters in California want to continue building the high-speed rail project, including 73% of registered Democrats and 54% of Independents.

Beyond the Central Valley, where construction is underway, support for the project is strong. 59% of L.A.

County voters support continued construction of the project – including 32% who strongly favor continued construction – while only 29% oppose it. And 65% of Bay Area voters support continued construction, while 27% oppose it.

As the Legislature reviews Governor Newsom’s budget request, the California High-Speed Rail Authority is competing for billions of dollars in competitive grant opportunities in the Bipartisan Infrastructure Law, as well as billions more in the pending budget reconciliation bill, which includes $10 billion in dedicated funding for high-speed rail projects.

City of
Santa Clara
The Cente:r ofWhat11 Possible
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Letter of Support for $4.2 bond appropriation for California High -Speed Rail May 10, 2022

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Approval of the $4.2 billion bond appropriation will signal continued support by the State of California, giving the Biden Administration an incentive to provide significant federal investments for the project.

Approving these funds will also make it easier for our coalition to advocate for new federal funding for the California High-Speed Rail project.

Together, these state and federal investments will help expedite the completion of an initial operating segment while advancing construction on the project's critical bookends in the Los Angeles Basin and the Bay Area.

While project costs continue to generate news, we must keep in mind that building the equivalent highway or aviation capacity would cost nearly twice as much as finishing the job on California’s high- speed rail project.

Meanwhile, The California High-Speed Rail Authority is moving beyond the issues of the past and making significant strides forward. The project has created 7,800 labor jobs, $5.2 billion in labor income and $13.7 billion in economic output. Daily construction jobs have tripled since 2018. 90% of the parcels needed for construction in the Central Valley have been purchased. And the Authority estimates the entire 500-mile system will be fully environmentally cleared by Fiscal Year 2023/24.

America’s effort to decarbonize transportation depends on the completion of the California High-Speed Rail project. Once the Los Angeles-to-San Francisco line is up and running, it will slash emissions by an average of 2 million metric tons annually – equivalent to saving 225 million gallons of gas and taking 432,000 cars off the road every single year.

To achieve sustainability, we need high-speed rail. There is no cheaper or better alternative to addressing the state’s transportation and oil dependency challenges. As a recent New York Times article stated, the California High-Speed Rail project is the most visible test of whether America can complete “the transformative projects necessary to confront 21st century challenges.”

Please support for this monumental effort and show the nation that America’s most advanced bullet train project is moving full speed ahead.

Sincerely,

Lisa M. Gillmor
Mayor, City of Santa Clara

cc: The Honorable Phil Ting, Chair, Assembly Budget Committee The Honorable Vince Fong, Vice Chair, Assembly Budget Committee The Honorable Nancy Skinner, Chair, Senate Budget Committee The Honorable Jim Nielsen, Vice Chair, Senate Budget Committee • • •
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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

June 9, 2022

The Honorable Marc Berman
Assembly Member, District 24
1021 O Street, Suite 6130
Sacramento, CA 95814

RE: AB 2181 (Berman) SANTA CLARA VALLEY TRANSPORTATION AUTHORITY – OPPOSE

UNLESS AMENDED

Dear Senator Berman:

On behalf of the City of Santa Clara, I am writing to express the City’s oppose unless amended position to AB 2181 (Berman). AB 2181 proposes signi ficant changes to the membership and governance of the Santa Clara County Valley Transportation Authority (VTA) by reducing the elected representation of the Board of Directors and significantly modifying the agreed upon process by which five seats are app ointed by 14 of the 15 cities within the Santa Clara County.

These changes have the potential to limit Santa Clara’s voice regarding critical regional transportation issues and projects as rank choice voting could leave Santa Clara’s elected officials without direct guaranteed representation either as a voting member or an alternate on the VTA Board.

VTA's decisions related to transit service levels in each city and funding for road pavement maintenance, active transportation improvements, and major infrastructure such as BART Phase 1 and 2 directly affect each city's ability to plan for its transportation needs to support community land-use plans and projects. To fulfill the State’s ambitious housing targets which have been primarily focused on transit -oriented development, it is critical that the City of Santa Clara be afforded equitable access to critical transportation funding to help meet our required regional housing needs assessment (RHNA) goals. On the horizon, Santa Clara is seeing significant development growth opportunities and require an active partnership with the County’s regional transportation planning agency (i.e. VTA) as regional solutions will be key to creating sustainable and livable communities for our current and future residents and b usinesses. Reducing opportunities for Santa Clara’s elected officials to have a voice on the VTA Board runs contrary to our goal to be actively engaged in transportation solutions affecting our community.

An active partnership between the VTA Board of Directors and cities includes understanding each city's community needs and priorities. However, AB 2181 in its current form runs counter to this important goal. Notably, AB 2181 would require ranked choice voting among 14 cities (e.g., all the cities within Santa Clara County except for San Jose) to compete for five seats on the VTA Board.

Under AB 2181, at least two but no more than three seats, would be for elected officials representing the 14 cities, and the remaining two seats would be filled by communit y members.

City of
Santa Clara
The Cente:r ofWhat11 Possible
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AB 2181 (Berman) SANTA CLARA VALLEY TRANSPORTATION AUTHORITY – OPPOSE UNLESS AMENDED June 9, 2022

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Allowing only up to three elected officials from 14 cities is not sufficient representation.

Additionally, the selected community members would have no accountability to voters in our cities while making significant funding decisions on critical transportation projects. Further, the ranked choice voting process does not guarantee that Santa Clara will have representation on the VTA Board. With the extension of VTA Board member terms to four years from two years and ranked choice voting, Santa Cla ra elected officials could be left voiceless on the VTA Board of Directors for an extended amount of time. Finally, AB 2181 will have lasting impacts for all residents and businesses within the Santa Clara County and must include a significant public input and outreach process with affected communities.

If the intent of this bill is to provide a more experienced, transparent, and regionally focused VTA Board to better meet Santa Clara County's complex transportation needs, we suggest that a series of publ ic workshops be conducted with all affected agencies and communities in Santa Clara County to fully discuss the various options related to VTA Governance reform. Additionally, a Countywide community survey is needed to provide all agencies with a better sense of what our community desires from the VTA as a transportation agency.

While we appreciate the effort to bring needed changes to the VTA governance structure, as proposed, we firmly believe this will disenfranchise our community members and neighbo ring jurisdictions and reduce Santa Clara’s voice on regional transportation policy, programs, projects, and funding. It is our hope that we can collaboratively work with the Legislature to address our concerns; however, we must regretfully oppose AB 2181 unless amended as currently drafted.

Should you have any questions regarding our position, please contact our legislative advocate, Casey Elliott, with Townsend Public Affairs, at (916) 447-4086.

Sincerely,

Lisa M. Gillmor
Mayor

cc:

The Honorable Alex Lee, California State Assembly
The Honorable Bob Wieckowski, California State Senate
Members, Senate Transportation Committee
Santa Clara Valley Transportation Authority, Board of Directors Seth Miller, League of California Cities Regional Public Affairs Manager, [email protected]
Meg Desmond, League of California Cities, [email protected]

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1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2200 ● Fax: 408-241-6771 ● www.SantaClaraCA.gov Mayor
Lisa M. Gillmor

Councilmembers
Kathy Watanabe, District 1
Raj Chahal, District 2
Karen Hardy, District 3
Kevin Park, District 4
Suds Jain, District 5
Anthony J. Becker, District 6

April 1, 2022

The Honorable Patrick Leahy
Chairman, Committee on Appropriations
United States Senate
Room S-128, The Capitol
Washington, DC 20510

The Honorable Richard Shelby
Vice Chairman, Committee on Appropriations
United States Senate
Room S-128, The Capitol
Washington, DC 20510

RE: Support for Congressionally Directed Spending Request – South San Francisco Bay Shoreline Project (Phase 1) – Reaches 4/5 Levee Construction

Dear Chairman Leahy and Vice Chairman Shelby:

As mayors representing communities along the South San Francisco Bay Shoreline that are vulnerable to sea level rise and coastal flooding, we write to express our strong support for a $10 million appropriation for levee work on Reaches 4/5 of the South San Francisco Bay Shoreline (Phase I) Project (Shoreline Project), which will protect Silicon Valley and the disadvantaged community of Alviso from coastal flooding due to sea level rise and intensified storms due to climate change.

The Shoreline Project is a multi -benefit flood protectio n and sea level rise adaptation project that is a collaboration between the U.S. Army Corps of Engineers (Corps), the California State Coastal Conservancy, and Valley Water (the Santa Clara Valley Water District). The project will provide one -hundred-year coastal flood protection, including for future sea level rise through 2067, for over 5,000 structures, highways, airports, sewage treatment plants, utility infrastructure, and the heart of California’s technology economy. The Shoreline Project will protect a disadvantaged community, critical public and private infrastructure, and the San José -Santa Clara Regional Wastewater Facility that serves much of Silicon Valley, all in conjunction with the largest wetlands restoration in the western U.S.

In late February 2021, the Corps produced a new certified cost estimate for the project that identified a federal funding shortfall of $91 million for the construction of Phase I of the project. The request for $10 million for levee work on Reaches 4/5 of Phase I of t he Shoreline Project would help reduce this federal funding shortfall. It also would ensure continued progress toward the completion of a sea level rise resilience project to protect the disadvantaged community of Alviso, critical state and local infrastructure, and numerous Silicon Valley economic assets.

City of
Santa Clara
The Cente:r ofWhat11 Possible
•
: >: ,_ . -:o • •
• •••••••••
Chairman Leahy and Vice Chairman Shelby
Re: Support for Congressionally Directed Spending Request – South San Francisco Bay Shoreline Project (Phase 1) – Reaches 4/5 Levee Construction
April 1, 2022

Page 2 of 2 ends

Ensuring progress on the Phase I project will also help ensure that future phases move forward. The Phase II feasibility study, currently underway, aims to provide protection for approximately 5,000 at-risk homes, businesses, and critical infrastructure in Palo Alto and Mountain View, including the Bay Area’s fourth busiest airport; U.S. Highway 101, a critical artery that serves Silicon Valley; and the Palo Alto Regional Water Quality Control Plant. The Phase III feasibility study, which has yet to receive federal funding, would study a project to protect homes, businesses, and critical infrastructure in Mountain View and Sunnyvale, including leading Silicon Valley businesses like Google, Lockheed Martin, the NASA Ames Research Center, Moffett Airfield, the Sunnyvale Water Pollution Control Plant, the Sunnyvale Solid Waste Recycling and Transfer Station, and California State Route 237.

Given the critical importance of protecting our communities and the S ilicon Valley region against the accelerating impacts of climate change and sea level rise, we strongly urge you to use some of the Corps’ historic levels of funding to assist with the advancement of the Shoreline Project.

Thank you for your consideration.

Sincerely,

Lisa M. Gillmor
Mayor
City of Santa Clara

: >-
: 1-. --:o • • •

April 5, 2022

The Honorable Patrick Leahy
Chairman, Committee on Appropriations
United States Senate
Room S-128, The Capitol
Washington, DC 20510

The Honorable Richard Shelby
Vice Chairman, Committee on Appropriations
United States Senate
Room S-128, The Capitol
Washington, DC 20510

RE: Support for Congressionally Directed Spending Request – South San Francisco Bay Shoreline Project (Phase 1) – Reaches 4/5 Levee Construction

Dear Chairman Leahy and Vice Chairman Shelby:

The Shoreline Project is a multi-benefit flood protection and sea level rise adaptation project that is a collaboration between the U.S. Army Corps of Engineers (Corps), the California State Coastal Conservancy, and Valley Water (the Santa Clara Valley Water District). The project will provide one-hundred-year coastal flood protection, including for future sea level rise through 2067, for over 5,000 structures, highways, airports, sewage treatment plants, utility infrastructure, and the heart of California’s technology economy. The Shoreline Project will protect a disadvantaged community, critical public and private infrastructure, and the San José- Santa Clara Regional Wastewater Facility that serves much of Silicon Valley, all in conjunction with the largest wetlands restoration in the western U.S.

In late February 2021, the Corps produced a new certified cost estimate for the project that identified a federal funding shortfall of $91 million for the construction of Phase I of the project.

The request for $10 million for levee work on Reaches 4/5 of Phase I of the Shoreline Project would help reduce this federal funding shortfall. It also would ensure continued progress toward ~-· ,-*"7/
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Mountain
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the completion of a sea level rise resilience project to protect the disadvantaged community of Alviso, critical state and local infrastructure, and numerous Silicon Valley economic assets.

Ensuring progress on the Phase I project will also help ensure that future phases move forward.

The Phase II feasibility study, currently underway, aims to provide protection for approximately 5,000 at-risk homes, businesses, and critical infrastructure in Palo Alto and Mountain View, including the Bay Area’s fourth busiest airport; U.S. Highway 101, a critical artery that serves Silicon Valley; and the Palo Alto Regional Water Quality Control Plant. Phase II received $1.7 million under the Infrastructure Investment and Jobs Act (IIJA) to complete the study. The Phase III feasibility study, which received $1.5 million under the IIJA, will study a project to protect homes, businesses, and critical infrastructure in Mountain View and Sunnyvale, including leading Silicon Valley businesses like Google, Lockheed Martin, the NASA Ames Research Center, Moffett Airfield, the Sunnyvale Water Pollution Control Plant, the Sunnyvale Solid Waste Recycling and Transfer Station, and California State Route 237.

Given the critical importance of protecting our communities and the Silicon Valley region against the accelerating impacts of climate change and sea level rise, we strongly urge you to use some of the Corps’ historic levels of funding to assist with the advancement of the Shoreline Phase I Project.

Thank you for your consideration.

Sincerely,

Sam Liccardo
Mayor, City of San José

Lisa M. Gillmor
Mayor, City of Santa Clara

Lucas Ramirez

Lucas Ramirez
Mayor, City of Mountain View

Larry Klein
Mayor, City of Sunnyvale

Cc: U.S. Senator Dianne Feinstein
U.S. Senator Alex Padilla
U.S. Representative Ro Khanna
U.S. Representative Zoe Lofgren
U.S. Representative Anna Eshoo
U.S. Representative Jimmy Panetta

June 15, 2022
The Honorable Shalanda Young
Director
Office of Management and Budget
725 17th Street, N.W.

Washington, DC 20503
The Honorable Michael Connor
Assistant Secretary of the Army for Civil Works
108 Army Pentagon
Washington, DC 20310-0108
Re: South San Francisco Bay Shoreline Phase I Project
Dear Director Young and Secretary Connor:

As mayors representing vulnerable and disadvantaged communities struggling with the devastating impacts of sea level rise and coastal flooding, we write to express our strong support for upholding the federal government’s partnership and commitment to funding Phase I of the South San Francisco Bay Shoreline Project (Shoreline Project). We understand that, without additional federal funding, this project – the first U.S. Army Corps of Engineers (Corps) coastal flood risk reduction project that incorporate sea level rise in its analysis – is at risk of not being completed. Time and time again Santa Clara County residents have voted to tax themselves to advance the Shoreline Project and similar efforts . We find it simply unacceptable to tell our constituents that this long-promised project – which began in 2005 and will reduce known flood risks for thousands of people, major businesses powering the global economy , and critical infrastructure assets – may not be realized. We need your help to get this project back on track.

The Shoreline Project, which took decades to study, plan, and design in partnership with the U.S.

Army Corps of Engineers (Corps), provides an unprecedented opportunity to advance our shared goals of climate adaptation and environmental justice. While this region, home to Silicon Valley, is an essential economic driver of t he nation and the world, it is also home to disadvantaged communities that are on the front lines of climate change. Phase I of the Shoreline Project, which is currently under construction but at risk of not being completed, includes the disadvantaged community of Alviso. Phase I of the Shoreline Project will provide not only coastal flood risk reduction but also protect ion for up to 2.6 feet of sea level rise to 2,220 residents and 1,100 structures, including an elementary school, fire station, library, and numerous small businesses.

Alviso sits 13 feet below sea level and has experienced up to 8 feet of flooding many times in the past. As sea levels continue to rise, this community cannot afford to endure any further project delays.

Each phase of the Shoreline Project, now being undertaken in three phases, is dependent upon the successful completion of Phase I. Once complete, the entire shoreline project will protect 18 miles of shoreline, and hundreds of thousands of residents and businesses spanning five cities across Silicon Valley . In each phase, critical infrastructure and federal assets will benefit fro m these esse ntial investments. Phase I is designed to protect the disadvantaged community of City of
Santa Clara
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The Honorable Shalanda Young
The Honorable Michael Connor

Page 2 of 2 ends

Alviso, the San José-Santa Clara Regional Wastewater Facility, a facility that serves more than

1.5 million people (nearly the entire Santa Clara County population), the Silicon Valley Advanced Water Purification Center, and California State Route 237. The Phase II project in Palo Alto will protect the Bay Area’s fourth busiest airport, U.S. Highway 101 (a major artery for residents and commuters), and the Palo Alto Region al Water Quality Control Plant. The Phase III project will protect the NASA Ames Research Center, Moffett Federal Airfield, the Sunnyvale Water Pollution Control Plant, the Sunnyvale Solid Waste Recycling and Transfer Station , and California State Route 237. And all phases will protect global businesses that help fuel the region’s economy.

Flooding of any of this infrastructure could have a devastating financial impact on the region, state, and nation.

We understand that the Shoreline Project, like many major infrastructure projects across the country, has faced challenges such as cost overruns and numerous delays. Regardless of these challenges, the project is , without question, worth constructing. We strongly encourage you to work with the non-federal sponsors, Valley Water and the California State Coastal Conservancy, to find a path forward that completes the Phase I project expeditiously and upholds the federal government’s commitment to providing the full federal cost share.

The Shoreline Project is a priority for our cities and for the region. The future of climate adaptation projects in the Bay Area and beyond depend on the success of efforts like the Shoreline Project.

We cannot see it fail. Thank you for your attention to this urgent national matter.

Sincerely,

Sam Liccardo
Mayor
City of San José

Lisa M. Gillmor
Mayor
City of Santa Clara

Larry Klein
Mayor
City of Sunnyvale
Lucas Ramirez
Lucas Ramirez
Mayor
City of Mountain View

Cc by e-mail:

The Honorable Dianne Feinstein, U.S. Senate
The Honorable Alex Padilla, U.S. Senate
The Honorable Zoe Lofgren, U.S. House of Representatives The Honorable Ro Khanna, U.S. House of Representatives
The Honorable Anna Eshoo, U.S. House of Representatives The Honorable Jimmy Panetta, U.S. House of Representatives

1 June 23, 2022 Cities Association
Legislative Action Committee – Bill Analysis
Item 2. Discuss and Consider Bills for Potential Action Bill Number Summary Recommended
Position
Legislative Priority Alignment
AB 2011
(Wicks)
Would require
specified housing
development
projects to be a use
by right on sites
zoned for retail,
office, or parking if
certain requirements
are met related to
the development, as
well as the use of a
skilled and trained
workforce.

Strongly
Oppose
Housing LAP (Reduces local control)
AB 2097
(Friedman)
Prohibits a local
government from
imposing or
enforcing a minimum
automobile parking
requirement, on
residential,
commercial, or other
development if the
development is
located on a parcel
near public transit.

Oppose Housing LAP (Reduces local control)
SB 897
(Wieckowski)
Makes numerous
changes to existing
ADU law - including
requiring local
governments to allow
ADUs to be
constructed with a
height of up to 25
feet.

Oppose

Legislative Guiding Principal – Protect
and/or increase local government
discretion
SB 1087
(Gonzalez)
Would limit who can
legally sell and
purchase a detached
catalytic converter.

This measure would
make a violation of
this proposed law an
Support Public Safety LAP (Addresses crime trends
and attempts to curb illegal activity)
City of
Santa Clara
The Center of What 's Possible
Legislative Action Committee – Bill Analysis
June 21, 2022

Page 2 ends

2 Bill Number Summary Recommended
Position
Legislative Priority Alignment
infraction punishable
with a fine between
$1,000 to $5,000.

Item 3. Other Bills for Consideration, Time Permitting
Bill Number Summary Recommended
Position
Legislative Priority Alignment
SB 917
(Becker)
Requires transit
agencies in MTC
service area to
establish a regional
transit coordinating
council. Requires
council to work with
MTC to adopt a
Connected Network
Plan, adopt an
integrated fare
structure, and
develop a regional
transit mapping and
wayfinding system.

Support Transportation Issues LAP (Integrate fare
payments/schedules/transfers/technology
across transit agencies)
AB 1985 (R.

Rivas)
Would create an
online database of
organic waste
products on the
market so local
governments can
connect with local
farmers and
community members
seeking their organic
waste products and
continue to the
conversation to
address the
procurement
requirements in the
SB 1383 regulations.

No Action Staff did not have enough time to review
after the revised agenda was posted.

Legislative Action Committee – Bill Analysis
June 21, 2022

Page 3 ends

3 Bill Number Summary Recommended
Position
Legislative Priority Alignment
AB 2120
(Ward)
Would ensure 55%
of the bridge funds
headed to California
through the federal
infrastructure
package are
allocated to local
projects through a
needs-based
allocation.

No Action Staff did not have enough time to review
after the revised agenda was posted.

SB 833
(Dodd)
Would create a grant
program for local
governments to
develop and
implement
community resiliency
plans and expedite
permitting for
distributed energy
resources.

Support Energy Legislation, Regulations, and
Issues LAP (Provide local public agencies
with financial resources to prepare for,
and mitigate the impacts from, planned
power outage events)

City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-884 Agenda Date: 7/5/2022

REPORT TO STADIUM AUTHORITY BOARD

SUBJECT
Request from the Stadium Manager to Execute Agreement with Tyson Group, LLC for Stadium Builder’s License (SBL) Sales Training Services

BOARD PILLAR
Ensure Compliance with Measure J and Manage Levi’s Stadium

DISCUSSION
On June 27, 2022, the Stadium Manager submitted the attached Recommendation for Award memo, along with supporting documentation, to request the following:
· Approval to execute a one-year agreement with Tyson Group, LLC in the amount of $80,000 for SBL Sales Training Professional Services, with the option to extend for two additional one- year periods.

The Stadium Manager’s Recommendation for Award memo (Attachment 1) describes the training services and the Request for Proposals (RFP) process that was implemented in more detail. This service is included in the Stadium Authority FY 2022/23 Operating Budget under the SBL Sales and Services line item.

ATTACHMENTS

1. Stadium Manager’s Recommendation for Award Memo

2. Draft Agreement with Tyson Group, LLC
City of Santa Clara Printed on 6/30/2022Page 1 of 1
powered by Legistar™

Date: June 27, 2022

To: Brent Schoeb
Chief Revenue Officer

From: Jenti Vandertuig
Procurement Director

Subject: Recommendation for Award RFP FY21-0021
SBL Sales
Training Professional Services

Recommendation
Recommend approval and award an agreement to Tyson Group to provide a training program to the SBL for a one-year
period, to commence on July 25, 2022 through July 24, 2023 with an option to extend the agreement for two additional one year periods. The amount of the agreement shall not exceed $80,000 for year one. Total compensation, in the aggregate, shall not exceed $240,000 over the three-year period. The term for subsequent fiscal years shall be conditioned upon approval of the Stadium Authority budget for the applicable fiscal year that includes the amounts due under this contract.

RFP Process
The Santa Clara Stadium Authority (SCSA) is the public agency that owns the stadium, which it lic. The SBL gives the customer
the right to purchase season tickets for 49ers games and priority rights to purchase tickets for Forty Niners Stadium
Management Company LLC (Stadium Manager) employs a team of approximately ten sales people to handle the sales of SBLs to the general public on behalf of the SCSA. Individual SBLs range in price from $2,000 to $80,000 per seat, depending on the seat location and amenities.

Stadium Manager has a need for a robust and results oriented training program and curriculum that will provide training to the sales team and their sales manager to maximize sales of SBLs to the diverse customer base of the San Francisco Bay Area while considering the complexities of the public-private partnership between the Stadium Manager and the SCSA. The key value SBL customers have the right to purchase 49ers season
tickets, so it is important that the training program is focused on that key element.

On February 9, 2022, Stadium Manager issued Request for Proposals (RFP) to select qualified firms to provide sales training professional services
DocuSign Envelope ID: AF53A696-7AE9-4CAA-9FA1-5F167B7AD6AF ,lijij ;

STADIUM

FORTY NINERS STADIUM MANAGEMENT COMPANY
for Levi's Stadium
sales team to maximize sales of Stadium Builder's Licenses (SBLs) leases to the 49ers. The SCSA financed the construction of Levi's Stadium in large part through the sales of Stadium Builder's Licenses (SBLs) to the general pub other events at Levi's Stadium, such as concerts and soccer events. driver for Levi's Stadium SBLs is that
for Levi's Stadium. Stadium Manager
1 published the RFP on Bonfire Inte
https://49ers.bonfirehub.com/portal/. In addition to inviting a list of firms on our established supplier list, we also selected suppliers registered on the portal with specific commodity codes offering sales training services. On February 18, 2022, Stadium Manager issued Addendum #1, providing answers to questions received and revising the purpose of the RFP. The RFP closed on March 2, 2022 at 3:00 p.m. (PT).

Three proposals were received from the following firms:

1. The Aspire Group

2. ISBI 360 LLC

3. Tyson Group

Evaluation Process
An evaluation committee (EC) consisting of subject matter experts was formed. An e guide outlining the roles and responsibilities of the EC was provided to each EC member to review and execute the following forms to ensure that there was no conflict of interest in evaluating the proposals:

Proposal Evaluator Guidelines
Confidentiality Agreement
Conflict of Interest Disclosure Form

The EC evaluated the proposals and scored based on the evaluation and weighting criteria specified in Section 15 of the RFP. Upon completion of the clarification meetings, individual EC scores were utilized to compute , summarized below:

Evaluation Criteria Maximum
Tyson
Group
The Aspire
Group
ISBI 360
LLC
Proposal Responsiveness Pass/Fail Pass Pass

Pass
Experience and Qualifications 45% 45% 32% 36%
Methodology and Approach 45% 38% 27% 27%
Cost 10% 6% 10% 8%
Total 100% 89% 69% 71%

Stadium Manager conducted business clarification meetings including cost with Tyson Group and was successful in negotiating the cost down without compromising the training curriculum. Tyson Group was determined to be the highest ranking proposer offering best value.

Notice of Intended Award
A notice of intended award (NOIA) was issued on May 3, 2022, recommended firm. The RFP process includes a seven-day protest period, which commenced with the issuance of the NOIA and ended on May 10, 2022. No protests were received.

DocuSign Envelope ID: AF53A696-7AE9-4CAA-9FA1-5F167B7AD6AF ractive, Stadium Manager's eProcurement portal
►
►
►
an "average score "
valuators'
announcing Stadium Manager's
2 Submission of Post-Award Submittals
Once Stadium Manager receives approval from the Stadium Authority Board, the agreement will be executed by both parties and a copy forwarded to the Board. Supporting documentation has been provided for review and approval.

The cost for this service is covered in the FY22/23 SCSA Budget, SBL Sales and Services line item. The annual cost to the SCSA of this service will be $60,800 (76%). The remaining annual cost of $19,200 (24%) will be charged to StadCo. This cost allocation is based on the analysis of the time records of the members of the Stadium Manager SBL sales team that will participate in the training, as documented in the allocation analysis in the accounting records.

Submitted By: __________________________________ Date: ___________________ Jenti Vandertuig, Procurement Director

Approved By: ___________________________________ Date: ____________________ Brent Schoeb, Chief Revenue Officer

DocuSign Envelope ID: AF53A696-7AE9-4CAA-9FA1-5F167B7AD6AF (""; DocuSigned by:

L'::66~~
6/27/2022
r-: DocuSigned by:
~D~~~
6/27/2022
3 Contract No: XXXXX
Agreement with Tyson Group, LLC Page 1
Rev. 07-01-18 for Stadium Manager 07-16-20)

SERVICE AGREEMENT

BETWEEN

FORTY NINERS STADIUM MANAGEMENT COMPANY LLC
AND

TYSON GROUP, LLC

PREAMBLE
This Service Agreement (the “Agreement”) is entered into between Forty Niners Stadium Management Company LLC, a Delaware limited liability company (“Stadium Manager”), Tyson Group, LLC, an OHIO corporation, (Contractor). Stadium Manager and Contractor may be referred to individually as a “Party” or collectively as the “Parties” or the “Parties to this Agreement.”

RECITALS
A. Stadium Manager desires to secure the services more fully described in this Agreement, at Exhibit A, entitled “Scope of Services”;
B. Contractor represents that it, and its subcontractors, if any, have the professional qualifications, expertise, necessary licenses and desire to provide certain goods and/or required services of the quality and type which meet objectives and requirements of Stadium Manager; and,
C. The Parties have specified herein the terms and conditions under which such services will be provided and paid for.

The Parties agree as follows:

AGREEMENT TERMS AND CONDITIONS

1. AGREEMENT DOCUMENTS
The documents forming the entire Agreement between Stadium Manager and Contractor shall consist of these Terms and Conditions and the following Exhibits, which are hereby incorporated into this Agreement by this reference:

Exhibit A – Scope of Services
Exhibit B – Schedule of Fees
Exhibit C – Insurance Requirements
Exhibit D – Tyson Group Training Methodology
This Agreement, including the Exhibits set forth above, contains all the agreements, representations and understandings of the Parties, and supersedes and replaces any previous agreements, representations and understandings,

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 2
Rev. 07-01-18 for Stadium Manager 07-16-20)
whether oral or written. In the event of any inconsistency between the provisions of any of the Exhibits and the Terms and Conditions, the Terms and Conditions shall govern and control.

2. TERM OF AGREEMENT
Unless otherwise set forth in this Agreement or unless this paragraph is subsequently modified by a written amendment to this Agreement, the term of this Agreement shall begin on July 25, 2022 and terminate on July 24, 2023 with an option to extend for two additional one-year periods. Since the term extends beyond a single fiscal year, the term for subsequent fiscal years shall be conditioned upon approval of the SCSA budget for the applicable fiscal year that includes the amounts due under the agreement.

3. SCOPE OF SERVICES & PERFORMANCE SCHEDULE
Contractor shall perform those Services specified in Exhibit A within the time stated in Exhibit A. Time is of the essence.

4. WARRANTY
Contractor expressly warrants that all materials and services covered by this Agreement shall be fit for the purpose intended, shall be free from defect and shall conform to the specifications, requirements and instructions upon which this Agreement is based. Contractor agrees to promptly replace or correct any incomplete, inaccurate or defective Services at no further cost to Stadium Manager when defects are due to the negligence, errors or omissions of Contractor. If Contractor fails to promptly correct or replace materials or services, Stadium Manager may make corrections or replace materials or services and charge Contractor for the cost incurred by Stadium Manager.

5. QUALIFICATIONS OF CONTRACTOR - STANDARD OF CARE
Contractor represents and maintains that it has the expertise in the professional calling necessary to perform the Services, and its duties and obligations, expressed and implied, contained herein, and Stadium Manager expressly relies upon Contractor’s representations regarding its skills and knowledge. Contractor shall perform such Services and duties in conformance to and consistent with the professional standards of a specialist in the same discipline in the State of California.

6. COMPENSATION AND PAYMENT
In consideration for Contractor’s complete performance of Services, Stadium Manager shall pay Contractor for all materials provided and Services rendered by Contractor in accordance with Exhibit B, entitled “SCHEDULE OF FEES.” The maximum compensation of this Agreement is eighty thousand dollars ($80,000), subject to budget appropriations, which includes all payments that may be

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 3
Rev. 07-01-18 for Stadium Manager 07-16-20)
authorized for Services and for expenses, supplies, materials and equipment required to perform the Services. All work performed or materials provided in excess of the maximum compensation shall be at Contractor’s expense.

Contractor shall not be entitled to any payment above the maximum compensation under any circumstance.

7. TERMINATION
A. Termination for Convenience. Stadium Manager shall have the right to terminate this Agreement, without cause or penalty, by giving not less than Thirty (30) days’ prior written notice to Contractor.

B. T
ermination for Default . If Contractor fails to perform any of its material obligations under this Agreement, in addition to all other remedies provided by law, Stadium Manager may terminate this Agreement immediately upon written notice to Contractor.

C. Upon termination, each Party shall assist the other in arranging an orderly transfer and close-out of services. As soon as possible following the notice of termination, but no later than ten (10) days after the notice of termination, Contractor will deliver to Stadium Manager all Stadium Manager information or material that Contractor has in its possession.

8. ASSIGNMENT AND SUBCONTRACTING
Stadium Manager and Contractor bind themselves, their successors and assigns to all covenants of this Agreement. This Agreement shall not be assigned or transferred without the prior written approval of Stadium Manager. Contractor shall not hire subcontractors without express written permission from Stadium Manager.

Contractor shall be as fully responsible to Stadium Manager for the acts and omissions of its subcontractors, and of persons either directly or indirectly employed by them, as Contractor is for the acts and omissions of persons directly employed by it.

9. NO THIRD PARTY BENEFICIARY
This Agreement shall not be construed to be an agreement for the benefit of any third party or parties and no third party or parties shall have any claim or right of action under this Agreement for any cause whatsoever.

10. INDEPENDENT CONTRACTOR
Contractor and all person(s) employed by or contracted with Contractor to furnish labor and/or materials under this Agreement are independent contractors and do not act as agent(s) or employee(s) of Stadium Manager. Contractor has full rights to manage its employees in their performance of Services under this Agreement.

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 4
Rev. 07-01-18 for Stadium Manager 07-16-20)

11. CONFIDENTIALITY OF MATERIAL
All ideas, memoranda, specifications, plans, manufacturing procedures, data, drawings, descriptions, documents, discussions or other information developed or received by or for Contractor and all other written information submitted to Contractor in connection with the performance of this Agreement shall be held confidential by Contractor and shall not, without the prior written consent of Stadium Manager, be used for any purposes other than the performance of the Services nor be disclosed to an entity not connected with performance of the Services. Nothing furnished to Contractor which is otherwise known to Contractor or becomes generally known to the related industry shall be deemed confidential.

12. OWNERSHIP OF MATERIAL
All material, which shall include, but not be limited to, data, sketches, tracings, drawings, plans, diagrams, quantities, estimates, specifications, proposals, tests, maps, calculations, photographs, reports, designs, technology, programming, works of authorship and other material developed, collected, prepared or caused to be prepared under this Agreement shall be the property of Stadium Manager but Contractor may retain and use copies thereof. Stadium Manager shall not be limited in any way or at any time in its use of said material. However, Contractor shall not be responsible for damages resulting from the use of said material for work other than as intended herein.

The term "Contractor Intellectual Property" shall include all materials, PowerPoint slides and other documents prepared by Contractor in connection with Contractor’s Services and any recordings made thereof, and specifically, shall mean (i) all Contractor trade secrets, ideas, inventions, designs, developments, devices, methods and processes (whether or not patented or patentable, reduced to practice or included in the Contractor Confidential Information); (ii) all Contractor copyrights, copyrightable works and mask works (whether or not included in the Contractor Confidential Information); (iii) all Contractor Confidential Information; and (iv) all other proprietary rights contributed to, or conceived or created by, Contractor or anyone acting on its behalf (whether alone or jointly with others) at any time prior to the termination of this Agreement, where such materials and information is prepared or used by Contractor. All training materials and content supplied by the Contractor are the sole property of the Contractor and covered by copyright.

13. RIGHT OF STADIUM MANAGER TO INSPECT RECORDS OF CONTRACTOR Stadium Manager, through its authorized employees, representatives or agents shall have the right during the term of this Agreement and for four (4) years from the date of final payment for goods or services provided under this Agreement, to audit the books and records of Contractor for the purpose of verifying any and all charges made by Contractor in connection with Contractor compensation under this Agreement, including termination of Contractor. Contractor agrees to

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 5
Rev. 07-01-18 for Stadium Manager 07-16-20)
maintain sufficient books and records in accordance with generally accepted accounting principles to establish the correctness of all charges submitted to Stadium Manager. Any expenses not so recorded shall be disallowed by Stadium Manager. Contractor shall bear the cost of the audit if the audit determines that there has been a substantial billing deviation in excess of five (5) percent adverse to the Stadium Manager.

Contractor shall submit to Stadium Manager any and all reports concerning its performance under this Agreement that may be requested by Stadium Manager in writing, including a SOC 2 Type 2 report of its security and privacy controls.

Such report shall be provided to Stadium Manager prior to execution of this Agreement Contractor agrees to assist Stadium Manager in meeting Stadium Manager’s reporting requirements to the State and other agencies with respect to Contractor’s Services hereunder.

14. PROTECTION OF SENSITIVE INFORMATION
A. Contractor shall implement, maintain, and submit to Stadium Manager, a comprehensive written information security program that contains appropriate security measures to safeguard certain sensitive and personally identifiable information being gathered as part of the Services provided. Additionally, Contractor shall submit to Stadium Manager independent, third-party evidence assessing its information security program and operational compliance to the terms of this Agreement. Such assessment must also analyze whether Contractor’s information security program is adequate to perform the Services, normally, as well as during potentially disruptive events or security breaches either Stadium Manager’s or Contractor’s premises.

B. In the event of a security breach, Contractor shall immediately inform Stadium Manager of such breach, as well as the individuals affected, in accordance with CA Civil Code Sections 1798.29(a) and 1798.82(a).

15. HOLD HARMLESS/INDEMNIFICATION
A. To the extent permitted by law, Contractor agrees to protect, defend, hold harmless and indemnify the Indemnified Parties (defined below) from and against any claim, injury, liability, loss, cost, and/or expense or damage, including all costs and attorney’s fees in providing a defense to any such claim or other action, and whether sounding in law, contract, tort, or equity, in any manner arising from, or alleged to arise in whole or in part from, or in any way connected with the Services performed by Contractor pursuant to this Agreement – including claims of any kind by Contractor’s employees or persons contracting with Contractor to perform any portion of the Scope of Services – and shall expressly include passive or active negligence by the Indemnified Parties connected with the Services.

However, the obligation to indemnify shall not apply if such liability is

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 6
Rev. 07-01-18 for Stadium Manager 07-16-20)
ultimately adjudicated to have arisen through the sole active negligence or sole willful misconduct of the Indemnified Parties; the obligation to defend is not similarly limited.

B. Contractor’s obligation to protect, defend, indemnify, and hold harmless in full Indemnified Parties’ employees, shall specifically extend to any and all employment-related claims of any type brought by employees, contractors, subcontractors or other agents of Contractor, against any of the Indemnified Parties (either alone, or jointly with Contractor), regardless of venue/jurisdiction in which the claim is brought and the manner of relief sought.

C. To the extent Contractor is obligated to provide health insurance coverage to its employees pursuant to the Affordable Care Act (“Act”) and/or any other similar federal or state law, Contractor warrants that it is meeting its obligations under the Act and will fully indemnify and hold harmless Indemnified Parties for any penalties, fines, adverse rulings, or tax payments associated with Contractor’s responsibilities under the Act.

D. Indemnified Parties shall mean Stadium Manager, the Santa Clara Stadium Authority, the City of Santa Clara, their affiliates, and each of their respective officers, directors, managers, members, partners, owners and employees, each tenant and event promoter of Levi’s Stadium, and any mortgagee, bond trustee or other financial institution from time to time holding a line or indenture upon an interest in Levi’s Stadium.

16. INSURANCE REQUIREMENTS
During the term of this Agreement, and for any time period set forth in Exhibit C, Contractor shall provide and maintain in full force and effect, at no cost to Stadium Manager, insurance policies as set forth in Exhibit C.

17. WAIVER
Contractor agrees that waiver by Stadium Manager of any one or more of the conditions of performance under this Agreement shall not be construed as waiver(s) of any other condition of performance under this Agreement. Neither Stadium Manager’s review, acceptance nor payments for any of the Services required under this Agreement shall be constructed to operate as a waiver of any rights under this Agreement or of any cause of action arising out of the performance of this Agreement.

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 7
Rev. 07-01-18 for Stadium Manager 07-16-20)

18. NOTICES
All notices to the Parties shall, unless otherwise requested in writing, be sent to Stadium Manager addressed as follows:

Attention: Brent Schoeb, Chief Revenue Officer
Address: Forty Niners Stadium Management Company LLC
4949 Marie P. DeBartolo Way
Santa Clara, CA 95054

With a copy to: Legal Affairs
Forty Niners Stadium Management Company LLC
4949 Marie P. DeBartolo Way
Santa Clara, CA 95054

Procurement Department
Forty Niners Stadium Management Company LLC
4900 Marie P. DeBartolo Way
Santa Clara, CA 95054
Email: [email protected]

And to Contractor addressed as follows:

Tyson Group, LLC
6605 Longshore Street, Suite #240-101
Dublin, OH 43017
[email protected]
The workday the e-mail was sent shall control the date notice was deemed given.

An e-mail transmitted after 1:00 p.m. on a Friday shall be deemed to have been transmitted on the following business day.

19. COMPLIANCE WITH LAWS
Contractor shall comply with all applicable laws and regulations of the federal, state and local government, including but not limited to “The Code of the City of Santa Clara, California” (“SCCC”). In particular, Contractor’s attention is called to the regulations regarding Campaign Contributions (SCCC Chapter 2.130), Lobbying (SCCC Chapter 2.155), Minimum Wage (SCCC Chapter 3.20), Business Tax Certificate (SCCC section 3.40.060), and Food and Beverage Service Worker Retention (SCCC Chapter 9.60), as such Chapters or Sections may be amended from time to time or renumbered. Additionally Contractor has read and agrees to comply with City’s Ethical Standards (http://santaclaraca.gov/home/showdocument?id=58299
).

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 8
Rev. 07-01-18 for Stadium Manager 07-16-20)

20. CONFLICTS OF INTEREST
Contractor certifies that to the best of its knowledge, none of the Indemnified Parties has any financial interest in the business of Contractor and that no person associated with Contractor has any interest, direct or indirect, which could conflict with the faithful performance of this Agreement. Contractor is familiar with the provisions of California Government Code section 87100 and following, and certifies that it does not know of any facts which would violate these code provisions. Contractor will advise Stadium Manager if a conflict arises.

21. FAIR EMPLOYMENT
Contractor shall not discriminate against any employee or applicant for employment because of race, sex, color, religion, religious creed, national origin, ancestry, age, gender, marital status, physical disability, mental disability, medical condition, genetic information, sexual orientation, gender expression, gender identity, military and veteran status, or ethnic background, in violation of federal, state or local law.

22. NO USE OF STADIUM MANAGER NAME OR EMBLEM
Contractor shall have no right to use, reproduce, or display the trademarks, symbols, trade names or other intellectual property of the Stadium Manager, Levi’s Stadium®, the San Francisco 49ers, or their respective affiliates, or Stadium tenants or their affiliates or other event performers directly or indirectly, in connection with any production, promotion, client list, service or publication, without the prior written approval of Stadium Manager.

23. GOVERNING LAW AND VENUE
This Agreement shall be governed and construed in accordance with the statutes and laws of the State of California. The venue of any suit filed by either Party shall be vested in the state courts of the County of Santa Clara, or if appropriate, in the United States District Court, Northern District of California, San Jose, California.

24. SEVERABILITY CLAUSE
In case any one or more of the provisions in this Agreement shall, for any reason, be held invalid, illegal or unenforceable in any respect, it shall not affect the validity of the other provisions, which shall remain in full force and effect.

25. AMENDMENTS
This Agreement may only be modified by a written amendment duly authorized and executed by the Parties to this Agreement.

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 9
Rev. 07-01-18 for Stadium Manager 07-16-20)

26. COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but both of which shall constitute one and the same instrument.

Contract No: XXXXX
Agreement with Tyson Group, LLC Page 10
Rev. 07-01-18 for Stadium Manager 07-16-20)
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly appointed representatives as of the Effective Date.

STADIUM MANAGER:

FORTY NINERS STADIUM MANAGEMENT COMPANY LLC, a Delaware limited liability company

By: _________________________________

Name: Brent Schoeb

Title: Chief Revenue Officer

CONTRACTOR:

TYSON GROUP, LLC, a Coportation

By: _________________________________

Name: Lance Tyson

Title: President and CEO

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit A-Scope of Services Page 1 Rev. 07-01-18

EXHIBIT A

SCOPE OF SERVICES
The Services to be performed for the Stadium Manager by the Contractor under this Agreement are set forth below.

Contractor shall evaluate, strategize, and deliver a comprehensive training program with ongoing support to the sales team and leadership training for management as follows:

1. Evaluate and provide a strategic analysis of sales department’s strength’s and weaknesses via evaluation of each individual sales person

2. Provide both group and individual sales training to ten to eleven salespeople

3. Provide leadership training to mangagment group

4. Provide ongoing support as requested or needed during the term of contract

Contractor and Stadium Manager shall develop a detailed training plan utilizing Exhibit D to include the following:

A. Provide Assessments
o Tyson Group Sales Assessments:
 Define the skills and behaviors that matter
 Identify skill gaps related to the sales process
 Identify natural strengths that lead to success
 Predict the potential success of any individual in any position  Create a team benchmark for future hiring
o Delivery and Logistics
 Online
 30 to 45 Minutes
 Quantity: Unlimited

B. Provide Group Management Assessment Coaching (in conjunction with Assessments)
o 3 Virtual Leadership Sessions
 Understand competencies of team
 Identify areas of opportunities and gaps
 Learn how to leverage strengths
 Practice coaching methodology for development
 Understand motivation
 More effective communication in 1:1 conversations
o Delivery and Logistics
 3 Virtual Sessions
 Up to 2 Hours per Sessions
 Quantity: 3

C. Provide Instructor Led Training
o Topics
 To be determined based on need(s) identified during pre-training preparation call

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit A-Scope of Services Page 2 Rev. 07-01-18
 Reference training proposal and methodology in Exhibit D o Delivery and Logistics
 Sales Training
• 8 In-Person Training Days
o 4 Sessions Annually
o 2 Days per Session
• Number of Participants: Up to 15
• Location: Onsite at Levi’s Stadium

 Sales Management Training
• 4 In-Person Training Days
o 4 Sessions Annually
o 1 Day per Session
• Number of Participants: Up to 5
• Location: Onsite at Levi’s Stadium

D. Virtual Training
o Topics
• To be determined based on need(s) identified during pre-training preparation call
• Reference training proposal and methodology in Exhibit D o Delivery and Logistics
• Sales Training
• 4 Virtual Sessions
o 1 Session per Quarter
o Up to 2 Hours per Session
• Number of Participants: Up to 15
• Location: Via Zoom
• Sales Management Training
• 4 Virtual Sessions
o 1 Session per Quarter
o Up to 2 Hours per Session
• Number of Participants: Up to 15
• Location: Via Zoom
E. Learning Management System (LMS) Access
• Access to training modules to augment in-person and virtual instruction for sales training program
• Access to recordings of virtual deliveries

Location of On-Site Services
On-site training shall be provided at the Stadium:

Levi’s Stadium
4900 Marie P DeBartolo Way
Santa Clara, CA 95054

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit A-Scope of Services Page 3 Rev. 07-01-18

Virtual and Onsite Assessment and Training
At the discretion of the Stadium Manager, assessment and training shall be conducted onsite or virtually. Based on the Public Health Orders issued by the Santa Clara County Health Department related to Novel Coronavirus (COVID-19), all parties will be required to follow the health orders and appropriately forecast, plan and schedule onsite or virtual training.

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit D-Labor Compliance Page 1 Rev. 07-01-18

EXHIBIT B

SCHEDULE OF FEES
Contractor will bill Stadium Manager on a quarterly basis for Services provided by Contractor during the preceding quarter on an invoice and in a format approved by Stadium Manager and subject to verification and approval by Stadium Manager.

Stadium Manager will pay Contractor within thirty (30) days of Stadium Manager’s receipt of an approved invoice.

Fee Schedule*

Deliverable Cost
Assessments and Group Management Coaching $8,000
Sales Training $40,000
Sales Leadership Training $22,000
Estimated Travel Expenses*
• 1 Trip / quarter
• 3 Training days / quarter
• Total investment for 4 trips
$10,000
TOTAL* $80,000
*Total cost based on the deliverables selected by the Stadium Manager. Those selections could impact estimated travel expenses.
**Estimated Travel Expenses based on current average rates and subject to market fluctuations beyond control of Contractor.

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit D-Labor Compliance Page 2 Rev. 07-01-18

EXHIBIT C

INSURANCE REQUIREMENTS
At all times during the term hereof, Contractor shall keep and maintain in full force and effect the following types of insurance coverage and/or bonds:

1. Commercial general liability insurance, including property damage, against liability for personal injury, bodily injury, death and damage to property occurring in or about the property in the amount of One Million Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000) in the aggregate.

2. Automobile liability in the amount of One Million Dollars ($1,000,000) with respect to owned, hired and non-owned vehicles.

3. Workers compensation insurance, as required by applicable law.

4. Employer’s liability in the am ount of One Million Dollars ($1,000,000) each accident, One Million Dollars ($1,000,000) each employee, by disease, and One Million Dollars ($1,000,000) policy aggregate by disease.

5. Liability insurance covering claims arising out of errors and omissions by vendors rendering professional services, in the amount of One Million Dollars ($1,000,000) each occurrence or claim including contractual liability coverage, with all coverage retroactive to the earlier of the date of agreement or commencement of Contractor’s services.

6. Cyber Liability insurance providing coverage for first-party claims, including breach response expenses for notification and credit monitoring, and third-party claims, in the amount of One Million Dallars ($1,000,000) per occurrence or claim.

7. Umbrella or excess liability insurance in the amount of T wo Million Dollars ($2,000,000) providing excess coverage over general liability, auto liability, and employer’s liability specified above.

The above stated limits may be achieved by a com bination of primary and excess/umbrella coverage. Any deductible or self-insured retention amounts are the sole responsibility of the Contractor. Contractor is responsible for i nsuring any equipment brought to Levi’s Stadium. Stadium Manager shall have no liability for such equipment.

All insurance policies and bonds required to be maintained by Contractor shall be issued by insurers or sureties (as the case may be) reasonably satisfactory to client, authorized to do business in the state of California a nd having an AM Best rating and financial size category of A -/VII or better. All policies of the vendor shall be (i) primary and non- contributing with respect to any policies carried by client; (ii) with respect to general liability insurance only, a provision including Stadium Manager, Santa Clara Stadium Authority, Forty Niners SC Stadium Company LLC and Forty Niners Football Company LLC as additional insureds; (iii) a waiver by the insurer of any right to subrogate against Stadium Manager (iv) a severability of interest or endorsement; (v) a provision that the insurer will

Contract No: XXXXX
Agreement with Tyson Group, LLC/Exhibit D-Labor Compliance Page 3 Rev. 07-01-18
not cancel or change the coverage provided by such without giving the Stadium Manager thirty (30) days' prior written notice; and (vi) general liability be an "occurrence form" policy. Any policy of insurance required to be carried by Contractor that names additional insureds contained herein shall not be subject to a deductible or self-insured retention, it being the intent of the parties that such insurance shall fully and completely insure such additional insured entities for all loss or expense; if any such policy has a deductible or self-insured retention clause applicable to these operations, Contractor shall provide evidence that insurance carrier shall pay without regard to such deductible or self-insured retention.

12.5 METHODOLOGY
•
•
•
•
•
•
•
•
•
Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Our mission is to coach, train, and consult with sales leaders and their teams to compete in a complex world.

We do this by taking a diagnostic approach to understanding your team and the gaps we can help you fill. By adhering to the following process, we are able to propose solutions that deliver the results that make sense for your organization and needs. We aren't just a company that provides training-we are a partner that provides results .

Coach: Our trainers will
coach your managers and
sales team through
difficult conversations
and pipeline
development.

Assess: Our partnership
begins with an in-depth
assessment of individual
team members to identify
competencies.

Train: Our tailored
training will improve your
team's competencies and
equip them with the
desired skills for your
marketplace.

TRAIN 06S/6N
Design: Once we
diagnose your needs,
we'll provide a detailed
playbook that defines the
strategy to grow your
team's competencies.
"-----./
Our Services and Programs
What services do we offer?
To gain insight into your sales team and help them
execute the sales process, we collaborate with you
to provide :

Team Assessments
Group Coaching Sessions
Instructor-Lead Training Sessions
Virtual Training/Coaching Sessions
Learning Management System (LMS)
What programs do we offer?
Our training programs have a solid foundation in our
process but can be tailored to your team's
competencies . Some of our programs include :

Away-Game Selling
Sales Leadership and Management
Sales Deal Planning
Negotiate Like a Pro
03/02/2022 www .tysongroup .com Page 14
© 2022 Tyson Group. All Rights Reserved
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Predictive Analysis Assessments
While it might be interesting to know if a sales candidate is an extrovert, it's critical to know if that person can successfully prospect, handle objections, and close . Our assessments can help you determine this .

Every person has innate characteristics that influence their abilities to perform well in a specific role. This doesn't mean someone can't do a job well. It simply means that they may need an extra tool for their tool belt. Through predictive analysis, we assess your sales team to determine what additional tools they might need to successfully perform in their role and help drive revenue .

What does it do?
Measures up to 140 key competencies within
defined profiles to influence complete talent
audit
Leverages state-of-the-science techniques
with over 400 validation studies of research
Focuses on predicting success on the job
rather than describing broad traits
Concentrates on skills that can be observed
and coached
Provides insight into habits and motivations
Group Management Coaching
What are the benefits?
Provides tools for more effective and
standardized interview and coaching
processes
Eliminates subjective methods for
determining someone's ability to perform a
role
Objectively pinpoints only the skills that affect
bottom-line results for the specific position
Focuses on specific behaviors that affect
results
The predictive analysis assessments are used to coach your team and give them the opportunity to ask questions . We will review your team's results with the management team and conduct coaching sessions to dive deeper into an individual's competencies and determine individual needs. The coaching sessions will provide the management team with the tools and confidence to use the assessment results to effectively coach their team and hold them accountable .

Who do we coach?
Executives
Sales Leaders/Managers
Sales Teams
Individual Sales Reps
Why is it important?
Provides deeper understanding of
assessment results
Creates an opportunity for individuals to ask
questions and seek guidance
Ensures assessments are not delivered
without an explanation of the results
Once the team has been assessed and the management team coached on how to read and use the reports, we will collaborate with the Stadium Manager to identify the programs that will achieve the desired goals for the SBL team .
03/02/2022 www .tysongroup.com Page IS
© 2022 Tyson Group. All Rights Reserved

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Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Away-Game Selling
Does the market drive the sales offering or does the sales offering drive the market? In a technology-driven world, people have unlimited access to knowledge-and that includes your customer . Your sales team is facing different challenges because today's buyer has more information at their fingertips . It's time to refine your sales team's skillset and give them the strategies and tactics to :

Build a connection with customers
Generate interest
Prescribe and tailor a solution
Create dialogue
Close the sale
Based on the proven sales process in Lance Tyson's
bestselling book, Selling is an Away Game: Close
Business and Compete in a Complex World, your team
will learn to reach their customers by understanding the mindset of the buyer. The Away-Game Selling model is a
scalable, measurable, and repeatable approach that will equip your team with the tools to achieve predicable results .

It's more than a training program that provides relevant examples . It's an applicable approach to understanding the strategy needed to obtain consistent results in a complex world.

Sales Leadership
What departments will benefit
from this program?
Salespeople of any tenure or background will
benefit from this training as we will tailor our
approach to fit your team's needs and daily
responsibilities .
"You manage things : you lead people." ~Rear Admiral Grace Murray Hopper Are you a manager or a leader? Do you know the difference? Strong leaders can motivate people to follow them by developing and strengthening leadership and communication skills. Through our training, your team will learn to navigate the differences between leading and managing a team . Hands-on exercises will provide insight into their roles in the organization and how it influences their team . They'll gain strategies to help:

Build a strong, productive, and successful team
Support teams through development with effective
feedback
Coach teams to manage time and achieve goals
Develop and strengthen personal leadership and
communication skills
03/02/2022 www .tysongroup .com
Who benefits from this program?
Any person who is responsible for leading
or managing a team

Page 16 ends

•
•
•
•
•
•
•
•
•
•
•

Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Negotiate Like a Pro
There's no skill in closing, but there's a lot of skill in negotiating .

Regardless of a person's role in a company , they often find themselves in a situation that requires negotiation on behalf of their department, their team , or their company . For a salesperson, level-headed negotiations are a key to success . In this training, participants will learn how negotiating is different from resolving an objection and gain a unique set of skills to navigate any negotiation . Our instructors will provide your sales team with the strategies and tactics to :

Understand the person they are negotiating with,
what they want to get from that person, and what
that person wants to get from them
Gain insight into the buyer's mind
Identify situations that require negotiation
Practice negotiating skills
Persuasive Presentation Skills
Who benefits from this program?
Any person who has to collaborate with
internal or external customers
Strong presentations go beyond public speaking and cross into the realm of understanding your audience and preparing a sound proposal.

Most people don't associate being a good presenter with being a good salesperson . But strong presentation skills are a foundational skill for salespeople-or any person in your organization.

In the Persuasive Presentation Skills boot camp, participants will give multiple presentations on the spot and receive immediate coaching and feedback . The goal is to allow participants to present themselves as a credible source and persuade others to buy into their ideas-whether it's a sale or a crucial topic for the business. Each presentation will focus on various skills including personal motivational techniques, presence, body language, and building rapport with hands-on activities on how to :

Make an impression
Create your own brand
Present challenging information
Present outside your comfort zone
Persuade and motivate people to act
Field difficult questions
Present to a virtual audience
03/02/2022 www .tysongroup.com
Who benefits from this program?
Any person or team who regularly gives
presentations or proposals

Page 17 ends

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•

•
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Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Sales Deal Planning
Veterans who have been around the block still benefit from continuing the Sales Conversation .

In this program, well-versed participants are given the opportunity for practical application of the sales process . Using a blueprint exercise to gather information from individuals about a specific sale that was lost or an upcoming opportunity, we 'll walk through how to ensure better outcomes . This creates a valuable learning experience that salespeople of all backgrounds can apply to future opportunities . Individuals will :

Use a blueprint to map out a deal
Identify information to know about a prospect and
the stakeholders
Determine proactive actions for any situation
Recognize how a prospect will evaluate you and
make a decision
Define buying criteria
Utilize negotiation skills to ensure a deal
Account Management and Service
Who benefits from this program?
Any person responsible for creating new or
keeping existing business
Deliver outstanding service while up-selling, cross-selling , or ensuring a continued relationship with a valuable customer .

Teaching customer service requires a deep understanding of human behaviors and needs. Our Account Management and Service blends concepts from our sales process with an approach to understanding a customer and activating on your brand. In our program, individuals will learn to :

Provide service while selling
Resolve customer concerns or conflicts
Negotiate with customers to reach resolutions
Collaborate with internal customers to achieve
results
03/02/2022 www .tysongroup .com
Who benefits from this program?
Any person who interacts with your
customers

Page 18 ends

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Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Coaching Services
Salespeople aren't born; they are built.

Learning and growing doesn't stop once the participants leave the training room. We provide post training coaching services for leaders and sales teams on mutually identified set of goals in order to improve their professional performance and personal satisfaction . These goals may be concepts identified during the training and larger goals determined by your leadership team . This can include:

Post training sessions to ensure the training
concepts are appropriately executed
Refresher sessions
Impact statement development
Personal coaching
Executive consulting
Pipeline management
Learning Management System (LMS)
Who benefits from this program?
Any person or team who wants to continue
their growth
Consistency of learning is critical to creating a repeatable and scalable sales process.

Our Learning Management System (LMS) is an integral part of the training and development process. The LMS will empower the participants, so they can continue their growth, success, and ultimately drive revenue.

Provides unlimited access to sales training content
Tracks learner progress and performance
Reduces learning and development time
Reinforcement of concepts
Who benefits from this program?
Any person or team who wants to continue
their growth
03/02/2022 www .tysongroup.com Page 19
© 2022 Tyson Group. All Rights Reserved

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Exhibit D - Tyson Group Training Methodology

TYSON GROUP
Staffing
Tyson Group has recruited the most talented in the business to achieve industry excellence . Our team is comprised of experts that are equipped to guide any team to meet their sales goals and generate substantial , measurable results . We have achieved proven and scalable outcomes with decades of experience in many industries, such as sales, healthcare, manufacturing, technology, financial services, insurance, and professional sports .

The team that will partner with the Stadium Manager will include :

Lance Tyson - the President and CEO of Tyson Group will oversee the project from and executive level Allison Schuller - the VP of Training and Strategy will provide recommendations for content and instructional staff based on her knowledge, experience, and understanding of the project Gina Beltrama - the VP of Sales will support the sales team through the RFP process Jon Shollenberger - the Director of Business Development will be the primary point of contact throughout the RFP process
Sian Valentine - the Director of Client Activation and her team will coordinate all delivery aspects of the project , including but not limited to onboarding , pre and post training calls, assessment scheduling, coaching sessions, in-person training , virtual training, reporting , and preparation of materials In addition to the above, our instructional staff has an average of 20 years of training experience . Wh ile all have worked with a variety of industries , they all have a passion with pro-sports sales teams . The following instructors may be assigned to this project:

Joshua Belkoff
Jennifer Cassidy
Sheila McVeigh
Traci Tigue
The above list is not inclusive of our entire instructional support team and other instructors may be added to the project as needed .
03/02/2022 www .tysongroup .com Pa g e I 10
© 2022 Tyson Group. All Rights Reserved

12.6 QUALIFICATIONS
Exhibit D - Tyson Group Training Methodology

TYSON GROUP
At Tyson Group, we believe sales is a high-stakes team sport. A SellingPower top sales training company and the sales training leader for the nation 's top pro sports teams-we teach companies in any industry how to win the complex sale, from drawing up a game plan, to making critical adjustments, to running the perfect play that closes the deal. Best of all, our programs prepare sales teams to handle even the most unpredictable situations with confidence . Led by Lance Tyson, a thought leader in the field , we have built an exceptional reputation: more than 9 out of 10 clients have referred us to others- 43% higher than the industry average! When you need to equip your sales team for the real world , Tyson Group delivers the strategy , skills, and track record to win under any field conditions .

Organizations nationwide look to Tyson Group to help them develop efficient personnel management, establish compensation structures in a down economy , create new product offerings , and attract more customers in a virtual environment. From recognition on the most influential lists and awards in the industry, to increased demand for free online resources, to an instant bestselling book, it's apparent that Tyson Group's input is highly valued .

Awards
Sellin ower
Top Sales Training
Company
2021
03/02/2022
Selling Power Magazine Top 25 Sales Training Companies, 2021 We are thrilled to announce our inclusion in Selling Power Magazine Top 25 Sales Training Companies in 2021 ! We are so proud to be selected from the many applications received in the year 2021 .

Online Sales Training Companies, 2021
We are honored to announce our inclusion in Selling Power Magazine Top 20 Virtual Sales Training Companies for the second year in a row! We competed against 250 organizations, and we 're thrilled to be recognized for our accomplishments during this time .

Stevie® Awards for Sales & Customer Service, 2021
We are honored to have won the Silver Stevie Awards for Sales Consulting Practice of the Year for the second year in a row! We competed against 2,300 organizations in 51 nations , and we're thrilled to be recognized for our accomplishments during this time .

The Globee® Awards
The Globee® Awards ,_organizers of the world's premier business awards programs and business ranking lists, has named Tyson Group a winner in the 8th Annual 2021 Sales and Customer Service Excellence Awards . These prestigious global awards recognize achievements in sales, service , support , and business development from all over the world .
www .tysongroup.com Page 111
© 2022 Tyson Group. All Rights Reserved

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Exhibit D - Tyson Group Training Methodology
Sellin ower
Top 20 Sales Training
Companies
2018,2019,2020
Differentiators

TYSON GROUP
Selling Power 2018, 2019, 2020
Tyson Group is a proud 'Selling Power' Magazine Top 20 Sales Training Company for the past three years consecutively . The main criteria used when selecting the companies to include on the list of Top 20 Sales Training Companies were :
-Depth and breadth of training offered
-Innovative offerings (training courses, methodology, or delivery methods) -Contributions to the sales training market
-Strength of client satisfaction
Online Sales Training Companies, 2020
Tyson Group was named first-ever Top 20 Online Sales Training Companies list for 2020 . This special edition of Selling Power's flagship Top 20 list focuses specifically on companies that are helping sales leaders navigate the shift toward virtual selling by providing online sales training.

Stevie Awards 2020
Tyson Group won a silver award in 2020 STEVIE® Awards for sales & customer service . The Stevie Awards for Sales & Customer Service are the world's top honors for customer service , contact center , business development and sales professionals .

Training Industry 2020
Training industry 2020 announces Tyson Group as B2B sales training company to watch . Training Industry is the most trusted source of information on the business of learning . Their Top Sales Training List is based on thorough analysis of the capabilities , experience , and expertise of sales training providers.

What makes Tyson Group different from other training professionals? We approach sales-in any industry-as a team sport. It requires a smart game plan, the ability to adjust to changing conditions, and great coaching .

We are one of the top sales training companies in the nation .

Many of the biggest names in sports rely on our acumen and training .

Our comprehensive and scalable training reliably prepares sales professionals for the real world .

We have an exceptional track record of success . Over 90 percent of clients have referred us-43% higher than the industry average .
03/02/2022 www.tysongroup.com Page I 12
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

LANCE TYSON
President and CEO

TYSON GROUP
We consider Lance a born entrepreneur and self-starter . Through passion and grit, he has become an authority in the sales world with a zeal for developing strong business leaders. Lance has worked with some of the biggest names in sports and entertainment, including the New York Yankees and the Dallas Cowboys . Over the past two decades he has followed his passion for developing strong business leaders and their salespeople by tapping into his natural ability to connect with others and foster and environment for learning and coaching.

After leaving school to start his first business, Lance took over several Dale Carnegie Training operations in the Midwest. He started with Cleveland then moved on to Columbus, and eventually took over the Cincinnati and Indianapolis marketplaces . Under his leadership, these marketplaces experienced 23 percent growth to become the largest Dale Carnegie Training operations . In 2010, Lance sold his interest in Sale Carnegie and formed PRSPX in Dublin, Ohio to help clients build effective sales ecosystems . PRSPX has since been restructured as Tyson Group to provide services to assess sales teams, diagnose their needs, and equip them to be better salespeople and leaders. Our focus at Tyson Group is to assess and diagnose your sales team and propose solutions specific to the needs of your organization to deliver maximum results . We have hired only the best experts who have decades of experience in sales, in the healthcare, manufacturing, technology, financial services, insurance, professional services, and professional sports industries .

Lance is also a three-times bestselling author of Selling is an Away Game, Igniting Sales EO, and the recently released The Human Sales Factor.
03/02/2022 www .tysongroup .com Pa g e I 15
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

TYSON GROUP

GINA BEL TRAMA
Vice President of Sales
Gina Beltrama began working with Tyson Group in 2018 to develop new business opportunities . As an experienced salesperson, she specializes in creating, cultivating, and fostering new (and existing) relationships . With a background in sports selling (tickets, suites, and partnerships), her prior experience with the Dallas Cowboys, San Francisco 49ers, Super Bowl 50 and Topgolf were a natural fit as a Senior Director of Business Development.

In her 4 years with Tyson Group, Gina has increased overall revenue by almost 24%, exceeded her 2019 goal by over 29%, and accounts for over 37% of total revenue since coming aboard. With the current business climate, Gina has found opportunities to partner with new and existing clients with an innovative approach to help them continue to build strong sales teams .

As the VP of Business Development, Gina's goal is to ensure that Tyson Group exceeds our clients' expectations and provides support to help them maximize their sales and sales leadership talent. In alignment with Tyson Group culture and philosophies, she will also be responsible for continued growth for the company.

Gina resides in Northern California. She loves to spend her time away from Tyson Group with her family and two sons and daughter . She has no free time due to said small people, though she does enjoy a good yoga class and a Peloton ride.
03/02/2022 www .tysongroup .com Pa g e I 16
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

TYSON GROUP

ALLISON SCHULLER
Vice President of Training and Strategy
Allison Schuller joined the Tyson Group team in July 2011 . After working on every project in the company and moving her way up the ladder, she was given account management responsibilities to support client needs and organize the logistics of our strategic partnerships . After maximizing her training and education opportunities , she earned a Sales Talk Championship, was given a hard sales goal and transitioned to a Business Development Specialist position . As a BDS, she worked closely with one of our clients to tailor accelerated professional development solutions for organizations .

Proving her skills yet again, Schuller was promoted to Account Executive where she was tasked with selling Tyson Group services to prospects . Allison quickly proved that she had not only the drive to be a success in sales, but also that she could impart her experience as an effective sales trainer.

As the VP of Training and Strategy, Allison will focus on scaling the business by developing a new department of professional instructors, helping them to build and diversify their own skills, and match their talents with the needs of Tyson Group's client base.

Allison hails from Harvard on the Hocking and is a 2009 graduate of Ohio University. After a short stint living abroad, she earned a degree in International Studies and is a certified Dale Carnegie Instructor .

When Allison isn't at work, you'll find her with friends or outside playing with her dogs . She enjoys staying active and pursuing her true passions: traveling and cooking . 03/02/2022 www .tysongroup .com Pa g e I 17
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

TYSON GROUP

JON SHOLLENBERGER
Director of Business Development
Jon Shollenberger joined the Tyson Group in August of 2021 . Much of his career thus far has been with the Dallas Cowboys as a Sales Consultant. Over 6 seasons with the Cowboys, Jon was responsible for selling long term seat options and suites as well as renewing his over 800 accounts resulting in year after year sell outs of AT&T Stadium . As a student of the Tyson Group for the last 6 years, while with the Cowboys, he knows firsthand how beneficial this training can be!
Jon is a graduate of the University of Findlay in Findlay, OH with a degree in Sports Management and Hospitality Management. While in school, he excelled not only in the classroom but also on the baseball field and started the universities first student run business which is still open and operating to this day.

As the Director of Business Development, Jon is responsible for showcasing all the Tyson Group's best practices as well as being a valued resource for sales leaders across all industries .

Jon resides in Cincinnati, Ohio with his Wife and Daughter . In his free time, he enjoys spending time with his family , getting out on the golf course and relaxing on Lake Erie. 03/02/2022 www .tysongroup .com Pa g e I 18
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

TYSON GROUP

SIAN VALENTINE
Director of Client Activation
After relocating from the East Coast with her family to Ohio, Sian (pronounced like Sean) Valentine was looking for a new challenge . While waiting for the right opportunity, she took on the role of team manager for her son's hockey team . It was during that time that she met Tyson Group President and CEO, Lance Tyson.

Lance realized that Sian's 15 years as an HR Consultant and Project Manager could be a valuable resource for his growing company.

Initially charged with managing Lance's calendar and assisting with correspondence, Sian's role quickly evolved from Executive Assistant to Corporate Communications . As the liaison to the CEO, her role included planning, analysis, scheduling, teamwork, and communication .

As Director of Client Activation, Sian will deliver and oversee overall relationship management and contract fulfillment for a portfolio of clients . With a deep understanding of client goals and objectives, responsibilities will include on-boarding clients, oversight of assessments and assessment coaching, preparation for instructor-led training and virtual sessions . In addition, she will oversee the other members of the Client Activation Team to make sure that all deliverables are provided with the highest level of quality. This position will work closely with all members of Tyson Group to ensure we deliver best-in-class service .

A native of Connecticut, Sian is a fiercely loyal alum of the University of Connecticut. She has lived in Medina, OH for the past 17 years with her husband, Mark, son, and daughter . 03/02/2022 www.tysongroup.com Page I 19
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

TYSON GROUP

JOSH BELKOFF
Director of Business Development/ Instructor
Upon graduating from the University of Arizona with a degree in Sports Management, Josh accepted a position at the Phoenix Suns' new business team, where he focused on selling season tickets, group tickets, and premium hospitality for the NBA's Phoenix Suns and WNBA's Phoenix Mercury. During his time as an Account Executive, he was #1 in both membership sales and new season ticket sales revenue .

In June of 2014, only two years from his first day of employment at the Suns, he was promoted to the Manager of the New Business Development program-one of the fastest leadership ascensions in the department's history . He spent three seasons in that role recruiting, training, leading, and developing the entry level sales consultants . During his tenure, Josh grew the sales staff from fourteen to nineteen members, while helping more than forty people get promoted to senior level positions within sports teams all over the country .

Since his time with the Suns, Josh has spent the last three years partnering with several organizations in the sports business industry, focusing on sales training, leadership development, and talent management. He has worked with teams in the NFL, NHL, NBA, MLB, NCAA, WNBA, NCAA, NASCAR, and the ECHL.

Josh currently resides in Phoenix, AZ. In his free time, he enjoys traveling , working out, being outside , and trying new restaurants with friends .
03/02/2022 www.tysongroup.com Page I 20
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

JENNIFER CASSIDY
Instructor

TYSON GROUP
Jennifer is one of the newest members of the Tyson Group training team . Prior to coming aboard, Jennifer spent 31 years as a Dale Carnegie trainer and executive coach. While sharpening her training skills she was also a Public Affairs Officer for the United States Air Force for 28 years. Jennifer brings a ton of coaching, training, and industry knowledge to the table .
03/02/2022 www .tysongroup .com Page I 21
© 2022 Tyson Group. All Rights Reserved

Exhibit D - Tyson Group Training Methodology

SHEILA MCVEIGH
Instructor

TYSON GROUP
"You get the best effort from others not by lighting a fire beneath them, but by building a fire within ." - Dr.

Bob Nelson
Sheila's success comes from vision, drive and support. She prides herself on helping people see their potential and what should be or could be.

During her 24-year career in Performance Improvement, she has served as a Trainer, Salesperson, Director of Instruction, Sales Manager, and as a Master Trainer. Her broad industry experience includes pro sports, financial, manufacturing, medical, energy, Federal Government, and Defense .

Sheila received her degree in Behavioral & Social Sciences from University of Maryland . She enjoys spending time with her 3 sons, Conor, Garrett and Ronan. She loves reading, crossword puzzles, traveling, walking and playing tennis with her husband, Chris. She did not know how to play tennis before and her husband has been a patient and encouraging coach!
03/02/2022 www .tysongroup .com Page I 22
© 2022 Tyson Group. All Rights Reserved
Exhibit D - Tyson Group Training Methodology

TRACI TIGUE
Instructor

TYSON GROUP
Traci Tigue is an uncommon mixture of serious business and a lot of fun . She takes her business very seriously ... and she has a blast doing it. "My purpose ," says Traci, "is to get people, teams and organizations to the next level of performance through the resources of Tyson Group. " Through her intense fuel driven teams, each touch with a prospect has the capability to accelerate the performance of an organization and impact their business model , sales teams and revenue. Because of that , we must be on point.

Tigue comes from a background of building, leading, training and accelerating sales and best practices for departments and organizations ; both in the corporate world, Dale Carnegie Training (DCT), or in Education, SMART Technologies . This is where she excels; she broke sales records, and recruited and led nationally recognized award winning teams. She has consistently found herself in the role of trainer, innovator, speaker, salesperson and manager for most of her life; whether it has been leading teams, building departments or establishing companies , she has been the architect and the builder.

With a degree from Bowling Green State University this Falcon loves taking on adventures like traveling, hiking, boating, warrior dashes, half marathons , and triathlon racing. Traci is constantly expanding her own horizons as part of her own personal push. The best part is that Traci does business the way she does life. Her enthusiasm is contagious. When you work with her, you will find your horizons expanding too . Traci lives in Brunswick, OH with her husband Russ, their daughter and 2 sons. 03/02/2022 www.tysongroup .com Page I 23
© 2022 Tyson Group. All Rights Reserved
City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-885 Agenda Date: 7/5/2022

REPORT TO STADIUM AUTHORITY BOARD

SUBJECT
Report from the Stadium Authority for Action Regarding Stadium Manager’s Request to Execute Agreement with Tyson Group, LLC for Stadium Builder’s License (SBL) Sales Training Services

BOARD PILLAR
Ensure Compliance with Measure J and Manage Levi’s Stadium

BACKGROUND
On October 8, 2019, the Stadium Authority Board (Board) approved Ordinance No. 2005 amending Chapter 17.30 of the City Code (Stadium Authority Procurement Policy), which rescinded the delegation to the Executive Director to enter into agreements without prior Board approval. As result of Ordinance No. 2005, the Stadium Manager is also required to request Board approval before entering into agreements on behalf of the Stadium Authority. As of the effective date of the Ordinance (November 8, 2019), all Stadium Authority agreements for services, supplies, materials, and equipment require the approval of the Stadium Authority Board.

As the Stadium Manager, Forty Niners Stadium Management Company, LLC is responsible for making recommendations to the Stadium Authority with respect to facilitation of a secondary market for SBLs, and marketing, monitoring, and managing SBL agreements as required by the Management Agreement between the Stadium Authority and Stadium Manager.

The Stadium Manager is requesting the following:
· Approval to execute a one-year agreement with Tyson Group, LLC in the amount of $80,000 for SBL sales training professional services for their SBL sales team, with the option to extend for two additional one-year periods.

This service is included in the Stadium Authority FY 2022/23 Operating Budget under the SBL Sales and Services line item. Consistent with Santa Clara Procurement Policy Chapter 17.30.100, the draft agreement includes language stating that the term for any subsequent fiscal years shall be conditioned upon approval of the Stadium Authority budget for the applicable fiscal year that includes the amounts due under the agreement.

DISCUSSION
Stadium Authority staff reviewed the Stadium Manager’s Recommendation for Award memo, supporting documentation, and draft agreement with Tyson Group, LLC. that were submitted (these documents are attached to corresponding report #22-884) for consistency against the Stadium Authority Procurement Policy and Santa Clara City Code Chapter 2.105.330(a)(2).

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22-885 Agenda Date: 7/5/2022
Out of Levi’s Stadium’s 68,500 seats, 93% have SBLs and the remaining 7% translates into approximately 5,000 remaining seats that SBLs are yet to be sold. SBLs generate significant revenue for the Stadium Authority that is used for debt repayment. SBL Holders can either pay their SBL in full at the time of purchase, pay their SBL in two installments which have no interest, or finance their SBLs over 10 years. The Stadium Authority received $27,279,416 in total from SBL cash receipts for FY 2021/22. There have also been some recent staffing changes within the SBL sales team, and such sales training will benefit the Stadium Authority and the team. The training will occur virtually and onsite and there is no staff travel associated with this request. The training will focus on assessments, group management coaching, sales, and sales leadership.

Based on the documentation provided and the information above, staff recommends approval of the Stadium Manager’s request to execute an agreement with Tyson Group, LLC. Staff also recommends delegating authority to the Executive Director to approve exercising any of the extension options after the first year of the agreement term.

The Stadium Authority will require full supporting documentation including compliance with prevailing wage laws, if applicable, before releasing public funds upon completion of work. This requirement is consistent with the Stadium Authority Board’s March 27, 2019 direction to staff to stop payment of any additional invoices for services unless there is substantial documentation of services rendered which must also be in compliance with State law and City Code.

ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.

FISCAL IMPACT
This service is included in the Stadium Authority FY 2022/23 Operating Budget under the SBL Sales and Services line item. The Stadium Authority’s share of the training is expected to be less than the total amount of $80,000 and there are sufficient funds in the budget to cover this cost.

Should the option(s) to extend the agreement for the two additional one-year periods be exercised, those costs would be subject to future budget appropriations.

COORDINATION
This report has been coordinated with the City’s Purchasing Manager and the Stadium Authority Counsel and Treasurer’s Offices.

PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email [email protected] <mailto:[email protected]> or at the public information desk at any City of Santa Clara public library.

RECOMMENDATION
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22-885 Agenda Date: 7/5/2022
Approve the Stadium Manager’s request to execute a one-year agreement with Tyson Group, LLC in the amount of $80,000 for SBL sales training services, with the option to extend for two additional one-year periods, subject to budget appropriations; authorize the Executive Director to approve the exercise of any option to extend the agreement for up to two additional one-year periods, subject to budget appropriations; and authorize the Executive Director to approve and process the reimbursement of such costs upon receiving final invoices and supporting documentation from the Stadium Manager.

Prepared by: Christine Jung, Assistant to the Executive Director Reviewed by: Rajeev Batra, Executive Director
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City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-891 Agenda Date: 7/5/2022

REPORT TO COUNCIL

SUBJECT
Adoption of Resolutions Calling for a Municipal General Election and Ordering Consolidation with the Gubernatorial General Election for the Purpose of Submitting to the Voters a Business License Tax (BLT) Modernization Measure and Utility Transfer Charter Amendment; Authorizing the City Clerk to Contract with the County of Santa Clara for Services to be Performed in Connection with the Gubernatorial General Election to be Held on November 8, 2022, as well as Directing the City Attorney to Prepare an Impartial Analysis; and Setting Priorities for Ballot Arguments

COUNCIL PILLAR
Deliver and Enhance High-Quality, Efficient Services and Infrastructure

BACKGROUND
The City Council has identified modernization of the City’s employee-based business license tax and an amendment of the Utility Transfer Tax provisions in the City Charter as priorities for voter consideration on the November 2022 General Election Ballot. The Council directed Staff to bring forward a workplan and timeline for successfully placing these measures before the voters. This information was presented and approved by the City Council at the February 8, 2022 Council Priority Setting Session.

On December 7, 2021, the City conducted voter research and community engagement through the City’s professional and public opinion research experts. In January 2022, 600 voters likely to participate in a November 2022 General Election were surveyed on a variety of issues, attitudes, and service priorities, including gauging support for various mechanisms to achieve those goals, inclusive of a Business License Tax Modernization Measure and a Utilities Transfer Tax Charter Amendment. This work was augmented by focus group meetings conducted with local businesses in February 2022. Results of this preliminary voter research and stakeholder outreach were presented to the City Council at the February 2022 Council Priority Setting Session.

At that time, the City Manager advised the City Council that Staff would continue with best practice research and a community engagement process with a goal of bringing forward ballot measure recommendations to the City Council before July 12, 2022, ahead of the August deadline to submit to the County Registrar of Voters.

The purpose of this report is to provide the Council with a summary of the community and stakeholder engagement process completed to date, to share feedback from stakeholders and to bring forward the required resolutions to place two measures on the November 2022 ballot: 1) Modernization of the City’s Business License Tax; and a 2) Utilities Transfer Tax Charter Amendment to update Section 1320 of the City Charter to align the City’s Charter with recent amendments to the California Constitution that requires certain fees and charges by public agencies to be approved by voters. Affirmation of the practice and amendment of the Charter will preserve the City’s long-standing practice of an annual utilities transfer in the amount of approximately $30,000,000 to the City’s General Fund to fund and maintain essential City services.

DISCUSSION
Modernization of the Business License Tax:

All businesses operating within the City of Santa Clara (including those operating in but located outside of Santa Clara), must have a license to transact business or occupy space in the city.

Last updated in 1992, the current employee-based tax rate ranges from a low of $15 for a sole proprietor to a maximum of $500 for businesses that exceed a total of 1,000 employees. With approximately 7,000 current business license City of Santa Clara Printed on 6/30/2022Page 1 of 12
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22-891 Agenda Date: 7/5/2022
holders in the City, the business license tax program generates approximately $900,000 annually to support General Fund programs. This represents about .4% of the City’s total General Fund. While the business license tax has remained unchanged for the past thirty (30) years, without a cost escalator component, the value of that revenue has declined. In comparison, the City is currently projected to receive approximately $9 million in transient occupancy taxes (TOT) from the hospitality industry or 5% of the City’s total General Fund - this is down from $24 million pre-pandemic. The TOT was updated two years ago to reflect current needs.

The City of Santa Clara business license tax structure includes multiple tax categories with varying rates and more than 20 alternative tax rates for businesses such as ambulance services, contractors, theaters, taxi cabs and bowling lanes that have historically been exempt from the employee headcount tax rate. This area has been identified as an opportunity to streamline the administration to create a more equitable, easily understood tax structure.

Another opportunity for ease of administration is consolidating business license tax bills. Currently, each business location is required to obtain a separate business license. As a result, businesses with multiple locations receive multiple tax bills, pay per location and, potentially, at various times throughout the year. The business community has asked the City to explore the feasibility of bill consolidation so that they receive one bill and can pay in one transaction.

Technological advances have given rise to a new phenomenon in the business environment that could not have been envisioned when the business tax program was initially adopted - the remote and/or hybrid work environment that has become a hallmark of the COVID19 business environment. As employers struggle to adapt to this evolving shift in the workplace, it becomes increasingly important-and difficult-to properly account for the number of employees that should be factored into the business tax rate calculation. The business community has asked the City to develop simple, objective measures for accounting and reporting purposes that consider the new hybrid work environment when looking to modernize the Business License Tax program.

Over the past 30 years, the business environment in Santa Clara-and the surrounding valley-has changed significantly.

The size and number of businesses located in the City and the number of employees who work in Santa Clara, have increased exponentially. While the $500 cap may have been appropriate in 1992, it is now an equity issue for small businesses who view the disproportionate impact of their fee compared to the fees charged to large businesses.

Moreover, the ability of local businesses to pay what is perceived to be “their fair share” has also changed significantly as local businesses have grown in size and profits.

The following chart illustrates how Santa Clara’s current Business License Tax rate compares to select neighboring cities with employee-based business taxes:

This chart illustrates that Santa Clara’s current tax rate is significantly lower than the market. It is important to note that while the City of Mountain View is on the high end for large businesses, their methodology factors into account one very large employer. In the case of San Jose, the tax is significantly higher for small businesses and considerably lower for large businesses than in the City of Mountain View. This methodology is in direct contrast to the desired values expressed to Staff by the City Council to protect small businesses. While the rate in Sunnyvale is on the low end, Sunnyvale had considered a possible adjustment pre-COVID but has since deferred action on this item. Unlike Santa Clara, however, the Sunnyvale model includes a Consumer Price Index (CPI) adjustment factor.

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Single 5 50 1,000 2,500 5,000
City employee employees employees employees employees employees Mountain $75 $95 $445 $84,195 $271,695 $584 ,1 95
View
San Jose $207 $307 $1,966 $59,544 $159,219 $166,365
Santa Clara $15 $30 -$70 $100-$380 $500 $500 $500
Sunnyva le $41 $69 $694 $13,188 $13,188 $13,188
22-891 Agenda Date: 7/5/2022
It is the opportunity to modernize a tax structure that is difficult to administer, inequitable in its application, and has the potential to realize much-needed revenue to maintain essential City services that has led to the study of a potential November 2022 ballot measure. The following section of this report provides a summary of the voter research and community engagement process that has been utilized in the development of the recommended ballot measure being brought forward in this report for Council’s consideration.

Voter Research and Community Engagement
In December 2021, the City retained the Lew Edwards Group to conduct voter research and community engagement. A survey of 600 likely voters was conducted in January 2022. The results of this preliminary survey indicated that support for a potential modernization measure was as high as 64% for a simple majority requirement measure. .

In directing Staff to proceed with the development of a ballot measure for the modernization of the business license tax, the Council expressed the following values to guide the work:

1. Modernization of Business License Tax should be structured on a progressive employee head count basis

2. The measure should be equitable in design so that all businesses pay their fair share

3. The measure should be business-friendly and mindful of the impact on small businesses; and

4. Staff should work collaboratively with stakeholders in the development of solutions that will address modernization needs and help maintain essential City services Since January, a team comprised of staff from the City Manager’s Office, the Finance Department and the City Attorney’s Office has worked collaboratively with trained community facilitators to design and implement a robust outreach plan. This plan has included:
• Two voter research surveys of likely voters in the November 2022 election • Focus group meetings with local businesses, including data centers • Listening sessions conducted in coordination with the Silicon Valley Chamber of Commerce (1), a listening session with members of City Boards and Commissions (1); and a listening session for the public and local businesses at large
• Two rounds of Council briefings to keep the Council apprised of stakeholder input and timelines
• Best practice research and conversations with outside agencies considering their own business license tax measures
• Meetings with Chamber representatives (3), NAIPO representatives (1) and a consortium of Santa Clara’s largest employers (3)
• Two interviews with San Jose Spotlight and one with the Silicon Valley Business Journal • Invitations to participate in the community engagement process were sent to the approximately 7,000 current business license tax holders As noted in the voter research survey results conducted in January 2022, a solid majority (61%) perceive a need for additional funding for the City.

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22-891 Agenda Date: 7/5/2022
This sentiment was echoed consistently by stakeholders throughout the community engagement process. While the current economic environment presents challenges, stakeholders consistently acknowledged the need to modernize the 1992 business license tax structure to generate revenue and maintain essential City services.

Other consistent themes include:
• Modernization of the BLT should be fair and equitable. A tiered, employee headcount model is preferred. Strong opposition was expressed to a square footage methodology or a methodology that targeted specific industries.
• The BLT should be simple and easy to administer for both the business community and the City
• Adjustments to the tax rate should be reasonable and predictable. • The rate and administration of the BLT should not act as a disincentive for attracting new business or a factor in compelling current businesses to re-locate outside of Santa Clara • The tax rate should objectively account for remote work, allowing for self-reporting but with clear and consistent criteria for defining employee counts • The City should ensure that services are delivered in the most cost-efficient and cost-effective manner
• Modernization should preserve Santa Clara’s business-friendly environment while balancing the need to maintain high-quality, reliable City services.

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Santa Clara Need for Funding Over Time
A solid majority of voters continue to perceive a need for additional funding for the City. ■ Great need ■ Some need ■ Don't know Little need No need 2022 5% 17% 18%
2018 499' 11% 13% 11%
1EMC1
~~
research
Great/ Little/ Net
Some No Need
61% 35% +26
65% 25% +40
22-891 Agenda Date: 7/5/2022
Enclosed as Attachment 1 is a more detailed summary of the feedback that has received throughout the process.

Consistent with Council’s direction, Staff has utilized an approach of “listening sessions” to gather input from all stakeholders (businesses, large and small; community leaders and residents in Santa Clara and those who work in Santa Clara) on which elements of the current BLT program work and which areas needed modernization. Staff evaluated this feedback within the context of the values expressed by Council in directing Staff to evaluate modernization:

1. Modernization of Business License Tax should be structured on a progressive employee head count basis

2. The measure should be equitable in design so that all businesses pay their fair share

3. The measure should be business-friendly and mindful of the impact on small businesses; and

4. Staff should work collaboratively with stakeholders in the development of solutions that will address modernization needs and help maintain essential City services Proposed Elements of a Modernized Business License Tax Program:

Based on this engagement process, Staff is recommending the following elements of a modernized BLT:

1. Adoption of a tiered, employee-based head count model with a base rate of $75 with incremental increases of $15 to $135 per employee or rental unit with larger businesses paying more, up to a maximum cap of $350,000 (approximately 2,800 employees).

2. Inclusion of a CPI adjustment provision to be reviewed annually by the City Council, with a cap of 5%.

3. An exemption to the business license tax for businesses with gross receipts under $5,000 per year.

4. An effective date of no sooner than January 1, 2024

5. Use of $330,000 in settlement funds in the City Manager’s Office budget to help small businesses transition to tax rates in Year 1 of the new program (2024). Businesses with 1 to 4 employees would be eligible to receive a one-time subsidy in the amount of $80.

6. A reduction in the number of alternative tax rates and the elimination of multiple business categories.

7. The adoption of a base rate of $75 for rental units with an additional flat rate of $15 per unit.

8. The adoption of a base rate of $75 for out-of-town businesses with a per-employee tax pro- rated based on the number of days work is performed in the City.

9. The consolidation of business license tax requirements such that licenses are no longer required by site but by tax identification number

10.Use of Employment Development Department definitions related to the proper accounting for remote workers with the delegation of authority to the City Finance Director to develop specific criteria related to compliance with reporting requirements and the authority to make necessary adjustments that reflect accurate employee counts.

The following chart illustrates the application of the proposed schedule on a per employee count basis:

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22-891 Agenda Date: 7/5/2022
This model reflects Council’s direction to assume a progressive per-employee head count basis. It includes consistent incremental increases to ensure equity across the range of businesses.

Using this model, Staff then re-visited comparable tax rates in other jurisdictions and the potential impact on the range of business license taxpayers in Santa Clara. The following two charts illustrate this impact:

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r
Range of
I Employees Business Tax Rate
1-4 $75 plus $15 per employee
5-9 $135 plus $30 per emp loyee over 4
10-19 $285 plus $45 per emp loyee over 9
20-49 $735 plus $60 per emp loyee over 19
50-99 $2,535 plus $75 per emp loyee over 49
100-249 $6,285 plus $90 per employee over 99
250-499 $19,785 plus $105 per emp loyee ove r 249
500-999 $46,035 plus $120 per emp loyee ove r 499
1000+ $106 .035 olus $135 oer emo lovee ove r 999
Chart of Comparable Jurisdictions Utilizing Proposed Tax Rates l iogl1 5 50 1,000 2,500 5,000
Citv 1mglove1 employees employees employees employees employees Mountain $75 $95 $445 $84,195 $271 ,695 $584,195
View
San Jose $207 $307 $1 ,966 $59,544 $159,219 $166,365
Santa Clara $90 $160 $3,510 $107,070 $309,570 $647,070
Sunnyvale $41 $69 $694 $13,188 $13,188 $13,188
Impact Analysis on Current City of Santa Clara Business License Holders Employee Range # of Businesses Est Revenue Avg. Per Business 0-4 3,838 $366,315 $95
5-9 842 $173,820 $206
10-19 559 $268,620 $4,801
20-49 445 $607,635 $1 ,365
50-99 151 $591,135 $3,915
100-249 87 $977,715 $11 ,238
250-499 34 $1,053,945 $30,998
500-999 32 $2,211,720 $69,116
1000+ 15 $3,218,490 $214 ,566
6,003 $9,469,395
22-891 Agenda Date: 7/5/2022
In the first chart, it was clear that the original model-while consistent with Council’s value to protect small businesses-would result in a significant increase for the City’s largest employers, thereby conflicting with the Council’s value to remain business-friendly and not be detrimental to business growth.

With this in mind, Staff met on several occasions with representatives of the City’s largest employers as well as with the Silicon Valley Central Chamber of Commerce. The recommendation from these meetings was that the City should consider a maximum cap on the amount of tax any one employer would pay. The group initially communicated that an increase of 500 times the current rate would be acceptable; however, a rate of 1,000 times would be problematic and would necessitate the need for organized opposition. The group also communicated that a cap would be viewed as recognition by the City of the value added by Santa Clara businesses who contribute in many ways to the well- being of the City and are important partners in the City’s economic recovery.

On June 28, 2022, Staff presented a proposal for a cap of $400,000 which would have maintained Santa Clara’s position in the middle of the market - significantly lower than Mountain View but higher than San Jose, whose methodology again has a much higher impact on small businesses. The group indicated that the proposed cap was higher than anticipated and a request was made for the City to consider a lower cap. When asked by staff if a proposal to meet halfway would be acceptable, the sentiment was that while the preference would be for a cap in the range of $300,000, meeting halfway would not be a deal-breaker. For this reason, given the City’s need to generate as much revenue as possible while maintaining the viability of a potential measure, Staff recommends that a cap of $350,000 per adopted, subject to the annual CPI adjustment.

In the second chart, it is important to note the disproportionate number of small businesses in Santa Clara with 1 to 4 employees. This data helped inform the Staff recommendation to provide a one- time subsidy to these businesses utilizing $330,000 in settlement agreement funds earmarked for small business assistance. This subsidy would be used to help the City’s smallest business owners to transition to a new tax rate with the least amount of impact. Given the 30 years that have passed since the current rates were adopted, a large increase is unavoidable; however, the recommendation to delay implementation for all businesses until 2024 and to offer subsidies for the City’s smallest employers is intended to help mitigate this impact.

Utility Transfer Tax Charter Amendment
In 1951, City of Santa Clara voters approved a City Charter amendment authorizing the partial use of utility rate revenues for City services. It was subsequently amended by the voters in 1980 to increase the transfer percentage from 4.5% to 5%. The current provision allows for a general fund transfer ("GFT") from utilities in "an amount not to exceed 5% of the gross receipts from such utilities” to provide a locally-controlled revenue source to the General Fund. Combined with other sources of revenue (sales tax, property tax, utility users’ tax, etc.), the General Fund is the primary revenue source used to fund essential City services including, but not limited to, police, fire, street repairs, parks, libraries, senior services, and other municipal services.

Subsequent to the adoption of the City’s Charter provision, California voters approved Proposition 218 in 1996 and Proposition 26 in 2010. Both of these propositions amended the California Constitution to provide that certain fees and charges imposed by public agencies must be approved by voters. In general, if a fee or charge for a service exceeds the cost to provide that service, voters City of Santa Clara Printed on 6/30/2022Page 7 of 12
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22-891 Agenda Date: 7/5/2022
must approve the fee or charge. Proposition 218 applies to water service fees, and Proposition 26 applies to electric service.

While these propositions do not directly address utility transfers, out of an abundance of caution and to preserve the City’s long-standing voter approved utility tax transfer to the General Fund in the amount of approximately $30,000,000 annually to support essential City services, Staff has prepared an amendment to Charter Section 1320 to align with the amendments in the California Constitution requiring voter approval. The proposed amendment will not result in any rate increase but will simply reaffirm this community’s desire to continue the transfer of utility revenues to fund essential City services.

Loss of this revenue source would require immediate and significant reductions in the service areas mentioned above. The City is already experiencing a significant structural deficit in amount of approximately $27 million ongoing due to the COVID19 pandemic and failure to reaffirm voter approval for this long-standing practice would be catastrophic.

Proposed Ballot Language
State Elections Code Section 9051 requires that a ballot question not exceed 75 words. The proposed compliant ballot questions are as follows:

City of Santa Clara Business License Update / Tax Equity Measure “To protect Santa Clara’s financial stability and maintain essential services such as 911 emergency/public safety/crime reduction services, safe/clean public areas, pothole repair, parks and libraries, shall an ordinance to update Santa Clara’s 1992 business license tax to $75, increasing incrementally between $15 to $135 per employee or rental unit, with larger businesses paying more, generating approximately $9,000,000 annually until ended by voters with independent financial audits, all funds staying local, be adopted?” The revenue projection in the proposed ballot language is based recent business license tax data which includes self- reported employee counts. Because the accuracy of the information could not be verified, the actual amount of revenue will differ.

Utility Transfer Charter Amendment
“City of Santa Clara No Tax Increase/ Services Protection Measure. To protect essential services without raising taxes, such as 9-1-1 response; police patrols, fire protection; street/storm drain repair, and maintaining reliable local utility service; shall Section 1320 of the Charter continuing the annual budget transfer of funds from City utilities to the general fund at 5% of gross receipts until ended by voters, generating approximately $30,000,000 annually, with independent audits, all funds local, be reaffirmed/adopted?” The revenue projection in the proposed ballot language is based on recent revenue projections. The actual amount of revenue may differ.

Next Steps
To place an item before the voters, the Council must adopt a resolution. The attached draft resolutions call for the following:

1. Approval of the ballot language to be presented to the voters of the City of Santa Clara;

2. A Special Election to be held on November 8, 2022 and requesting consolidation with the Gubernatorial General Election and the services of the Registrar of Voters to conduct the election;

3. Direction to the City Attorney to prepare an impartial analysis for the measure;

4. Direction on ballot arguments to the City Clerk to be printed in the Sample Ballot; and

5. Approval of a draft amendment to the City Charter or Municipal Code, as applicable, to incorporate the proposed City of Santa Clara Printed on 6/30/2022Page 8 of 12
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22-891 Agenda Date: 7/5/2022
changes if the voters approve the measures.

Calling of an Election
As required by the State Elections Code, the City Council must adopt a resolution calling an election, requesting consolidation with the Gubernatorial General Election and request the County Registrar of Voters to provide election services. The attached resolution meets those requirements.

Impartial Analysis by the City Attorney
The State Elections Code Section 9280 authorizes the Council to direct the City Attorney to prepare an impartial analysis of the measure. The authorization is included in the attached resolution.

Ballot Argument Process
State Elections Code Section 9282(b) provides for the filing of ballot measure arguments by the following: City Council or any member(s) of the Council authorized by the Council, any individual voter eligible to vote on the measure, bona fide association of citizens or any combination of voters and associations.

The City Council determines whether the Council or members of the Council authorized by the Council will draft the argument supporting the ballot measure or whether it will, instead, allow a third party to do so. The City Charter and the California Elections Code authorize, but do not require, the City Council to write the argument in support of the ballot measure. If the City Council chooses to write the ballot argument, it should designate a maximum of three Council members to draft the argument. These designees would prepare and sign the argument and submit it to the City Clerk.

Alternatively, the Council may designate the Mayor to sign on behalf of the entire Council. A total of five individuals and/or organizations may sign the ballot argument and the Council may designate which individuals or organization fill any available signature slots. If the City Council decides not to draft the argument itself, any registered voter or bona fide association of citizens may submit a proposed argument to the City Clerk. If the City Clerk receives multiple proposed arguments, the City Clerk shall select one of the arguments in adherence to Elections Code Section 9287.

The City’s ballot measure resolution must be received by the Registrar of Voters between July 28 - August 12th; with arguments due by August 16th; and rebuttal arguments and impartial analysis due on August 23rd.  In order to meet these deadlines, the resolution is being brought forward for Council action on the July 5, 2022 agenda to allow for the required 14-day public comment period for arguments and the 10-day public comment period for rebuttals that must be completed before submission of the required documents to the County Registrar of Voters. As such, in accordance with Elections Code Section 9285(a) the City Clerk as the local Elections Official has set the following deadlines:  adoption of the ballot resolution on July 5, 2022; arguments due by 5:00 p.m. to the City Clerk’s office on July 19, 2022; rebuttals due by 5:00 p.m. to the City Clerk’s office on July 29, 2022. The City Attorney shall draft an impartial analysis on the measure, which is also due on Friday, July 29, 2022.

Draft Amendment to the Santa Clara City Charter Section The proposed ballot measures require an amendment to the City of Santa Clara City Charter Section 1320 and voter approval. There is no tax increase on taxes. The Amendment would not take effect, unless and until, approved by a vote of at least 50% plus one of the voters voting on the questions at the election.

The proposed amendment is as follows (with deletions shown in strikethrough):

Charter Section Sec. 1320 Utilities fund.

Receipts from the utilities operated by the City shall be paid into the City Treasury and maintained in a separate utilities fund for such utilities.

Expenditures from such fund shall be made for the following purposes only for such utilities in the order named, viz.:
(a) For the payment of operating expenses, pension charges and proportionate payments to such compensation and other insurance and accident reserve funds as the City or the City Council may establish; (b) For repairs and maintenance;
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(c) For the payment of interest and sinking funds on bonds issued for acquisition, construction or extensions;
(d) For the payment of not to exceed five percent of the gross receipts from such utilities to the general fund of the City in payment for services rendered; subject, however, to such limitations as may be contained in any resolution or indenture heretofore adopted providing for the issuance of revenue bonds for the acquisition, construction or improvement of such utilities, which bonds are now outstanding or may hereafter be issued under such existing resolution or indenture; (e) For extensions and improvements;
(f) For the establishment of a sinking fund within the utilities fund for the replacement of utilities property in the minimum amount of two million five hundred thousand dollars ($2,500,000.00).

The City Council shall cause records to be kept of the receipts and expenditures of each utility and of credits and debits of each utility in the aforementioned utilities fund. The City Council may, however, order expenditures from the utilities fund for any utility even though that utility has no credit in the utilities fund, provided only that the balance in the utilities fund is greater than the proposed expenditure.

Draft Amendment to the Santa Clara Municipal Code Chapter 3.40 The proposed increase to the Business License Tax requires an amendment to the City of Santa Clara Municipal Code and voter approval. The rate change would not take effect unless and until approved by a vote of at least 50% plus one of the voters voting on the questions at the election. The proposed ordinance will repeal the existing Chapter 3.40 and replace it with the proposed ordinance, which can be reviewed in Attachment 3.

Election Timing
To place a measure on the November 8, 2022 ballot, the Registrar of Voter’s deadline is August 12, 2022. This item is being considered on July 5, 2022 to allow sufficient time for arguments, rebuttals and preparation of the impartial analysis.

Community Outreach
Should the Council submit a ballot measure for the November 8, 2022 general election, a communications plan will be implemented using the City’s many public education channels including, but not limited to:
• City website
• Email campaign via GovDelivery
• Social media (Facebook, Twitter, Next Door, etc.)
• Government Access Channels
• City digital newsletters (i.e. City Hall News, Library, Senior Center) • News Releases
• Ads in local and ethnic media outlets
• Direct mailers to Santa Clara likely voters
• Utility Bill Inserts
• Educational videos like those used in the Prioritize Santa Clara Transit Occupancy Tax campaign • Digital billboards
• Informational flyers available at City-owned public facilities City of Santa Clara Printed on 6/30/2022Page 10 of 12
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22-891 Agenda Date: 7/5/2022
Conclusion
The City anticipates a FY 2022/23 budget deficit in excess of $27 million dollars ongoing. Should the Council wish to place both, or either measure, on the November 8, 2022 General Municipal Election, appropriate documentation supporting formal action by the Council must be received by the Santa Clara County Registrar of Voters no later than August 12, 2022. The purpose of this report is to seek Council direction on the placement of two ballot measures on the November 8, 2022 ballot.

ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA guidelines section 15378(b)(5) in that it is a governmental organization or administrative activity that will not result in direct or indirect changes in the environment.

FISCAL IMPACT
Additional ongoing revenues of approximately $8 million is projected from a successful passage of the proposed Business License Tax Ballot Measure, effective January 1, 2024. With the passage of the Utilities Transfer Charter Amendment, $30 million in existing transfers would continue.

The FY2022/23 Adopted Budget includes $350,000 to cover election costs and existing funding to conduct basic education and voter outreach. Actual costs will be determined by the County Registrar of Voters based on the number of ballots and the actual printing costs allocated to the City of Santa Clara. A future budget amendment may be brought forward at a later date if required.

COORDINATION
This report has been coordinated with the City Manager’s Office, the Finance Department and City Attorney’s Office.

ALTERNATIVES

1. Adopt a resolution ordering submission of a ballot measure to the qualified electors of the City; calling for a Special Municipal Election to be held in the City of Santa Clara on Tuesday, November 8, 2022, for the purpose of submitting to City voters a measure modernizing the City’s Business License Tax; requesting consolidation with the Gubernatorial General Election and election services from Santa Clara County; directing the City Attorney to prepare an impartial analysis; setting priorities for ballot arguments; and approval of the draft amendment to the Santa Clara City Code to incorporate the proposed changes if the measure is approved by the voters.

2. Adopt a resolution ordering submission of a ballot measure to the qualified electors of the City; calling for a Special Municipal Election to be held in the City of Santa Clara on Tuesday, November 8, 2022, for the purpose of submitting to City voters a measure to amend the City’s Charter regarding Utility Transfers; requesting consolidation with the Gubernatorial General Election and election services from Santa Clara County; directing the City Attorney to prepare an impartial analysis; setting priorities for ballot arguments; and approval of the draft amendment to the Santa Clara City Code to incorporate the proposed changes if the measure is approved by the voters.

3. Other direction as approved by the City Council

RECOMMENDATION
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22-891 Agenda Date: 7/5/2022

Reviewed by: Cynthia Bojorquez, Assistant City Manager
Approved by: Rajeev Batra, City Manager

ATTACHMENTS

1. Summary of Community Engagement Process Input

2. Resolution Placing Business License Tax on November 2022 Ballot

3. Resolution Placing Utility Transfer on November 2022 Ballot City of Santa Clara Printed on 6/30/2022Page 12 of 12
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May 26, 2022
To: Cynthia Bojorquez,
Assistant City Manager
City of S_anta Clara
Fr: Shawn Spano,
C ~ Public Djalogue
~ Consortium
Public Dialogue Consortium
Re: Report on Community Engagement Listening Sessions
Background
This report summarizes the work that the Public Dialogue Consortium (PDC) completed in eliciting input and feedback from members of the business community and the community at large on Santa Clara
1 s Fiscal Sustainability Strategies and the potential Modernization of the Business License Tax (BLT).

Outreach
Staff conducted extensive outreach to business groups, employers, and community groups, organizations, and individuals to invite participants to the Listening Sessions. Multiple platforms were utilized, including targeted outreach to the 8,500 registered businesses in the City and the City1s Commission and Board members. Staff also worked closely with the Chamber of Commerce to conduct a Listening Session devoted specifically to their members, with the Chamber taking the lead on extending the invitations and securing the location.

Four Listening Sessions were conducted between February and May 2022 with 40 participants total:
• February 3 - for the business community and community at-large (6 participants) • May 5 - for Chamber of Commerce members (7 participants) • May 12 - for City Commission and Board members (12 participants) • May 19 - for the business community and community at-large (15 participants) Listening Session Format
The February 3 and May 5 sessions were designed specifically to elicit input on the Modernization of the Business License Tax. While information about the City1s budget and fiscal sustainability efforts were presented, participants were asked to share their views of the BLT and their preferences for how it should be structured.

In addition to feedback on the BLT, participants at the May 12 and May 19 sessions were also asked to provide feedback on the City1s Fiscal Sustainability efforts and to identify the City 1 service and program priorities that are most important to them and their groups or organizations.

The focus group format was similar for all four of the Listening Sessions. The PDC facilitator welcomed the participants, previewed the session purposes and agenda, and asked participants to provide brief self introductions. Kenn Lee, City Finance Director, then presented information on the City's fiscal condition, the budget-balancing actions taken to date, and the Modernization of the BLT. The presentation for the February 3 and May 5 sessions differed slightly from the one presented at the May 12 and May 19 sessions to reflect the broader scope of the topics covered. Following the presentation, participants engaged in facilitated discussion and dialogue in .order to provide their input and feedback.

Results and Summary Themes
Overall, Listening Session participants expressed the view that a modernized BLT is either desirable for Santa Clara or is moderately or minimally acceptable. The different positions expressed were dependent on the underlying values guiding the BLT, how it will be structured, and the other fiscal sustainability and cost-saving efforts the City pursues.

1. Key values that should guide modernization of the BLT:
• It should be fair and equitable for all businesses, accounting for the range of different types of businesses in the City (e.g. large vs. small, self employed, etc.) • It should simple and easy to administer for the both the business and the City • It should take into account changes in the work environment from COVID (virtual and remote work vs. in-person)
• The rate and administration of the BLT should not be a disincentive for attracting new business to the City, or a factor compelling current businesses to re-locate outside of Santa Clara

2. How the BLT should be structured:
• A tiered, employee head count is preferred
• The current $500 cap on employees is not seen as fair, with large businesses being given an advantage over small businesses
• Basing the tax on gross receipts is not seen as fair and can be a disincentive for business growth
• There needs to be a fair and accurate way define and measure square footage • Consider how to tax remote/virtual and hybrid employees

3. The need to seek creative solutions and alternative sources of revenue:
• Encourage retail and implement a vacant space ax
• Add a utility tax for Data Centers
• Allow for Cannabis Dispensaries
• Increase fees to ensure cost recovery

4. Ensure City services and programs are delivered efficiently and effectively:
2 • Prioritize services in order to ensure that essential services are sufficiently resourced • Ensure that services are being delivered in the most cost-efficient and cost-effective way possible
• Focus on maintaining services rather than expanding them during times of budget shortfalls
• Public Safety and Libraries are priority City services 3 June 18, 2022
Dear Mayor and Council,
The Silicon Valley Central Chamber of Commerce (SVC Chamber) opposes anv dramatic increase in the Business License Tax, such as the nearly 700% increase that is being proposed. Similarly, we onpose any harmful tax on small and medium-sized businesses.

Working Together:

The SVC Chamber has appreciated the opportunity to work with the City of Santa Clara this year as we evaluate the impact of new taxes or increased fees on our members and the business community in general. We met with City staff at the SVC Chamber office on April 8 and co-hosted a focus group at Roche Diagnostics on May 5 for our members and others in the business community.

In anticipation of your discussion of potential business taxes at your next City Council meeting, we would like to provide you with additional recommendations from the business community.

Business License Tax:

The SVC Chamber can be supportive of increasing and updating the City of Santa Clara's Business License Tax, which has not been changed for decades. However, such increases and updates should be modest and reasonable.

The following are modest and reasonable elements the SVC Chamber would support:
•
•
•
Reasonable Increase:

City staff has suggested one scenario that would result in an almost seven-fold increase in the Business License Tax. During these uncertain times, when we have rising interest rates and many of our businesses find it challenging to recruit and retain employees, that dramatic of an increase for our local businesses is potentially devastating. We could be supportive of a smaller overall increase that no more than doubles the current total revenue collected from the current Business License Tax.

Employer Cap:

We support a cap on the total tax that any one employer would pay. To be competitive with other local cities, we suggest that the cap be substantially lower than the County average so the City of Santa Clara can be competitive and remain a business-friendly city.

Inflation Index and Cap:

It is appropriate to increase the tax incrementally each year indexed to the rate of inflation.

That would be helpful to the City while providing businesses certainty and predictability.

Should indexing be adopted, it is critical to cap the index rate as well below 5.0%. High inflation creates problems for many businesses, as we see in the economy today. Our local businesses should not be subjected to extra financial burdens in the future from City Hall due to dramatic increases in Business License Taxes caused by high inflation. fin"#Da 3350 Scott Blvd., Bid. 54 (408) 244-8244
@SVCchamber Santa Clara, CA 95054 www.SVCentralChamber.com Additional Revenue:

The City could use more reserves or "rainy day" funds to help balance its budget. Clearly, we are all suffering from an uncertain economy with supply chain problems, high fuel costs, rising inflation, greater borrowing costs, and the difficulties in recruiting and retaining employees. This is the definition of a "rainy day." However, we are optimistic that our economic challenges will be temporary. Furthermore, with the numerous major developments talcing place in the City of Santa Clara, we believe that increased economic activity will generate additional tax revenues in the not-too-distant future.

Therefore, we request that you use "rainy day" funds to plug what is likely to be a short-term financial challenge. This is much preferred over dramatically raising business taxes which may likely force Santa Clara employers to look elsewhere for expansion or relocation opportunities. That reaction would have a potential long-term negative impact on our city.

Employee Head Tax:

We are opposed to an employee head tax because we think it will have a detrimental effect on economic development and hurt the City of Santa Clara's reputation for being a business-friendly city. A head tax is also difficult to administer and monitor; especially when many companies are allowing their employees to work remotely.

The current Business License Tax accounts for the varying size of City of Santa Clara employers by defining employee headcount within range categories. Updating the Business License Tax along similar lines is a more sensible approach that is administratively easier for both city government and employers.

Conclusion:

Finally, the SVC Chamber is willing to continue to work with the City before something is put on the November 2022 ballot. If we can come to an agreement sometime during the month of July to meet the ballot deadline, we would consider supporting a measure that meets the criteria as stated herein.

Conversely, if we believe a ballot proposition is harmful to local businesses, and ultimately the City of Santa Clara, we must oppose it while encouraging others to do so as well. fin tJJ Ca
@SVCchamber
Respectfully,
.~
Christian D. Malesic, MBA, CAE, cMP, roM
President / CEO
3350 Scott Blvd., Bid. 54 (408) 244-8244
Santa Clara, CA 95054 www.SVCentralChambM r:om
Cynthia Bojorquez
From: [email protected]
Sent: Thursday, June 9, 2022 10:43 AM
Cynthia Bojorquez; Kenn Lee To:

Cc: [email protected]; [email protected]; [email protected]; [email protected]; [email protected]
Subject: Follow-up on BLT Discussion
Dear Cynthia and Kenn:

Thanks for making the time to meet with us on Tuesday. We appreciate you previewing some of the City's thinking about a new Business License Tax and listening to our comments.

We echo the direction you received from Council that a new tax should be equitable, business-friendly, and mindful of the impact to small businesses-and that the City should work collaboratively on the new BLT. As we mentioned during our meeting, we believe we can work with the City to arrive at a modernized BLT that meets the needs of the City and of employers.

To recap a few of the key points we made during our discussion:

1. The goal should be to have a simple counting mechanism that is easy to administer by both the City and the companies.
a. It needs to correctly capture the number of our employees who actually work in Santa Clara (and not the ones who work in neighboring Silicon Valley cities, or out of the area, who are taxed at those locations).
b. We aren't certain that "EDD data" will do this efficiently. c. Perhaps the City would be open to "self-reporting" by companies with multiple locations throughout Silicon Valley.
d. Need to consider hybrid workers and remote workers who only come to campus a few times a month (acting more like business travelers)

2. We urge the City to consider a 'max cap' like San Jose so that companies that plant their roots in Santa Clara believe they can also grow in Santa Clara and will continue to be welcomed. a. It appeared in our discussion that staff was thinking about a cap somewhere around the 2,500-employee mark in your two options.
b. A cap at that level would represent a S00x increase in BLT ~pretty substantial.

3. For competitiveness reasons, we would urge the City not to make Santa Clara the "business tax leader" for Silicon Valley-it's important to consider the modernization of the BLT in the context of what neighboring cities, like San Jose, are charging while still addressing the structural deficits in the City's budget.

Again, we hope you found the conversation useful. Please do continue to share with us your ideas as they come into clearer focus.

Thanks.

Joe Pon I APPLIED MATERIALS
Erika Edgerly I INTEL
1 Ned Finkle I NVIDIA
The content of this message is APPLIED MATERIALS CONFIDENTIAL. If you are not the intended recipient, please notify me, delete this email and do not use or distribute this email. 2 Santa Clara Listening Session
Meeting Notes
May 19, 2022
Participants
Edesa Bitbadal - Consultant for the data centers
CF - resident
Brenda Craig - Business Licensing, City of Santa Barbara Kristine Evon - resident
Mark Gilley - DEi Task Force, City of Santa Clara
Jan Hintermeister - resident
Stanley King - resident
Alexander Moore - business owner
Teresa O'Neill - Silicon Valley Chamber of Commerce
Peter Tran - resident
Linda Zazzara - resident
City Council
Suds Jain - Vice Mayor, City of Santa Clara
Kathy Wantanabe - Council Member, City of Santa Clara
Staff
Cynthia Bojorquez - Assistant City Manager
Kenn Lee - Director of Finance
Maria Le - Communications & Outreach Manager
Fiscal Sustainability Presentation
Ken Lee, Director of Finance
Main Themes of Participant Questions and Comments
■ Business license tax modernization is desirable for Santa Clara ■ Focus on maintaining services rather than expanding them during times of budget shortfalls ■ Consider other revenue streams to cover the deficit, as well as other ways to calculate the BLT such as square footage
■ Set the BLT rate to be equal to or competitive with surrounding cities in order to keep businesses in Santa Clara
Participant Questions and Comments
■ What is the definition of essential services?
o A: Residents were recently polled to inform service priorities. A few years ago the City Manager's office conducted a similar survey.
■ Santa Clara is an outlier and we need adjustments to support our infrastructure.

Maintenance should be the focus during tight budget times, rather than looking to expand services.
1 ■ Shopping local is something we can do as residents to support our businesses and city. ■ Parks and recreation opportunities are important to our city. ■ A modernized business license tax seems like a good idea, Ken has made a strong argument in support of it. Years ago we had a development fee for parks and I remember feeling shocked that cities all around us were charging use fees for parks and we were not. I have the same reaction to learning that cities around us are collecting much high revenues via a BLT than Santa Clara is. It seems to make sense for our city. ■ Santa Clara has relied on a robust business community and we have kept fees very low. A problem I see is fees and taxes were put in place without a CPI to increase with inflation.

Most business owners see a CPI as reasonable, adjusting with the cost of living. We need to ensure we are recovering full costs for the services we provide as not all of our shortfall can be covered with a BLT.
■ We need to consider an employee count tax carefully, as well as how we define employees considering remote and hybrid workers. How do we ensure we do not impact small businesses disproportionately? Should we consider a square footage fee instead? ■ Has the city considered a BLT based on square footage rather than ee count? o A: Yes, we have looked at it. Our focus is on employee count for a few reasons 1} the ease of understanding the tax; 2) changing our current methodology changes would require transition and outreach that increase short term costs and would need to be explained to voters; 3} neighboring cities that are based on square footage have a few large resident businesses with a lot of office space. ■ If we were to double everyone's current tax it would only result in an additional $900K in the face of a $20M deficit. It seems we need to look at other revenue streams to cover the deficit.
■ Staff is doing a great job, Santa Clara is doing better than neighboring cities by bringing people into the process. Process is important, Santa Clara is listening to community members rather than leading the community to an end.
■ A square footage tax is much more complex and can create an accounting nightmare for staff and businesses. Head count tax in general is much easier to calculate and administer. ■ Look at other cities to see what they are charging and do not go above and beyond this so that you keep businesses in your city. Include a cap so businesses can forecast what their expenses will be.
■ I work for large employers who when faced with additional taxes based on an employee count, their answer is to move out of the state. When adding taxes to facilities, I do not hear that as much.
■ Has anyone reached out to various business tiers to ask for their opinion on the BLT? o A: Yes, staff has worked hard to engage with all levels of businesses in the community. Staff has gone out to various businesses and advisory committees to hear from as many stakeholders as possible. If there are additional businesses or groups to engage, please let us know.
■ I am concerned that you are not hearing from small businesses and English as a second language employers. I want to make sure all businesses in Santa Clara have the opportunity to engage.
o A: Good feedback, we can look at translating some of our materials. 2 o A: We have had three listening sessions {one organized by the Chamber of Commerce), we have also sent mailers out to all those who currently hold a business license tax to invite them to participate in the listening sessions and survey. This went out to 8500 businesses.
■ In Santa Clara, business license are budgeted at merely 0.4% of the general fund. How does this compare to the neighboring cities?
o A: We are near the bottom when compared to other cities, others are closer to 2.5% for neighboring cities up to 15% for San Francisco.
3 Santa Clara Listening Session
Meeting Notes
May 12, 2022
Participants
Debbie Tryforos - Library Board of Trustees
Kim Messmer - resident
Stan Messmer - resident
Patricia Leung - Historical Landmarks Commission Chair
Diana Torres - 49ers
Nancy Toledo - volunteer, resident
Rob Mayer - resident, architect, former planning commissioner Adam Thompson - lifelong resident
Wanda Buck - Senior Advisory Commission for Santa Clara, resident Mario Bouza - resident
Jonathon E - Library Board of Trustees
Art B - resident
Staff
Cynthia Bojorquez, City Manager
Kenn Lee, Director of Finance
Maria Le, Communications & Outreach Manager
Fiscal Sustainability Presentation
Ken Lee, Director of Finance
Key Themes from Participant Questions and Comments
■ A modernized BLT is viable and should be applied in a way that is equitable and does not negatively impact small businesses.
· - Encourage desirable retail to locate in Santa Clara to draw more sales tax revenue - Consider how to tax remote and hybrid employees
- Consider raising the cap of $500 to capture more revenue from large businesses ■ City Departments should look internally to:
- Prioritiz~ services
- Ensure that services are being delivered in the most cost-efficient and cost-effective way possible
■ There is a need for creative solutions and alternative sources of revenue. - Encourage Retail and Implement a Vacant Space Tax
- Add a Utility Tax for Data Centers
- Allow for Cannabis Dispensaries
- Increase fees to ensure cost recovery
■ Public Safety and Libraries are priority services.
1 Participant Questions and Comments
- Q: Taxes and business licenses seem like two different things. What do you mean by a business license tax?
o A: They are one in the same in this case.
- Timing is problematic right now. Everyone needs money right now to keep up with expenses and costs. It is a better strategy to cut costs rather than trying to raise costs and revenues.
- Keep safety at the forefront of service and budget priorities, but maybe we need to defer some of the upkeep of our city.
- I do not understand with property values increasing how this is not an increased source of revenue.
o A: We are receiving more property taxes, however there is a 2% cap on the growth - I am a sole proprietor who works out of my house, I have projects in many nearby cities. I am required to purchase business licenses for each city I do projects in, which is starting to add up and become onerous as I do not even visit the cities I do project in. It feels like I am being pecked to death. It doesn't seem right that I pay as much as those who operate their businesses full time in a city.
- I agree with the approach to cut the budget and salaries to stay within our budget rather than raise business taxes, I know this is a delicate issue. - In Sunnyvale they train first responders to respond as both police and fire needs. I am unsure if this would work, but it is a creative solution. - Are other cities with more vibrant downtowns experiencing the same budget shortfalls? I work on the downtown commission and have been working for decades on revitalizing our downtown. I think vital town centers attract more people and revenue. o Neighboring cities with more vitalized downtowns are also facing deficits - What is the percentage of TOT tax that funds Santa Clara? o It used to be 20% of total revenues, at the worst part of the pandemic it was down 90%, it is still down 60% or so.
- For years I was an independent photographer working out of my home, I am concerned about the business license tax impact on small businesses. It is hard for a small sole proprietor who doesn't make much income to increase their business license tax. At the same time, a cap of $500 seems quite low for large companies and businesses who use a lot more infrastructure than someone like me who is a small business owner with just me. - I have lived here for over 20 years, I understand we need revenues. I see former commercial properties along El Camino turning into residential units. It doesn't make sense to me that large residential rental building are taking over the commercial zone. - It is going to take more than a small increase in the BLT to cover the deficit as the TOT revenues are not going to come back. Business travel will never rebound to what it was before.
- Levi Stadium is the biggest problem and drain on our city. It sits there empty most days of the year and drains our revenues. We are stuck with this stadium, and we need to generate more revenue out of this rather than out of small businesses. 2 - We need to look at this in a multipronged way. I do not agree with cost recovery methods of increasing fees for developers as this encourages people to build without permits. This is a recent and real problem we are addressing.
- I disagree that business travel will not rebound as both my husband and I are having to travel again for work. Our travel budget within my company has increased, some of it is last minute and therefore we pay the highest prices. We are encouraged to be working together face to face again.
- I am interested in the unfunded projects, we have many projects no being considered {Morse Mansion, Berryessa Adobe Building - a heritage building). We can only defer maintenance so much.
- Because we fund police and fire with a majority of our budget, we should be looking for more creative solutions in this part of our budget.
- Q: Are we thinking to tax total employees? What about remote employees? Would it be just those working locally or all?
o A: Working remotely is a new trend, some cities are looking at EDD and payroll data.

This could be a potential for us to explore more.
o I work in HR and deal with payroll and we are looking at a person's residential address if they are a remote worker to "tag" them for payroll. - How do we sustainably update the BLT for inflation? We can look at taxing different entity types in different ways (sole proprietors vs corporations}, and doing a sliding scale based on revenues.
o A: Other cities have a CPI that adjusts with inflation. We do not currently have this in place, so the revenues are still at the same levels they were 30 years ago. - We have not addressed our BLT for a long time. It seems like you are pushing the BLT really hard right now. We need a balance, how much does it cost for what we are getting? The police have military grade equipment that is extremely costly. We need to look at purchases we have made and continue to make to ensure we get real value for our tax dollars.
- We also need to be creative about our revenue streams. Right now we need to maximize the value of what we have in place, like Measure J (which I opposed). Creative solution I have are:
o The swim center used to host international events, the BMX track can host regional and national events. These are the programs we need to nurture to draw people and revenue to our city. We are removing commercial property in favor of housing, taking away these potential revenue streams.
o We need a scale and equitable tax that does not tax small businesses into oblivion.

Have you done a study to see what the revenues of a BLT would be versus potentially lost revenues if people move? Taxing the largest businesses makes the most sense.
o I like the idea of a utility tax on the data centers. They provide a great service, but they take up a lot of land and do not provide a lot of jobs. Santa Clara has made a huge investment in our public utility; this is an asset we need to capitalize on. o We need to do a scaled parcel tax for largest parcels, and look at land lease taxes. 3 o Unoccupied tax is another option. Large developments need to include retail in their housing structures. Empty housing and commercial spaces should be taxed. o Look inward, manage budgets, make cuts.
- It's about time we modernize our BLT, I have been in business here since 1975. Out BLT is the lowest in the area and needs to be brought up to date. - We should tax the data centers and all of the space they are using while they do not generate jobs.
- It is important to maintain our infrastructure, as well as law and order with our police and fire.
- These things will all generate revenues for our city:
o Property taxes will continue to increase
o The small businesses generate sales taxes for our city o The old downtown will never be like it was, I see the future being around the new development around Levi Stadium
o Travel is also coming back, so will TOT
- Things will recover, I do agree we need to modernize our BLT. - We need to become more competitive with our BLT, I do not think companies will leave te area with the increases you are proposing.
- There are areas of revenue we have not tapped into yet:
o Why are restaurants closing and no businesses want to move here? We don't have good restaurants here anymore.
o Marijuana dispensaries are profitable, why don't we tap into this source of revenue? - A BLT is a start, I like the idea of a vacant retail tax as well. There is an incentive for commercial properties to be retail oriented and defer leases for financing reasons rather than starting leases as soon as they can.
- I like the other creative funding ideas being proposed, like dispensaries. We have dispensaries bordering our city as so will suffer if they do bring in additional crime, but we cannot capitalize on this.
- The BLT is a good idea, we just need to ensure we do not squash the smaller businesses as we implement this.
- I also agree that we need to look at the revenues generated by dispensaries. We are naive to think that this is going to generate more problems than revenues. - I also want to agree with allowing dispensaries as a revenue source for our city. This is a major oversight we are losing revenues from.
- The retail vacancy tax is a great idea. I agree with this as well. There is too much economic incentive for builders to not rent these spaces.
- Permitting fees are getting too high, this does create disincentive for people to get permits. - I am also in favor of taxing vacant retail spaces as we need to encourage good retail in our community and disincentivize developers to keep places vacant. - It is unreasonable to think that the stretch of El Camino can stay commercial, it makes sense to add residential hubs close to transportation and services. We just need to encourage good retail to go with it.
- I also like the idea of a data center tax.
4 - Q: Do we have incentives in place to encourage businesses to open in certain areas? Do we have mechanisms to attract to specific zones?
o A: No, this is an interesting idea.
- Q: Is there a quantity of initiatives the city can put on the ballot? Are there costs associated? What if we put a few initiatives on the ballot rather than try to package them together? We do need to pass revenue initiatives.
o A: If you put too many initiatives on a ballot at once, it can split the vote and decrease the likeliness of any of them passing.
5 CHAMBER LETTERHEAD
April 29th, 2022
Cynthia Bojorquez
Assistant City Manager
City of Santa Clara
1500 Warburton Avenue
Santa Clara, CA 95050
Dear Cynthia,
We appreciate the time you and your colleagues took to share with us the City's process to place a business tax on the ballot during a meeting at the Silicon Valley Central Chamber of Commerce on April 8, 2022.

The Chamber will continue to work cooperatively with you as we evaluate the impact of new taxes or increased fees on our members and the business community in general.

With that goal in mind, we will host a focus group on May 5 at Roche for your members and other Santa Clara businesses to attend. Our Chamber Board Chair Christian Pellecchia will attend to communicate our position and answer questions as well if necessary.

To summarize some of the highlights from our April 8 meeting, we ask the following of City staff:
• Communicate the complete financial impact that businesses have in Santa Clara rather than narrowly focusing on the revenue from the business license tax. As you know, businesses pay a substantial amount of taxes in Santa Clara. In fact, almost 40 percent of the sales tax is generated by business-to-business sales according to the City's data.

T.hat's about $24 million per year from just Santa Clara businesses. • Communicate how our Chamber helped you raise revenues in the past by supporting the ballot proposition to raise the transient occupancy tax. • Evaluate the potential impact of losing businesses if Santa Clara is considered unfriendly to future business growth.
• Evaluate how businesses, especially small and medium-sized ones, would be impacted by a substantial and sudden increase in the business tax or other fees particularly if it's a 600+ percent increase like one of the options currently being discussed. • Include in your evaluation the amount of potential revenue from new business and development that is projected to happen in Santa Clara, like the Related project, and the possible new developments from the specific plans.
• Include in your evaluation the size of City reserves and the rationale for not reducing them to accommodate "a rainy day" which we believe is a fair way to characterize the economy today considering the great amount of uncertainty.

Thank you again for working with us on this important issue. We look forward to keeping Santa Clara a business-friendly city.

Sincerely,
Christian Pellecchia
Board Chair
Cc: Kenn Lee, Director of Finance
Maria Le, Communications and Outreach Manager
Resolution/Notice of Intention
Rev: 11/22/17

Page 5 of 5 ends

RESOLUTION NO.

A RESOLUTION OF THE CITY OF SANTA CLARA, CALIFORNIA

ORDERING THE SUBMISSION OF A BALLOT MEASURE TO

THE QUALIFIED ELECTORS OF THE CITY AT A SPECIAL
MUNICIPAL ELECTION TO BE HELD ON NOVEMBER 8, 2022,
REGARDING A BALLOT MEASURE KNOWN AS THE ‘CITY OF

SANTA CLARA NO TAX INCREASE/ SERVICES PROTECTION
MEASURE’ — THAT, IF PASSED, WOULD AMEND SECTION
1320 OF THE SANTA CLARA CITY CHARTER; CALLING AND

GIVING NOTICE OF A SPECIAL MUNICIPAL ELECTION TO BE

HELD IN THE CITY OF SANTA CLARA ON TUESDAY,
NOVEMBER 8, 2022, FOR A VOTE ON SAID BALLOT
MEASURE; REQUESTING CONSOLIDATION WITH THE

GUBERNATORIAL GENERAL ELECTION AND ELECTION
SERVICES FROM SANTA CLARA COUNTY; DIRECTING THE
CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS;

AND SETTING PRIORITIES FOR BALLOT ARGUMENTS

BE IT RESOLVED BY THE CITY OF SANTA CLARA AS FOLLOWS:

WHEREAS, City of Santa Clara wishes to maintain critical services that address our community’s urgent priorities such as public safety, clean and safe streets, COVID-19 response, street and sidewalk repair, and flood protection;
WHEREAS, the measure as written would enact an administrative change that allows the city to retain community priorities without increasing taxes;
WHEREAS, By law this measure will require audits and oversight. All funds must be spent locally and cannot be taken by the state;
WHEREAS, the next Gubernatorial General Election will be held November 8, 2022; WHEREAS, the City Council intends to submit a ballot measure and ballot question, reaffirming the City’s utility tax transfer, as described in this Resolution, to the qualified electors of the City of Santa Clara at such election;
WHEREAS, proceeds from the utility tax transfer imposed by this Charter amendment shall be deposited in the general fund of the City and shall be available for any legal purpose;
WHEREAS, pursuant to the requirements of the City Charter there is called and ordered to be held in the City of Santa Clara, California, on Tuesday, November 8, 2022, a special municipal election Resolution/Notice of Intention
Rev: 11/22/17

Page 5 of 5 ends

placing on the ballot one measure that, if passed, would amend City Charter Section 1320; and, WHEREAS, in the course of conducting a special municipal election on November 8, 2022, it is desirable that such special municipal election be consolidated with the general election, pursuant to Santa Clara City Charter section 600.02, to be held on the same date as if there were only one election.

It is also necessary for the City to request services of the County as set forth in this resolution.

NOW THEREFORE, BE IT FURTHER RESOLVED BY THE CITY OF SANTA CLARA AS FOLLOWS:

1. SPECIAL ELECTION. That pursuant to the requirements of the City Charter, there is called and ordered to be held in the City of Santa Clara, California, on Tuesday, November 8, 2022, a special municipal election placing one measure on the ballot that, if passed, would amend City Charter Section 1320 to update the Utility Fund transfer language.

2. BALLOT QUESTION. That the ballot question shall read as follows:

CITY OF SANTA CLARA NO TAX

INCREASE/ SERVICES

PROTECTION MEASURE
City of Santa Clara No Tax Increase/ Services Protection Measure. To protect essential services without raising taxes, such as 9-1-1 response; police patrols, fire protection; street/storm drain repair, and maintaining reliable local utility service; shall Section 1320 of the Charter continuing the annual budget transfer of funds from City utilities to the general fund at 5% of gross receipts until ended by voters, generating
approximately $30,000,000 annually, with independent audits, all funds local, be reaffirmed/adopted?
Yes

3. MEASURE. That the measure read as set forth on Exhibit A (attached hereto and incorporated herein by reference, with additions to and deletions from the current text indicated thereon) which, if passed by the voters, shall amend the Charter of the City of Santa Clara.

4. NOTICE OF ELECTION. That in accordance with the City Charter and applicable state law, the City Clerk is hereby authorized and directed on behalf of the City Council to cause notice of the time and place of the holding of the election to be published once in a newspaper of general circulation, printed, published, and circulated in the City of Santa Clara, Resolution/Notice of Intention
Rev: 11/22/17

Page 5 of 5 ends

and hereby designated for that purpose by the City Council of Santa Clara. Furthermore, the City Clerk hereby is authorized, instructed and directed to coordinate with the County of Santa Clara Registrar of Voters to procure and furnish any and all official ballot, notices, printer matter and all supplies, equipment and paraphernalia that may be necessary in order to properly and lawfully conduct the election.

5. CONSOLIDATION REQUEST. Pursuant to the requirement of Part 3 (Consolidation of Elections; Section 10400 et seq) of Division 10 of the Elections Code, the City Council hereby requests the Board of Supervisors of the County of Santa Clara to consolidate the special municipal election with the Gubernatorial general election on November 8, 2022, and to further provide that, upon consolidation, the consolidated election shall be held and conducted in all respects as if there were only one election, and only one form of ballot shall be used, election officers appointed, voting precincts designated, ballot printed, pools opened and closed, ballots opened and returned, returns canvassed, and all other proceedings in connection with the election shall be regulated and done by the Registrar of Voters of the County of Santa Clara in accordance with the provisions of applicable laws regulating consolidating elections. This City Council requests and consents to such consolidation.

6. REQUEST FOR COUNTY SERVICES. Pursuant to Section 10002 of the California Elections Code, the City Council hereby requests the Board of Supervisors of the County of Santa Clara to permit the Registrar of Voters to render services to the City of Santa Clara relating to the conduct of Santa Clara’s special municipal election to be held on Tuesday, November 8, 2022. Services shall be of the type normally performed by the Registrar of Voters in assisting the clerks of municipalities in the conduct of elections.

7. ELECTION COSTS. Subject to the approval of the Board of Supervisors of the foregoing requests, the City Clerk is hereby authorized to engage the services of the Registrar of Voters of the County of Santa Clara to aid in the conduct of the election. The City Director of Finance is authorized and directed to pay the costs of services, provided that no payment Resolution/Notice of Intention
Rev: 11/22/17

Page 5 of 5 ends

shall be made for services which the Registrar of Voters is otherwise required by law to perform.

8. BALLOT AND REBUTTAL ARGUMENTS FOR MEASURE. Primary and rebuttal arguments for the measure may be filed consistent with Elections Code Section 9282, et seq.

9. ARGUMENT (IN FAVOR) OR (AGAINST) MEASURE. The Council hereby selects the following course of action regarding argument (in favor) or (against) the measure: (Council to select one of the following concurrent with the adoption of resolution):

A. Authorizes the City Council as a body to submit a written argument (in favor) or (against) the measure and in the event an argument is filed for the measure, a rebuttal argument.

Signatures on the rebuttal argument may be different from those who signed the primary argument. OR
C. Takes no action with regard to authorizing the Council or member of the Council to submit a written argument (in favor) or (against) the measure, in which case the City Clerk shall select an argument against the measure in accordance with the priority order set forth in Elections Code section 9287.

10. IMPARTIAL ANALYSIS. Pursuant to Elections Code Section 9280, the City Council hereby directs the City Attorney to prepare an impartial analysis of the measure.

11. TRANSMITTAL OF RESOLUTION. The City Clerk is hereby directed to file a certified copy of this resolution with the Board of Supervisors and the County Registrar of Resolution/Notice of Intention
Rev: 11/22/17

Page 5 of 5 ends

Voters.

12. EXEMPTION FROM CEQA. The City Council finds, pursuant to Title 14 of the California Code of Regulations, Sections 15378(b)(4) and 15378(b)5) that this resolution is exempt from the requirements of the California Environmental QUALITY Act (CEQA) in that it involves fiscal and administrative activities that will not result in a potentially significant impact on the environment.

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

14. That this resolution provides notice of the time and place for holding the general municipal election and the City Clerk is authorized, instructed and directed to give further or additional notice of the general municipal election in time, form and manner as required by law.

15. That the proposed measure shall not take effect unless and until approved by a vote of at least 50% plus one of the voters voting on the question at the election.

16. Effective date: This resolution shall become effective immediately.

I HEREBY CERTIFY THE FOREGOING TO BE A TRUE COPY OF A RESOLUTION PASSED

AND ADOPTED BY THE CITY OF SANTA CLARA, CALIFORNIA, AT A REGULAR MEETING THEREOF HELD ON THE DAY OF , 2022, BY THE FOLLOWING VOTE:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST:

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA
Attachment: Exhibit A - Amendment to Santa Clara City Charter section 1320

Page 6 of 6 ends

EXHIBIT A

The Charter of the City of Santa Clara shall be amended as follows:

Section 1320 of the Charter of the City of Santa Clara is amended to be entitled and to read as follows:

Sec. 1320 Utilities fund.

Receipts from the utilities operated by the City shall be paid into the City Treasury and maintained in a separate utilities fund for such utilities. Expenditures from such fund shall be made for the following purposes only for such utilities in the order named, viz.:

(a) For the payment of operating expenses, pension charges and proportionate payments to such compensation and other insurance and accident reserve funds as the City or the City Council may establish;

(b) For repairs and maintenance;

(d) For the payment of not to exceed five per cent of the gross receipts from such utilities to the general fund of the City in payment for services rendered; subject, however, to such limitations as may be contained in any resolution or indenture heretofore adopted providing for the issuance of revenue bonds for the acquisition, construction or improvement of such utilities, which bonds are now outstanding or may hereafter be issued under such existing resolution or indenture;

(e) For extensions and improvements;

(f) For the establishment of a sinking fund within the utilities fund for the replacement of utilities property in the minimum amount of two million five hundred thousand dollars ($2,500,000.00).

Page 1 of 23 ends

RESOLUTION NO.

A RESOLUTION OF THE CITY OF SANTA CLARA, CALIFORNIA
ORDERING THE SUBMISSION OF A BALLOT MEASURE —
KNOWN AS THE ‘CITY OF SANTA CLARA BUSINESS LICENSE
UPDATE / TAX EQUITY MEASURE’ TO THE QUALIFIED

ELECTORS OF THE CITY AT A SPECIAL MUNICIPAL
ELECTION TO BE HELD ON NOVEMBER 8, 2022, REGARDING
A BALLOT MEASURE TO AMEND CITY CODE CHAPTER 3.40

TO MODERNIZE AND INCREASE THE BUSINESS LICENSE
TAX; CALLING AND GIVING NOTICE OF A SPECIAL

MUNICIPAL ELECTION TO BE HELD IN THE CITY OF SANTA
CLARA ON TUESDAY, NOVEMBER 8, 2022, FOR A VOTE ON
SAID BALLOT MEASURE ; REQUESTING CONSOLIDATION

WITH THE GUBERNATORIAL GENERAL ELECTION AND
ELECTION SERVICES FROM SANTA CLARA COUNTY;

DIRECTING THE CITY ATTORNEY TO PREPARE AN
IMPARTIAL ANALYSIS; AND SETTING PRIORITIES FOR

BALLOT ARGUMENTS

BE IT RESOLVED BY THE CITY OF SANTA CLARA AS FOLLOWS:

WHEREAS, Santa Clara’s Business License Tax has not been updated in 30 years; WHEREAS, the current tax does not reflect the way business operates in the City today; WHEREAS, the measure as written will allow the City of Santa Clara to treat all businesses equitably;
WHEREAS, this measure will allow the city to maintain the essential priorities upon which local businesses and residents rely, including public safety, clean and safe streets, COVID-19 response, street and sidewalk repair, and flood protection; WHEREAS, the measure as written requires strict oversight, financial audits and disclosures, and must be spent locally, without being taken by the state; WHEREAS, the next Gubernatorial General Election will be held November 8, 2022; WHEREAS, the California Constitution Article XIIIC, Section 2(b) requires a proposed tax to be submitted to voters at a general municipal election;
WHEREAS, the City Council intends to submit a ballot measure and ballot question, concerning an increase in the Business License Tax rate, as described in this Resolution, to the qualified electors of the City of Santa Clara at such election;

Page 2 of 23 ends

WHEREAS, pursuant to the requirements of the City Charter there is called and ordered to be held in the City of Santa Clara, California, on Tuesday, November 8, 2022, a special municipal election placing on the ballot one measure that, if passed, would amend City Code Chapter 3.40; and, WHEREAS, in the course of conducting a special municipal election on November 8, 2022, it is desirable that such special municipal election be consolidated with the general election, pursuant to Santa Clara City Charter section 600.02, to be held on the same date as if there were only one election.

It is also necessary for the City to request services of the County as set forth in this resolution.

NOW THEREFORE, BE IT FURTHER RESOLVED BY THE CITY OF SANTA CLARA AS FOLLOWS:

1. SPECIAL ELECTION. That pursuant to the requirements of the City Charter, there is called and ordered to be held in the City of Santa Clara, California, on Tuesday, November 8, 2022, a special municipal election placing one measure on the ballot that, if passed, would amend City Code Chapter 3.40 to increase business license tax rates.

2. BALLOT QUESTION. That the ballot question shall read as follows:

CITY OF SANTA CLARA BUSINESS LICENSE UPDATE / TAX EQUITY MEASURE

To protect Santa Clara’s financial stability and maintain essential services such as 911 emergency/public safety/crime reduction services, safe/clean public areas, pothole repair, parks and libraries, shall an ordinance to update Santa Clara’s 1992 business license tax to $75, increasing incrementally between $15 to $135 per employee or rental unit, with larger businesses paying more, generating approximately $9,000,000 annually until ended by voters with independent financial audits, all funds staying local, be adopted?
Yes

4. NOTICE OF ELECTION. That in accordance with the City Charter and applicable state law, the City Clerk is hereby authorized and directed on behalf of the City Council to

Page 3 of 23 ends

cause notice of the time and place of the holding of the election to be published once in a newspaper of general circulation, printed, published, and circulated in the City of Santa Clara, and hereby designated for that purpose by the City Council of Santa Clara. Furthermore, the City Clerk hereby is authorized, instructed and directed to coordinate with the County of Santa Clara Registrar of Voters to procure and furnish any and all official ballot, notices, printer matter and all supplies, equipment and paraphernalia that may be necessary in order to properly and lawfully conduct the election.

7. ELECTION COSTS. Subject to the approval of the Board of Supervisors of the foregoing requests, the City Clerk is hereby authorized to engage the services of the Registrar

Page 4 of 23 ends

of Voters of the County of Santa Clara to aid in the conduct of the election. The City Director of Finance is authorized and directed to pay the costs of services, provided that no payment shall be made for services which the Registrar of Voters is otherwise required by law to perform.

8. BALLOT AND REBUTTAL ARGUMENTS FOR MEASURE. Primary and rebuttal arguments for the measure may be filed consistent with Elections Code Section 9282, et seq.

9. BALLOT ARGUMENT (IN FAVOR) OR (AGAINST) MEASURE. The Council hereby selects the following course of action regarding argument (in favor) or (against) the measure:
(Council to select one of the following concurrent with the adoption of resolution):

A. Authorizes the City Council as a body to submit a written argument (in favor) or (against) the measure and in the event an argument is filed for the measure, a rebuttal argument.

B. Authorizes (#) of member(s) of the City Council to submit a written argument (in favor) or (against) the measure: (one or more name(s)): at (Name(s) discretion, the argument may also be signed by other members of the City Council, bona fide associations or individual voters who are eligible to vote on the measure. In the event that an argument is filed for the measure, (Name(s) is also authorized to submit a rebuttal argument on behalf of the City Council, which, at (Name(s) discretion, may also be signed by members of the City Council, bona fide associations, or individual voters who are eligible to vote on the measure. Signatures on the rebuttal argument may be different from those who signed the primary argument. OR
C. Takes no action with regard to authorizing the Council or member of the Council to submit a written argument (in favor) or (against) the measure, in which case the City Clerk shall select an argument against the measure in accordance with the priority order set forth in Elections Code section 9287.

10. IMPARTIAL ANALYSIS. Pursuant to Elections Code Section 9280, the City Council hereby directs the City Attorney to prepare an impartial analysis of the measure.

Page 5 of 23 ends

11. TRANSMITTAL OF RESOLUTION. The City Clerk is hereby directed to file a certified copy of this resolution with the Board of Supervisors and the Registrar of Voters.

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

15. That the proposed measure shall not take effect unless and until approved by a vote of at least 50% plus one of the voters voting on the question at the election.

16. Effective date: This resolution shall become effective immediately.

I HEREBY CERTIFY THE FOREGOING TO BE A TRUE COPY OF A RESOLUTION PASSED

AND ADOPTED BY THE CITY OF SANTA CLARA, CALIFORNIA, AT A REGULAR MEETING THEREOF HELD ON THE DAY OF , 2022, BY THE FOLLOWING VOTE:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST:

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

Attachment: Exhibit A Ordinance Amending and Restating Santa Clara City Code Chapter 3.40

Page 6 of 23 ends

EXHIBIT A

ORDINANCE NO.

AN ORDINANCE OF THE CITY OF SANTA CLARA,
CALIFORNIA, AMENDING AND RESTATING CHAPTER 3.40
(“BUSINESS LICENSE”) OF TITLE 3 (“REVENUE AND
FINANCE”) OF “THE CODE OF THE CITY OF SANTA CLARA,
CALIFORNIA” TO MODERNIZE AND INCREASETHE TAX RATE

BE IT ORDAINED BY THE PEOPLE OF THE CITY OF SANTA CLARA

SECTION 1: That Chapter 3.40 (entitled “Business License”) of Title 3 (entitled “Revenue

and Finance”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended and restated in its entirety to be numbered, entitled, and to read as follows:

Chapter 3.40

BUSINESS TAX

3.40.010 Purpose.

This chapter is enacted to raise revenue for municipal purposes and not for the purpose of regulation. The payment of a business tax required by this chapter, and its acceptance by the City, and the issuance of a business tax certificate to any person shal l not entitle the holder thereof to carry on any business unless he or she has complied with all of the requirements of the City Code and all other applicable laws, nor to carry on any business in any building, on any premises, or in any location designated in such business tax certificate in the event that such building, premises or location is situated in a zone or locality in which the conduct of such business is in violation of any law.

3.40.020 Effect on other fees and charges.

Persons required to pay a business tax for transacting and carrying on any business under this chapter shall not be relieved from the payment of any other charge, fee, or tax as may be imposed by the City for the privilege of doing business within the city, or for the cost of regulating a business, and such persons shall remain subject to the regulatory provisions of all other ordinances, codes, and resolutions of the City, including but not exclusive to regulations for

Page 7 of 23 ends

zoning, building, fire, and safety.

3.40.030 Chapter controlling.

To the extent that the provisions of this chapter are inconsistent with the provisions of any other chapter of the City Code or parts thereof, the provisions of this chapter shall be deemed controlling.

3.40.040 Definitions.

The words and terms used in this chapter shall have the following meanings unless the context clearly indicates otherwise:
(a) “Business tax certificate” means the document issued as a result of a completed tax affidavit and taxes paid.
(b) “Business” means all activities engaged in or caused to be engaged in within this city including any commercial or industrial enterprise, trade, profession, occupation, vocation, calling, or livelihood including rental or lease of residential or nonresidential real estate and mobilehome parks, or independent contractors, whether or not carried on for gain or profit, but shall not include the services rendered by an employee to his employer.
(c) “Business community” means any and all areas of the City not zoned as residential.

(d) “CPI Index” The Consumer Price Index —All Urban Consumers for All Items for the San Francisco-Oakland-Hayward Area or any successor to that index designated by the Federal Bureau of Labor Statistics or the city council.
(e) “Director” means the Director of Finance or his or her designee.

(f) “Employee” means any or all persons engaged in the operation or activity of any business, whether as owner, a corporate officer, a partner, agent, manager, solicitor or any and all persons employed or working in such business either full time, part-time, permanent or temporary. (g) “Fiscal year” means an accounting period of twelve (12) months commencing upon the payment of a business tax and every twelve (12)-month period thereafter. (j) “Number of employees” means the number of persons employed in the business as

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anticipated, or the number of employees including owner(s) at time of renewal.

(l) “Person” means all domestic and foreign corporations, limited liability company, firms, associations, syndicates, joint stock corporations, partnerships of every kind, joint ventures, clubs or common law trusts, societies, individuals, estates, business trusts, receivers, retirement plans, trustees, or any other group or combination acting as a unit engaged in any business in the city other than as an employee.

3.40.050 Other licenses, permits, taxes, fees or charges authorized when.

Nothing contained in this Chapter 3.40 shall be deemed to repeal, amend, be in lieu of, replace or in any way affect any requirements for any license or permit required by, under or by virtue of any provision of any other title or chapter of this Code or any other ordinance or resolution of the city or of its council, nor be deemed to repeal, amend, be in lieu of, replace or in any way affect any tax, fee or other charge imposed, assessed or required by, under or by virtue of any other title or chapter of this Code or any other ordinance or resolution of the city or of its council.

3.40.060 Imposition of tax.

The City does hereby tax, as provided in this chapter, each and every kind of business transacted, conducted, exhibited or carried on in the city, at the rates named and prescribed in this chapter. If more than one business shares a bus iness location, each business is required to apply and pay the prescribed tax.

3.40.070 Business tax certificate required.

It shall be unlawful for any person to transact or carry on any business in the city without first having paid the business tax to the City and having obtained a valid business tax certificate or renewal, in compliance with all applicable provisions of the City Code. Notwithstanding any language in this chapter to the contrary, each branch establishment or location at or from which a person carries on the same business shall not be deemed a separate business, but all such branches and locations shall be treated as one business. If a business opens a new location

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during the term of the existing business license, an amended business tax certificate application must be submitted to include the new location in the business tax certificate.

3.40.080 Business tax certificate application.

(a) Any person applying for a tax certificate shall make application upon a form provided by the Director, which form shall provide such information as may be required to show compliance with all City, State and Federal laws, and as may be necessary to determine ownership, the nature of the business, occupancy requirements, location, and the classification and amount of tax due. (b) All applicants shall pay a tax computed on the number of employees or rental units as provided in this chapter upon submitting the application. (c) When necessary, the Director or designee shall refer an applicatio n or a notice of changed or new addresses to the appropriate City officers or staff for determination as to whether the proposed business activity and the premises in which it is to be conducted comply with applicable laws and ordinances. In the event it is determined that the proposed activity may not be maintained in compliance with the law, the Director or designee shall so inform the applicant and no new or renewed tax certificate may issue.
(d) Failure of the City to approve, deny, or act upon the application within one hundred eighty (180) days shall be deemed a denial of the application.

3.40.090 Appeal process.

An appeal from denial of issuance of a business tax certificate may be made under the procedures set forth in Chapter 2.115 SCCC.

3.40.100 Business location.

Business tax fees are based on the actual physical location of the business within the jurisdictional limits of the City of Santa Clara. A mail stop, post office box or other such mail address is not considered a valid business location for the purpose of fire and safety inspection. All business not physically located within the jurisdictional limits of the City of Santa Clara are

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considered out-of-town and must pay taxes as established for out-of-town businesses regardless of whether they have a mailing address in the City of Santa Clara.

3.40.110 Branch establishments.

A separate business tax certificate for each branch establishment or location of the business will not be required but all business locations must be included on the application for a business tax certificate. When any person conducts, at one location, businesses classified separately by this chapter, such person shall pay the higher of the taxes.

3.40.120 Notice not required by City.

The Director is not required to send a renewal, delinquency or other notice or bill to any person subject to the provisions of this chapter and failure to send notice or bill shall not affect the validity of any tax or penalty due.

3.40.130 When annual tax due and payable.

The annual business tax imposed under the provision of this chapter shall be due and payable on the first day of January of each year, unless otherwise established by resolution of the city council or at the time of commencemen t of business activity or upon occupying space in the business community for newly established businesses. Business taxes which are paid on an annual basis, which would be due on the first day of the year, shall be deemed timely if payment is made on or before seven (7) days after the due date. All business tax certificates shall expire on December 31st of each calendar year. The tax for the renewal of such certificate shall be due and payable upon expiration of the prior certificate.

3.40.140 Refunds and proration.

(a) All business tax certificates shall be issued from the date set forth in the certificate and no business shall be entitled to the refund of any portion of the tax paid by reason of the termination of such business activity before the certificate expires. (b) Any business required to cease activity within the city as the result of public acquisition of the premises by any governmental agency shall be entitled to a refund of an amount

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prorated as to the time remaining under the certificate when the business activity ceases. Such licensee shall file a verified claim with the Director stating the date of and reason for cessation of business activity.
(c) The business tax may be prorated in accordance with the administrative guidelines promulgated by the Director.

3.40.150 Penalty for delinquent or nonpayment.

The penalty for noncompliance shall be:

(a) Any person who fails to apply for a tax certificate and fails to pay the tax as determined on or within thirty (30) days after opening, engaging in business, or occupying space in the business community, shall be subject to a penalty of twenty- five percent (25%) of the tax due. (b) Every annual tax which is not received and paid within a period of thirty (30) days after the tax became due is hereby declared to be delinquent, and a penalty of twenty-five percent (25%) of the tax will be added to the tax due.
(c) Whenever a check is submitted in payment of a business tax and said check is subsequently returned unpaid by the bank upon which said check is drawn for any reason, the taxpayer shall be liable to pay a nonsufficient funds charge, the correct tax amount due, and a penalty, if applicable.
(d) If any person fails to pay the annual renewal tax within ninety (90) days after the tax becomes due, his or her business tax certificate is considered revoked. The City is not required to send a notice of revocation for the revocation to be valid. Following revocation, the person must reapply for a new business tax certificate, pursuant to SCCC 3.40. 080, and pay all associated penalties. Failure to reapply for a new business tax certificate shall constitute a violation, pursuant to SCCC 3.40.310.

3.40.160 Annual adjustments for inflation.

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Subject to approval of the city council, the business certificate tax, the additional tax based on number of employees or rental units, and the cap referred in SCCC 3.40.360 below, may be adjusted annually, commencing on January 1, 2024 and every year thereafter, if the cost of living in the city has increased over the preceding base period as shown by the CPI Index but in no event shall the adjustment exceed five percent (5%) per year. The CPI Index will be set in October of each year or as established in the administrative guidelines promulgated by the Director in accordance with this chapter.

3.40.170 Exemptions from tax.

No tax prescribed in this chapter shall be deemed or construed to apply to any of the following persons who are exempt from payment thereof upon submission of proof of exemption:
(a) Charitable and Nonprofit Organizations. Any church, school, charitable, benevolent or social organizations having exempt status under Federal tax law. (b) Conflict With Federal and State Law. Any person conducting any business exempt by virtue of the Constitution, or applicable statutes of the United States or of the State of California from the payment to municipal corporations of such taxes as are herein prescribed. (c) Disabled Veterans. Disabled veterans exemption pursuant to the requirements of Section 16001 or 16001.5 of the California Business and Professions Code. (d) Employees. No person who is an employee shall be required to pay a tax for doing any part of the work of such business for which a tax certificate has been issued. (e) Interstate Commerce. Every peddler, solicitor or other person claiming to be entitled to exemption from the payment of any tax provided for in this chapter upon the ground that such tax casts a burden upon his/her right to engage in commerce with foreign nations or among the several states or conflicts with the regulations of the United States Congress respecting interstate commerce, shall file an affidavit or a declaration under penalty of perjury with the Director describing the interstate or other character of his/her business which entitled him to such exemption.

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(f) Business operators whose annual gross receipts from such business operations in the city are five thousand dollars ($5,000) or less. Acceptable documentation must be provided to support the claimed exemption.
(g) Nothing in this chapter shall be deemed or construed to apply to any person transacting and carrying on any business exempt by virtue of the Constitution or applicable statutes of the United States or the State of California for payment of such taxes as are herein prescribed.

3.40.180 Business tax constitutes debt to City – Collection of unpaid taxes.

The amount of any business tax imposed by this chapter shall be deemed a debt to the city, and any business operating without having a certificate from the city so to do shall be liable to an action in the name of the city in any court of competent jurisdiction for the amount of the business tax imposed on such business, together with all penalties and interest then due thereon in any such action, and any cost the city reasonably incurs to collect the tax, including attorneys' fees which, if judgment is recovered, shall be included and assessed as recoverable costs in such action.

3.40.190 Transferability – Changes to affidavit.

A certificate issued pursuant to this chapter shall not be transferable. When a certificate has been issued authorizing a specifically named person to transact and carry on a specific type of business at a specific location, the business shall, upon application in writing, and the payment of the prescribed fee, have such certificate records amended to include any change of name, type of business, or address. Any business for which such a change must be made shall pay a fee as fixed by resolution of the City Council for the handling and processing of such change.

3.40.200 Issuance of business tax certificate.

All certificates issued under the provisions of this chapter shall be issued by the Director or authorized employees and shall state the nam e of the business, the location of the business, the mailing address, the type of business being conducted at the listed location, the amount of the tax

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paid, the expiration date of the certificate and additional information that may be required. A business tax certificate will be issued upon the determination by the Director and any other necessary City departments that the business tax has been paid and that the business tax certificate affidavit information is accurate, that the busine ss applicant is operating legally pursuant to all applicable Federal, State and local laws, and there are no business operations that endanger the public.

3.40.210 Duplicate tax certificate.

A duplicate business tax certificate may be issued by the Director to replace a previously issued certificate that has been lost or destroyed upon the owner filing a written request attesting to such fact, and paying a fee as fixed by the resolution of City Council for handling and processing of such request.

3.40.220 Business tax certificate record.

The Director shall maintain a “public business tax certificate record,” which shall contain the name of the business, the location of the business, the type of business and the time period for which the certificate is issued.

3.40.230 Confidential documents.

Except as provided for under Section 6254 of the Public Records Act, the affidavit, statements and any other documents required by this chapter to be filed, shall be deemed confidential in character and shall not be subject to public inspection, and shall be kept so that the contents thereof, shall not become known except to:
(a) The persons charged with administration of this chapter;

(b) City employees for the sole purpose of administering or enforcing any provisions of this article;
(c) Federal or State officials, or to a grand jury or court of law, upon subpoena.

3.40.240 Display of certificate.

Every person to whom a certificate is issued, shall keep the same conspicuously posted in

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or about the place where the business is located or conducted.

3.40.250 Administrative rules and regulations.

The Director may make rules and regulations not inconsistent with the provisions of this Code for the purpose of administering the provisions of this chapter. The Director shall further have the power to compromise any claims as to the amount of any tax due and paid.

3.40.260 Affidavit to be submitted where business tax based on number of employees

– Information required.

(a) Upon making application for a certificate to be issued under this chapter where the amount of the tax is measured by the number of employees, the applicant shall furnish to the Director, for guidance in ascertaining the amount of such tax, a signed affidavit un der penalty of perjury, upon a form provided by the Director, setting forth such information as may be necessary to determine the amount of the tax.
(b) The amount of the tax is determined by the average number of persons engaged in the business over the last four quarters immediately preceding application, and shall be determined as follows:
(1) Based upon the employment data as reported to the State Department of California Employment Development Department, if the applicant files with the State Department of California Employment Development Department the forms and reports hereinafter mentioned, and if the applicant reports therein all applicant's employees as defined in this chapter, the applicant may calculate the average number of employees by taking the number of employees employed in applicant's business in the city in each month of the preceding year as shown and reported on all DE3 forms, and by dividing the sum thus obtained by twelve. The DE3 and other forms hereinabove referred to are those certain forms entitled "DE3 Contribution Return and Report of Wages Under the Unemployment Insurance Code," which employers are required to file with the state department of employment, under the Unemployment Insurance Code of the state for the purpose of reporting contributions due under such code, and any other form or forms now

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or hereafter required by the state for such purposes; or

(2) For a business with multiple locations located in and outside of the city, the applicant may self-report the total number of employees. The report shall include all employees that perform services in the city which include any of the following: i) an employee where all or most of the employee’s services are performed in the city; or ii) where an employee’s base of operations is located in the city; or iii) the place from which the business exercises basic and general direction and control over all the employee’s services is in the city. (3) The average number of employees of the business may also be disclosed in a manner as approved by the Director.

3.40.270 Renewal generally – Affidavit and information required.

In all cases, the applicant for renewal of a certificate shall submit to the Director, for guidance in ascertaining the amount of the tax to be paid by the applicant, a written affidavit under penalty of perjury upon a form provided by the Director, setting forth such information concerning the applicant’s business as may be required by the Director to ascertain the amount of tax to be paid by such applicant pursuant to the provision of this chapter.

3.40.280 Statements not conclusive.

No statement set forth in any affidavit required by this chapter shall be conclusive as to the matters set forth therein, nor shall the filing of the same preclude the City from collecting by appropriate action such sum as is actually due and payable under this chapter. Such affidavit and each of the several items therein contained shall be subject to review and verification by the Director, or authorized employees of the City.

3.40.290 Extensions of time for filing sworn declarations.

The Director shall have the power, for good cause shown, to extend the time for filing any sworn statement required under this chapter and in such case to waive any penalty that would otherwise have accrued.

3.40.300 Director duties.

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The Director shall make diligent effort to discover all persons conducting any business in the city for which a certificate is required by the provisions of this chapter.

3.40.310 Violations.

The issuance of a certificate under this chapter shall not entitle the person(s) to engage in any business which for any reason is in violation of any law or provision of this Code. (a) Separate Violation. The conducting of business in the city or occupying space in the business community, without first having procured a business tax certificate from the City to do so, or without complying with any and all regulations of such business contained in this chapter shall be a separate violation hereof for each and every day that such business is so carried on. (b) Violations. Pursuant to SCCC 1.05.070, the City, in its prosecutorial discretion, may enforce violation(s) of the provisions of this chapter as a criminal, civil, and/or administrative action.

3.40.320 City Attorney’s duties.

The Director may at any time request the City Attorney to bring a civil suit in the name of the City for the recovery of any tax from any person who conducts a business without procuring the certificate required by this chapter, or not paying the prescribed tax, and the recovery of such tax and penalties due thereon.

3.40.330 Enforcement.

The Director is hereby directed to enforce each and all of the provisions of this chapter, and the Chief of Police shall render such assistance in the enforcement hereof as may from time to time be required by the Director. The Director, in the exercise of the duties imposed hereunder, and acting through deputies or duly authorized assistants, shall examine or cause to be examined all places of business in the city to ascertain whether the provisions of this chapter have been complied with.

The Director, all duly authorized assistants and any police officers shall have the following powers:

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(a) To enter free of charge, and at any reasonable time during business hours, any place of business required to be certified herein, and demand an exhibition of its certificate. Any person to whom a certificate is issued shall exhibit the same on demand. (b) To issue citations for any violations of this chapter.

3.40.340 Effect of annexation.

All existing businesses brought under the jurisdiction of the City by annexation procedures shall conform to the provisions of this chapter within thirty (30) days of the effective date of such annexation.

3.40.350 Businesses taxed.

Every person having a fixed place of business within the city and who engages in any business shall pay a tax based on the number of employees as defined and set forth in this chapter, according to the following rate schedules, unless the basis of the tax is otherwise prescribed in Section 3.40.380 or the business is exempted from the tax as prescribed in Section

3.40.170 of this chapter.

3.40.360 General schedule for person having fixed place of business within City.

From and after January 1, 2024, every person engaged in business in the City, whether or not at a fixed place of business in the City, shall annually pay to the Director the following prescribed tax:

(a) A minimum business tax of seventy-five dollars ($75.00) per year, plus an additional per employee tax per year in the amounts set forth below in Subsection B., not to exceed a cap of three hundred fifty thousand dollars ($350,000.00) per year, subject to annual adjustments set forth in SCCC 3.40.160. (b) Per Employee Tax shall be as follows:

Number of Employees Authorized Maximum Business Registration and Certificate Tax
1 - 4 $75 plus $15 for each employee
5 – 9 $135+ $30/employee for each employee over 4
10 – 19 $285 + $45/employee for each employee over 9

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20 – 49 $735 + $60/employee for each employee over
19 employees
50 – 99 $2,535+ $75/employee for each employee over
49 employees
100 – 249 $6,285 + $90/employee for each employee over
99 250 – 499 $19,785 + $105/employee for each employee
over 249

500 – 999
$46,035+ $120/employee for each employee
over 499

1000+
$106,035 + $135/employee for each employee
over 999

3.40.370 Business without a fixed place of business in city.

Unless such business is otherwise specifically taxed by other provisions of this chapter, every person who does not have a fixed place of business in the city, but whose employees come into the city for the purpose of conducting a business or rendering services, when such employees come into the city for these purposes six (6) or more days during any calendar year, shall pay a minimum base tax of $75 and a tax based on the number of employees as defined and set forth in this chapter, according to the following rate schedule:

Out-of-Town Businesses Business Registration and Certificate Tax Number of Days Percentage of Tax
6 – 64 25%
65 – 129 50%
130+ 100%

For purposes of this section "operating a business in the city" shall include every person entering into a contract with the city, including, without limitation, contracts for public works, consultant services and franchise agreements.

Out of town business shall, as required on the application form and in compliance with

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procedures and methodologies adopted by the Finance Department, estimate the number of

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employees who will be conducting business within the City and the estimated number of days that business will be conducted within the city.

3.40.380 Rental units.

(a) Every person engaged in the business of renting rooms, apartments, single-family houses, or other accommodations for dwelling, sleeping or lodging purposes, in the city shall pay the following tax:
(1) A base rate of $75.00 plus $15.00 per annum for each rental unit, subject to annual adjustments set forth in SCCC 3.40.160.
(2) Provided, however, that no tax shall be payable under this section, unless the person engaged in such business operates three or more rental units in the city. (b) As used in this section, unit means a room or suite of two or more rooms (including, but not limi ted to single -family houses) designed for or used as separate accommodations for dwelling, sleeping or lodging purposes by a person living alone or two or more persons living together.

3.40.390 Rental unit – Surcharge.

(a) It is contemplated that the City Council will from time to time adjust the amount of the surcharge fee by resolution to cover the changing cost of the mediation services involved with these businesses and to insure that the surcharge fee amount prorated to the rental units shall not exceed the cost of the program services made available. (b) Any and all fees collected pursuant to this section are dedicated to and shall be used exclusively to pay the costs of the above services rendered in response to needs generated by the subject type of rental businesses.
(c) Those businesses covered under Chapter 3.25 SCCC, and paying the business tax under SCCC 3.40.310, Schedule No. 100, are exempt from paying the rental unit surcharge.

3.40.400 Cumulative remedies.

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This chapter provides for administrative enforcement of its provisions, which are in addition to all other legal remedies, administrative, criminal or civil, which may be pursued by the city to address any violation of this chapter provided only that the city may not recover any sum due under this chapter more than once.

3.40.450 Audit.

The Director shall have the right to audit records of the businesses subject to the business license tax to ensure compliance with this chapter. Businesses s hall retain records pertaining the business license tax for a period of three (3) years from the end of each calendar year, and shall allow the city access to such records, with appropriate notice and at a mutually agreeable time, to monitor compliance with the requirements of this chapter. Where a business does not maintain or retain adequate records documenting the number of its employees or does not allow the city reasonable access to such records, the city's calculation of the number of employees of the business shall be presumed to be accurate, absent clear and convincing evidence otherwise.

3.40.460 Constitutionality and legality; Gann limit.

(a) This tax is intended to be applied consistently with the United States and California Constitutions, state law and the City Charter. The tax shall not be applied so as to cause an undue burden upon interstate commerce, a violation of the equal protection and due process clauses of the Constitutions of the United States or the State of California, to constitute a special tax, or to cause a violation of any other provision of applicable law. (b) Pursuant to California Constitution, Article XIII B, the appropriation limit for the city is hereby increased to the maximum extent over the maximum period of time allowed under law by the amount of the revenues generated by the tax.

3.40.470 Severability.

Should any provision of this chapter, or its application to any person or circumstance, be determined by a court of competent jurisdiction to be unlawful, unenforceable or otherwise void, that determination shall have no effect on any other provision of this chapter or the application of

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this chapter to any other person or circumstance and, to that end, the provisions hereof are severable.

SECTION 2: Implementation.

(a) The new tax imposed by this ordinance will go into effect on January 1, 2024.

(b) Each business will be required to make annual payments on the first day of January in accordance with SCCC 3.40.130 with the initial tax payment due on January 1, 2024. (c) The Director of Finance is charged with the implementation and transition of the new business tax. Any tax payments due between January 1, 2023 and December 31, 2023 may be prorated or credited in accordance with the administrative guidelines promulgated by the Director.

SECTION 3: General Tax. Proceeds of the tax imposed by this Ordinance shall be deposited in the general fund of the City and shall be available for any legal purpose.

SECTION 4: Ordinances Repealed. With exception of the provisions protected by the savings clause, all ordinances (or parts of ordinances) in conflict with or inconsistent with this ordinance are hereby repealed.

SECTION 5: Savings clause. The changes provided for in this ordinance shall not affect any offense or act co mmitted or done or any penalty or forfeiture incurred or any right established or accruing before the effective date of this ordinance; nor shall it affect any prosecution, suit or proceeding pending or any judgment rendered prior to the effective date of this ordinance. All fee schedules shall remain in force until superseded by the fee schedules adopted by the City Council.

SECTION 6: Effective date. Subject to passage by the voters and the vote declared by the City Council, pursuant to Elections Code Section 9217, this ordinance shall take effect on January 1, 2024.

Attachments incorporated by reference: None
City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-1761 Agenda Date: 7/5/2022

REPORT TO COUNCIL

SUBJECT
Public Hearing: Action on Introduction of Ordinances to Establish Objective Zoning, Subdivision, and Design Standards for SB 9 Residential Projects by Amending Chapter 17.05 (Subdivisions) of Title 17 (Development) and Amending Title 18 (Zoning) to Create Chapter 18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits); and Address Affordability Recommendations of the Planning Commission for SB 9 Developments

COUNCIL PILLAR
Promote and Enhance Economic, Housing and Transportation Development

BACKGROUND
California Senate Bill 9 (SB 9), which became effective on January 1, 2022, requires ministerial review and approval of a housing development with two primary dwelling units on a single-family (R1) zoned property, the subdivision of an R1 zoned parcel, or both for projects that meet specific eligibility criteria. Ministerial review of an SB 9 application requires a process without discretionary review or hearing, where City staff is limited to ensuring that the proposed development meets all eligibility criteria and applicable objective zoning, subdivision, and design review standards.

Additional background information on applicability of SB 9, what SB 9 allows, and the ways in which jurisdictions may and may not regulate SB 9 proposals was provided in a staff report and presentation for the joint City Council and Planning Commission study session held on January 25, 2022. The staff report and presentation for the joint study session are included in the attachments to the May 25, 2022 Planning Commission staff report (Attachment 1).

Objective Standards
Any SB 9 proposal is subject to the City’s objective standards included within Title 18 (Zoning) and Title 17 (Development/Subdivision), provided that those standards:

1. Do not physically preclude the construction of two units of at least 800 square feet each, per property;

2. Do not conflict with SB 9 standards (e.g., setbacks, parking, etc.); and

3. Do not conflict with the ministerial review requirement for SB 9 projects.

Attachment 1 includes the City’s SB 9 Eligibility Checklist and Planning Application form, which identifies a list of general requirements for SB 9 proposals, including references to current objective standards. Objective standards may not include personal or subjective judgement and must be uniformly verifiable and knowable by both the applicant and public officials.

State law allows a local jurisdiction, on a limited basis, to adopt an ordinance that establishes objective development standards to regulate the implementation of SB 9 projects. At the joint study City of Santa Clara Printed on 6/30/2022Page 1 of 6
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session, staff provided development standard examples from SB 9 ordinances of other cities, with preliminary recommendations for Santa Clara to implement its own requirements.

Joint Study Session
At the January 25, 2022 joint study session, staff identified and discussed several topics that SB 9 and/or the current Zoning Code in their current form do not specifically address including: parking, urban lot split standards, privacy, and neighborhood compatibility. The City may adopt standards to regulate these issues, as long as they are consistent with other SB 9 requirements. The attached draft ordinance is reflective of the discussion at the joint study session and includes proposed changes to the City Code, adding Chapter 18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits) and amending Chapter 17.05 (Subdivisions).

Planning Commission
At the May 11, 2022 Planning Commission meeting, following the staff presentation, the Commission discussed the draft ordinance, including potential changes to several of the proposed development standards, and continued their discussion of four topics, summarized in the discussion section of the May 25, 2022 Planning Commission staff report. The proposed development standards are summarized in the discussion section of the staff report for the May 11, 2022 Planning Commission (Attachment 1).

The City’s current process for review of subdivisions includes a public hearing with approval by the City Council. Because SB 9 requires a ministerial review process, it is also necessary to make amendments to Chapter 17.05 to remove the public hearing requirement and to designate the City Engineer as the approver for SB 9 Urban Lot Split projects. Since the Planning Commission does not make recommendations on ordinances outside of Title 18 (Zoning), the proposed changes were provided to the Planning Commission for reference. A summary of the Planning Commission’s continued discussion and recommendation from their May 25, 2022 hearing is included in the discussion section below.

DISCUSSION
The Planning Commission’s discussion and recommendation focused on the following four topics:

1. Parking Design & Location

2. Front Yard Landscaping/Paving

3. Solar Access

4. Affordability
Parking Design & Location
As previously drafted, parking for an SB 9 project (whether required or provided voluntarily) must meet the City’s parking design standards including the requirement that the parking be covered (i.e., a garage or carport) and be located outside of the required yard areas. The Commission recommended the following changes:

A. Allow any required parking for an SB 9 unit to be uncovered only on lots below a certain size.

Otherwise, any required parking must be covered. The Planning Commission directed staff to investigate and present to City Council a lot size for establishing whether required SB 9 parking may be uncovered (below the specified lot size) or covered (at or above the specified lot size).

B. For lots that qualify for their required parking to be uncovered, the Planning Commission recommended that those uncovered parking spaces could be accommodated on a driveway in City of Santa Clara Printed on 6/30/2022Page 2 of 6
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22-1761 Agenda Date: 7/5/2022
the front yard.

The Planning Commission did not specify a lot size for the covered parking requirement, but rather directed staff to investigate an appropriate minimum threshold lot size. Staff evaluated potential SB 9 development scenarios for up to two SB 9 units of at least 800 square feet each, on lots with varying configurations ranging in size between 6,000 square feet (a typical R1 lot) to 2,400 square feet (40- percent minimum of typical R1 lot) to determine if a covered parking requirement would negatively impact the feasibility of constructing an SB 9 unit or units. Based on this analysis, staff determined that a 2,400 square foot lot would be the smallest lot which theoretically could accommodate two 800 square foot units (provided that they were 2-story) along with covered parking spaces. However, staff further concluded that it would be potentially redundant and/or ineffective to establish a specific exception from the covered parking requirement given the wording of SB 9, which allows feasibility to be determined for each project on a project-by-project basis.

Given that SB 9 requires jurisdictions to waive development standards that preclude development of two 800 square foot units, staff recommends retaining all development standards, including covered parking, for all lots and to rely upon the waiver process built into SB 9 to drop the covered parking requirement when it would impact feasibility. As recommended by staff, staff will review proposed SB 9 projects for conformity to all standards and review any applicant requests for waiving of standards, including covered parking, on a case-by-case basis. This approach allows staff to propose alternative configurations to achieve as many development standards as possible and meets the intent behind the Planning Commission’s recommendation, even though no specific textual modifications are proposed by staff.

Front Yard Landscaping/Paving
The Planning Commission recommended changing Section 18.13.060(i) of the draft ordinance to lower the minimum percentage of required front yard landscaping from 60-percent to 50-percent to allow additional paving, which would increase the opportunity for multiple on-site parking spaces on a driveway in the front yard, particularly on narrower lots. The typical width of a parking space is 10 feet. With a 50-percent landscaping requirement, a typical 60-foot wide lot could thus accommodate a 30-foot wide 3-car driveway or a 40-foot wide lot could accommodate a 20-foot wide 2-car driveway.

Solar Access
To preserve solar access on properties neighboring an SB 9 project site, the Planning Commission recommended inserting the following language, using the California Solar Shade Control Act (SSCA) as a model, into the proposed ordinance:

A. Add Section 18.13.040(c): After the installation of a solar collector, a person owning or in control of another property shall not construct or alter a residence so as to cast a shadow greater than 10 percent of the collector absorption area upon that solar collector surface at any one time between the hours of 10 a.m. and 2 p.m., Pacific Standard Time.

B. Include a definition of solar collector: “Solar collector” means a fixed device, structure, or part of a device or structure, on the roof of a building, comprising photovoltaic panels, that is used primarily to transform solar energy into electrical energy.

Affordability
To address the possibility of including an affordability requirement for a second unit constructed under SB 9, the Planning Commission made a separate motion recommending the City Council City of Santa Clara Printed on 6/30/2022Page 3 of 6
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explore the opportunity for affordable housing under SB 9 with incentives for homeowners to enable more affordability and increase housing numbers. As is the case with the majority of Accessory Dwelling Units (ADUs), most SB 9 units that are limited to a maximum of 1,000 square feet, could similarly be considered affordable by design. Therefore, it may not be necessary for the City to establish an affordability requirement for SB 9 units. A September 2021 report by the Association of Bay Area Governments (ABAG) conservatively assumes that ADUs fall into the following income categories: 30-percent Very Low Income (0-50% AMI), 30-percent Low Income (51-80% AMI), 30- percent Moderate Income (81-120% AMI), and 10% Above Moderate Income (120%+ AMI). The City’s 2021 Annual Progress Report (APR) that was submitted to the California Department of Housing and Community Development (HCD) earlier this year reported ADU production based on these assumptions.

Since 2018, with the enactment of Assembly Bill 1505, cities have had the authority to impose inclusionary housing requirements. Gov’t Code § 65850(g). In response, in Santa Clara, the City enacted Chapter 17.40 of the City Code, requiring housing developments with 10 or more units to provide 15% of those units at affordable prices or rents. Residential developments with fewer than 10 units must either provide one affordable unit or pay an in-lieu fee pursuant to the affordable housing master fee schedule. Chapter 17.40 provides an exemption for single residential units, duplex units, and ADUs; for those dwellings, neither an affordable unit nor an in-lieu fee is required.

If the Council provides direction to establish an affordability requirement for SB 9 developments, that could take a number of different forms. The most ambitious option would be a requirement that every second unit built under SB 9 would have to be affordable (in other words, 50% of the homes on every lot). A less aggressive, but still significant, alternative would be to require one out of four units to be affordable when a lot is split using SB 9 and two homes are planned for each lot (so 25% of the homes would be affordable). A third option would be to impose an inclusionary housing fee only, treating SB 9 developments like any other housing development that has fewer than 10 units. And finally, the Council could establish an incentive program for development of affordable housing rather than imposing mandates.

If the Council chooses any option other than incentives or simply applying the existing Chapter 17.40 fees, it would be advisable to first prepare an economic feasibility study. Under a series of court cases, the City cannot enact an affordability restriction that is so significant as to be “confiscatory,” which means the property owner is denied a fair and reasonable return on his or her property.

Although there is no fixed percentage at which an affordability requirement becomes “confiscatory,” it is relevant to note that any affordable housing ordinance that imposes a requirement above 15% is subject to review by the California Department of Housing and Community Development (HCD), which can require the preparation of an economic feasibility study. In addition, any new affordability requirements could constitute a constraint on housing development, which will need to be analyzed in the City’s upcoming 2023 Housing Element, which is also subject to HCD approval.

Given that the Council previously made the policy decision to exempt ADUs from the reach of the affordable housing ordinance, imposing an inclusionary requirement on SB 9 developments would represent a policy shift. If the Council decides to direct staff to return with an ordinance imposing an affordability requirement, staff recommends either imposing a fee under the existing ordinance, or deferring such a requirement until an economic feasibility analysis can be prepared. If the Council instead decides to ask staff to research an incentive program, and/or to not impose affordability requirements on SB 9 developments at this time, staff recommends that Council direct staff to City of Santa Clara Printed on 6/30/2022Page 4 of 6
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prepare a simple amendment to Chapter 17.40 to clarify that it does not apply to SB 9 developments.

ENVIRONMENTAL REVIEW
Pursuant to California Government Code Sections 65852.21 (j) and 66411.7 (n), a local agency may adopt an ordinance to implement SB 9 and that ordinance shall not be considered a project under CEQA (Division 13 (commencing with Section 21000) of the Public Resources Code).

FISCAL IMPACT
There is no fiscal impact to the City other than administrative staff time and expense.

COORDINATION
This report has been coordinated with the City Attorney’s Office.

PUBLIC CONTACT
Public contact was made by publishing a hearing notice in the Mercury News on April 29, 2022 and in the Santa Clara Weekly on June 22, 2022. The Council agenda was also posted on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, [email protected] <mailto:[email protected]> or at the public information desk at any City of Santa Clara public library. An email notification of this meeting and a link to the City’s SB 9 page with additional background information was sent to people that are subscribed to the Zoning Code Update topic through the City’s email subscription service GovDelivery.

A Planning Commission meeting was held on May 11, 2022 and May 25, 2022. A joint City Council and Planning Commission study session was held on January 25, 2022.

ALTERNATIVES

1. Waive first reading and introduce an ordinance to establish objective subdivision, zoning, and design standards for SB 9 residential projects by amending Title 18 (Zoning) to create Chapter

18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits) with specified modifications to the draft ordinance as recommended by the Planning Commission related to front yard landscaping and solar access.

2. Direct staff to return with an alternate version of an ordinance to establish objective subdivision, zoning, and design standards for SB 9 residential projects by amending Title 18 (Zoning) to create Chapter 18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits) with specified modifications to the draft ordinance as recommended by the Planning Commission related to front yard landscaping, solar access, and uncovered parking.

3. Direct staff to return with an alternate version of an ordinance to establish objective subdivision, zoning, and design standards for SB 9 residential projects by amending Title 18 (Zoning) to create Chapter 18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits) with other modifications directed by the City Council.

4. Waive first reading and introduce an ordinance amending Chapter 17.05 (Subdivisions) of Title 17 (Development) to revise the subdivision process for SB 9 developments.

5. Direct staff to bring back an ordinance amending Chapter 17.40 (Citywide Affordable Housing Requirements) of Title 17 (Development) to add SB 9 projects to the types of developments City of Santa Clara Printed on 6/30/2022Page 5 of 6
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subject to an affordable housing fee.

6. Direct staff to bring back an ordinance amending Chapter 17.40 (Citywide Affordable Housing Requirements) of Title 17 (Development) to clarify that the affordable housing requirements will not apply to SB 9 developments.

7. Direct staff to bring back a report on obtaining an economic feasibility analysis for purposes of later establishing an inclusionary housing requirement on SB 9 developments.

8. Direct staff to bring back a report on establishing an incentive program for affordable housing, without enacting new affordable housing mandates.

RECOMMENDATION
Alternatives 1, 4, and 5:

1. Waive first reading and introduce an ordinance to establish objective subdivision, zoning, and design standards for SB 9 residential projects by amending Title 18 (Zoning) to create Chapter

18.13 (Two Unit Dwelling Residential Development and Urban Lot Splits) with specific modifications to the draft ordinance as recommended by the Planning Commission related to front yard landscaping and solar access.

4. Waive first reading and introduce an ordinance amending Chapter 17.05 (Subdivisions) of Title 17 (Development) to revise the subdivision process for SB 9 developments.

Reviewed by: Andrew Crabtree, Director, Community Development Approved by: Rajeev Batra, City Manager

ATTACHMENTS

1. May 25, 2022 Planning Commission Staff Report and Attachments

2. SB 9 Zoning Ordinance

3. SB 9 Subdivision Ordinance
City of Santa Clara Printed on 6/30/2022Page 6 of 6
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City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-716 Agenda Date: 5/25/2022

REPORT TO PLANNING COMMISSION

SUBJECT
Amend Title 18 Zoning to Establish an SB 9 Implementing Ordinance Including Development Standards for SB 9 Residential Projects (Continued from May 11, 2022)

BACKGROUND
On May 11, 2022 the Planning Commission received a presentation on an ordinance amending Title 18 Zoning of the Santa Clara City Code to add a new Chapter 18.13 Two-Unit Dwelling Residential Development and Urban Lot Splits to implement the provisions of Senate Bill 9 (SB 9). The Commission discussed the draft ordinance (Attachment 1), including potential changes to several of the proposed development standards, and continued their discussion of four topics, summarized in the discussion section below, to the May 25, 2022 Planning Commission hearing.

The staff report with attachments for the May 11, 2022 Planning Commission hearing, included for reference as Attachment 2, provides additional background on where SB 9 applies, what SB 9 allows, and the ways in which jurisdictions may and may not regulate SB 9 proposals.

DISCUSSION
Parking Design & Location Requirements
As drafted, the proposed ordinance (Section 18.13.040(b)) requires any required or proposed parking for an SB 9 project to meet the City’s parking design standards including the requirement that the parking be covered (i.e., a garage or carport) and located outside of required setbacks.

The Commission discussed, but did not reach an agreement, on modifying the draft ordinance to:

1. Allow uncovered parking for SB 9 units; and

2. Allow parking in the front setback (i.e., on a driveway) to count toward any required parking for SB 9 units.

The Commission generally indicated support for allowing uncovered parking for SB 9 units to provide applicants with design flexibility and to encourage the provision of off-street/on-site parking, especially in locations where SB 9 precludes the City from requiring any parking.

The Commission was split on the proposed change to allow parking in the front setback to count toward any required parking. Commissioners that did not support this proposal noted that this change would likely reduce the total number of off-street parking spaces provided for an SB 9 project. As the ordinance is currently drafted, an SB 9 unit that is required to provide one (1) parking space would have one (1) space located outside of the required setbacks and one (1) or more additional spaces City of Santa Clara Printed on 5/19/2022Page 1 of 4
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on a driveway. Advocates of the proposed change suggested that because the City already allows uncovered parking on driveways in the front setback and because SB 9 states that jurisdictions can only requires one (1) parking space, that the proposed ordinance should allow parking on a driveway in the front setback to count toward any required parking.

Front Yard Landscaping/Paving
Related to the Planning Commission’s parking discussion, a proposal was introduced to modify Section 18.13.060(i) Front Yard Landscaping to reduce the minimum required front yard landscaping (i.e., un-paved area) from 60-percent to 50-percent or 40-percent. Staff noted that the current R1 Zoning requirement is that a minimum of 35-percent of the front yard be permanently maintained as landscaped area.

The Commission discussed, but did not reach agreement on, a recommended change to the minimum percentage of landscaping / maximum percentage paving in the front yard. The discussion focused on changing the requirement to either:

1. Minimum 50-percent landscaping (maximum 50-percent paving)

2. Minimum 40-percent landscaping (maximum 60-percent paving) The proposed change was introduced primarily to facilitate parking on a driveway in the front setback.

On a typical 60-foot wide lot with a 20-foot deep front yard, a two-car side-by-side driveway can be accommodated under the proposed minimum 60-percent front yard landscaping requirement.

Reducing the front yard landscaping requirement to 50-percent or 40-percent would allow a three-car wide driveway.
· Percent Landscaping / Percent Paving (driveway width/depth) o 60 / 40 (24’ W x 20’ D) = 2 parking spaces
o 50 / 50 (30’ W x 20’ D) = 3 parking spaces
o 40 / 60 (36’ W x 20’ D) = 3 parking spaces
Solar Access
Chair Biagini expressed a concern that the construction of new units could cast a shadow on solar panels installed on adjacent houses, and asked whether there was a way to preserve the solar access. Assistant City Attorney Alexander Abbe responded that the Commission could add language to the ordinance addressing solar panels, and suggested the California Solar Shade Control Act (SSCA) as a model. The SSCA requires that trees and shrubs be trimmed so that they cast a shadow covering no more than 10 percent of solar collector absorption areas between 10 a.m. and 2 p.m. standard time. The SSCA does not apply to shrubs and trees that were planted prior to the installation of the solar panel.

Based on that model, Assistant City Attorney Abbe suggested that Chair Biagini could move to insert the following language into Section 18.13.040 of the ordinance, only it would apply to new or renovated homes instead of trees and shrubs:
(b) After the installation of a solar collector, a person owning or in control of another property City of Santa Clara Printed on 5/19/2022Page 2 of 4
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shall not construct or alter a residence so as to cast a shadow greater than 10 percent of the collector absorption area upon that solar collector surface at any one time between the hours of 10 a.m. and 2 p.m., Pacific standard time.

Assistant City Attorney Abbe also suggested including a definition of “solar collector” that mirrored the SCSA, Public Resources Code § 25981. Later in the discussion, Commissioner Saleme pointed out that an expansive definition of “solar collector” could apply to water heating and space heating without the presence of photovoltaic panels. Based on that, Mr. Abbe suggested a narrower definition than in the SCSA, which would exclude water heating and space heating. The definition would read as follows:
“Solar collector” means a fixed device, structure, or part of a device or structure, on the roof of a building, comprising photovoltaic panels, that is used primarily to transform solar energy into electrical energy.

Affordability
Chair Biagini also asked whether it would be possible to include an affordability requirement for a second unit constructed under SB 9. Assistant City Attorney . Abbe responded that Fremont and Santa Barbara had both recently adopted ordinances imposing such a requirement, although he would need to research whether SB 9 allowed for such a provision in Santa Clara. In the meantime, Assistant City Attorney Abbe suggested that the Commission could make a separate motion on an affordability recommendation to the Council, and that he would research the feasibility of including an affordability requirement prior to the Council meeting. (Because the City’s affordability requirements are contained in Title 17 of the City Code, rather than the Zoning Ordinance, the Planning Commission would not review the actual ordinance imposing an affordability requirement.)

ENVIRONMENTAL REVIEW
Pursuant to California Government Code Sections 65852.21 (j) and 66411.7 (n), a local agency may adopt an ordinance to implement SB 9 and that ordinance shall not be considered a project under Division 13 (commencing with Section 21000) of the Public Resources Code.

FISCAL IMPACT
There is not a fiscal impact to the City other than administrative staff time and expense.

COORDINATION
This report has been coordinated with the City Attorney’s Office.

PUBLIC CONTACT
Public contact was made by publishing a hearing notice in the Mercury News on April 29, 2022. The Planning Commission agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615- 2220, email [email protected] <mailto:[email protected]> or at the public information desk at any City of Santa Clara public library.

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An email notification of the May 11, 2022 Planning Commission meeting and a link to the City’s SB 9 page with additional background information was sent via e-notify to those that are subscribed to the Zoning Code Update topic through the City’s email subscription service GovDelivery.

ALTERNATIVES

1. Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter

18.13 Two Unit Dwelling Residential Development and Urban Lot Splits.

2. Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter

18.13 Two Unit Dwelling Residential Development and Urban Lot Splits with specified modifications to the draft ordinance.

RECOMMENDATION
Alternative 1: Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter 18.13 Two Unit Dwelling Residential Development and Urban Lot Splits.

Reviewed by: Andrew Crabtree, Director of Community Development Approved by: Manuel Pineda, Assistant City Manager

ATTACHMENTS

1. SB 9 Implementing Ordinance DRAFT

2. May 11, 2022 Planning Commission Staff Report and Attachments City of Santa Clara Printed on 5/19/2022Page 4 of 4
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Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 1 of 11 Rev: 09/2019
ORDINANCE NO. _____

AN ORDINANCE OF THE CITY OF SANTA CLARA ,
CALIFORNIA, AMENDING TIT LE 18 (“ZONING”) BY
ADDING A NEW CHAPTER 18.13 (“TWO-UNIT DWELLING
RESIDENTIAL DEVELOPMENT AND URBAN LOT SPLITS”)
TO “THE CODE OF THE CITY OF SANTA CLARA ,
CALIFORNIA”

BE IT ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

NOW THEREFORE, BE IT FURTHER ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

SECTION 1 : That a new Chapter 18.13 (entitled “Two Unit Dwelling Residential Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 2 of 11 Rev: 09/2019
Development and Urban Lot Splits”) is hereby added to Title 18 (entitled “Zoning”) of “The Code of the City of Santa Clara, California” (“SCCC”) to read as follows:
“Chapter 18.13

Two Unit Dwelling Residential Development and Urban Lot Splits

18.13.010 Purpose. The purpose of this Chapter is to regulate two dwelling unit residential development and urban lot splits in compliance with California Government Code Sections 65852.21 and 66411.7 to allow two detached or attached housing units on one parcel, and ancillary uses and structures, and to allow urban lot splits. Proposed two dwelling unit housing developments and urban lot splits shall be considered ministerially, without discretionary review or a hearing, if the proposed housing development meets all of the requirements of this Chapter.

18.13.020 Applicability.

This Chapter shall apply to properties within the Single-Family Residential Zone (R1-6L) and Single-Family Residential, Larger Parcel Zone (R1-8L), with the following exceptions:
(a) The development site is within a state or local historic district or is included on the State Historical Resources Inventory or on the City’s Historic Resource Inventory. (b) The property is located on a hazardous waste site, as defined by Government Code Section 65913.4(a)(6)(E).
(c) The property is within a special flood hazard area subject to inundation by the 1 percent annual chance flood (100-year flood), as defined by Government Code Section 65913.4(a)(6)(G).
(d) The property is within a regulatory floodway, as defined by Government Code Section 65913.4(a)(6)(H).

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 3 of 11 Rev: 09/2019
(e) The development would demolish or alter any existing dwelling unit that is subject to affordability restrictions under a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income. (f) The development would demolish or alter any existing dwelling unit on the lot that has been occupied by a tenant in the last three years prior to the date of application.

18.13.030 Construction of Multiple Units in Single Family Zones Notwithstanding Sections 18.10.030 and 18.12.030, up to two homes are permitted on a single parcel within the R1-6L and R1-8L zones, subject to the requirements of this Chapter. On a parcel that has not been divided pursuant to Section 18.13.050, accessory dwelling units meeting the requirements of Sections 18.10.030(d) or

18.12.030(d) are also permitted.

18.13.050 Development Standards within R-1 Building Envelope Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 4 of 11 Rev: 09/2019
For development that will result in two units on a lot, if both units proposed will be located entirely within the allowed R-1 building envelope, the development standards of the R1-6L or R1-8L zone will apply to each house, except that the maximum number of houses shall be two per lot.

18.13.060 Development Standards outside of R-1 Building Envelope For development that will result in two units on a lot, where any portion of a building or buildings is proposed to be located outside of the allowed R-1 building envelope, the following development standards apply.

Residential developments shall comply with the development standards in this Chapter and for the R1-8L and R1-6L Zones, as applicable, set forth in Chapters 18.10 and

18.12 (Single-Family, Larger Lot Area Zoning and Single-Family Zoning Districts) and additional parking regulations set forth in Chapter 18.74 (Parking Regulations), with the following exceptions:
(a) Size. Units may be as small as 220 square feet in floor area or as large as 1,000 square feet in floor area.
(b) Maximum Height/Stories.
(1) Rear 15 feet of a parcel: Buildings or structures shall not exceed one story in height or 16-feet.
(2) All other areas on the parcel: Buildings or structures shall not exceed one and one-half stories or 25 feet in height
(c) Side and Rear Setbacks. Minimum side and rear setbacks shall be the least of the following:

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 5 of 11 Rev: 09/2019
(1) As required by Chapters 18.10 (R1-8L) or 18.12 (R1-6L), as applicable;
(2) 4 feet;
(3) The setbacks of an existing structure for which there is no proposal to alter its dimensions, or a structure constructed in the same location and to the same dimensions as an existing structure.
(d) Upper Story Windows. Second story egress windows shall face the front property line or interior of the project. Otherwise second story windows must be either of the following:
(1) 5-foot minimum sill height above finished floor; or (2) Clerestory; or
(3) Opaque/frosted glass.
(f) Second Story Balconies and Roof Decks. Balconies with a maximum depth of 4-feet allowed within the R1-6L and R1-8L setbacks. Roof decks are not allowed. (g) Front Door Placement/Orientation. For units within 30-feet of a street, the main entrance door or entry porch must be oriented to the street and be located no more than 5-feet behind the front most wall of the unit. (h) Garage Location/Size. For garages within 30-feet of a street, the maximum width for a garage with a garage door facing the street is 40 percent of the lot width.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 6 of 11 Rev: 09/2019
(i) Front Yard Landscaping. A minimum of 60 percent of the front yard shall be maintained as un-paved landscaping, except as may be required to meet minimum off - street parking and access requirements of the Zoning Code. (j) Modification or Waiver of Standards. An applicant for a residential development that will result in two homes on a lot may apply for a modification or waiver of specific development standards, if all of the following requirem ents are met:
(1) The applicant must demonstrate, to the satisfaction of the Zoning Administrator, that the strict application of development standards in this Chapter, or the standards for the R1-6L or R1-8L Zones (set forth in Chapters 18.12 and 18.10) would preclude the construction of a maximum of two units, where each unit is at least 800 square feet in floor area.
(2) The applicant shall have the burden of proof to establish that the modification or waiver is necessary and that there is no redesign possible that would still allow for the construction of two dwellings of at least 800 square feet without the modification or waiver.
(3) Notwithstanding the foregoing, a modification or waiver shall not be used to reduce the minimum setback size to less than four feet, unless the setback is on an existing legal structure with setbacks of less than four feet, and the proposed development either (A) does not propose to modify the dimensions of that existing structure, or (B) will replace the structure with another structure with exactly the same dimensions.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 7 of 11 Rev: 09/2019

18.13.070 Urban Lot Splits.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 8 of 11 Rev: 09/2019
(6) The urban lot split conforms to all applicable objective requirements of the Subdivision Map Act (Division 2 (commencing with Section 66410)), except as otherwise expressly provided in this Section.
(7) The parcel being subdivided was not established through prior exercise of an urban lot split as provided for in this Chapter. (8) Neither the owner of the parcel being subdivided nor any person acting in concert with the owner has previously subdivided an adjacent parcel using an urban lot split as provided for in this Chapter.
(b) Development Standards. Development standards for each new parcel resulting from an urban lot split shall conform to Section 18.13.030. Development standards shall be applied to each new parcel individually. New flag lots shall provide a 15-foot minimum front setback (measured from the property line shared between the front lot and the flag lot).
(c) Nonconforming Zoning Conditions. Correction of legal nonconforming zoning conditions shall not be required as a condition for ministerial approval of a parcel map application for the creation of an urban lot split. (d) Residency Requirement. An applicant for an urban lot split shall sign an affidavit stating that the applicant intends to occupy one of the housing units as their principal residence for a minimum of three years from the date of the approval of the urban lot split. This requirement shall not apply to an applicant that is a “community land trust” as defined in Revenue and Taxation Code Section 402.1(a)(11)(C), or is a Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 9 of 11 Rev: 09/2019
“qualified nonprofit corporation” as described in Revenue and Taxation Code Section 214.15.
(e) Residential Use. Except as authorized by Chapter 18.100, any parcel created through this Chapter may only be used for residential purposes and any unit created through this Chapter shall not be used as a short-term rental (rented for a period of 30 days or less).

18.13.080 Accessory Dwelling Units.

On a parcel that has not been divided pursuant to Section 18.13.050, a n Accessory Dwelling Unit (ADU) and/or a Junior ADU (JADU) that conform with California Government Code Sections 65852.2 (ADUs) and 65852.22 (JADUs) are allowed in addition to the units allowed in this Section. Once a parcel has been divided pursuant to Section 18.13.050, however, the maximum number of dwellings on each resulting parcel, inclusive of any ADU or JADUs, is two.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 10 of 11 Rev: 09/2019
(c) “Demolish or alter” means removal of more than 25-percent of exterior walls on a building even if the rental unit itself is not altered. (d) “Egress window” means a window with a minimum net clear opening dimensions of at least 20" in width and 24" in height.
(e) “Flag Lot” means a parcel with access provided to the bulk of the lot by means of a corridor between 12 and 15 feet in width, inclusive. (f) “Half Story” means a habitable living space with a sloping roof, which may have dormer windows.
(g) “R-1 Building Envelope” means an area defined by the minimum setback and maximum lot coverage requirements of Chapters 18.10 or 18.12, whichever is applicable.
(h) “Urban Lot Split” means a subdivision of a residential lot located in either the R1-6L or R1-8L zone into two lots subject to the requirements of this Chapter.” SECTION 2: Savings clause. The changes provided for in this ordinance shall not affect any offense or act committ ed or done or any penalty or forfeiture incurred or any right established or accruing before the effective date of this ordina nce; nor shall it affect any prosecution, suit or proceeding pending or any judgment rendered prior to the effective date of this ordinance. All fee schedules shall remain in force until superseded by the fee schedules adopted by the City Council.
//

//
Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 11 of 11 Rev: 09/2019
SECTION 3: Effective date. This ordinance shall take effect thirty (30) days after its final adoption; however, prior to its final adopti on it shall be published in accordance with the requirements of Section 808 and 812 of “The Charter of the City of Santa Clara, California.” PASSED FOR THE PURPOSE OF PUBLICATION this XX day of XXXXXX, 2022, by the following vote:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST: ___________________________

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

Attachments incorporated by reference: None
City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-476 Agenda Date: 5/11/2022

REPORT TO PLANNING COMMISSION

SUBJECT
Amend Title 18 Zoning to Establish an SB 9 Implementing Ordinance Including Development Standards for SB 9 Residential Projects

BACKGROUND
Senate Bill 9 (SB 9) was signed into law by Governor Newsom on September 16, 2021 and became effective on January 1, 2022. For projects that meet specific eligibility criteria, SB 9 requires ministerial review and approval of a housing development with two primary dwelling units on a single- family (R1) zoned property, the subdivision of an R1 zoned parcel, or both.

Ministerial review of an SB 9 application means a process without discretionary review or hearing, where City staff is limited to ensuring that the proposed development meets all eligibility criteria and applicable objective zoning, subdivision, and design review standards.

For additional background on where SB 9 applies, what SB 9 allows, and the ways in which jurisdictions may and may not regulate SB 9 proposals, please see attached staff report and presentation from the January 25, 2022 joint City Council and Planning Commission study session.

Objective Standards
Any SB 9 proposal submitted after the law became effective on January 1, 2022 is automatically subject to the City’s current objective standards (Title 18 Zoning) and/or (Title 17 Development/Subdivision) standards, so long as those standards:

1. do not physically preclude the construction of two units of at least 800 square feet each, per property, and

2. do not conflict with SB 9 standards (e.g., setbacks, parking, etc.) and

3. do not conflict with the ministerial review requirement for SB 9 projects.

Attached is the City’s SB 9 Eligibility Checklist and Planning Application, with a list of general requirements for SB 9 proposals, including references to current objective standards in Title 18.

At the January 25, 2022 joint study session, staff identified several topic areas that SB 9 and/or the City’s current Zoning Code do not adequately address. These topics include parking, urban lot split standards, privacy, and neighborhood compatibility.

Recommendations for additional objective zoning and design standards for SB 9 projects are incorporated into the attached draft Ordinance, which would amend the current Title 18 to add a new chapter specifically for SB 9 projects.

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If adopted by City Council, the SB 9 ordinance will go into effect 30 days after the subject ordinance’s second reading by the City Council and incorporated into the Final Draft of the City’s Zoning Code Update, which is scheduled for recommendation and adoption hearings by the Planning Commission and City Council in the next few months.

DISCUSSION
State law allows a local jurisdiction, on a limited basis, to adopt ordinances that establish development standards to regulate the implementation of SB 9 projects. The primary issue for the Planning Commission to consider when evaluating the proposed ordinance is the appropriateness and adequacy of the proposed development standards for SB 9 projects (listed in Sections 18.13.030 and 18.13.040 of the draft ordinance and summarized below). As part of the discussion staff has provided questions for the Planning Commission to consider as you review the proposed development standards.

Unit Size
SB 9 states that a local agency may impose objective zoning, subdivision, and design review standards, providing such objective standards do not preclude the construction of either of the two units being less than 800 square feet in floor area; however SB 9 does not establish a minimum or maximum floor area. The proposed ordinance identifies the minimum unit size allowed per Building Code (220 square feet) and a maximum unit size based on the maximum Accessory Dwelling Unit (ADU) size proposed in the Zoning Code Update (1,000 square feet).

Question 1. Should the maximum SB 9 unit size be smaller (can be as small as 800 square feet) or larger than 1,000 square feet?
Off-Street Parking
SB 9 requires parking of no more than one space per dwelling unit, except no parking is required for projects within a half-mile walking distance of a high-quality transit corridor or a major transit stop, or within one block of a car share. The proposed ordinance is consistent with this requirement and each project will be evaluated to determine if one space or zero spaces are required per unit.

Question 2. Should all SB 9 projects be exempt from providing parking regardless of proximity to transit or car share?
The proposed ordinance will require any off-street parking, whether required or proposed, to meet the City’s parking design standards. However, the City’s existing ordinance regulating Accessory Dwelling Units (ADUs) has no parking requirements for any ADUs, regardless of proximity to transit.

Question 3. Should SB 9 projects be subject to less restrictive parking design standards (e.g., smaller parking space dimensions, smaller setbacks, etc.)?
Privacy Standards
To help address privacy concerns, particularly with SB 9 units being allowed with reduced side and rear setbacks (can require no greater than 4-feet), the following standards, which are based on the City’s existing Single-family and Duplex Residential Design Guidelines (RDGs) and draft Zoning Code Update, are included in the draft ordinance.

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parcel shall not exceed one story or 16-feet in height. On the rest of the parcel, buildings or structures shall not exceed one and one-half stories or 25-feet in height. (A “half story” is habitable space with a sloping roof that reduces the total volume of space. Dormer windows are common in half stories.)
Second story egress windows are required to face the front property line or interior of the SB 9 project (i.e., not facing adjacent properties) and for other second story windows to be either high/clerestory or opaque.

Second story balconies are limited to a maximum depth of 4-feet and roof decks are not allowed.

Question 4. Do these standards sufficiently address privacy concerns from SB 9 projects? Neighborhood Compatibility
The draft ordinance includes standards to enhance the compatibility of SB 9 units with adjacent properties and the surrounding neighborhood, including standards for front door placement/orientation, garage location/size, and front yard landscaping.

For units within 30-feet of a street, the main entrance door or entry porch must be oriented to the street and be located no more than 5-feet behind the front most wall of the unit.

If an SB 9 unit includes a garage that is located within 30-feet of a street with a garage door that faces the street, the maximum width for the garage is 40 percent of the lot width.

SB 9 properties are required to maintain of minimum of 60 percent of the front yard as un-paved landscaping, except as may be required to meet Zoning Code minimum off-street parking and access requirements.

Question 5. Are there additional standards that could be applied to SB 9 projects that would support enhanced neighborhood compatibility?
Applicability of Standards
One additional consideration in preparing the ordinance was whether these standards should apply only to the second house built on a property, or whether they would apply to both an existing house and the newly constructed house. The disadvantage of the latter approach is that if the original house exceeded any of the new standards of the ordinance, it would become legal nonconforming, which would limit a homeowner’s ability to make renovations or expansions to the house in the future.

In addition, it would treat homeowners differently based on whether they already had one house and were building a second home, or whether they were building two houses on a vacant lot.

Rather than focus on when a house was constructed, the ordinance instead considers where the houses are located on a lot. For larger lots, if it possible for both houses to be located within the building envelope that would otherwise apply to a single home (in other words, the standard setbacks and lot coverage requirements), then the standard R-1 requirements will apply. So neither house would, for example, be subject to the 1000 sf maximum size. If, however, either house uses the reduced setbacks or lot coverage requirements allowed by SB 9, then both houses would become subject to the stricter standards listed above, including the 1000 sf maximum.

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Question 6. Is the Planning Commission comfortable with this approach? Subdivision Process
When a homeowner splits a lot using SB 9, the law requires that the process be conducted ministerially (without a public hearing or discretionary review). The City’s subdivision ordinance, City Code Chapter 17.05, currently requires all subdivisions to have a public hearing at City Council. As a result, it is necessary to also make amendments to Chapter 17.05 to set up this new ministerial process. There is a reference to a new section of Chapter 17.05 in the proposed ordinance, but the actual amendments to Chapter 17.05 will be brought forward to City Council separately, since the Planning Commission does not make recommendations on ordinances outside of the zoning code.

For reference, a draft of the proposed changes to Chapter 17.05 is attached as Attachment 5.

ENVIRONMENTAL REVIEW
Pursuant to California Government Code Sections 65852.21 (j) and 66411.7 (n), a local agency may adopt an ordinance to implement SB 9 and that ordinance shall not be considered a project under Division 13 (commencing with Section 21000) of the Public Resources Code.

FISCAL IMPACT
There is not fiscal impact to the City other than administrative staff time and expense.

COORDINATION
This report has been coordinated with the City Attorney’s Office.

PUBLIC CONTACT
Public contact was made by publishing a hearing notice in the Mercury News on April 29, 2022. The Planning Commission agenda was also posted on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email [email protected] <mailto:[email protected]> or at the public information desk at any City of Santa Clara public library.

An email notification of this meeting and a link to the City’sSB 9 page <https://www.santaclaraca.gov/our-city/departments-a-f/community-development/planning- division/zoning/sb-9> with additional background information was sent to people that are subscribed to the Zoning Code Update topic through the City’s email subscription service GovDelivery.

A joint City Council and Planning Commission study session was held on January 25, 2022.

ALTERNATIVES

1. Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter 18.13 Two Unit Dwelling Residential Development and Urban Lot Splits

2. Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter 18.13 Two Unit Dwelling Residential Development and Urban Lot Splits with specified modifications to the draft ordinance.

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RECOMMENDATION

1. Recommend that the City Council adopt an ordinance amending Title 18 Zoning to include Chapter 18.13 Two Unit Dwelling Residential Development and Urban Lot Splits Reviewed by: Andrew Crabtree, Director of Community Development Approved by: Rajeev Batra, City Manager

ATTACHMENTS

1. Joint City Council/Planning Commission Study Session Staff Report

2. Joint City Council/Planning Commission Study Session Presentation

3. City of Santa Clara SB 9 Eligibility Checklist and Application

4. SB 9 Implementing Ordinance DRAFT

5. Proposed revisions to Chapter 17.05 (Subdivision).

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City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-85 Agenda Date: 1/25/2022

REPORT TO COUNCIL

SUBJECT
Joint City Council and Planning Commission Study Session on Senate Bill (SB) 9

COUNCIL PILLAR
Promote and Enhance Economic, Housing and Transportation Development

EXECUTIVE SUMMARY
Senate Bill (SB) 9 (Atkins), signed into law by Governor Newsom on September 16, 2021, effective January 1, 2022, preempts restrictions imposed by local jurisdictions to allow property owners within a single-family residential zone to build two units and/or to subdivide a lot into two parcels, for a total of four units.

The law also outlines how jurisdictions may regulate SB 9 projects. Jurisdictions may only apply objective zoning, subdivision, and design standards to these projects, and these standards may not preclude the construction of up to two units of at least 800 square feet each. Jurisdictions can conduct objective design review but may not have hearings for units that meet the state rules (with limited exceptions).

The purpose of this study session is to provide the Planning Commission and City Council with an overview of SB 9 and discuss some examples of how other jurisdictions have proposed to regulate SB 9 projects, and how the City of Santa Clara could adopt its own implementing ordinance with objective design, subdivision, and zoning standards.

BACKGROUND
SB 9 requires ministerial approval of the following development activities:
· Two-unit housing development - Two homes on an eligible single-family residential parcel (whether the proposal adds up to two new housing units or adds one new unit to one existing unit).
· Urban lot split - A one-time subdivision of an existing single-family residential lot into two parcels. This would allow up to a total of four units (unless a jurisdiction decides to allow additional units).

SB 9 applies to all single-family (R1-6L and R1-8L) residentially zoned properties within an urbanized area with several key exceptions:
· Environmentally sensitive areas
· Environmental hazard areas if mitigations are not possible · Historic properties and districts
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· Properties where the Ellis Act was used to evict tenants at any time in the last 15 years. The Ellis Act is a 1985 California state law that allows landlords to evict residential tenants to "go out of the rental business".
· Additionally, demolition is generally not permitted for units rented in the last 3 years, rent- controlled units or units restricted to people of low or moderate incomes.

This law is similar to recent state ADU legislation in that it allows jurisdictions to apply local standards as long as they do not prevent the development of a small new home (or multiple homes in the case of lot splits). Market analysis predicts the uptake will be limited in part because homeowners already have many of the same rights under the ADU law. The bigger change is likely permitting the splitting and sale of lots by homeowners.

What Can Be Built
Prior to SB 9
Prior to SB 9, a single-family residentially zoned property was allowed one primary dwelling unit, one Accessory Dwelling Unit (ADU), and one Junior ADU, for a total of up to three housing units. 1 primary dwelling unit +
1 ADU + 1 JADU = 3 Total Housing Units
SB 9 with no Lot Split
Homeowners can use SB 9 to build two new homes on a vacant lot. If there is an existing home, they can add one primary dwelling unit. In addition, an ADU and a JADU would also be allowed, for a total of up to four housing units.
2 primary dwelling units +
1 ADU + 1 JADU = 4 Total Housing Units
SB 9 with Lot Split
Homeowners that split a lot will be allowed to build one new primary dwelling unit plus one additional primary dwelling unit or one ADU on each of the two new lots, allowing for a total of up to four housing units.
1 primary dwelling unit +
1 primary dwelling unit or 1 ADU =
2 Housing Units on each lot (4 Total Housing Units)
The following graphic illustrates potential scenarios that could occur on a single-family property under SB 9:

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LOT WITH LOT WITH LOT WITH SINGLE-FAMILY

VACANT LOT SINGLE-FAMILY HOME NONCONFORM ING DUPLEX HOME AND AN ADU A1 81 (1 D1
UJ
a:
0 LL
UJ
co
No units 1 unit Up to 2 units 1 unit
(nonconforming ) + 1 ADU/JADU
A2 82 C2 D2
V') !::: I- _,
- c.. z V)
::::i I-
Cl 0 _,
Cl 0 cl'. z
Up to 2 units Up to 2 units No additional units Can add 1 addt/. unit + 2 ADUs/JADUs + 2 ADUs /JADUs + 1 ADU/JADU
0 B3 (3
z I-
V)- -
I- _,
- c.. z V)
::::i I-
Cl 0 _,
Cl
cl'.

Up to 4 total units Up to 4 total units Up to 4 total units Up to 4 total units "Legally constru cted but not currently permitted . Check your local ordinan ce for nonconformin g use policies .

USING SB 9 WITHOUT A LOT SPLIT:
• Without a lot split , SB 9 does not limit the number
of ADUs or JADUs (B2, 02) - but other laws might.
• SB 9 could be interpreted to allow 2 new units
beyond an existing unit (up to 3 units/lot, plus
any allowed ADUs/ JADUs).

USING SB 9 WITH A LOT SPLIT:
• SB 9 does not require jurisdictions
to approve more than 4 units
total , including any ADUs/ JADUs.

SINGLE-UNIT DEVELOPMENTS
SB 9 can be used to develop single
units - but projects must comply
with all SB 9 requirements.
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LOT WITH LOT WITH LOT WITH SINGLE-FAMILY

VACANT LOT SINGLE-FAMILY HOME NONCONFORMING DUPLEX HOME AND AN ADU A1 81 (1 D1
LU
er:
0 LL
LU
co
No units 1 unit Up to 2 units 1 unit
(nonconforming) + 1 ADUIJADU
A2 82 (2 D2
v,· !::

I- ....J
- Cl..
z V,
:::) I-
Cl 0
....J
Cl 0 cl: z
Up to 2 units Up to 2 units No additional units Can add 1 addtl. unit + 2 ADUs/JADUs + 2 ADUs l JADUs + 1 ADUIJADU
0 83 C3
z I-
V') .. ~
!::: Cl..
z V,
:::) I-
Cl 0
....J
Cl
cl:

Up to 4 total units Up to 4 total units Up to 4 total units Up to 4 total units 'Legally constructed but not currently permitted . Check your local ordinance for nonconforming use policies .

USING SB 9 WITHOUT A LOT SPLIT:
• Without a lot split , SB 9 does not limit the number
of ADUs or JADUs (B2, D2) - but other laws might .
• SB 9 could be interpreted to allow 2 new units
beyond an existing unit (up to 3 units/lot , plus
any allowed ADUs/ JADUs).

USING SB 9 WITH A LOT SPLIT:
• SB 9 does not require jurisdictions
to approve more than 4 units
total , including any ADUs/ JADUs.

SINGLE-UNIT DEVELOPMENTS
SB 9 can be used to deve lop single
un its - but projects must comply
with all SB 9 requirements .
22-85 Agenda Date: 1/25/2022

Potential New Home Creation
It is unclear how many homes will be created by SB 9 over time. While SB 9 increases the zoned potential for residential units in single-family neighborhoods, market conditions and other factors are likely to limit the impacts of SB 9. The City of Santa Clara has approximately 18,000 single-family residential lots that would be subject to SB 9. While social, physical or economic factors will likely constrain utilization o the SB 9 provisions, the new law should still be expected to result in changes within established Santa Clara neighborhoods. (Constraints may include construction costs, a limited number of developers interested in taking on small scale projects, smaller properties that constrain the ability to develop multiple units, and/or the desire of property owners to continue living in traditional single-family homes within established neighborhoods.) While SB 9 applies to an estimated 18,000 parcels in the City of Santa Clara, past experience with state housing laws such as Accessory Dwelling Unit (ADU) laws suggests that only a small percentage of owners may choose to utilize SB 9. For reference, in 2020, a similar number of parcels were eligible to build up to two ADUs (one full size and one junior) in the City of Santa Clara, but only 74 permits for ADUs were issued, and almost all of those were for one ADU per lot.

In July, UC Berkeley's Terner Center for Housing Innovation published a report on SB 9, concluding that single family homes would continue to be the dominant land use in areas covered by SB 9. This is because single family sales prices are high, many lots have limited buildable area, and construction costs limit what is feasible. Even when the economics are right, many property owners will still choose not to build. The report estimates that less than 4-percent (approximately 700 lots) of City of Santa Clara Printed on 1/20/2022Page 5 of 10
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the City of Santa Clara’s single-family parcels would be economically viable to allow new unit construction under SB 9, compared to prior law. The report states that the construction of 1,100 new units in Santa Clara could be market-feasible under SB9.

Note the Terner Center projection is a snapshot of economic viability under current market conditions, not a time-horizon forecast. Changes in land, labor, and material cost over time will continue to shift the number of parcels that may be potentially developed under SB 9.

Regional Housing Needs Allocation (RHNA)
SB 9 units may be able to count for purposes of Housing Elements and RHNA, but the exact methodology is currently unclear. In future years, it will be based on actual construction trends, but for the upcoming housing element, there is not sufficient time or data available to establish a pattern upon which to project housing yield. HCD is expected to provide guidance on this in the coming months. For subsequent annual progress reports to the State, local jurisdictions will be required to include data on all SB 9 units and applications for urban lot splits.

Regulations
The law details which ways jurisdictions may regulate SB 9 proposals. There are some actions jurisdictions must take, some decisions that jurisdictions can choose to take, and some areas they may not regulate.

The following requirements and limitations apply to all two-unit housing development and urban lot split projects under SB 9:
· Ministerial review - Jurisdictions must review and process applications for SB 9 two-unit housing developments and urban lot splits ministerially, without any discretionary/subjective review or CEQA.
· Objective standards - Jurisdictions may only impose objective zoning, design, and subdivision standards. Such standards shall not physically preclude the construction of two units of at least 800 square feet each, per property. Note that applicants may propose units that are as small as 220 square feet.
· 4-foot rear and side setbacks - Jurisdictions may not impose residential setbacks greater than 4 feet for side and rear property lines.
· Rebuild demolished buildings with same setback - Jurisdictions may not impose any new setback requirements for a new residence constructed in the same location and to the same dimensions as an existing structure that is demolished. · Zero or one parking space - Jurisdictions may not require more than one parking space per unit. For properties within one-half mile walking distance of either a high-quality transit corridor or a major transit stop, or within one block of a car share vehicle, no parking spaces may be required.
· Denials for public health and safety exemption - Jurisdictions may only deny an SB 9 proposal if the Building Official finds that it would have a “specific, adverse impact [as defined by law], upon public health and safety or the physical environment and for which there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact.” Any denials must be based on objective, identified public health and safety standards, policies or conditions that existed when the application was submitted.

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· Attached buildings allowed - Jurisdictions may not reject an application because it proposes adjacent or connected structures provided that the structures meet building code safety standards and are sufficient to allow separate conveyance. Note that SB 9 does not define “sufficient to allow separate conveyance.”
The following additional limitations apply to all urban lot split projects under SB 9:
· Dedications/Improvements - Jurisdictions may not require dedications of rights-of-way or the construction of offsite improvements.
· Easements - Jurisdictions may require easements required for the provision of public services and facilities and may require that parcels have access to, provide access to, or adjoin the public right-of-way.
· No correction of non-conforming conditions - Jurisdictions may not require correction of an existing legal non-conforming condition as a condition for ministerial approval.

Additional Information on Applicability and Restrictions SB 9 applies in all Urban Areas, as defined by the US Census Bureau, except the following:
· Environmental Sensitivity/Environmental Hazards - Properties designated as:
o Prime farmland or farmland of statewide importance
o Wetlands
o Within a very high fire hazard severity zone (with exceptions) o A hazardous waste site (with exceptions)
o Within a delineated earthquake fault zone (with exceptions) o Within a flood zone (with exceptions)
o Identified for conservation or under conservation easement o Habitat for protected species
· Ellis Act - Properties where the Ellis Act was used to evict tenants at any time in the last 15 years.
· Historic Properties - Properties located in a state or local historic district, or properties designated historic landmarks on a state or local register.

SB 9 includes the following additional restrictions:
· Deed restricted affordable housing and rental housing - SB 9 projects may not demolish housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income. Nor is it allowed for housing that is subject to any form of rent or price control through a public entity’s valid exercise of its police power. Demolition is also not permitted for housing that has been occupied by a tenant in the last three years.
· No short-term rentals - Rental terms less than 30 days are not allowed. · Limits on demolition - Projects may not demolish more than 25 percent of existing exterior structural walls unless (a) the property has not been occupied by a tenant for 3 years or (b) otherwise allowed by the jurisdiction.

The following rules are specific to SB 9 Urban Lot Splits:
· One lot split only - Only one lot split is allowed through use of SB 9 (additional splits would only be possible if otherwise allowed by the City’s Zoning Code).

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· Residential only - The uses on the resulting lots are limited to residential uses. · Approximately equal size - Each new parcel must be “approximately equal” in lot area provided that one parcel shall not be smaller than 40 percent the size of the original parcel. · Minimum parcel size - No parcel shall be less than 1,200 square feet. Jurisdictions may by ordinance adopt a smaller minimum lot size subject to ministerial approval. · Intention to occupy - The subdivider must sign an affidavit stating they intend to occupy one of the units for a minimum of three years. The local jurisdiction cannot impose additional owner occupancy standards. Community land trusts and qualified nonprofits are exempted from this requirement.
· Limits on adjacent urban lot splits - Neither the subdivider nor any person “acting in concert” with the subdivider has previously subdivided an adjacent parcel using an urban lot split. Note that SB 9 does not define what “acting in concert” means, or how it would be proven.

DISCUSSION
As described above, the law establishes limited standards that jurisdictions may apply to the review of qualifying SB 9 projects. However, jurisdictions may impose objective zoning, subdivision, and design standards to the extent that those standards do not conflict with the limitations imposed by SB 9 and would not physically preclude the construction of up to two units of at least 800 square feet each.

Staff is seeking input on the following topics where the City of Santa Clara can apply existing objective standards and establish new objective standards for the review of SB 9 applications:
· Parking - SB 9 limits the number of parking spaces that can be required to a maximum of one space per unit, or no parking if the parcel is within one-half mile of a high-quality transit corridor or a major transit stop, or if the parcel is within one block of a car share. o Since SB 9 is otherwise silent on the topic of parking, the City may apply current zoning parking design standards (or develop less restrictive standards) for SB 9 projects that are required to provide parking or propose parking.
· Urban Lot Split Standards - SB 9 requires that one parcel shall not be smaller than 40 percent of the lot area of the original parcel and both newly created parcels are no smaller than 1,200 square feet. Forty percent of a typical 6,000 square foot lot is 2,400 square feet. o The City may apply current zoning and subdivision standards to SB 9 Urban Lot Split projects to the extent that those standards do not conflict with the limitations imposed by SB 9. The City may establish lot width, frontage width, and flag lot standards that are specific to SB 9 Urban Lot Split projects.
· Privacy - Privacy is not addressed in SB 9. Establishing objective standards for the following could help address privacy concerns:
o Size and/or placement of second stories
o Size, placement, or style of second story windows
o Second story balconies and roof decks
· Maximum Unit Size - Local standards shall not preclude construction of up to 2 units that are each at least 800 square feet.
o Since SB 9 is otherwise silent on unit size, the City may establish a maximum unit size that is at least 800 square feet. Note that an applicant may propose units as small as 220 square feet.

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· Neighborhood Compatibility - There are no standards in SB 9 that address neighborhood compatibility concerns, but the City may apply current zoning development standards and can adopt additional objective standards that are not in conflict with SB 9 including the following:
o Front and street-side setbacks
o Front door placement/orientation
o Garage location/size
o Front yard landscaping
The presentation for the study session will include examples of how other jurisdictions propose to address the above topic areas and recommendations for how the City of Santa Clara could address these topics.

Historic Preservation - As mentioned above, SB9 is not applicable to properties located in a state or local historic district, or properties designated historic landmarks on a state or local register. The City may want to consider undertaking or promoting the designation of historical properties or districts as a means of preserving historical areas that could be otherwise affected by SB9.

ENVIRONMENTAL REVIEW
The action being considered is a study session only and does not constitute a “project” within the meaning of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines section 15378(a), as it has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.

Future action to adopt an ordinance implementing SB 9 would not be considered a project per Section 65852.21(j) of the California Government Code.

FISCAL IMPACT
There is no fiscal impact to the City other than administrative staff time and expense.

COORDINATION
This report has been coordinated with the City Attorney’s Office and the City Manager’s Office.

RECOMMENDATION
Provide feedback on the following SB 9 Study Session topics:

1. Parking

2. Urban Lot Split Standards

3. Privacy

4. Maximum Unit Size

5. Neighborhood Compatibility
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6. Researching Historic Preservation Analysis and Incentives Reviewed by: Andrew Crabtree, Director, Community Development Department Approved by: Deanna J. Santana, City Manager

ATTACHMENTS

1. SB 9 Overview/Checklist

2. SB 9 FAQ
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SENATE BILL 9 (SB 9): AN OVERVIEW

WHAT IT IS AND HOW IT IMPACTS RESIDENTIAL LAND USE
Senate Bill 9 (SB 9) is a new California State Law taking effect January 1, 2022 .

Similar to previous state legislation on Accessory Dwelling Units (ADUs), SB 9 overrides existing density limits in single -family zones. SB 9 is intended to support increased supply of starter, modestly priced homes by encouraging building of smaller houses on small lots.

SB 9 WAIVES DISCRETIONARY REVIEW AND PUBLIC HEARINGS FOR:

BUILDING TWO HOMES

ON A PARCEL IN A SINGLE-FAMILY ZONE & SUBDIVIDING A LOT INTO TWO THAT CAN BE SMALLER THAN REQUIRED MIN. SIZE
Used together, this allows 4 HOMES where 1 was allowed before.

SB 9 CAN BE USED TO: Add new homes to existing parcel • Divide existing house into multiple units • Divide parcel and add homes

WHAT IT CAN MEAN FOR DEVELOPMENT OF NEW HOMES
Illustrations are based on a preliminary analysis of the law. Details are subject to cha nge and are for informational purposes only.

VACANT LOT

LOT WITH

SINGLE-FAMILY HOME

LOT WITH
NONCONFORMING DUPLEX *

LOT WITH SINGLE -FAMILY

HOME AND AN ADU
BEFORE
No units
1 unit
Up to 2 units
(nonconforming)
1 unit
+ 1 ADU/JADU

ADD UNITS,

NO LOT SPLIT
Up to 2 units
+ 2 ADUs/JADUs
Up to 2 units
+ 2 ADUs/JADUs
No additional units
Can add 1 addtl. unit
+ 1 ADU/JADU

ADD UNITS,

LOT SPLIT
Up to 4 total units
Up to 4 total units
Up to 4 total units
Up to 4 total units
*Legally constructed but not currently permitted. Check your local ordinance for nonconforming use policies.

USING SB 9 WITHOUT A LOT SPLIT:
• Without a lot split, SB 9 does not limit the number
of ADUs or JADUs (B2, D2) – but other laws might.
• SB 9 could be interpreted to allow 2 new units
beyond an existing unit (up to 3 units/lot, plus
any allowed ADUs/JADUs).

USING SB 9 WITH A LOT SPLIT:
• SB 9 does not require jurisdictions
to approve more than 4 units
total, including any ADUs/JADUs.

SINGLE-UNIT DEVELOPMENTS
SB 9 can be used to develop single
units – but projects must comply
with all SB 9 requirements.

THIS DOCUMENT DOES NOT CONSTITUTE LEGAL ADVICE OR OPINIONS REGARDING SPECIFIC FACTS. FOR MORE INFORMATION ABOUT SB 9, PLEASE CONTACT YOUR OWN LEGAL COUNSEL. ~ ASSOCIATION
./\ ~ ,~"""""um OF BAY AREA
~1'1i ~•~~~-;.~ ~ GOVERNMENTS
A1 B1 (1 D1
A2 B2 (2 D2
B3 (3

DOES THE PROJECT QUALIFY?
2-UNIT DEVELOPMENTS AND LOT SPLITS
• Single-family lot (usually R1-6L or R1-8L)
• Located in an urbanized area or urban cluster1
• Not in state/local historic district, not an historic landmark • Meets requirements of SB35 subparagraphs (a)(6)(B)-(K)2:

PROPERTY CANNOT BE:
o Prime farmland or farmland of statewide importance (B) o Wetlands (C)
o Identified for conservation or under conservation
easement (I+K)
o Habitat for protected species (J)

PROPERTY CANNOT BE (UNLESS MEETING SPECIFIED
REQUIREMENTS):
o Within a very high fire hazard safety zone (D)
o A hazardous waste size (E)
o Within a delineated earthquake fault zone (F)
o Within a 100-year floodplain or floodway (G+H)
• Project would not alter nor demolish:
o Deed-restricted affordable housing
o Rent-controlled housing
o Housing on parcels with an Ellis Act eviction in last 15 yrs o Housing occupied by a tenant currently or in last 3 yrs3 Addtl. Qualifications for
2-UNIT DEVELOPMENTS
• Project does not remove
more than 25% of exterior
walls on a building that
currently has a tenant or
has had a tenant in the last
3 yrs even if the rental unit
itself isn’t altered
Addtl. Qualifications for

LOT SPLITS
• Lot is split roughly in half
– smaller lot is at least
40% of the original lot4
• Each new lot is at least
1,200ft2 5,6
• Lot is not adjacent to
another lot split by SB 9
by the same owner or
“any person acting in
concert with the owner”
• Lot was not created by a
previous SB 9 split7

RELATIONSHIPS TO OTHER LAWS
CEQA Does not apply to 2 -unit or lot split approvals
or ordinances implementing 2 -unit or lot split provisions COASTAL ACT Applies, but no public hearings needed for duplex and lot split coastal development permits
HOUSING CRISIS ACT Local ordinances cannot impose
restrictions that reduce the intensity of land use on
housing sites (including total building envelope, density, etc.) SB8 SB 9 projects are subject to Permit Streamlining Act deadlines
SB478 Does not apply to single -family zones

LIMITATIONS APPLIED
2-UNIT DEVS. AND LOT SPLITS
• Agencies MUST only impose objective 8 zoning standards, subdivision standards, and design standards (they may impose a local ordinance to set these standards)
o These standards MUST not preclude 2 units of at least 800ft 2 • Projects must follow local yard, height, lot coverage, and other developm ent standards, EXCEPT:
• A local agency MAY NOT require rear or side setbacks of more than 4 feet, and cannot require any setback if utilizing an existing structure or rebuilding a same -dimensional structure in the same location as an existing structure
• Project MAY be denied if a building official makes a written finding of specific, adverse impacts on public health or safety based on inconsistency with objective standards, with no feasible method to mitigate or avoid impact
• Agency MAY require 1 parking space /unit, unless the project is:
o Within 1/2 mile of “high -quality transit corridor” or “major transit stop” 9
o Within 1 block of a carshare vehicle
• Agency MUST require that units created by SB 9 are not used for short-term rental (up to 30 days)
• Agency MUST allow proposed adjacent or connected structures as long as they comply with building codes and are “sufficient to allow separate conveyance”
• HOAs MAY restrict use of SB 9
2-UNIT DEVS
• Without a lot split, agency
CANNOT use SB 9 to limit
ADUs/JADUs e.g., lot can have
2 primary units+1 ADU+1 JADU
• Agency MUST include # of SB
9 units in annual progress
report
• For properties with on-site
wastewater treatment, agency
MAY require a percolation test
w/in last 5 years or
recertification within last 10
years

LOT SPLITS
• Agency MAY approve more
than 2 units on a new parcel
including ADUs, JADUs, density
bonus units, duplex units
• Project MUST conform to all
relevant objective reqs. of
Subdivision Map Act
• Agency MAY require
easements for provision of
public services and facilities
• Agency MAY require parcels
to have access to, provide
access to, or adjoin public
right of way
• Project MUST be for residential
uses only
• Applicant MUST sign affidavit
stating they intend to live in one
of the units for 3+ years10
• Agency MUST include number of
SB 9 lot split applications in
annual progress report
• Agency CANNOT require right-
of-way dedications or off-site
improvements
• Agency CANNOT require
correction of nonconforming
zoning conditions

KEY DECISIONS FOR AGENCIES TO MAKE
WHETHER TO REQUIRE:
• 1 parking space per unit
• 2-UNITS Septic tank percolation
tests
• 2-UNITS Owner-occupancy
• SPLIT Public services/facilities
easement
• SPLIT Right-of-way easements
WHETHER TO ALLOW:
• Creation of lots <1,200ft2
• SPLIT >2 units/new lot
DEFINE:
• Objective zoning/subdivision/
design review standards
• “Acting in concert with owner”
• “Sufficient for separate
conveyance”
CREATE:
• Application forms and checklists
• Recording of deed restrictions
for short-term rentals and future
lot splits
• Owner-occupancy affidavit
1 Defined by the Census Bureau
2 See Section 65913.4(a)(6) Exclusions for full details and definitions 3 Lot can split, then new units added to the lot w/o the Ellis -affected building 4 Each lot can be smalle r than required minimum lot size 5 This number can be lowered by local ordinance
6 If min. size is 1,200ft 2, this requires a 2,400ft 2 lot, or 3,000ft 2 if a 60/40 split 7 This does not apply to previous lot splits taken under usual Map Act procedures 8 “Objective” as defined by the Housing Accountability Act 9 See Sections 21155 and 21064.3 of the Public Resources Code for definitions 10 Unless the applicant is a land trust or qualified non -profi t

1 Senate Bill 9 – Ministerial Urban Lot Splits & Two-Unit Developments Frequently Asked Questions (FAQ)

DISCLAIMER: These frequently asked questions about SB 9 are provided by the Association of Bay Area Governments (ABAG). This document is intended to provide general information and does not constitute legal advice. Additional facts, facts specific to a particular situation, or future developments may affect the subjects discussed in this document. Seek the advice of your attorney before acting or relying upon the following information.

BASICS

1. When does SB 9 go into effect?
January 1, 2022.

2. What is the definition of an urbanized area or urban cluster? As defined by the U.S. Census Bureau, an urbanized area is an area with 50,000 or more persons, and an urban cluster is an area with at least 2,500 people, but less than 50,000 people. Maps of urbanized areas and urban clusters can be found on the official U.S. Census Bureau website.

3. Can you use SB 9 in zones that allow single-family development but are zoned primarily for multi-family or mixed-use development?
No. The language of the statute is clear that it applies only to parcels in single- family residential zones. Since the intent of the legislation was to upzone or densify areas where only single-family development is currently permitted, it would not serve the purposes of the legislation for it to apply in areas where multi-family or denser uses are already permitted. SB 9 also does not apply to a parcel that is currently developed with a single-family home, if that parcel is located in anything other than a single-family residential zone.

4. Does SB 9 apply to homeowners' associations (HOAs)?
SB 9 overrides local zoning only. It does not address rules or restrictions implemented and adopted by homeowners' associations or included in CC&Rs (covenants, conditions, and restrictions).

5. Is a lot eligible for an SB 9 lot split if it was split before SB 9? Yes. The language of SB 9 only prohibits an applicant from using SB 9 to subdivide a lot if it was previously split using the authority contained in SB 9. Even after using SB 9, the lot could be further split using ordinary procedures under the Subdivision Map Act and local subdivision ordinance subject to minimum lot size and other requirements that apply to the parcel.

2 6. Is the restriction on the demolition of 25% of the exterior walls of the building only applicable to deed-restricted affordable units?
No. This restriction applies to all units unless (1) the city adopts an ordinance allowing for demolition of more than 25% of the exterior walls of an existing structure, or (2) a tenant has not resided on the property in the last three (3) years.

7. How do you verify that existing housing has not been rented in the last 3 years?
SB 9 does not provide an explicit mechanism for determining whether existing housing has been rented in the last three years. Given that, this is an issue that local agencies will want to address in an implementing ordinance or in their application procedures. Some approaches might include:
 In jurisdictions with existing records of rental properties, which may include business licenses, rent control registries, or inspection records, using data from the local records to be cross-referenced upon submission of an SB 9 application;
 Requiring applicants to sign a declaration under penalty of perjury; and/or  Providing that it is a violation of the Municipal Code or allowing a private cause of action if inaccurate information is submitted.

8. When the provisions of SB 9 are unclear, can we seek clarification from the Department of Housing and Community Development?
Unlike other recent state laws, such as SB 35 or SB 330, SB 9 does not include any provisions requiring HCD to issue guidelines for the implementation of SB 9.

Nonetheless, HCD has indicated that it intends to provide a technical assistance (TA) memo on SB 9 implementation. The timeline for when HCD's TA memo will be available is unclear.

INTERSECTION WITH OTHER LAWS

9. How does the state Density Bonus Law apply to the 4-unit scenario? State Density Bonus Law would not be applicable to SB 9 projects. Government Code § 65915(i) defines "housing development project," for the purposes of state density bonus, as "a development project for five or more residential units." SB 9 covers up to four units total on two contiguous lots. Additionally, the urban lot split section states specifically that local agencies are not required to allow more than the maximum of two units on each lot notwithstanding any provision of density bonus law.

10. How do SB 9 urban lot splits relate to the Subdivision Map Act and the fact that the Subdivision Map Act requires general plan conformance? The language in SB 9 overrides any conflicting provisions of the Subdivision Map 3 Act. Specifically, Government Code § 66411.7(b)(2) provides that "[a] local agency shall approve an urban lot split only if it conforms to all applicable objective requirements of the Subdivision Map Act…, except as otherwise expressly provided in this section." General Plan and specific plan conformance is not required if it would preclude lot splits mandated by SB9.

11. Do minimum frontage requirements apply to restrict lot subdivision? Minimum frontage requirements continue to apply unless the requirements would physically preclude the lot split or the construction of two units of at least 800 square feet each. However, SB 9 does allow local agencies to require the resulting parcels to have access to, provide access to, or adjoin the public right-of-way.

12. How does the Permit Streamlining Act apply if these are ministerial actions? SB 8, also effective January 1, 2022, extends the requirements of the Permit Streamlining Act to housing projects of one unit or more that require no discretionary approvals. As a consequence, SB 9 projects are subject to the Permit Streamlining Act’s requirements for completeness letters (within 30 days of submittal) and approval deadlines (within 60 days of determining that the project is exempt from CEQA).

QUANTITY/ACCESSORY DWELLING UNITS

13. SB 9 states that "[a] housing development contains two residential units if the development proposes no more than two new units or if it proposes to add one new unit to an existing unit." Why are some people saying that you can add two new units to a parcel with an existing single-family home?
As the question states, Gov. Code § 65852.21(i) provides that a development contains two residential units if "the development proposes no more than two new units or if it proposes to add one new unit to one existing unit." This could be interpreted to mean that the statute applies to a two-unit proposal even if those units are proposed for a lot already containing a unit. While the urban lot split section (Gov. Code § 66411.7) clearly allows local agencies to limit total development to two units per lot, including existing units, ADUs, and JADUs, the same language is not present in the two-unit development section. The Legislature’s intent regarding a two-unit development on a single lot is not clear. It may be possible for an applicant who only uses the two-unit development provisions, but not the urban lot split provisions, to have more than two units on the lot.

14. Does SB 9 prohibit ADUs with an urban lot split, or can jurisdictions disallow ADUs with an urban lot split?
SB 9 does not prohibit accessory dwelling units or junior accessory dwelling units on lots created by an urban lot split. Under SB9 a local agency "shall not be required to approve" more than two units (including ADUs and JADUs) on a lot created via an SB 9 lot split.

Agencies may also prohibit ADUs and JADUs on parcels created by urban lot splits that 4 use the two-unit provision. Given this language, local agencies could choose to limit development on lots created by an urban lot split to two primary units each via adoption of an SB 9 implementing ordinance.

15. Are the two new SB 9 units entitled to an ADU or JADU? If the two new SB 9 units are not located on a lot created via the urban lot split provision, then ADUs and JADUs are allowed as under existing law. If the applicant used both the SB 9 lot split provisions and the SB 9 two-unit development provisions, then a local ordinance can limit total development to two units per lot, including ADUs and JADUs, or could choose to allow only two primary units on each lot.

16. If there is an existing four-unit building on a parcel in a single-family residential zone, can an applicant still add a duplex?
The existing four-unit building would already be a non-conforming use in a single-family zone. Depending on the jurisdiction's non-conforming use policies, the non-conforming structure may need to be removed if the applicant wishes to add a duplex. However, the urban lot split provision (section 66411.7(i)) prohibits requiring correction of nonconforming zoning conditions for urban lot splits. Nonetheless, the agency can require that no more than two units be located on each lot.

17. Does SB 9 allow an applicant to use the duplex entitlements to build a single unit "monster home" and get around non-objective single-family design guidelines? Probably, yes. Section 65852.21(a) states, “A proposed housing development containing no more than two residential units within a single-family residential zone shall be considered ministerially, without discretionary review or a hearing….” Later in the section, in paragraph (i), it also states “[a] housing development contains two residential units if the development proposes no more than two new units or if it proposes to add one new unit to one existing unit.” Although it is not clear whether the legislature intended to include single-family home development, the "no more than two units" language in SB 9 could be interpreted to cover development projects proposing to construct one single-family home.

18. Are the new units created via the authority in SB 9 condominiums? Does SB 9 facilitate ministerial condominium conversions? Does SB 9 allow for condominium conversion of existing duplexes?
SB9 does not amend laws regarding condominiums. SB9 does not allow denial of attached units so long as their design and construction allow them to be “separately conveyed,” i.e., sold separately as condominiums may be sold. New units created via the authority in SB 9 may be approved as condominiums if the applicant asks for that approval, but the application would need to meet state and local law concerning 5 condominiums. A jurisdiction's regular condominium conversion process would also continue to apply.

OBJECTIVE STANDARDS

19. Can the applicant seek variances from zoning requirements? SB 9 provides that a local agency may apply its objective zoning standards so long as they do not physically preclude the construction of two units of at least 800 square feet each with four-foot setbacks (no setbacks are required if the unit is constructed in the same location and with the same dimensions as an existing structure). In that situation, the applicant does not need to apply for a variance.

However, if the applicant desires to construct a larger unit which does not meet the agency’s zoning standards, it could be denied under SB 9, or the applicant could apply for a variance.

20. My understanding is that SB 330 requires only objective design standards for design standards adopted after Jan 1, 2020, is this the same for SB 9? SB 330 would apply to an SB 9 implementing ordinance, so any design standards adopted must be objective.

21. For purposes of a duplex, can jurisdictions adopt an objective standard that says the units have to be within, for example, 10 feet of each other? Yes, a city could adopt this as an objective standard. However, if the standard or requirement would physically preclude the construction of two units or the construction of a unit that is at least 800 square feet, then it cannot be applied to the specific project.

Also note that section 66411.7(k) provides that an urban lots split “shall not be rejected solely because it proposes adjacent or connected structures provided that the structures meet building code safety standards and are sufficient to allow separate conveyance.”

22. Is there a street frontage or lot width requirement for ministerial lot splits? SB 9 does not contain street frontage or lot width requirements. A local agency may apply an objective frontage or lot width requirement. It must, however, allow lot splits that create lots that are at least 1,200 square feet each where both lots are of approximately equal size. This likely means that the local agency may not be able to apply its minimum lot dimensions or frontage requirements to some urban lot splits.

23. Is the 4-foot setback provision similar to that for ADUs? Yes. A local agency cannot impose a rear or side setback greater than 4 feet, or less if a structure is in the same location and with the same dimensions as an existing structure.

6 24. Does the right of way dedication provision require cities to allow for flag lots, provided they meet the 60-40 split?
The agency may require the parcel to have access to, provide access to, or adjoin a public right of way but must allow the lot split. Where a parcel does not front on a public right of way, the options are to allow a flag lot or to provide access to the public right-of-way via an easement through the other lot.

25. Could a jurisdiction define "sufficient to allow separate conveyance" to require separate HVAC systems and separate water connection to meet Title 24 requirements?
Yes. Title 24 is a state law requirement. Therefore, compliance can be mandated assuming that Title 24 requires separate HVAC systems and water connections for units that are separately conveyed.

26. If a jurisdiction doesn't require "dedications" but a property owner wants to put in some improvements in the right-of-way, could the jurisdiction require that those meet the jurisdiction’s standards for right of way improvements? If an applicant includes improvements to the public right of way in its SB 9 application, the jurisdiction can require that those improvements meet objective agency standards.

27. Does the requirement for one parking space/unit supersede other local minimum parking requirements? For example, if local parking standards require two covered spaces per residential unit and additional parking spaces tied to additional bedrooms.

Yes, SB 9 supersedes local standards. A local agency "may require" off-street parking of up to one space per unit, and "shall not impose" parking requirements where the parcel is located within one-half mile walking distance of either a high-quality transit corridor or major transit stop, or where there is a car share vehicle located within one block of the parcel.

28. Can a jurisdiction impose affordability requirements on units created via SB 9? There is nothing in the statute that would prohibit the imposition of objective affordability requirements. However, agencies should examine the economic feasibility of any affordability requirements to ensure that urban lot splits and two-unit developments remain economically feasible.

29. Can a local jurisdiction impose conditions of approval on an SB 9 project? A jurisdiction may impose standard objective conditions of approval on an SB 9 project.

7 FIRE/INFRASTRUCTURE CHALLENGES

30. Is it true that SB 9 cannot be used in high fire hazard severity zones? No. SB 9 provides that any proposed two-unit development or urban lot split must comply with the requirements of Government Code § 65913.4(a)(6)(D), which excludes projects in high or very high fire hazard severity zones, unless either: (1) the site was excluded from the zone by the jurisdiction; or (2) the site has adopted fire hazard mitigation measures “pursuant to existing building standards or state fire mitigation measures applicable to the development.” “Fire hazard mitigation measures” and “state fire mitigation measures” are not defined. A local ordinance could specify which “building standards” apply or reference the appropriate “state fire mitigation measures.”

An agency may also reject SB 9 proposals on a case-by-case basis where the local building official makes a written finding that the project would have a specific, adverse impact on public health and safety or the physical environment, based on inconsistency with an objective standard, and there is no feasible method to satisfactorily mitigate or avoid the impact.

31. X County has some areas that are identified as "urban" or "urban clusters" and could be a qualifying parcel under SB9. However, those areas do not have access to water or sewer connections and may have to expand an existing leach field and utilize other water sources. If the applicant cannot demonstrate that they can build what's allowed under SB9 with a wastewater treatment system and water source that meets Environmental Health Codes, would the County be able to deny them their application?
Yes. In this scenario, the county could deny the application because it would not meet objective standards. The building official could also likely make a finding that the project would have a specific, adverse impact on public health and safety or the physical environment and that there is no feasible method to satisfactorily mitigate or avoid specific impact.

32. If a jurisdiction has substandard existing sewer infrastructure, can those areas of the jurisdiction be excluded from SB 9 applicability?
The local agency likely could not outright exclude those areas from SB 9 applicability.

However, if projects are proposed in these areas, the local building official could deny the application if it would have a specific, adverse impact on public health and safety or the physical environment, by violating an existing objective standard, with no feasible method to satisfactorily mitigate or avoid the impact.

8 33. Can a jurisdiction prohibit someone from creating a new unit in an existing structure that would be below the Base Flood Elevation? To qualify for ministerial approval, SB 9 provides that an applicant must comply with all the requirements in Government Code §§ 65913.4(a)(6)(B)-(K). Subparagraphs (G) and (H) exclude development within a flood plain or floodway, respectively, as those sites are determined by maps promulgated by FEMA. However, subparagraphs (G) and (H) also allow development in a flood plain where FEMA has issued a flood plain development permit or meet FEMA criteria and allow development in a floodway where a no-rise certification has been issued or the project otherwise meets FEMA criteria. If these mitigation requirements are met, then it may be possible for the new unit to be built below Base Flood Elevation. Agencies should refer to the text of the statute.

URBAN LOT SPLITS

34. Would the "sufficient to allow separate conveyance" provision allow someone to build an attached duplex but then sell them as two separate lots with their own yard?
"Sufficient to allow separate conveyance" is not defined in the statute. However, “separate conveyance” means that the units can be sold separately. This phrase would seem to require that each unit be built to condominium standards so that they can be sold separately if the local agency approves a condominium application. Agencies may wish to define this in their local ordinances.

35. Should agencies record a deed restriction stating that the lot has been split using SB9 and cannot be split further?
This is not specifically addressed by SB 9. Two possibilities are a recorded deed restriction and a notation on the approved parcel map. It would be good practice for local agencies to include such a requirement in their implementing ordinances.

REPORTING REQUIREMENTS/HOUSING ELEMENT

36. How do jurisdictions account for SB 9 in Housing Elements? SB 9 requires jurisdictions to report (1) the number of units constructed pursuant to SB 9 and (2) the number of applications for parcel maps for urban lot splits under SB 9 in their annual housing element report. SB 9 itself does not include any reference to housing elements. The HCD TA memo may provide some guidance on how to project SB 9 development in a community’s housing element.

9 37. What can be included in a sites inventory?
There is nothing in SB 9 that prohibits a jurisdiction from using SB 9-eligible parcels in their sites inventory, but there would be limited history to project how many units might be built and what income levels might be served.

38. Could cities use the Terner Center’s findings to project above moderate- and moderate-income housing in their Housing Elements?
This may be a reasonable approach. It is not known if HCD will accept it, however.

City Council /
Planning
Commission Study
Session
Item 2 RTC 22-85
SB 9: California HOME Act
January 25, 2022
Topics
• Details of the new law
• Impact on Santa Clara
• Options for local controls
2 Part 1: Legal Details
Ministerial Approval of…
• 2 units per R-1 lot
– Add a second SFR to a lot
with an existing SFR
– Build two new SFRs
– Build new duplex
4 Ministerial Approval of…
• Lot splits
– Divisions of 50/50 to 40/60
(“approximately equal area”)
– Both parcels ≥ 1200 sf
– Applicant must intend to
occupy a unit for 3+ years
5 “Ministerial Approval” means:
• No CEQA review
• No hearings
• City cannot disapprove, unless:
–does not meet objective criteria
–Specific health & safety impacts
6 Where SB 9 applies
All R-1 lots in urbanized areas, except:
• Rental units
• Historic properties
• Certain special types of land (wetlands, prime
farmland, conservation easements)
7 What the City can impose
• Easements for provision of
public facilities & services
• Requirement that new
parcels are connected to a
public right-of-way
• Limitation on short-term
rentals 8

What the City can impose
• “Objective” zoning, subdivision & design
standards*
• “Objective” means:
–no personal or subjective judgment
–uniformly verifiable
–knowable by both the applicant & public official
9 *Limitations on city control
• Setbacks
–Maximum side/rear: 4 feet
–No requirement for existing
structure, or same footprint
• No correction of LNC
conditions 10
__ ., ___ _
,,,..,-,,-
~ ....... ___ _ r---- ---
-">i --- r --- I
r< -
-
MAXIMUM I ..................... ....
8lllLD ING l HEIGHT
*Limitations on city control
• Parking
–Site > ½ mi from transit:
1 space per unit
–Site ≤ ½ mi from transit:
no parking spaces
11 *Limitations on city control
• Subdivision improvements
–No dedications of PROW
–No construction of offsite improvements
• Development standards must allow for
construction of 2 units of 800 sf each
12 How Often Can It Be Used
• Limit of one
subdivision under SB

9. • Any subsequent lot
split would have to go
through standard
subdivision process 13

Interplay with ADUs
• Existing law:
–SFR + 1 detached ADU + 1
attached JADU = 3 du
–MFR + 2 detached ADUs
= 4+ du
14 Interplay with ADUs
• If no lot split:
ok to build ADUs
• 2 SFRs +
1 detached ADU +
1 JADU = 4 du
15 Interplay with ADUs
• After lot split: no ADU
allowed, if result is > 2
units on either lot
• 1 SFR +
1 ADU
= 2 du
16 • 1 SFR +
1 SFR
= 2 du
total: 4 units
SB 9’s Maximum Potential:
• Prior to lot split, ok to
build ADUs
17 Interplay with ADUs

SB 9’s Maximum Potential:
• Prior to lot split, ok to
build ADUs
• After lot split, ADU laws
cannot be used.
18 Interplay with ADUs

Upcoming
• Redondo Beach lawsuit
• Initiative petition
19 Part 2: Impact & Options
SB 9 Potential New Home Creation City of Santa Clara
• Approx. 18,000 single-family lots subject to SB 9
• In 2020 a total of 74 permits for ADUs filed
• SB 9 would increase number of market-feasible units on less than 4-percent of eligible single-family lots in Santa Clara (approx. 700 lots) “Will Allowing Duplexes and Lot Splits on Parcels Zoned for Single-Family Create New Homes? Assessing the Viability of New Housing Supply Under California’s Senate Bill 9”. Terner Center 2021. 21 • Parking
• Urban Lot Split Standards
• Privacy
• Maximum Unit Size
• Neighborhood Compatibility
22 Key Implementation Topics
Parking – SB 9 Requirement and Examples
23 SB 9 Sunnyvale & San Jose Campbell
Number of Spaces:

Max. 1 parking space
per unit or no parking if
parcel within ½-mile of
high-quality transit
corridor or major transit
stop or if car share
within one block.

Same as SB 9 Same as SB 9
Design Standards:

Not defined in SB 9
If parking required or proposed,
spaces must meet current
Zoning Code requirements for
size, design, and placement
Meet current Zoning Code
requirements for size, except
uncovered spaces allowed and
may encroach into required front or
street-side yard setback
Parking – Recommendations
24 SB 9 City of Santa Clara City of Santa Clara (Alt.)
Number of Spaces:

Max. 1 parking space
per unit or no parking if
parcel within ½-mile of
high-quality transit
corridor or major transit
stop or if car share
within one block.

Same as SB 9 Exempt SB 9 units from providing
any parking like ADUs.

Additional Requirements
If parking required or proposed,
spaces must meet current
Zoning Code requirements for
size, design, and placement
NA
Urban Lot Splits – SB 9 Requirement and Examples
25 SB 9 San Jose Campbell
Min. Lot Size:

One parcel shall not be
smaller than 40% of the
lot area of the original
parcel and both newly
created parcels are no
smaller than 1,200
square feet.

Same as SB 9 Same as SB 9
Min. Lot Width:

Not defined in SB 9
30-feet of street frontage and
average width. Width of flag
pole portion of flag lot between
12 and 15 feet.
25-feet of street frontage and
minimum width. Flag lots allowed
12-foot frontage.

Urban Lot Splits – Recommendations
26 SB 9 City of Santa Clara
Min. Lot Size:

One parcel shall not be
smaller than 40% of the
lot area of the original
parcel and both newly
created parcels are no
smaller than 1,200
square feet.

Same as SB 9
Min. Lot Width:

Not defined in SB 9
Min. 24-feet of street frontage and average width.

Min. 12-feet and Max. 15-feet width of flagpole portion of flag lot. (note: 24-feet is 40% of a typical 60 foot wide lot)
100’ D
60’ W
4’ rear4’ rear
4’ side
20’ front 20’ front
Buildable
Area
22’ W x 76’ D
= 1,672sf
Buildable
Area
22’ W x 76’ D
= 1,672sf
4’ side
4’ side
4’ side
Two Lots
30’ W x 100’ D
= 3,000sf
Or
24’ W x 100’ D
= 2,400sf
and
36’ W x 100’ D
= 3,600sf
Conventional
Lot Split
Example
100’ D
60’ W
20’ front 20’ front
4’ rear4’ rear
4’ side
4’ side
4’ side
4’ side
Buildable
Area
16’ W x 76’ D
= 1,216sf
Buildable
Area
28’ W x 76’ D
= 2,128sf
50-50 Split 40-60 Split
100’ D
60’ W
4’ rear
15’ flag front
20’ front
12’ dw
Buildable Area
40’ W x 36’ D
= 1,440sf
Buildable Area
52’ W x 21’ D
= 1,092sf
4’ side
4’ side
4’ side
4’ side
4’ rear
Rear Lot
60’ W x 40’ D
+ 12’ W x 60’ D
= 3,120sf
Front Lot
48’ W x 60’ D
= 2,880sf
Flag
Lot Split
Example
100’ D
60’ W
4’ rear
10’ flag front
20’ front
12’ dw
Buildable Area
40’ W x 46’ D
= 1,840sf
Buildable Area
52’ W x 16’ D = 832sf
4’ side
4’ side
4’ side
4’ side
4’ rear
Rear Lot
60’ W x 30’ D
+ 12’ W x 70’ D
= 2,640sf
Front Lot
48’ W x 70’ D
= 3,360sf
Flag
Lot Split
Example
Privacy – SB 9 Requirement and Examples
30 SB 9 Sunnyvale Campbell
Size/Placement/Style
Second Story Windows:

Not addressed in SB 9
Windows facing a side property
line must be high sill and
opaque unless no other location
available for required egress
Windows less than 8 feet from rear
and interior property lines shall be
clerestory. Other windows only
min. number and size for egress.

Second Story Balconies
and Roof Decks:

Not addressed in SB 9
Balconies and decks more than
2-feet above grade: 10-foot side
and 20-foot rear setback when
adjacent to residential.

Balconies only permitted on front
elevation of primary dwelling unit.

Rooftop terraces/decks prohibited.

Privacy – SB 9 Requirement and Examples
31 SB 9 Palo Alto San Jose
Size/Placement Second
Stories:

Not addressed in SB 9
Second floor area not permitted
within the side and rear yard
setbacks of underlying zoning
district.
1 story, 20-foot height limit within
20-feet of rear property line.

Privacy – Recommendations
32 SB 9 City of Santa Clara
Size/Placement/Style Second Story
Windows:

Not addressed in SB 9
Second story egress windows shall face the front
property line or interior of the project. Otherwise
windows must be either of the following: sill height
5-foot min. above finished floor; clerestory; or
opaque/frosted glass.

Second Story Balconies and Roof
Decks:

Not addressed in SB 9
Roof decks are prohibited. Balconies only allowed
within underlying setbacks with a maximum depth
of 4-feet.

Size/Placement Second Stories:

Not addressed in SB 9
SB 9 units greater than one story in height must
have a minimum 15-foot rear yard setback
(consistent with proposed ADU standards)
Maximum Unit Size – SB 9 Requirement and Examples
33 SB 9 Campbell Sunnyvale
Maximum Unit Size:

Not addressed in SB 9.

Local standards may not
preclude construction of
up to 2 units that are at
least 800 sf.
1,200 sf subject to maximum
FAR and lot coverage Based on 45% FAR
Maximum Unit Size – Recommendation
34 SB 9 City of Santa Clara
Maximum Unit Size:

Not addressed in SB 9. Local
standards may not preclude
construction of up to 2 units
that are at least 800 sf.
1,000 sf for new SB 9 unit(s)
(subject to existing Zoning Code
40% maximum lot coverage)
Note: Although local standards may not preclude construction of up to 2 units that are at least 800sf, applicants may propose units as small as 220 square feet (as allowed by Building Code).

Neighborhood Compatibility – Examples
35 SB 9 Campbell Sunnyvale
Front and Street-
side/corner setbacks:

Front not addressed in
SB 9. SB 9 side 4-feet
Front setback per Zoning Code.

Front and street-side elevations
of the second-story shall be
recessed by 5-feet from the first
story, as measured wall to wall
Front setback per Zoning Code.

Front yard setback minimum 25-
feet for the second story
Front door
placement/orientation:

Not addressed in SB 9
Neighborhood Compatibility – Examples
36 SB 9 Campbell Sunnyvale
Garage location/size:

Not addressed in SB 9 Street-facing attached garages
shall not exceed 50% of the
linear width of the front yard or
street-side yard elevation
Front yard landscaping:

Not addressed in SB 9
Not more than 50% of the required
front yard shall be paved with
asphalt, concrete cement, or any
other impervious surface, except
as may be required to meet off-
street parking and access
Neighborhood Compatibility – Recommendations
37 SB 9 City of Santa Clara
Front and Street-side setbacks:

Front not addressed in SB 9
SB 9 side 4-feet
Per current underlying zoning
Front door placement/orientation:

Not addressed in SB 9
For units within 30-feet of street, main entrance door or entry porch must be oriented to street and no more than 5-feet behind the front most wall of the house
Garage location/size:

Not addressed in SB 9
For garages within 30-feet of street, max. garage width with garage door facing street: 40% width of newly
created lot with.

Front yard landscaping:

Not addressed in SB 9
Min. 60% of required front yard maintained as un-paved
landscaping, except as may be required to meet min. off- street parking and access requirements of Zoning Code.

Next Steps
38 • Interim Guidance
• Draft Ordinance
• Public Hearings (Spring)
• Planning Commission
• City Council
• Zoning Code Update Integration (Spring)
City Council /
Planning
Commission
Study Session
Item 2 RTC 22-85
SB 9 California HOME Act
January 25, 2022
40 Image from: https://www.houzz.com/
SB 9 CALIFORNIA HOME ACT

PROJECT ELIGIBIILITY CHECKLIST

AND PLANNING APPLICATION

CITY OF SANTA CLARA, COMMUNITY DEVELOPMENT/PLANNING DIVISION 1500 Warburton Avenue, Santa Clara, CA 95050
(408) 615-2450 Fax: (408) 247-9857
E-mail: [email protected]
Website: www.SantaClaraCA.gov
SB 9 Eligibility Checklist1
All the following boxes must be checked in order for a project to potentially qualify for ministerial approval of additional residential dwelling units and/or a parcel map for an urban lot split under California Government Code Sections 65852.21 and 66411.7 (SB 9 (2021)) Two Dwelling Unit Residential Developments and Urban Lot Splits ☐ Parcel located entirely within a sin gle-family lot zoned R1-6L or R1-8L ☐ Site is not listed on the City’s Historic R esources Inventory (HRI) or included on the State Historic Resources Inventory
☐ Site meet s requirements of Government Code Section 65913.4 (a)(6)(E), (G), and (H)2:
• Property cannot be (unless meeting specified requirements):
o A hazardous waste site (E)
o Within a 100-year floodplain(G)
o Within a regulatory floodway (H)
☐ Project w ould not alter nor demolish:
• Deed-restricted affordable housing
• Rent-controlled housing
• Housing on parcels with an Ellis Act eviction in last 15 years • Housing occupied by a tenant currently or in last 3 years Additional Qualifications for Two Dwelling Unit Residential Developments ☐ Project does not remove more than 25% of exterior walls on a building that currently has a tenant i
n the last 3 years (even if the rental unit itself isn’t altered).

Additional Qualifications for Urban Lot Splits
☐ Existing l ot is split roughly in half – smaller lot is at least 40% of the original lot ☐ Each new lot is at least 1,200 square feet
☐ Lot is not adjacent to another lot split by SB 9 by the same owner or any person acting in concert w
ith the owner
☐ Lot was not created by a previous SB 9 Urban Lot Split 1 It is the applicant’s responsibility to verify that the property’s Homeowner Association (HOA) and/or Conditions, Covenants, and Restrictions (CC&Rs) allow the proposed SB 9 project. 2 Senate Bill 35 does not apply to certain types of properties listed in Government Code Section 65913.4(a)(6)(B)-(K). In addition to the properties listed in the checklist above, this includes (B) prime farmland; (C) wetlands; (D) high fire hazard zones; (F) earthquake fault zones; (I) lands in a natural resource protection plan; (J) habitat for protected species; and (K) lands under a conservation easement. These types of properties are not currently present in Santa Clara.

SB 9 CALIFORNIA HOME ACT

PROJECT ELIGIBIILITY CHECKLIST AND PLANNING APPLICATION City Review Steps
Planning Review. If a project meets all the criteria in the above SB 9 Eligibility Checklist (all boxes checked), then the applicant may submit the completed checklist, project information (below), and plans for review by the Planning Division. Planning will refer applications to other departments for their review, as needed.

Building Review. If approved by the Planning Division, and the project does not include an Urban Lot Split, the applicant may then submit the proposed project to the Building Division for plan check.

Public Works Review. A project that includes an Urban Lot Split must submit to Public Works and obtain approval of a parcel map prior to applying for a building permit.

Appl
ications, plans, and supporting documents should be submitted through the City’s Online Permitting Portal.

Pro
ject Information (Applicant to complete)
Applicant Name: Applicant Mailing Address:

Applicant Phone Number: Applicant Email Address:

Project Site Address: Assessor’s Parcel Number (APN):

Existing Lot Size (in square feet): Existing Unit(s) Sizes (in square feet):

Urban Lot Split Proposed (Yes or No):
☐Yes ☐No
Proposed Lot Sizes (in square feet):

Lot 1: Lot 2:

Project Description:

Pl
anning Review (Planning staff to complete)
Planning Record No.:

Date Received:

Fee(s) P aid 3:
☐Yes ☐No
Meets SB 9 requirements:
☐Yes. No Lot Split
submit to Building Division for plan check.
☐Yes. Urban Lot Split
submit to Public Works for Parcel Map approval,
then submit to Building Division for plan check.
☐No.

Planner Signature:
3 Planning fee (minor amendment) currently $840.40 ($813 + 3.37% Technology Surcharge) + other dept. review fee(s).

SB 9 CALIFORNIA HOME ACT

PROJECT ELIGIBIILITY CHECKLIST AND PLANNING APPLICATION General Requirements for Two Dwelling Unit Residential Developments and Urban Lot Splits

1. Each of the proposed units must meet the following development standards:
a. Minimum unit size: 220 square feet per unit.
b. Efficiency Dwelling Unit. Each unit shall meet the minimum Building Code standards required for an efficiency dwelling unit, including the provision of:
i. Adequate food preparation and cooking facilities – kitchen sink, cooking appliance, and refrigeration facilities, each having a clear working space of not less than 30 inches in front. ii. Separate bathroom containing a water closet (toilet), lavatory, and bathtub or shower. c. Setbacks (measured from property line)
i. Front yard4: same as underlying zoning district requirement (typically 20-feet) ii. Street side/corner yard4: same as underlying zoning district requirement (typically 15-feet) iii. Interior side yard: 4-feet
iv. Rear yard: 4-feet
d. Lot Coverage4: same as underlying zoning district requirement (typically 40%) e. Rear Yard Coverage4: same as underlying zoning district requirement (typically 40%) f. Parking:
i. Number of spaces: One parking space is provided per unit, if the parcel is not located within 1/2-mile walking distance of a high-quality transit corridor or major transit stop, and no car share vehicle facility is located within one block of the parcel. ii. Design4: If parking is required or proposed it must meet Zoning Code requirements g. Rental Term: if a unit will be used as a rental, the unit must be rented for a term longer than 30 days.

Additional Requirements for Urban Lot Splits

2. No more than two new parcels are being created.

3. The two new parcels will be of approximately equal lot area, with the smaller of the two parcels 40% or more of the original parcel lot area.

4. The newly created parcels will be no smaller than 1,200 square feet each.

5. Each of the proposed parcels has access to, provides access to, or adjoins the public right-of-way.

6. All easements required for the provision of public services and facilities are provided to the satisfaction of the Director of Public Works.

7. The parcels created by the Urban Lot Split will be for residential uses only.

8. Number of Dwelling Units. No more than two dwelling units will be permitted on each parcel, inclusive of Accessory Dwelling Units (ADUs).

9. Owner Affidavit. The owner of the parcel to be subdivided has provided a signed affidavit stating the intent to occupy one of the housing units as their principal residence for a minimum of three years from the date of approval of the Urban Lot Split. 5 4 The City shall waive objective design standards if the applicant can demonstrate with sufficient evidence that the standards would preclude the development of a unit or units of at least 800 square feet in area. Units greater than 800 square feet in area must comply with all design standards. 5 Unless the applicant is a community land trust or a qualified nonprofit corporation.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 1 of 11 Rev: 09/2019
ORDINANCE NO. _____

BE IT ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

NOW THEREFORE, BE IT FURTHER ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

Two Unit Dwelling Residential Development and Urban Lot Splits

18.13.020 Applicability.

18.12.030(d) are also permitted.

Residential developments shall comply with the development standards in this Chapter and for the R1-8L and R1-6L Zones, as applicable, set forth in Chapters 18.10 and

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 7 of 11 Rev: 09/2019

18.13.070 Urban Lot Splits.

18.13.080 Accessory Dwelling Units.

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST: ___________________________

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

Attachments incorporated by reference: None
CHAPTER 17.05

SUBDIVISIONS
[sections that require revision only – all other sections of Chapter 17.05 will remain in effect, unchanged]

17.05.110 Responsibilities.
. . .
(c) City Council. The City Council shall have final jurisdiction in the approval of tentative and final maps, tentative parcel maps and improvement agreements, and the acceptance by the City of lands and/or improvements as may be proposed for dedication to the City for subdivisions of five or more parcels. Notwithstanding the foregoing, the City Engineer shall have approval authority over lot splits pursuant to Sections 17.05.430 and

18.13.050.

The City Council shall act as the appeal board for hearing appeals of the approval, conditional approval or denial of tentative subdivision maps for subdivisions of five or more parcels.

(d) City Engineer. The City Engineer shall be responsible for:

(1) Establishing design and construction details, standards and specifications;

(2) Determining if proposed subdivision improvements comply with the provisions of this chapter and the Subdivision Map Act and for reporting the findings together with any recommendations for approval, or conditional approval, of the tentative map to the Director of Planning and Inspection;

(3) The processing of final maps, parcel maps, reversion to acreage maps and amended maps; the processing and approval of subdivision improvement plans, lot line adjustments, mergers, lot splits pursuant to Sections 17.05.430 and 18.13.050, and certificates of compliance;

(4) Examining and stating that final maps and parcel maps are in substantial conformance with the approved tentative map;

(5) The inspection, approval and acceptance of subdivision improvements;

(6) The acceptance of dedications and improvements for subdivisions of four or fewer parcels.
. . .

SB 9 – Draft Ordinance

17.05.400 Tentative parcel map.
. . .
(e) Approval and/or Denial.
(1) In approving or conditionally approving the tentative map, the City Council shall find that the proposed subdivision, together with its provisions for its design and improvements, is consistent with the General Plan and any applicable specific plans adopted by the City and all applicable provisions of this code and if the tentative map provides, to the extent feasible, for future passive or natural heating or cooling opportunities. (2) Whether or not such a condition is explicitly listed as a condition of approval, every approved tentative map shall be deemed to include a condition requiring the subdivider to defend, indemnify and hold harmless the City and its agents, officers and employees from any claim, action or proceeding against the City or its agents, officers or employees to attach, set aside, void or annul an approval of the City Council, Planning Commission, Subdivision Committee or City staff concerning a subdivision. The City shall promptly notify the subdivider of any claim, action or proceeding and shall cooperate fully in the defense. . . .

17.05.430 Parcel Map for Lot Splits Pursuant to Section 18.13.050 (a) Parcel Maps for Lot Splits pursuant to Section 18.13.050 shall comply with all requirements of Section 17.05.400, Tentative Parcel Map, except for subsections (d), (e)(1), and (f).
(b) Parcel Maps for Lot Splits Pursuant to Section 18.13.050 shall also comply with all requirements of Section 17.05.410, Parcel Maps.
(c) The City Engineer shall approve the Parcel Map for a Lot Split pursuant to Section

18.13.050 unless the City Engineer determines that the proposed map is not consistent with specific objective standards of the General Plan, applicable specific plans, or any applicable provision of this Code.

17.05.500 Dedication of streets, alleys and other public rights-of-way or easements. (a) As a condition of approval of a tentative, or parcel map, the subdivider shall dedicate or make an irrevocable offer of dedication of all parcels of land within the subdivision that are needed for streets and alleys, including access rights and abutters' rights, drainage, public greenways, scenic easements, public utility easements, and other public easements. In addition, the subdivider shall improve or agree to improve all streets and alleys, including access rights and abutters' rights, drainage, public utility easements and other public easements.

SB 9 – Draft Ordinance
(b) This Section does not apply to lot splits pursuant to Sections 17.05.430 and 18.13.050.

17.05.610 Improvements required.
(a) General. All improvements as may be required as conditions of approval of the tentative map or City ordinance, together with, but not limited to the following shall be required of all subdivisions.
(1) Requirements for construction of on-site and off-site improvements for subdivisions of four or less parcels shall be noted on the parcel map, or waiver of parcel map or the subdivision improvement agreement recorded prior to or concurrent with the parcel map.
(2) As a condition of approval of a tentative map, there may be imposed a requirement that improvements installed by the subdivider for the benefit of the subdivision contain supplemental size, capacity, number or length for the benefit of property not within the subdivision and that those improvements be dedicated to the public, subject to the provisions of Sections 66485 through 66489 of the Subdivision Map Act.
(3) Notwithstanding subsections (a)(1) and (a)(2) above, for Lot Splits authorized by Sections 18.13.050 and 17.050.430, required improvements shall be limited to on-site improvements.
. . .

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 1 of 12 Rev: 05/2022
ORDINANCE NO. _____

AN ORDINANCE OF THE CITY OF SANTA CLARA ,
CALIFORNIA, AMENDING TITLE 18 (“ZONING”) BY
ADDING A NEW CHAPTER 18.13 (“TWO-UNIT DWELLING

RESIDENTIAL DEVELOPMENT AND URBAN LOT
SPLITS”) TO “THE CODE OF THE CITY OF SANTA
CLARA, CALIFORNIA”

BE IT ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

NOW THEREFORE, BE IT FURTHER ORDAINED BY THE CITY OF SANTA C LARA AS FOLLOWS:

SECTION 1 : That a new Chapter 18.13 (entitled “Two Unit Dwelling Residential Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 2 of 12 Rev: 05/2022
Development and Urban Lot Splits”) is hereby added to Title 18 (entitled “Zoning”) of “The Code of the City of Santa Clara, California” (“SCCC”) to read as follows:
“Chapter 18.13

Two Unit Dwelling Residential Development and Urban Lot Splits

18.13.020 Applicability.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 3 of 12 Rev: 05/2022
(d) The property is within a regulatory floodway, as defined by Government Code Section 65913.4(a)(6)(H).
(e) The development would demolish or alter any existing dwelling unit that is subject to affordability restrictions under a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low, or very low income.
(f) The development would demolish or alter any existing dwelling unit on the lot that has been occupied by a tenant in the last three years prior to the date of application.

18.12.030(d) are also permitted.

18.13.040 Development Standards Applicable to All Lots With Two Units. (a) Off-Street Parking Requirements. For development that will result in two units on a lot, the minimum parking requirement shall be one space per unit, with the exception that no parking is required if the parcel is located within one-half mile walking distance of either a high-quality transit corridor, as defined in subdivision (b) of Section 21155 of the Public Resources Code, or a major transit stop, as defined in Section Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 4 of 12 Rev: 05/2022
21064.3 of the Public Resources Code, or if the parcel is located within one block of a car share facility.
(b) Off-Street Parking Design Standards. If off-street parking is required, the parking shall meet the parking design standards in Chapter 18.74. (c) Solar Access. After the installation of solar collector, a person owning or in control of another property shall not construct or alter a residence so as to cast a shadow greater than 10 percent of the collector absorption area upon that solar collector surface at any one time between the hours of 10 a.m. and 2 p.m., Pacific Standard Time.

18.13.050 Development Standards within R-1 Building Envelope For development that will result in two units on a lot, if both units proposed will be located entirely within the allowed R-1 building envelope, the development standards of the R1-6L or R1-8L zone will apply to each house, except that the maximum number of houses shall be two per lot.

Residential developments shall comply with the development standards in this Chapter and for the R1-8L and R1-6L Zones, as applicable, set forth in Chapters 18.10 and

18.12 (Single-Family, Larger Lot Area Zoning and Single-Family Zoning Districts) and Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 5 of 12 Rev: 05/2022
additional parking regulations set forth in Chapter 18.74 (Parking Regulations), with the following exceptions:
(a) Size. Units may be as small as 220 square feet in floor area or as large as 1,000 square feet in floor area.
(b) Maximum Height/Stories.
(1) Rear 15 feet of a parcel: Buildings or structures shall not exceed one story in height or 16-feet.
(2) All other areas on the parcel: Buildings or structures shall not exceed one and one-half stories or 25 feet in height
(c) Side and Rear Setbacks. Minimum side and rear setbacks shall be the least of the following:
(1) As required by Chapters 18.10 (R1-8L) or 18.12 (R1-6L), as applicable;
(2) 4 feet;
(3) The setbacks of an existing structure for which there is no proposal to alter its dimensions, or a structure constructed in the same location and to the same dimensions as an existing structure.
(d) Upper Story Windows. Second story egress windows shall face the front property line or interior of the project. Otherwise second story windows must be either of the following:
(1) 5-foot minimum sill height above finished floor; or (2) Clerestory; or
Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 6 of 12 Rev: 05/2022
(3) Opaque/frosted glass.
(f) Second Story Balconies and Roof Decks. Balconies with a maximum depth of 4-feet allowed within the R1-6L and R1-8L setbacks. Roof decks are not allowed. (g) Front Door Placement/Orientation. For units within 30-feet of a street, the main entrance door or entry porch must be oriented to the street and be located no more than 5-feet behind the front most wall of the unit. (h) Garage Location/Size. For garages within 30-feet of a street, the maximum width for a garage with a garage door facing the street is 40 percent of the lot width. (i) Front Yard Landscaping. A minimum of 50 percent of the front yard shall be maintained as un-paved landscaping, except as may be required to meet minimum off- street parking and access requirements of the Zoning Code. (j) Modification or Waiver of Standards. An applicant for a residential development that will result in two homes on a lot may apply for a modification or waiver of specific development standards, if all of the following requirements are met:
(1) The applicant must demonstrate, to the satisfaction of the Zoning Administrator, that the strict application of development standards in this Chapter, or the standards for the R1-6L or R1-8L Zones (set forth in Chapters 18.12 and 18.10) would preclude the construction of a maximum of two units, where each unit is at least 800 square feet in floor area.
(2) The applicant shall have the burden of proof to establish that the modification or waiver is necessary and that there is no redesign possible that would still Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 7 of 12 Rev: 05/2022
allow for the construction of two dwellings of at least 800 square feet without the modification or waiver.
(3) Notwithstanding the foregoing, a modification or waiver shall not be used to reduce the minimum setback size to less than four feet, unless the setback is on an existing legal structure with setbacks of less than four feet, and the proposed development either (A) does not propose to modify the dimensions of that existing structure, or (B) will replace the structure with another structure with exactly the same dimensions.

18.13.070 Urban Lot Splits.

An application for a parcel map for an urban lot split within the R1-6L or R1-8L zones shall go through a streamlined review process pursuant to Section 17.05.430 if it meets all of the requirements of this Section.
(a) Subdivision Requirements. A parcel map for an urban lot split must meet all of the following requirements:
(1) The parcel map subdivides an existing parcel to create no more than two new parcels of approximately equal lot area provided that one parcel shall not be smaller than 40 percent of the lot area of the original parcel proposed for subdivision. (2) Both newly created parcels are no smaller than 1,200 square feet. (3) Both newly created parcels have a minimum 24 feet of street frontage with a minimum average width of 24 feet. For flag lots, the flagpole portion, whether this is part of the flag lot or an easement to the flag lot, shall have a minimum width of 12 Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 8 of 12 Rev: 05/2022
feet and a maximum width of 15 feet and the flag portion shall have a minimum depth of 40 feet.
(4) Both parcels resulting from the urban lot split have access to, provide access to, or adjoin the public right-of-way through right-of-way frontage or recorded access easements (as a Covenant of Easement on the parcel map). (5) The approved parcel map shall include a notation that the parcels were created using the Urban Lot Split provisions of this Chapter and the resulting parcels cannot be further subdivided under this Section.
(6) The urban lot split conforms to all applicable objective requirements of the Subdivision Map Act (Division 2 (commencing with Section 66410)), except as otherwise expressly provided in this Section.
(7) The parcel being subdivided was not established through prior exercise of an urban lot split as provided for in this Chapter. (8) Neither the owner of the parcel being subdivided nor any person acting in concert with the owner has previously subdivided an adjacent parcel using an urban lot split as provided for in this Chapter.
(b) Development Standards. Development standards for each new parcel resulting from an urban lot split shall conform to Section 18.13.030. Development standards shall be applied to each new parcel individually. New flag lots shall provide a 15-foot minimum front setback (measured from the property line shared between the front lot and the flag lot).

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 9 of 12 Rev: 05/2022
(c) Nonconforming Zoning Conditions. Correction of legal nonconforming zoning conditions shall not be required as a condition for ministerial approval of a parcel map application for the creation of an urban lot split. (d) Residency Requirement. An applicant for an urban lot split shall sign an affidavit stating that the applicant intends to occupy one of the housing units as their principal residence for a minimum of three years from the date of the approval of the urban lot split. This requirement shall not apply to an applicant that is a “community land trust” as defined in Revenue and Taxation Code Section 402.1(a)(11)(C), or is a “qualified nonprofit corporation” as described in Revenue and Taxation Code Section 214.15.
(e) Residential Use. Except as authorized by Chapter 18.100, any parcel created through this Chapter may only be used for residential purposes and any unit created through this Chapter shall not be used as a short-term rental (rented for a period of 30 days or less).

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 10 of 12 Rev: 05/2022

18.13.080 Accessory Dwelling Units.

On a parcel that has not been divided pursuant to Section 18.13.050, an Accessory Dwelling Unit (ADU) and/or a Junior ADU (JADU) that conform with California Government Code Sections 65852.2 (ADUs) and 65852.22 (JADUs) are allowed in addition to the units allowed in this Section. Once a parcel has been divided pursuant to Section 18.13.050, however, the maximum number of dwellings on each resulting parcel, inclusive of any ADU or JADUs, is two.

18.13.090 Definitions. For purposes of this Chapter the following definitions shall apply:
(a) “Acted in concert” means that the owner, or a person acting as an agent or representative of the owner, knowingly participated with another person in joint activity or parallel action toward a common goal of subdividing the adjacent parcel. (b) “Car Share Facility” means one or more parking spaces that have been designated permanently for car share vehicles, where the vehicles are leased for short periods of time, often by the hour.
(c) “Demolish or alter” means removal of more than 25-percent of exterior walls on a building even if the rental unit itself is not altered. (d) “Egress window” means a window with a minimum net clear opening dimensions of at least 20" in width and 24" in height.
(e) “Flag Lot” means a parcel with access provided to the bulk of the lot by means of a corridor between 12 and 15 feet in width, inclusive.

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 11 of 12 Rev: 05/2022
(f) “Half Story” means a habitable living space with a sloping roof, which may have dormer windows.
(g) “R-1 Building Envelope” means an area defined by the minimum setback and maximum lot coverage requirements of Chapters 18.10 or 18.12, whichever is applicable.
(h) “Solar collector” means a fixed device, structure, or part of a device or structure, on the roof of a building, comprising photovoltaic panels, that is used primarily to transform solar energy into electrical energy.
(i) “Urban Lot Split” means a subdivision of a residential lot located in either the R1-6L or R1-8L zone into two lots subject to the requirements of this Chapter.” SECTION 2: Savings clause. The changes provided for in this ordinance shall not affect any offense or act committed or done or any penalty or forfeiture incurred or any right established or accruing before the effective date of this ordinance; nor shall it affect any prosecution, suit or proceeding pending or any judgment rendered prior to the effec tive date of this ordinance. All fee schedules shall remain in force until superseded by the fee schedules adopted by the City Council.
//

Ordinance/SB 9 Regulations for Two-Unit Residential Development Page 12 of 12 Rev: 05/2022
SECTION 3: Effective date. This ordinance shall take effect thirty (30) days after its final adoption; however, prior to its final adoption it shall be published in accordance with the requirements of Section 808 and 812 of “The Charter of the City of Santa Clara, California.”
PASSED FOR THE PURPOSE OF PUBLICATION this 5th day of July , 20 22, by the following vote:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST:
___________________________

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

Attachments incorporated by reference: None
Ordinance/SB 9 Subdivision Regulations for Two-Unit Residential Development Page 1 of 6 Rev: 05/2022
ORDINANCE NO. _____

AN ORDINANCE OF THE CITY OF SANTA CLARA ,
CALIFORNIA, AMENDING CHAPTER 17.05
(“SUBDIVISIONS”) OF TITLE 17 ( “DEVELOPMENT”) OF
“THE CODE OF THE CITY OF SANTA CLARA ,
CALIFORNIA” TO REVISE THE SUBDIVISION PROCESS
FOR SB 9 DEVELOPMENTS

BE IT ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

WHEREAS, on September 16, 2021, Governor Newsom signed into law legislation known as Senate Bill 9, the “California H.O.M.E. Act” (SB 9), which added Sections 65852.21 and 66411.7 to the California Government Code;
WHEREAS, beginning January 1, 2022, SB 9 requires local agencies to ministerially approve the construction of two primary dwellings and lot splits, pursuant to a parcel map, on single-family residential zoned lots upon satisfaction of a number of qualifying criteria; WHEREAS, SB 9 allows local agencies to impose objective zoning, subdivision, and design review standards on the construction of two residential dwellings on single-family lots, subject to certain limitations;
WHEREAS, because the law requires SB 9 projects, including lot splits, to be conducted ministerially (without public hearing or discretionary review), the City ’s s ubdivision ordinance, SCCC Chapter 17.05, which currently requires all subdivisions to have a public hearing at City Council, must also be amended to provide for the ministerial review and approval, by the City Engineer, of SB 9 Parcel Maps; and WHEREAS, this ordinance amends Title 17 to implement the provisions of SB 9 with specific objective subdivision review standards; and
WHEREAS, pursuant to Government Code Sections 65852.21 (j) and 66411.7 (n), a local agency may adopt an o rdinance to implem ent SB 9 and that ordinance s hall not be Ordinance/SB 9 Subdivision Regulations for Two-Unit Residential Development Page 2 of 6 Rev: 05/2022
considered a project under Division 13 (commencing w ith Section 21000) of the Public Resources Code.

NOW THEREFORE, BE IT FURTHER ORDAINED BY THE CITY OF SANTA CLARA AS FOLLOWS:

SECTION 1: That Section 17.05.110 (entitled “Responsibilities”) of Chapter 17.05 (entitled “Subdivisions”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is hereby amended to read as follows:
“17.05.110 Responsibilities.
(a) City Attorney. The City Attorney shall be responsible for approving as to form all property development agreements, subdivision improvement agreements and/or public improvement agreements.
(b) City Manager. Pursuant to the authority granted by Section 802(a) of the Santa Clara City Charter, the City Manager shall designate the following positions:

Director of Planning and Inspection, City Engineer, and Building Official. Further, the City Manager shall be responsible for executing all property development agreements, subdivision improvement agreements and/or public improvement agreements. (c) City Council. The City Council shall have final jurisdiction in the approval of tentative and final maps, tentative parcel maps and improvement agreements, and the acceptance by the City of lands and/or improvements as may be proposed for dedication to the City for subdivisions of five or more parcels. Notwithstanding the foregoing, the City Engineer shall have approval authority over lot splits pursuant to Sections 17.05.430 and 18.13.050.

The City Council shall act as the appeal board for hearing appeals of the approval, conditional approval or denial of tentative subdivision maps for subdivisions of five or more parcels.
(d) City Engineer. The City Engineer shall be responsible for:

(1) Establishing design and construction details, standards and specifications;

(4) Examining and stating that final maps and parcel maps are in substantial conformance with the approved tentative map;

(5) The inspection, approval and acceptance of subdivision improvements;

(6) The acceptance of dedications and improvements for subdivisions of four or fewer parcels.
(e) Director of Community Development. The Director of Community Development shall be responsible for:

(1) The processing of tentative subdivision and tentative parcel maps, and for the collection of all required planning fees.

(2) The recording of a notice of completion of private subdivision improvements when not to be maintained by the City.

(f) Project Clearance Committee. The Project Clearance Committee shall be responsible for the review of tentative maps for subdivisions of five or more parcels or units for compliance with City ordinances and regulations and determining the practicability of the proposal with respect to the provision of City services, and for providing suitable conditions of approval to the Planning Commission and the City Council.

(g) Planning Commission. The Planning Commission shall be responsible for making recommendations for approval, conditional approval, or denial of the tentative map for subdivisions of five or more lots or units and reporting its recommendations to the City Council; and hearing of appeals for minor subdivisions of four or fewer parcels.

(h) Subdivision Committee. The Subdivision Committee shall be responsible for making recommendations for approval, conditional approval or denial of tentative parcel maps for four or fewer parcels and review of lot line adjustments.

(i) Director of Community Development. The Director of Community Development shall be responsible for investigating proposed subdivisions for conformity to the General Plan, specific plans and Zoning Ordinance of the City, and reporting findings together with recommendations for approval or conditional approval to the Planning Commission and City Council for subdivisions of five or more parcels.” Ordinance/SB 9 Subdivision Regulations for Two-Unit Residential Development Page 4 of 6 Rev: 05/2022
SECTION 2: That Subsection (e) (entitled “Approval and/or Denial”) of Section 17.05.400 (entitled “Tentative P arcel Map ”) of Chapter 17.05 (entitled “Subdivisions”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is hereby amended to read as follows:
“(e) Approval and/or Denial.
(1) In approving or conditionally approving the tentative map, the City Council shall find that the proposed subdivision, together with its provisions for its design and improvements, is consistent with the General Plan and any applicable specific plans adopted by the City and all applicable provisions of this code and if the tentative map provides, to the extent feasible, for future passive or natural heating or cooling opportunities.
(2) Whether or not such a condition is explicitly listed as a condition of approval, every approved tentative map shall be deemed to include a condition requiring the subdivider to defend, indemnify and hold harmless the City and its agents, officers and employees from any claim, action or proceeding against the City or its agents, officers or employees to attach, set aside, void or annul an approval of the City Council, Planning Commission, Subdivision Committee or City staff concerning a subdivision. The City shall promptly notify the subdivider of any claim, action or proceeding and shall cooperate fully in the defense.”
SECTION 3: That a new Section 17.05.430 (entitled “Parcel Map for Lot Splits Pursuant to Section 18.13.050”) is hereby added to Chapter 17.05 (entitled “Subdivisions”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) to read as follows:
“17.05.430 Parcel Map for Lot Splits Pursuant to Section 18.13.050 (a) Parcel Maps for Lot Splits pursuant to Section 18.13.050 shall comply with all requirements of Section 17.05.400, Tentative Parcel Map, except for subsections (d), (e)(1), and (f).
(b) Parcel Maps for Lot Splits Pursuant to Section 18.13.050 shall also comply with all requirements of Section 17.05.410, Parcel Maps. (c) The City Engineer shall approve the Parcel Map for a Lot Split pursuant to Section 18.13.050 unless the City Engineer determines that the proposed map is not Ordinance/SB 9 Subdivision Regulations for Two-Unit Residential Development Page 5 of 6 Rev: 05/2022
consistent with specific objective standards of the General Plan, applicable specific plans, or any applicable provision of this Code.”
SECTION 4: That Section 17.05.500 (entitled “Dedication of streets, alleys and other public rights-of-way or easements”) of Chapter 17.05 (entitled “Subdivisions”) of Title 17 (entitled “Development”) of “The Code of the C ity of Santa Clara , California” (“SCCC”) is hereby amended to read as follows:
“17.05.500 Dedication of streets, alleys and other public rights-of-way or easements.
(a) As a condition of approval of a tentative, or parcel map, the subdivider shall dedicate or make an irrevocable offer of dedication of all parcels of land within the subdivision that are needed for streets and alleys, including access rights and abutters' rights, drainage, public greenways, scenic easements, public utility easements, and other public easements. In addition, the subdivider shall improve or agree to improve all streets and alleys, including access rights and abutters' rights, drainage, public utility easements and other public easements.
(b) This Section does not apply to lot splits pursuant to Sections 17.05.430 and

18.13.050.”
SECTION 5: That Subsection (a) (entitled “General”) of Section 17.05.610 (entitled “Improvements required”) of Chapter 17.05 (entitled “Subdivisions”) of Title 17 (entitled “Development”) of “The Code of the C ity of Santa Clara , California” (“SCCC”) is hereby amended to read as follows:
“(a) General. All improvements as may be required as conditions of approval of the tentative map or City ordinance, together with, but not limited to the following shall be required of all subdivisions.
(1) Requirements for construction of on-site and off-site improvements for subdivisions of four or less parcels shall be noted on the parcel map, or waiver of parcel map or the subdivision improvement agreement recorded prior to or concurrent with the parcel map.
(2) As a condition of approval of a tentative map, there may be imposed a requirement that improvements installed by the subdivider for the benefit of the subdivision contain supplemental size, capacity, number or length for the benefit of property not within the subdivision and that those improvements be dedicated to the Ordinance/SB 9 Subdivision Regulations for Two-Unit Residential Development Page 6 of 6 Rev: 05/2022
public, subject to the provisions of Sections 66485 through 66489 of the Subdivision Map Act.
(3) Notwithstanding subsections (a)(1) and (a)(2) above, for Lot Splits authorized by Sections 18.13.050 and 17.050.430, required improvements shall be limited to on-site improvements.”
SECTION 6: Savings clause. The changes provided for in this ordinance shall not affect any offense or act committ ed or done or any penalty or forfeiture incurred or any right established or accruing before the effective date of this ordina nce; nor shall it affect any prosecution, suit or proceeding pending or any judgment rendered prior to the e ffective date of this ordinance. All fee schedules shall remain in force until superseded by the fee schedules adopted by the City Council.

SECTION 7: Effective date. This ordinance shall take effect thirty (30) days after its final adoption; however, prior to its final adoption it shall be published in accordance with the requirements of Section 808 and 812 of “The Charter of the City of Santa Clara, California.” PASSED FOR THE PURPOSE OF PUBLICATION this XX day of XXXXXX, 2022, by the following vote:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST: ___________________________

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

Attachments incorporated by reference: None
City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
22-849 Agenda Date: 7/5/2022

REPORT TO COUNCIL

SUBJECT
Authorize the City Manager to Negotiate and Execute Amendment No. 3 to the Agreement for Design Services with Bellecci & Associates, Inc. and Associated Budget Amendment for the Loyalton Property

COUNCIL PILLAR
Deliver and Enhance High Quality Efficient Services and Infrastructure

BACKGROUND
Per 030 Council Policy action, staff brought to Council the discussion on the consideration of the sale of the Loyalton Property. The item was initially scheduled for Council consideration on March 16, 2021, but due to the length and complexity of Council Agendas, the item was continued multiple times. Ultimately the discussion occurred on August 17, 2021 (RTC 21-715), and at the August 17, 2021, Council meeting the item was continued to a future meeting for additional input from the City Attorney.

On September 7, 2021 (RTC 21-530), staff brought forth for Council consideration a contract amendment with Bellecci and Associates, Inc. (Bellecci) to revise demolition plans and to include an evaluation of the Loyalton Property fence which was damaged in the Loyalton Wildfire. Demolition of the buildings on Loyalton had already been planned and the design was underway. However, during the 2020 Loyalton Wildfire the existing buildings and a majority of the exterior Loyalton Property fencing were destroyed, necessitating a revision to the plans. The revised scope includes development of specifications for public works bid, civil support during the bid process and construction / demolition activity, and project and construction management services for structure demolition.

As stated in the September 7, 2021, Report to Council, staff has delayed the request to proceed with the contract amendment to allow for Council discussion on the possible sale of the property:

The City Council is actively having discussions regarding the long-term plan for the Loyalton property, including possible consideration of a sale. Staff has delayed the execution of this agreement to incorporate any needed changes that might occur per the Council discussion. However, at this time, staff believes it is appropriate to move forward with the design to identify needed improvements and complete an engineering construction estimate for the project.

The contract amendment to include the staff recommendation to survey the damage to the fencing and site remediation was not approved by Council.

City of Santa Clara Printed on 6/30/2022Page 1 of 4
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22-849 Agenda Date: 7/5/2022
The discussion of the Loyalton Property sale was agendized for Council consideration on October 26, 2021, and it was continued to the December 14, 2021, Council meeting. At the December 14, 2021, Council meeting the Council directed staff to develop the strategy and next steps for the sale of the property. The next steps and strategy were note and filed by Council on March 8, 2022 (RTC 22- 316). On June 7, 2022 (RTC 22-768), Council declared the property surplus and also directed staff to return with the cost for the design and construction estimate for the fencing and demolition/remediation of the Loyalton Property

DISCUSSION
Per the June 7, 2022, Council direction, staff requested updated estimates from Bellecci to perform the work at the Loyalton Property. The revised scope of work includes the aerial assessment of the fencing, fire damage site review and engineering construction cost estimates for the repair of fencing and site remediation. The new costs are as follows:
· Preliminary aerial survey and cost estimate for fence at Loyalton - $41,557 · Fire damage site review for remediation and demolition - $18,458 · Preparation of bid documents and specifications for Loyalton fence and site remediation project - $70,604
· Contingency for additional services - $42,962
· Total Cost - $173,581
As discussed in September 2021, if Council approves the amendment, staff shall only proceed with the design portion of the contract. Any future construction and/or demolition contract may require Council approval. If it does not require Council approval, staff will inform the Council prior to proceeding. Staff will take into consideration future Council discussion regarding sale of the property prior to making a recommendation on any construction contract. At this time, it is highly unlikely any actual construction/demolition shall proceed prior to the upcoming winter.

The discussion of the sale of the Loyalton Property may continue for many months. The Notice of Availability was mailed out on June 21, 2022, and will require a period of 60-days to determine if any offers are received. If offers are received, a 90-day period is required for negotiation. If no offers are received, staff will need to complete a selection process for a realtor and bring forward a contract for Council consideration to start the sale process in the open market. Additionally, staff has responded to the California Department of Fish and Wildlife email which expressed interest on purchasing the Loyalton Property with the information that the Council took action declaring the Loyalton Property as surplus land.

ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378 (b)(4) in that it is a fiscal activity that does not involve commitment to a specific project which may result in potential significant impact on the environment.

FISCAL IMPACT
Staff recommends a budget amendment to add funding to the Capital Outlay Budget of the SVP Operating Budget in the amount of $173,581 for the proposed Amendment No. 3. This funding will be transferred from Electric Utility Operating Fund Balance and will have no impact on the General City of Santa Clara Printed on 6/30/2022Page 2 of 4
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22-849 Agenda Date: 7/5/2022
Fund.

Budget Amendment
FY 2022/23
Current Increase/
(Decrease)
Revised
Electric Utility Operating Fund
(091)
Expenditure
Capital Outlay $1,544,038 $173,581 $1,717,619
Ending Fund Balance
Unrestricted Ending Fund Balance $33,219,856 ($173,581) $33,046,275

COORDINATION
This report has been coordinated with the Finance Department and City Attorney’s Office.

PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any report to Council may be requested by contacting the City Clerk’s Office at (408) 615-2220, [email protected] <mailto:[email protected]> or at the public information desk at any City of Santa Clara public library.

ALTERNATIVES

1. Authorize the City Manager to negotiate and execute Amendment No. 3 to the Agreement for Design Services with Bellecci & Associates, Inc. for engineering design services for the Loyalton Property fence and site remediation project in Loyalton, California, to increase the maximum compensation from $170,000 to $343,581;

2. Authorize the City Manager to add or delete services consistent with the scope of the agreement, and allow future rate adjustments subject to request and justification by contractor, approval by the City, and the appropriation of funds.

3. Approve the following FY 2022/23 budget amendment in the Electric Utility Operating Fund to increase the Electric Utility Department budget by $173,581 and decrease the unrestricted ending fund balance by $173,581 (five affirmative Council votes required for the use of unused balances).

4. Do not authorize the City Manager to negotiate and execute Amendment No. 3 to the Agreement for Design Services with Bellecci & Associates, Inc. for engineering design services for the demolition located in Loyalton, California.

5. Any other alternative as approved by Council.

RECOMMENDATION
Alternatives

1. Authorize the City Manager to negotiate and execute Amendment No. 3 to the Agreement for Design Services with Bellecci & Associates, Inc. for engineering design services for the Loyalton fence and site remediation project at Loyalton, California, to increase the maximum City of Santa Clara Printed on 6/30/2022Page 3 of 4
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22-849 Agenda Date: 7/5/2022
compensation from $170,000 to $343,581;

Reviewed by: Manuel Pineda, Chief Electric Utility Officer Approved by: Rajeev Batra, City Manager

ATTACHMENTS

1. Original Agreement for Design Professional Services

2. Amendment No. 1

3. Amendment No. 2

4. Attachment 1: Quote for Amendment No. 3
City of Santa Clara Printed on 6/30/2022Page 4 of 4
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BLUE ROUTE SHY If - CITY COUNCIL APPROY NOT REQUIRED
J. Shelton/D . Shiles
From/Department Originating: ELECTRIC Date Submitted: Return To: (S. Laughlin) -----6/7/2019 Dept. Contract Extension Code: ENG - ---- --
(1) Indicate signature authority:
~ City Manager Signature Authority per Ordinance 1941 (CC Action - June 16, 2015) [Elech·ic, Water and Sewer Service Agreements with a Value of$150 ,000 or Less] □
□
□
□
□
City Manager Signature Authority per Ordinance 1941 (CC Action - June 16, 2015) [All Other Service Agreements with a Value of$100,000 or Less] City Manager Signatme Authority per Resolution 6603 (CC Action - July 13, 1999) [Miscellaneous Agreements including Confidentiality Agreements] City Manager Signature Authority per Resolution 5600 (CC Action - May 28, 1991) [Miscellaneous Agreements]
Chief of Police Signature Authority per Resolution 6000 (CC Action - April 4, 1995) [Miscellaneous Polzice ~ eements] /!'
Other: J.cf_, ~~ ~~~
t
(2) Document: Bellecci & Associates, Inc. - Agreement for Design Professional Services [NAME OF DOCUMENT AND CONTRACTOR/OTHER PARTY
(3) Insurance is in compliance per attached EBIX printout [NOTE: IF INSURANCE IS NOT IN COMPLIANCE, AGREEMENT WILL BE RETURNED AND NOT ROUTED FOR CITY SIGNATURES] (4) Depaitment head originating agreement:_ "", ~l'f"--------- -------- - - - ---- 1LSJG NATURE]
(S) ~ FINANCE DEPARTMENT □ Not Applicable n
Cettified as to availability of funds: t{ (\ • - -~
-[S-IG_N_A_T4 ~~ - ]-~ -, -G:l-3---'~=--- - ---- --------- Account Number to be chai·ged: 091-1361 ~8~ 000 -0000-00000-39000 a) Original Contract Amount/Change Order Contingency (include prior amendn nt(s), if applicable):
$ 86 153 [NOT TO EXCEED CONTRACT DOLLAR AMOUNT]
b) All Previous Change Order Amounts (if applicable):
$ _____ _____ _
c) Current Amendment/Change Order Amount (if applicable):
$____ ____ __ [NOT TO EXCEED CONTRACT DOLLAR AMOUNT]
d) Total: $_~8=6-=l 5~3 ___ _ [(a), (b), and (c) for Agreements, or (b) and (c) for Change Orders] NOTE: AGREEJ\,IENTS OVER $100K/CHANGE ORDERS OVER THE CONTINGENCY REQUIRE COUNCIL APPROVAL (6) CITY ATTORNEY'S OFFICE
(7)
Approved as to form: c;f);., OJ. fit)~;,7 n O V
~~UTHORITY COUNSEL]
City Attomey's Office Assignment Number: ~1_8_.1_8_8_2~ -----

CITY CLERK'S OFFICE
Attached: _ 1_2 ____ original(s) _____ _ copy(ies)
- -- Transmit the attached original / copy to contractor \ Fully executed original on file in City Clerk's Office \ '\D \JeP'f. N\6\\\ S \l)\ Date Processed by Clerk's Office: -~(1)~--2_\_-_\_l\ ___ _ S:\Attorney\Blue Route Sheet Forni Rev. 9-1-1 S - PRINT TWO-SIDED ON BLUE PAPER CITY MANAGER R.. JUIRED INFORMATION
(1)
(2)
(3)
(4)
Scope of Services: [BRIEFL y SUMMARIZE THE SCOPE OF WORK/PURPOSE OF DOCUMENT] This Agreement is for engineering design services for the demolition of the caretaker dwelling, milk house and garage at the Benicia property. Bellecci & Associates, Inc. was selected through a formal RFP process; one bid was received.

Term of Agreement: June 10, 2019-December 31, 2023
[START DATE AND END DATE OF THE AGREEMENT/DOCUMENT]
VENDOR SELECTION PROCESS: Check the box that describes how you selected the vendor:

Note: The Informal Selection Process Requires that at least three ContractorsNendors are solicited for a quotation by any means available. The Fonua! Selection Process requires that at least three written competitive proposals are obtained. Award decisions for service contracts exceeding $50,000 that are not awarded to the lowest bidder shall be maintained as part of the record of transaction (completion plus 5 years). Records of solicitation must be maintained as part of the record of transaction (2 years).

Informal Selection Process
D Selection Process for Agreements with a value of $50,000 or less D Selection Process for Electric, Water or Sewer Utility Agreements with a value of$150,000 or less Formal Selection Process:
!XI Selection Process for Agreements with a value over $50,000 for City Departments excluding Electric, Water or Sewer Utilities
0 OTHER:

IDSTORY:

Has the department retained the same contractor for similar services in last 5 years? D YES [If yes, complete following] !XI NO [Ifno, no futther information required] Term of Agreement:

Contract Amount: $
-------[S_T_AR_T_D_A_TE_AND __ E_N_D_D_A_T_E_O_F-THE--A-G_RE_E_ME_N_T_/D_O_C_UME __ N_T] ______ _

CMOUSEONLY
"' 18
omce of the City 1~1, .. , ..... -
CIIY of sanla Clara
S:\Attorney\Blue Route Sheet Form Rev. 9-1-15-PRINT TWO-SIDED ON BLUE PAPER 2 EBIX Insurance No. S200004113

AGREEMENT FOR DESIGN PROFESSIONAL SERVICES

BETWEEN THE

CITY OF SANT A CLARA, CALIFORNIA,
AND
BELLECCI & ASSOCIATES, INC.

PREAMBLE
This Agreement is entered into between the City of Santa Clara, California, a chartered California municipal corporation (City) and Bellecci & Associates, Inc., a California corporation, (Contractor). City and Contractor may be referred to individually as a "Party" or collectively as the "Parties" or the "Parties to this Agreement."

RECITALS
A City desires to secure the design professional services more fully described in this Agreement, at Exhibit A, entitled "Scope of Services"; B. "Design professional" includes licensed architects, licensed landscape architects, registered professional engineers and licensed professional land surveyors; C. Contractor represents that it, and its subcontractors, if any, have the professional qualifications, expertise, necessary licenses and desire to provide certain goods and/or required services of the quality and type which meet objectives and requirements of City; and,
D. The Parties have specified herein the terms and conditions under which such services will be provided and paid for.

The Parties agree as follows:

AGREEMENT TERMS AND CONDITIONS

1. AGREEMENT DOCUMENTS
The documents forming the entire Agreement between City and Contractor shall consist of these Terms and Conditions and the following Exhibits, which are hereby incorporated into this Agreement by this reference:

Exhibit A - Scope of Services
Exhibit B - Schedule of Fees
Exhibit C - Insurance Requirements
Agreement with Bellecci
Rev. 07-01-18

Page 1 ends

City Council and Authorities ConcurrentJuly 5, 2022

City Council and Authorities Concurrent
July 5, 2022