Agenda packet — City Council and Authorities Concurrent, March 7, 2023 (part 6 of 7)

redevelopment project areas can be of direct benefit to those projects in assisting the accomplishment of project objectives; and WHEREAS, in connection with the Rede-v:elopment Plan, the Agency has established a Low and Moderate Income Housing Fund in accordance with California Health and Safety Code Section 33334.2 et §.§.SL.. (the "Housing Funds"), to provide funding for housing within the City of Santa Clara that is affordable to persons and families of very low, low or moderate income; and
WHEREAS, pursuant to Section 33334. 2 (g) of the Community Redevelopment Law, Agency may use the Housing Funds to assist in the provision of housing for low or moderate income households outside the Redevelopment Project Area upon resolution of the City Council and the Redevelopment Agency that such use will be of benefit to the Redevelopment Projects; and
WHEREAS, the City of Santa Clara (the 11 City 11 ) owns a single family residence · in the City of Santa Clara outside of the Redevelopment Project area (the "Property") and the City and Agency have heretofore found that the use of Housing Funds to rehabilitate the Property and provide housing subsidies on behalf of persons of very low income is of benefit to the Redevelopment Project; and WHEREAS, City and Agency have heretofore entered into a Master Lease, pursuant to which Agency will master lease the Property from City and sublease it in order to provide for its use as affordable housing; and
WHEREAS, Project Match, Inc., a California nonprofit
corporation ("Project Match"), has offered to sublease the Property from Agency in order to provide for its use as affordable housing for very low income households; and

Page 2 of 4 ends

WHEREAS, Project Match has requested that Agency enter into a Sublease in the form presented to this City Council, pursuant to which the Agency will make certain improvements to the Property and sublease the Property to Project Match, for a rent and pursuant to the conditions and restrictions contained in the Sublease, and Project Match will sub-sublease the Property to very low income households, for an affordable rent; and
WHEREAS, pursuant to the California Community Redevelopment Law (California Health and Safety Code, Sections 33000, et seq.) this City Council and the Agency held a joint public hearing on the proposed Sublease, having duly published notice of such public hearing and made copies of the proposed Sublease available for public inspection and comment; and
WHEREAS, the City Council has duly considered all terms and conditions of the proposed Sublease and believes that it is in the best interests of the City and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local law and requirements.

NOW, THEREFORE, the City Council of the City of Santa Clara hereby finds and resolves as follows:

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

2. The City Council recognizes that it has received and heard all oral and written objections to the proposed sublease of the Property pursuant to the Sublease and to other matters pertaining to this transaction, and that all such oral and written objections are hereby overruled.

Page 3 of 4 ends

)

3. The City Council . hereby finds and determines that the Sublease will provide affordable housing for very low income persons.

4. The Sublease is hereby approved.

5. This Resolution shall take effect upon adoption.

6. The City Clerk shall certify to the passage and adoption of this Resolution, shall enter the same in the Book of Resolutions of the City Council, and shall cause the action of the Mayor and .

City Council in adopting the same to be entered in the official minutes of the City Council.
* * * *

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

PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF SANTA CLARA, CALIFORNIA AT A REGULAR MEETING THEREOF HELD ON THE 10TH DAY OF NOVEMBER, 1998, BY THE FOLLOWING VOTES:

AYES:

NOES:

ABSENT:

ABSTAINED:

COUNCILMEMBERS: Di ridon, Gillmor, Mahan, Mclemore, Parle and Mayor Nadler
COQNCILMEMBERS: None
COUNCILMEMBERS: Arno
COUNCILMEMBERS: None
ATTEST: ----==--==--~ =--===:::-::'."'=-:='::':r=~""
lerk

Page 4 of 4 ends

REDEVELOPMENT AGENCY OF

THE CITY OF SANTA CLARA
RESOLUTION NO. 98-13 (RA)

A RESOLUTION OF THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA CLARA APPROVING A SUBLEASE WITH PROJECT MATCH, INC. AND MAKING CERTAIN FINDINGS WITH RESPECT TO SUCH SUBLEASE.

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

WHEREAS, the City Council of the City of Santa Clara has heretofore adopted the Redevelopment Plan for the Bayshore North Redevelopment Project on December 28, 1973 by Ordinance No. 1283 (the "Redevelopment Plan 11 ); and
WHEREAS, pursuant to Sections 33334.2(a) and 33334.6(c) of the California Community Redevelopment Law (Cal. Health and Safety Code Section 33000 et seq.) not less than 20% of all taxes which are allocated to the Redevelopment Agency of the City of Santa Clara ( 11 Agency 11 ) are set aside by the Agency in a Low and Moderate Income Housing Fund and used by the Agency for the purpose of increasing, improving and preserving the community's supply of low and moderate housing available at affordable housing costs to persons and families of low and moderate income, including very low income persons; and
WHEREAS, pursuant to Section 33334. 2 (e) of the Community Redevelopment Law, the Agency may exercise any and all of its powers to carry out this purpose; and
WHEREAS, pursuant to Section 33334.6(a) of the Community Redevelopment Law, the California State Legislature has found and declared that the provision of affordable housing outside of

Page 1 of 5 ends

redevelopment project areas can be of direct benefit. to those projects in assisting the accomplishment of project objectives; and WHEREAS, in connection with the Redevelopment Plan, the Agency has established a Low and Moderate Income Housing Fund in accordance with California Health and Safety Code Section 33334.2 et g_g__,_ (the "Housing Funds 11 ), to provide funding for housing within the City of Santa Clara that is affordable to persons and families of very low, low or moderate income; and
WHEREAS, pursuant to Sect ion 3 3 3 3 4. 2 ( g) of the Community Redevelopment Law, Agency may use the Housing Funds to assist in the provision of housing for low or moderate income hou_seholds outside the Redevelopment Project Area upon resolution of the City Council and the Redevelopment Agency that such use- will be of benefit to .the Redevelopment Projects; and
WHEREAS, the City of Santa Clara (the "City") owns a single family residence in the City of Santa Clara outside of the Redevelopment Project area (the "Property") and the City and Agency have heretofore found that the use of Housing Funds to rehabilitate the Property and provide housing subsidies on behalf of persons of very low income is of benefit to the Redevelopment Project; and WHEREAS, City and Agency have heretofore entered into a Master Lease, pursuant to which Agency will master lease the Property from City and sublease it in order to provide for its use as affordable housing; and
WHEREAS, Project Match, Inc., a California nonprofit
corporation ("Project Match") , has offered to sublease the Property from Agency in order to provide for its use as affordable housing for very low income households; and

Page 2 of 5 ends

WHEREAS, Project Match has requested that Agency enter into a Sublease in the form presented to this Agency, pursuant to which the Agency will make certain improvements to the Property and sublease the Property to Project Match, for a rent and pursuant to the conditions and restrictions contained in the Sublease, and Project Match will sub-sublease the Property to very low income households, for an affordable rent; and
WHEREAS, pursuant to the California Community Redevelopment Law (California Health and Safety Code, Sections 33000, et seq.) this Agency and the City Council held a joint public hearing on the proposed Sublease, having duly published notice of such public hearing and made copies of the proposed Sublease available for public inspection and comment; and
WHEREAS, the Agency has duly considered all terms and
conditions of the proposed Sublease and believes that it is in the best interests of the City and the health, safety, morals and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local law and requirements.

NOW, THEREFORE, the Redevelopment Agency of the City of Santa Clara hereby finds and resolves as follows:

1. The Agency hereby finds that the foregoing recitals are true and correct.

2. The Agency recognizes that it has received and heard all oral and written objections to the proposed sublease of the Property pursuant to the Sublease and to other matters pertaining to this transaction, and that all such oral and written objections are hereby overruled.
. Page 3 of s

3. The Agency hereby finds and determines that the Sublease will provide affordable housing for very low income persons.

4. The Sublease is hereby approved.

5. The Agency hereby authorizes the use of Housing Funds from the Redevelopment Project to improve the Property and/or to provide subsidies on behalf of very low income households.

6. The Executive Director of the Agency or her designee is hereby authorized to execute the Sublease on behalf of the Agency, provided that the City Council has first approved the Sublease.

7. The Executive Director of the Agency or her designee is hereby authorized, on behalf of the Agency, to sign all documents necessary and appropriate to carry out and implement the Sublease and to administer the Agency's obligations, responsibilities and duties to be performed thereunder.

8. This Resolution shall take effect upon adoption.

9. The Agency Secretary shall certify to the pas·sage and adoption of this Resolution, shall enter the same in the Book of Resolutions of said Agency, and shall cause the action of the Chairman and Governing Board in adopting the same to be entered in the official minutes of said Governing Board.
* * * *

Page 4 of 5 ends

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

PASSED AND ADOPTED BY THE REDEVELOPMENT AGENCY OF THE CITY OF SANTA CLARA, CALIFORNIA AT A REGULAR MEETING THEREOF HELD ON THE 10TH DAY OF NOVEMBER, 1998, BY THE FOLLOWING VOTES:

AYES:

NOES:

ABSENT:

ABSTAINED:

AGENCY MEMBERS: Diridon, Gillmor, Mahan, Mclemore, Parle and Chairman Nadler
AGENCY MEMBERS: None
AGENCY MEMBERS: Arno
AGENCY MEMBERS: None

Page 5 of 5 ends

REDEVELOPMENT AGENCY OF TF'- . )
1 CITY OF SANTA CLARA

ROUTING SHEET
Agency Meeting Date: November 10, 1998
between the Redevelopment Agency of the City of Santa Clara and Project Match, Inc. for the sublease of property located at 2319 Gianera Street to Project Match to be used as shared housing for very low income seniors.

CERTIFICATION
The proposed request to approve a Resolution of the Agency approving an agreement for the sublease of property located at 2319 Gianera Street by the Agency has been reviewed and is hereby certified.

1. As to Agency Functions,

2. As to Legality, by

3. As to Environmental
Impact Requirements, by

4. As to Substance, by
AGENCY AUTHORIZATION:
[I :\DA TA\WP\CRIS\ 1995\ l ROUTE. FRM]
byf~JL ~ epartment ~ad
Director of Planning
& Inspection
--------------- , 19
I •
) CITY OF SANTA CLARA

ROUTING SHEET
Council Date:November 10, 1998
SUBJECT : __ C=o=u=n=c'-'i=l=----=R=e=s-=o-=l=u=--'t=1=-· o==n'------'A=p-"'p=r'-'o"-v"--1=· =-=n=g..._-=t=h=e"'---=s'--'u=b=-l=e=a=s'""'e"'---=A=g""'r~e-=e=m~e=n=t= between the Redevelopment Agency of the City of Santa Clara and Project Match, Inc. for the sublease of property located at 2319 Gianera Street to Project Match to be used as shared housing for very low income seniors.

CERTIFICATION
The proposed request to approve a Resolution of the City Council approving an agreement for the sublease of property located at 2319 Gianera Street by the Agency to Project Match. Inc. has been reviewed and is hereby certified.

1. As to City Functions, by

2. As to Legality, by

3. As to Environmental
Impact Requirements, by

4. As to Substance, by
COUNCIL AUTHORIZATION:
[I :\DATA\WP\CRIS\1995\lROUTE.FRM)
Director of Planning
& Inspection
city Manager
_______________ ,19_

Appraisal Report
Residential Site
2319 Gianera Street
Santa Clara, Santa Clara County, California 95054

Report Date: January 9, 2023

FOR:

Mr. Joseph Bruzzone
Senior Electric Utility Engineer
City of Santa Clara | Silicon Valley Power
1500 Warburton Avenue
Santa Clara, California 95050

Valbridge Property Advisors |
Northern California

1530 The Alameda, Suite 100
San Jose, CA 95126
408.279.1520 phone Valbridge File Number:
408.279.3428 fax CA02-22-0549-000
valbridge.com

1530 The Alameda, Suite 100
San Jose, CA 95126
408.279.1520 phone
408.279.3428 fax
valbridge.com
January 9, 2023
Chrisoula Kantiotou, PhD
Norman C. Hulberg, MAI
408.279.1520, ext. 7141
[email protected]
Mr. Joseph Bruzzone
Senior Electric Utility Engineer
City of Santa Clara
1500 Warburton Avenue
Santa Clara, California 95050

RE: Appraisal Report
Residential Site
2319 Gianera Street
Santa Clara, Santa Clara County, California 95054

Dear Mr. Bruzzone:

In accordance with your request, an appraisal of the above referenced property was performed. This appraisal report sets forth the pertinent data gathered, the techniques employed, and the reasoning leading to the value opinions. This letter of transmittal does not constitute an appraisal report and the rationale behind the value opinion(s) reported cannot be adequately understood without the accompanying appraisal report.

The property, as referenced above, is located at 2319 Gianera Street, Santa Clara, Santa Clara County, California 95054, and is further identified as Assessor Parcel Number (APN) 104 -05-052. The site contains 12,478 square feet or 0.29 acres and is improved with a 1,140-square-foot single-family home.

The existing improvements do not contribute value to the site and the highest and best use is for redevelopment with up to 19 units per acre.

The analyses, opinions, and conclusions were developed, and this report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation ; the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute ; and the requirements of our client.

The City of Santa Clara/ Silicon Valley Power is our client in this assignment and is the sole intended user of the appraisal and the report and no others . The intended use is for due diligence on determining future actions regarding the property. The value opinions reported herein are subject to the definitions, assumptions, limiting conditions, and certifications contained in this report.

The findings and conclusions are further contingent upon the following extraordinary assumptions and/or hypothetical conditions, the use of which might have affected the assignment results:

Mr. Joseph Bruzzone
City of Santa Clara

Page 3 ends

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA Extraordinary Assumptions:
• None
Hypothetical Conditions:
• None
The value conclusions are based on the analysis in the following report and presented in the following table:

Respectfully submitted,
Valbridge Property Advisors | Northern California

Chrisoula Kantiotou, PhD
Senior Appraiser
California Certified License #AG027334

Norman C. Hulberg, MAI
Senior Managing Director
California Certified License #AG003542

Component As Is As Is
Value Type Fair Market Value Fair Market Rent
Property Rights Appraised Fee Simple
Effective Date of Value December 14, 2022 December 14, 2022 Value Conclusion $1,590,000 $2,600
$127 psf of Site Area $2.28 psf of NLA
Value Conclusion

RESIDENTIAL SITE

TABLE OF CONTENTS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 4 Table of Contents
Cover Page
Letter of Transmittal
Table of Contents ...................................................................................................................................................................... 4 Summary of Salient Facts ....................................................................................................................................................... 6 Aerial and Front Views ............................................................................................................................................................. 8 Location Map .............................................................................................................................................................................. 9 Introduction .............................................................................................................................................................................. 10 Scope of Work ......................................................................................................................................................................... 13 Regional and Market Area Analysis ................................................................................................................................. 15 City and Neighborhood Analysis ..................................................................................................................................... 22 Site Description ....................................................................................................................................................................... 27 Improvements Description ................................................................................................................................................. 34 Subject Photographs (Dated December 14, 2022) .................................................................................................... 36 Assessment and Tax Data ................................................................................................................................................... 38 Market Analysis ....................................................................................................................................................................... 39 Highest and Best Use Analysis .......................................................................................................................................... 46 Appraisal Methodology ....................................................................................................................................................... 48 Sales Comparison Approach .............................................................................................................................................. 49 Estimate of Fair Market Rent .............................................................................................................................................. 64 Reconciliation ........................................................................................................................................................................... 74 Exposure Time..................................................................................................................................................................... 74 National Quality Control ................................................................................................................................................. 75 General Assumptions and Limiting Conditions .......................................................................................................... 76 Certification – Norman C. Hulberg, MAI........................................................................................................................ 80 Certification – Chrisoula Kantiotou, PhD ....................................................................................................................... 81 Addenda .................................................................................................................................................................................... 82 Additional Subject Photographs (Dated December 14, 2022) ......................................................................... 83 Sketch ..................................................................................................................................................................................... 85

RESIDENTIAL SITE

TABLE OF CONTENTS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 5 .................................................................................................................................................................................................. 85 Glossary ................................................................................................................................................................................. 86 Qualifications ...................................................................................................................................................................... 93 Valbridge Property Advisors Information / Office Locations ........................................................................... 97

RESIDENTIAL SITE

SUMMARY OF SALIENT FACTS

Property Identification
Property Name Residential Site
Property Address 2319 Gianera Street
Santa Clara, Santa Clara County, California 95054
Latitude & Longitude 37.400159, -121.967374
Census Tract 5050.1
Tax Parcel Number 104-05-052
Property Owner City of Santa Clara
Site
Zoning Single Family Residential (R1-6L)
FEMA Flood Map No. 06085C0064H
Flood Zone X
Gross Land Area 12,478 square feet
Usable Land Area 12,478 square feet
Proposed Improvements
Property Use Single Family Home
Gross Building Area (GBA) 1,140 sf
Net Rentable Area (NRA) 1,140 sf
Number of Units 1
Number of Buildings 1
Number of Stories 1
Year Built 1960's
Condition Average
Construction Class D - Wood Frame
Construction Quality Average
Valuation Opinions
Highest & Best Use - As Vacant Redevelopment with up to 19 units per acre Highest & Best Use - As Improved Redevelopment with up to 19 units per acre Reasonable Exposure Time 6 to 9 months

RESIDENTIAL SITE

SUMMARY OF SALIENT FACTS

Approach to Value As Is
Cost Not Developed
Sales Comparison $1,590,000
Income Capitalization Not Developed
Component As Is As Is
Value Type Fair Market Value Fair Market Rent
Property Rights Appraised Fee Simple
Effective Date of Value December 14, 2022 December 14, 2022 Value Conclusion $1,590,000 $2,600
$127 psf of Site Area $2.28 psf of NLA
Value Indications
Value Conclusion

RESIDENTIAL SITE

AERIAL AND FRONT VIEWS

AERIAL VIEW

FRONT VIEW (DATED DECEMBER 14, 2022)

RESIDENTIAL SITE

LOCATION MAP

RESIDENTIAL SITE

INTRODUCTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 10 Introduction
Client and Intended Users of the Appraisal
The City of Santa Clara/ Silicon Valley Power is our client in this assignment and is the sole intended user of the appraisal and the report . Under no circumstances shall any of th e following parties be entitled to use or rely on the appraisal or this appraisal report:

i. The borrower(s) on any loans or financing relating to or secured by the property, ii. Any guarantor(s) of such loans or financing; or
iii. Principals, shareholders, investors, members or partners in such borrower(s) or guarantors.

Intended Use of the Appraisal
The intended use of this report is for due diligence on determining future action s regarding the property.

Real Estate Identification
The property is located at 2319 Gianera Street, Santa Clara, Santa Clara County, California 95054. The site is further identified by the Assessor Parcel Number (APN) 104-05-052.

Legal Description
We were not provided with a legal descript ion of the subject. We assume the legal description corresponds to its address and Assessor Parcel Number (APN).

Use of Real Estate as of the Effective Date of Value
As of the effective date of value, the property was a single-family home.

Use of Real Estate as Reflected in this Appraisal
The opinion of value for the property as is reflects use as a residential site.

Ownership of the Property
According to public records, title to the subject is vested in the City of Santa Clara.

History of the Property
We are unaware of sales, listings or offers for any portion of the subject within three years of the valuation date. When appropriate, we consider and analyze the known history of the property in the development of our opinions and conclusions.

Type and Definition of Value
The appraisal problem is to develop opinions of the market value and market rent of the property.

The purpose of this appraisal is to develop an opinion of the market value of the subject property. “Market Value,” as used in this appraisal, is defined as “The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions

RESIDENTIAL SITE

INTRODUCTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 11 requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self- interest, and assuming that neither is under undue duress .”1 Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:

• Buyer and seller are typically motivated.
• Both parties are well informed or well advised, each acting in what they consider their own best interests;
• A reasonable time is allowed for exposure in the open market; • Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
• The price represents the normal consideration for the property sold unaffected by special or creative financing or sale concessions granted by anyone associated with the sale.”

“Market rent,” as used in this appraisal, is defined as “the most probable rent that a property should bring in a competitive and open market reflecting all cond itions and restrictions of the lease agreement, including permitted uses, use restrictions, expense obligations, term, concessions, renewal and purchase options, and tenant improvements (TIs).” (Source: The Dictionary of Real Estate Appraisal, Fifth Edition, pp 121-122)
We have estimated the fair market value and fair market rent for the subject “as is,” under the market conditions as of the valuation date. Please refer to the Glossary in the Addenda section for additional definitions of terms used in this report.

Valuation Scenarios, Property Rights Appraised, and Effective Dates of Value Opinions of value for the subject were developed under the following valuation scenarios:

Date of Report
The date of this report is January 9, 2023.

List of Items Requested but Not Provided
• Preliminary Title Report
Assumptions and Conditions of the Appraisal
This appraisal assignment and the opinions reported herein are subject to the General Assumptions and Limiting Conditions contained in the report and the following extraordinary assumptions and/or hypothetical conditions, the use of which might have affected the assignment results.

1 THE DICTIONARY OF REAL ESTATE APPRAISAL, SEVENTH EDITION, (APPRAISAL INSTITUTE, 2022), 118 Valuation Scenario Effective Date of Value
Fair Market Rent December 14, 2022
As Is Fair Market Value December 14, 2022

RESIDENTIAL SITE

INTRODUCTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 12 Extraordinary Assumptions
• None
Hypothetical Conditions
• None

RESIDENTIAL SITE

SCOPE OF WORK

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 13 Scope of Work
The elements addressed in the Scope of Work are (1) the extent to which the subject is identified, (2) the extent to which the property is inspected, (3) the type and extent of data researched, (4) the type and extent of analysis applied, (5) the type of appraisal report prepared , and (6) the inclusion or exclusion of items of non -realty in the development of the value opinion . These items are discussed as below.

Extent to Which the Property Was Identified
The three components of the property identification are summarized as follows:
• Legal Characteristics – The property was legally identified via the Assessor Parcel Number (APN), plat map, site visit, Google Earth, public records, and client-provided information. • Economic Characteristics - Economic characteristics of the property were identified via information provided by our client, market data, and discussion with active market participants, as well as a comparison to properties with similar locational and physical characteristics. • Physical Characteristics - The property was physically identified via an interior and exterior inspection by Yulia Ferguson.

Extent to Which the Property Was Inspected
We inspected the property on December 14, 2022 . The improvements were measured during the course of the inspection.

Type and Extent of Data Researched
The following data was researched and analyzed: (1) market area data, (2) property -specific market data, (3) zoning and land -use data, and (4) current data on comparable listings and transactions.

Professionals familiar with the subject market/property type were also interviewed.

This report was prepared with the assistance of full -time trainee/assistant Yulia Ferguson, who performed and assisted in many tasks of the report under the full appraiser’s supervision, including research and data collection, assisted in writing regional and market analysis, city and neighborhood analysis, site and improvement description. In addition, Yulia searched and confirmed the comparable sales and rentals, completing the adjustment grid, determining the highest and best use, and reconciliation. The appraiser supervised and verified these steps.

Type and Extent of Analysis Applied (Valuation Methodology) Surrounding land use trends, the condition of any improvements, demand for the property, and relevant legal limitations were observed in the process of concluding a highest and best use for the property. The subject was then valued based on the highest and best use conclusion.

Appraisers develop an opinion of property value with specific appraisal procedures that reflect three distinct methods of data analysis: the cost approach, sales comparison approach, and income capitalization approach. One or more of these approaches are used in all estimations of value.

RESIDENTIAL SITE

SCOPE OF WORK

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 14 • Cost Approach - In the cost approach, the value indication reflects the sum of current depreciated replacement or reproduction cost, land value, and an appropriate entrepreneurial incentive or profit.
• Sales Comparison Approach - In the sales comparison approach, value is indicated by recent sales and/or listings of comparable properties in the market, with the appraiser analyzing the impact of material differences in both economic and physical elements between the subject and the comparables.
• Income Capitalization Approach - In the income capitalization approach, value is indicated by the capitalization of anticipated future income. There are two types of capitalization: direct capitalization and yield capitalization, more commonly known as discounted cash flow (DCF) analysis.

All th ese approaches to value were considered. The availability of data and applicability of each approach to value within the context of the characteristics of the property, along with the needs and requirements of the client, were assessed. Based on this asses sment, we relied upon the Sales Comparison Approach. Due to the age of the improvements and difficulty in estimating depreciation, the cost approach is not considered to be applicable. The Income Capitalization Approach was not used because single family homes are not typically purchased by investors for their income and therefore, the Income Approach to Value is not considered to be applicable. Per our client’s request, the rent comparison approach is utilized to estimate the fair market rent for t he home . Further discussion of the extent of our analysis and the methodology of each approach is provided later in the respective valuation sections.

Appraisal Conformity and Report Type
The analyses, opinions, and conclusions were developed, and this report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation; the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; and the requirements of o ur client. This is an Appraisal Report as defined by the Uniform Standards of Professional Appraisal Practice under Standards Rule 2-2a.

Personal Property/FF&E
All items of non-realty are excluded from this analysis. The opinion of market value developed herein is reflective of real estate only.

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

REGIONAL MAP

Overview
The property is located in the San Francisco Bay Region, an area which is comprised of the nine counties bordering the San Francisco Bay. According to the State of California Department of Finance, the area had a combined population of approximately 7.61 million as of January 1, 20 22. The Department of Finance characterizes the San Francisco Bay Area by a moderate climate, diversified economy and one of the highest standards of living in the United States.

Population
Santa Clara County is the most populous of the nine counties comprising the San Francisco Bay Region, with an estimated 1,894,783 residents as of January 1, 2022, according to the State of California Department of Finance. This was a decrease of 2.04% from the previous year. San Jose is the largest city in the county and the third largest in California, surpassing San Francisco.

According to the Site to Do Business projections, presented below, the county’s population is expected to decrease annually 0.3% between 2022 and 2027, while Santa Clara will increase approximately 0.1% annually over the same period.

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

T ransportation
Excellent transportation routes and linkages to all major cities within the region and throughout the state are primary reasons for the advancement of business activity in the Bay Area, including Santa Clara County.

Air service in the area is provided by Norman
Y. Mineta San Jose International Airport,
which accommodated more than 15 million
passengers from April 2019 to March 2020.

San Francisco and Oakland airports are also
within an hour’s drive from most portions of
the county. In 2010, San Jose Inte rnational
Airport completed the first phase of a two -
phase expansion with the goal of increasing
service to 17.3 million travelers a year, at a
cost of $1.3 billion. Planning for the second
phase, nine additional gates and a new
concourse extension at the south end of
Terminal B, began early in 2018.

The area has a well-developed freeway system although traffic congestion is unquestionably one of the negative aspects. The county’s transportation network also includes multiple expressways, which provide streamlined access to most interior locations. Lawrence Expressway, San Tomas Expressway and Foothill Expressway run north-south, while Central Expressway and Montague Expressway run roughly east-west.

Employment
High-technology employment and a skilled workforce translate into relatively high-income levels, and Santa Clara County is one of the most affluent metropolitan regions in the nation. Silicon Valley’s economy is stable, although its narrow range of driving industries has kept recent growth very slow.

Significant employment sectors within Santa Clara County include manufacturing; professional, scientific, and technical services; health care; retail; and educational services. Some of the largest employers are associated with the computer industry such as Adobe, Apple, AMD, and Hewlett - Packard; hospitals such as the VA Medical Center, Kaiser Permanente, and the San Jose Medical Center; space and aerotech including NASA and Lockheed Martin; and educational facilities such as San Jose State University and Stanford University School of Medicine.

Population
Estimated Annual ∆ Projected Annual ∆
Area 2010 2022 2010 - 22 2027 2022 - 27
United States 308,745,538 333,793,107 0.7% 333,934,112 0.0% California 37,253,956 39,770,476 0.5% 39,648,278 -0.1%
Santa Clara County 1,781,642 1,957,605 0.8% 1,925,788 -0.3% Santa Clara 116,610 130,983 1.0% 131,473 0.1%
Source: ESRI (ArcGIS)

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

Unemployment
The unemployment rate in Santa Clara County is currently less than the rates of the state and nation.

The County unemployment rate was 2.1% as of October 20 22 (most recent available). The State of California was at 3.8% while the Nation was at 3.4% for the same time period.

National Economic Overview
The U.S. economy is in transition from a strong recovery following a brief COVID-related recession to a slowdown as persistently rising inflation and higher interest rates take their toll on consumers and businesses. In addition, China’s continued COVID lockdowns has placed supply-related constraints on the national (and global) economy. And the Russian invasion of Ukraine has increased energy prices worldwide.

Employment by Industry - San Jose-Sunnyvale-Santa Clara, CA (MSA) 2022 Percent of
Industry Estimate Employment
Agriculture/Forestry/Fishing/Hunting 6,453 0.61%
Mining/Quarrying/Oil & Gas Extraction 308 0.03%
Construction 61,271 5.80%
Manufacturing 158,664 15.01%
Wholesale Trade 20,217 1.91%
Retail Trade 88,196 8.34%
Transportation/Warehousing 33,710 3.19%
Utilities 4,308 0.41%
Information 50,709 4.80%
Finance/Insurance 29,968 2.83%
Real Estate/Rental/Leasing 20,837 1.97%
Professional/Scientific/Tech Services 197,326 18.66%
Management of Companies/Enterprises 837 0.08%
Admin/Support/Waste Management Services 40,787 3.86%
Educational Services 81,755 7.73%
Health Care/Social Assistance 118,428 11.20%
Arts/entertainment/Recreation 15,993 1.51%
Accommodation/Food Services 57,512 5.44%
Other Services (excl Public Administration) 40,275 3.81% Public Administration 29,674 2.81%
Total 1,057,228 100.0%
Source: ESRI (ArcGIS)
Unemployment Rates
Area YE 2017 YE 2018 YE 2019 YE 2020 YE 2021 2022¹
United States 4.4% 3.9% 3.7% 8.1% 5.3% 3.4%
California 4.8% 4.3% 4.1% 10.2% 7.3% 3.8%
Santa Clara County 3.2% 2.7% 2.5% 7.2% 4.7% 2.1%
Santa Clara 3.1% 2.5% 2.3% 6.0% 4.0% 1.9%
Source: www.bls.gov data not seasonally adjusted; ¹October - most recent for US, others lag by 1-2 mos.)

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 18 Economic growth had surged through 2021, partially because of lower interest rates and about $6.4 trillion in government borrowing/spending, as well as from an increase in consumer spending. Since then, real gross domestic product (GDP) declined by 1.6% and 0.9% in the First and Second Quarters of 2022.

While two consecutive quarters of falling GDP are typically viewed as harbingers of an upcoming recession, it is counterbalanced by a strong, tight national job market. The national unemployment rate is low, at 3.5%, as of the end of September 2022 – a rate that is in line with the pre-COVID record high. As the national economy bounced back from an initial COVID shock, demand for employment (labor) has increased, and wages have been growing.

The Federal Reserve lowered its forecast for the U.S. economy to grow 0.2% by the end of 2022, an d by 1.2% in 2023 – especially as interest rate increases begin to impact consumer demand and business investment. These rates are down from its previous 1.7% and 1.7% growth rate predictions for 2022 and 2023, respectively.

Inflation Rate
The rate of infl ation accelerated during Fall 2021 and has been picking up speed throughout 2022.

Consumer demand surged following the “reopening of the economy” and from government stimulus payments.

According to the U.S. Labor Department, the Consumer Price Index (CPI) increased by 6.2% during Fall 2021 from the same one year ago. Price increases are observed in all areas – including gasoline, grocery, restaurant, and automobile prices. Businesses are also reporting higher labor costs, including vendor prices and costs for raw materials.

As of mid -year 2022, consumer spending increased by an adjusted annual rate of 1.1%. Consumer prices rose by 9.1%, according to Bureau of Labor Statistics, from the same time one year prior. Costs surged for gas, groceries, rent, and dental care.

In September 2022, the Labor Department reported that the rate of inflation was at 8.2%, largely due to a reduction in gasoline prices. The all-items index, minus the food and energy indices, was reported at 6.6% for the same period. By November 2022 (latest data available), the all-items index, minus the food and energy indices, was reported at 6.0%.

Federal Funds Rate
Inflation is currently at a level not seen since the early 1980’s. There are two means by which inflation can be decreased: fiscal policy or monetary policy. The former is controlled by Congress; the latter is controlled by the Federal Reserve (“Fed”). The Fed can raise the federal funds rate, which is the U.S. benchmark for interest rates, to combat inflation.

To maximize employment and stabilize inflation, the Federal Reserve Bank raised the federal funds rate nine times from 2015, when interest rates were almost zero, through 2018. Incremental rate decreases were made up to March 2020. In response to the pandemic, the Fed began to aggressively lower the federal funds rate, first by 50 basis points, and then again by 100 basis points.

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 19 In addition, the Fed began purchasing $120 billion
a month in U.S. Treasury bonds and mortgage -
backed securities to hold long -term interest rates
down and to stimulate the economy. By mid -year
2021, the rate was at near-zero.

Fast forward to Fall/Winter 2021 -2022, at a time
when the inflation rate was rapidly climbing, the
Fed agreed to taper their government bond
purchases. Since then, government investment has
decreased and been phased out.

Beginning March 2022, the Fed began raising the
interest rate, for the first time in three years, to
temper the rapid inflation growth. Their initial rate
increase was 25 basis points. Further rate increases
followed: by 50 basis points in May 2022, by 75
basis points on each occasion, in June, July,
September and November 2022 , and by 50 basis
points in December 2022. The benchmark interest
rate currently is at 4.25% to 4.50%.

Reference is made to the following graph. The current (as of October 2022) benchmark (Federal Funds) rate is lower than the prior peaks in 2000 and in 2007.

Source: Board of Governors of the Federal Reserve System (US); fred.stlouisfed.org Supplemental Comments on Inflation and Interest Rates
The cause of inflation is attributed to a combination of factors. One of the most significant factors is the increase in money supply because of the fiscal stimulus (such as the Payroll Protection Progr am and other COVID-related relief payments) and monetary stimulus (such as decreasing the benchmark interest rate to near zero for two years and Federal balance sheet increases). Other factors exacerbating inflation include China’s COVID -Zero policy – resulting in numerous manufacturing shutdowns, and Russia’s halt on natural gas supply to Europe.

The Fed has pursued the action of raising the interest rate at the fastest pace in 40 years, with five rate increases throughout 2022, including three consecutive increases by 75 basis points on each occasion.

The underlying theory is that as interest rates increase, the cost of borrowing increases – which, in turn, Date Target Range (%) Basis Point
Change
Dec-18 2.25% - 2.50% +25
Aug-19 2.00% - 2.25% -25
Sep-19 1.75% - 2.00% -25
Oct-19 1.50% - 1.75% -25
Mar-20 1.00% - 1.25% -50
Mar-20 0.00% - 0.25% -100
Apr-20 0.00% - 0.25% 0
Mar-22 0.25% - 0.50% +25
May-22 0.75% - 1.00% +50
Jun-22 1.50% - 1.75% +75
Jul-22 2.25% - 2.50% +75
Sep-22 3.00% -3.25% +75
Nov-22 3.75% - 4.00% +75
Dec-22 4.25% - 4.50% +50
Federal Funds Rate

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 20 diminishes the available credit to the market, causing downward pressure on asset prices, includin g real estate. Increasing rates, historically, have also placed upward pressure on capitalization rates, albeit not immediately.

As the cost of borrowing increases, the amount of money that real estate purchasers can finance decreases. Additionally, investors are looking for a return on investment, or yield. As the Federal Funds Rate increases, so do coupon rates of U.S. Government bonds, which has historically been perceived as being “risk free,” since it is assumed that the U.S. Government would not defa ult on its debts. The result is a flight of capital to the perceived safety of bonds – and away from real estate investment.

The California Forecast
The state, previously on mandatory lockdown, officially “reopened” in June 2021 as a result of the mass vaccination efforts that were underway and, a then waning of the coronavirus pandemic. Other factors, such as higher energy costs, supply chain interruptions, and rising inflation and interest rates, are also influences contributing to a slower economic growth forecast for California.

The most recent UCLA Anderson forecast (September 2022) calls for employment gains over the next three years, primarily in the leisure and hospitality, health care, social services, technology, and construction sectors. Statewide unemployment rates forecast at the end(s) of 2022, 2023, and 2024 are expected to be at 4.5%, 4.1%, and 4.5%, respectively.

Concluding Remarks
As of year-end 2022, the Fed has raised the benchmark interest rates seven (7) times to combat inflation, wit h rate increases in March (+25 bps), May (+50 bps), June (+75 bps), July (+75 bps), September (+75 bps), November (+75 bps), and December (+50 bps).

In the near term, market participants will likely execute very few transactions into the early part of 2023.

Debt rates are increasing rapidly; we have observed pending sale transactions of commercial real estate that have fallen out of escrow while buyers were seeking financing. We expect to see more creative financing, such as seller-carried financing, loan assumptions, and wrap mortgages – as examples, when deals do close.

It is likely that only the best properties will trade at the early 2023. High -quality tenancies with long- term leases remain the most sought-after investments. Lower-quality properties that can be assembled into development sites as large as one -acre, or g reater, will likely reflect land value for other commercial real estate sectors, such as life sciences, multi-family residential, or mixed uses.

Median Household Income
Total median household income for the region is presented in the following table. Overall, the subject’s MSA and county compare favorably to the state and the country.

RESIDENTIAL SITE

REGIONAL AND MARKET AREA ANALYSIS

Conclusions
Historically, the Santa Clara County region has been considered a desirable place to both live and work.

Physical features and a strong local economy attract both businesses and residents. It is a worldwide leader in technology and a regional employment center, with an increasingly diversified economy.

While traffic congestion will continue to be a problem, residents remain among the most affluent in the country.

The outlook is still somewhat clouded by the unknowns associated with the lingering effects of COVID- 19, inflation rates, and the other economic indicators discussed earlier in this section. Some people continue to curb their activity, and cert ain industries in particular have been severely affected.

California “re -opened for business” in June 2021, and the statewide mask mandate was lifted in February 2022.

Many market participants were becoming more optimistic, thanks in large part to the va ccination rollouts and the reopening of the state, however investors and consumers alike are proceeding with caution as we face headwinds. The timeline for a return to normalcy remains unknown, but the historic reasons for growth in the region remain the same, and thus the expectation is that normal growth will resume over time.

Median Household Income
Estimated Projected Annual ∆
Area 2022 2027 2022 - 27
United States $62,203 $67,325 1.6%
California $88,930 $106,150 3.6%
Santa Clara County $148,530 $170,727 2.8%
Santa Clara $146,845 $166,134 2.5%
Source: ESRI (ArcGIS)

RESIDENTIAL SITE

CITY AND NEIGHBORHOOD ANALYSIS

NEIGHBORHOOD MAP

City Overview
The City of Santa Clara is located in the “heart” of Silicon Valley and is a progressive community, known for low crime rates and the quality of municipal services, as well as its proximity to a large number of high-technology employers. San Jose borders Santa Clara to the north, east, and so uth, while Sunnyvale borders it to the west.

Santa Clara is a progressive community which owns and operates its own electric, water and sewer utilities. The quality and reliability of utility services is excellent and service charges are the lowest in the entire Bay Area. Santa Clara has also been chosen by the Association of Bay Area Governments (ABAG) as the pilot city for implementation of an interactive regional on -line guide to government services.

Industrial development in Santa Clara is concentrat ed north of Central Expressway and most of the retail and residential development is located south of Highway 101. Because of the lack of available land for development, Santa Clara’s population growth is expected to remain relatively low.

RESIDENTIAL SITE

CITY AND NEIGHBORHOOD ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 23 The city has good access to local and regional transportation. Highway 101 runs northwest/southeast through the center of Santa Clara providing excellent access to other “Silicon Valley” communities and the San Francisco Peninsula and San Francisco to the north. Interstate 280 also runs through Santa Clara providing an alternative route to San Francisco. Interstate 880 skirts Santa Clara to the east running in a north/south direction. This provides direct access to such East Bay cities as Fremont, Hayward and Oakland. Overall, the highway and local transportation systems in and around Santa Clara provides for excellent access to and from the city.

The major commercial thoroughfares include El Camino Real and Stevens Creek Boulevard, both running in an east/west direction and connecting Sunnyvale and San Jose. Major north/south thoroughfares include Lafayette Street, Scott Boulevard, San Tomas Expressway, Bowers Avenue and Lawrence Expressway.

The San Jose International Airport is minutes from anywhere in Santa Clara with service to most major U.S. cities.

Neighborhood Location and Boundaries
The subject neighborhood is located in the northern section of Santa Clara. The area is suburban in nature. The neighborhood is bounded by Highway 237 to the north, Zanker Road to the east, Highway 101 to the south, and Lawrence Expressway to the west.

T ransportation Access
Within the immediate area, transportation access helps define the character of its development. Major travel and commuter r outes within the immediate area include Tasman Drive and Lafayette Street.

Access to the area is considered average.

Demographics
The following table depicts the area demographics in Santa Clara within a one-, three-, and five-mile radius from the subject.

As shown in the table below, the total population and total hous eholds within a 1 -mile radius are projected to increase at 0.6% between 2022 and 2027, while within 3- and 5-miles radius are projected to increase at 0.4% and 0.1%. Median household income is projected to increase at 2.4%, 2.1% and

2.6% within the 1 -, 3 -, and 5 -mile radius from the property between 202 2 and 202 7. These demographics support a variety of single-family residential uses.

RESIDENTIAL SITE

CITY AND NEIGHBORHOOD ANALYSIS

Within a three -mile radius, the reported population is 122,811 with a projected growth rate of approximately 0.4% annually. There are 51,297 housing units within that three-mile radius. The growth rate is expected to be 1.0% annually. Most of the housing is tenant-occupied. Within a three -mile radius, the median household income is $155,454. Looking ahead, annual household income growth is projected at 2.1% per year. The average income figures suggest that the inhabitants are within the middle income brackets.

Immediate Area Uses
The property is located along the north side of Gianera Street in Santa Clara. The focal point of the neighborhood is the $1.2 billion Levi’s-49ers football stadium, which occupies a 17-acre site fronting the south line of Tasman Drive between the San Tomas Aquino Creek channel and Centennial Drive just north of the property. The stadium opened in July 2014 and has since hosted more than 100 events with an average of 20 events per year. In addition to 49er games, the stadium hosted the Super Bowl, Copa America Centenario in 2016. The below aerial photo exhibits the uses located in the immediate vicinity.

Neighborhood Demographics
Radius (Miles) 1 Mile 3 Mile 5 Mile
Population Summary
2010 Population 15,588 92,928 306,849
2022 Population Estimate 16,825 122,811 374,351
2027 Population Projection 17,319 125,427 376,657
Annual % Change (2022 - 2027) 0.6% 0.4% 0.1%
Housing Unit Summary
2010 Housing Units 6,093 36,122 117,789
% Owner Occupied 41.6% 44.6% 45.5%
% Renter Occupied 53.5% 50.8% 50.0%
2022 Housing Units 6,253 51,297 147,786
% Owner Occupied 34.7% 34.3% 39.7%
% Renter Occupied 62.4% 58.5% 53.7%
2027 Housing Units 6,607 53,799 153,091
% Owner Occupied 32.4% 33.0% 38.6%
% Renter Occupied 62.3% 58.3% 53.1%
Annual % Change (2022 - 2027) 1.1% 1.0% 0.7%
Income Summary
2022 Median Household Income Estimate $172,777 $155,454 $154,432 2027 Median Household Income Projection $194,573 $172,348 $175,460 Annual % Change 2.4% 2.1% 2.6%
2022 Per Capita Income Estimate $75,110 $74,636 $70,748 2027 Per Capita Income Projection $85,994 $87,014 $83,290 Annual % Change 2.7% 3.1% 3.3%
Source: ESRI (ArcGIS) (Lat: 37.400159, Lon: -121.967374)

RESIDENTIAL SITE

CITY AND NEIGHBORHOOD ANALYSIS

IMMEDIATE AREA USES

Source: Google Maps

The area is dominated by residential buildings to the east, south, and west. Directly to the north is a municipal service facility , known as Tasman Substation, including Northern Receiving Station and a parking lot.

Transportation to the area is good. Highway 101 runs northwest southeast through the center of Santa Clara providing excellent access to other "Silicon Valley" communities and the San Francisco Peninsula and San Francisco to the north.

The greater area, across San Tomas Aquino Creek Trail, is an area currently defi ned by exclusively commercial land uses. Great America Parkway is considered one of the more prestigious office corridors in Silicon Valley, and a number of high technology office and R&D users as well as luxury hotels are located along the thoroughfare.

Analysis and Conclusions
The property is located in the residential neighborhood in the City of Santa Clara, a progressive

RESIDENTIAL SITE

CITY AND NEIGHBORHOOD ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 26 community known the quality of municipal services, as well as its large number of high -technology employers. The city owns and operates its own electric, water and sewer utilities, which are considered to be of excellent quality and reliability with the lowest service charges in the entire Bay Area.

Overall, the highway and local transportation systems in and around Santa Clara provide for excellent access to and from the city. The property is located in a highly desirable section of Santa Clara. Levi’s Stadium and California’s Great American are prime attractions that draw large crowds from all over the Bay. Overall, the property neighborhood is appealing to a variety of residential users.

RESIDENTIAL SITE

SITE DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 27 Site Description
The site is located 2319 Gianera Street, Santa Clara, Santa Clara County, California 95054 . The characteristics of the site are summarized as follows:

Site Characteristics
Gross Land Area: 0.29 Acres or 12,478 SF
Usable Land Area: 0.29 Acres or 12,478 SF
Usable Land %: 100.0%
Shape: Rectangular
Average Depth: 143 feet
Topography: Level
Drainage: Assumed adequate
Grade: At street grade
Utilities: All public utilities are available to the site Off-Site Improvements: Gianera Street is a fully improved roadway with sidewalks, curbs, gutters, streetlights, and landscaping. This roadway carries one lane of traffic in each direction, east-west.

Interior or Corner: Interior
Signalized Intersection: No traffic signal at the site
Street Frontage / Access
Frontage Road Primary
Street Name: Gianera Street
Street Type: Local
Frontage (Linear Ft.): 85
Number of Curb Cuts: 1
Traffic Count (Cars/Day): Minimal
Flood Zone Data
Flood Map Panel/Number: 06085C0064H
Flood Map Date: 05-18-2009
Flood Zone: X
Flood Zone X includes areas of minimal flood hazard, which are outside a Special Flood Hazard Area and higher than the elevation of the 0.2%-annual-chance flood. No flood insurance is required.

Portion in Flood Hazard Area: 0.00%

RESIDENTIAL SITE

SITE DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 28 Other Site Conditions
Soil Type: We have not been provided a geotechnical report for the property.

Based on our physical inspection, soil conditions appear stable Environmental Issues: A Phase I Environmental Site Report was not provided for review.

We make no representations as to the presence of toxins and hazardous materials on the subject site. We are appraising the site as if clean. If this is of concern to any reader of this report, it is our recommendation that an environmental report is obtained from the appropriate professionals qualified to issue such opinions.

Easements/Encroachments: A Preliminary Title Report was not provided to the appraiser for review. We assume that there are no easements or encumbrances that would materially affect the value of the subject, either positively or negatively.

Earthquake Zone: The property is not located in an Alquist -Priolo Special Studies Zone for earthquake hazard. Earthquake hazard is typical for the overall area.

Proximity to Power Lines: The property is directly south from the Tasman Substation, a large, three bank distribution substation. Although electricity substations are an important part of power infrastructure, there are concerns about their safety as they emit electric and magnetic fields (EMFs).

There are rumors that EMFs cause cancer, miscarriages, birth defects and other health issues. However, that is n o conclusive evidence to support these claims.

According to an OLD Research Report prepared in October 2004 by Kevin E. McCarthy, most of the research conducted on the potential health benefits of the EMFs has focused on transmission and distribution lines rather than substation. According to the National Institute of Environmental Health Sciences (NIEHS) most of the EMF that comes from a substation is produced by these lines, rather than the equipment at the substation itself. According to National Cancer Institute, although a study in 1979 pointed to a possible association between living near electric power lines and childhood leukemia, more recent studies have had mixed finding.

An article published in The Appraisal Journal in Summer 20 16 by Ted Tatos, Mark Glick, PhD, JD and Troy A. Lunt, MAI finds some negative effects from transmission lines, sub transmission lines and substation on property values. The effects differ by type of transmission line and the effect diminish with distance. However, they also find evidence of modest positive effect associated with the proximity, which may be related to greenways constructed beneath power lines.

RESIDENTIAL SITE

SITE DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 29 These results are consistent with our own survey of active market participants, who report no impact due to the property’s proximity to the substation. We spoke with Mike Strouf, the broker representing the seller of 2303 Genera Street, Ramada Reddy, the broker representing the landlord of 2233 Calle De Primavera and Mei Ling, the broker representing the seller of 2215 Gianera Street among others. They all agreed that proximity to the substation was not an issue of concern among buyers and/or tenants and had no impact on the value or rental rate of the real estate.

Adjacent Land Uses
North: Municipal service facility
South: Residential, across Gianera Street
East: Residential
West: Residential
Site Ratings
Access: Average
Visibility: Average
Zoning Designation
Zoning Jurisdiction: City of Santa Clara
Zoning Classification: R1-6L, Single Family Residential General Plan Designation: Low Density Residential
Permitted Uses: A variety of single-family residential uses.

Zoning Comments: The property is under the jurisdiction of the City of Santa Clara and is zoned Single -Family (R1 -6L). The General Plan land use designation is Low Density Residential. The zoning is in conformance with the General Plan.

According to the City of Santa Clara Municipal Code, the intent of Single-Family zoning district is to stabilize and protect the residential characteristics of the district and to promote and encourage a suitable single-family residential environment.

Permitted uses include single-family dwellings, private garages and accessory buildings, accessory unit, supportive and transitional housing.

Each lot shall contain a minimum area of 6,000 square feet. The minimum lot width shall not be less than 60 feet. The maximum permitted height shall be two stories bu t not exceeding 25 feet.

Each front yard setback shall not be less than 20 feet in depth. A

RESIDENTIAL SITE

SITE DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 30 minimum of thirty -five percent (35%) of the front yard shall be permanently maintained as landscaped area. Each side yard shall not be less than 5 feet; rear yard s hall not be less than 20 feet in depth.

Each single -family dwelling shall have two garage or carport parking spaces; these parking spaces shall be prohibited in required front yards or corner lot side yards. A minimum driveway length of twenty (20) feet is required between said parking and any street right-of-way line. Additional parking shall be permitted in required front yards or corner lot side yards, with motor vehicles, trailers, and boats parked in an orderly manner, generally perpendicular to the street. Such parking shall be prohibited in the thirty-five percent (35%) minimum landscaped area. Motor vehicles that do not comply with restrictions imposed by other sections of this title are prohibited.

According to the City of Santa Clara General Plan, the Low-Density Residential land use designation is intended for residential densities of 8 to 19 units per gross acre. Building types may include detached or attached dwelling units. Low Density Residential development comes in the form of s ingle-family dwelling units, townhomes, rowhouses and combinations of these development types.

Analysis/Comments on Site
The site consists of a single parcel located along the north side of Gia nera Street in Santa Clara. The site has a rectangular shape and an interior lot configuration with approximately 85.00 feet of frontage along Gianera Street (with one curb cut). The site has average visibility and access.

The underlying site contains app roximately 12,478 square feet or 0.29 acres. The property zoning is Single-Family, and the General Plan land use designation is Low Density Residential. Overall, the site conforms to the area and is well suited to a variety of residential uses.

RESIDENTIAL SITE

SITE DESCRIPTION

TAX PLAT

RESIDENTIAL SITE

SITE DESCRIPTION

ZONING MAP

RESIDENTIAL SITE

SITE DESCRIPTION

GENERAL PLAN MAP

RESIDENTIAL SITE

IMPROVEMENTS DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 34 Improvements Description
The following description is based on property inspection, assessor records, and information provided by the client.

Improvement Characteristics
Property Type: Residential
Tenancy: Single Family Residence
Number of Buildings: 1
Number of Stories 1
Construction Class: D - Wood Frame per Marshall Valuation Service Construction Quality: Average
Gross Building Area (GBA): 1,140 SF (based on appraisal measurements and cross-checked with public records)
Ratios & Parking
Land-to-Building Ratio: 10.95 to 1 (Usable Land/GBA)
Floor Area Ratio (FAR): 0.09 (based on GBA)
Age / Life
Year Built: 1960’s
Condition: Below Average
Actual Age: 62 years
Effective Age: 50 years
Typical Building Life: 75 years
Remaining Economic Life: 25 years
Structural Characteristics
Foundation: Concrete slab
Building Frame: Wood frame
Exterior Walls: Painted stucco
Roof Type / Material: Composition shingle
Interior
Floors: Carpet and linoleum
Walls: Painted drywall
Ceilings: Painted drywall
Lighting: Standard

RESIDENTIAL SITE

IMPROVEMENTS DESCRIPTION

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 35 Site Improvements
Landscaping: Average
Legal, Conforming Status
Legally Permitted Use: Yes
Conformity Conclusion: The existing improvements appear to meet the zoning requirements.

Deferred Maintenance
Deferred maintenance was noted within the structure. It consists of ceiling cracks, worn out flooring, peeling paint, etc. The house is vacant for a long time and all utilities are shut off.

Analysis/Comments on Improvements
The property is improved with a single-family home. The impro vements contain 1,140 square feet based on the appraisal measurements and cross-checked with public records . The building was constructed circa 1960s. The residence is secured with a wood fence.

The building has a wood frame construction. The roof has a composition shingle covering. The interior of the building has painted drywall walls and ceilings. The flooring consists of carpet and linoleum. The property has a total of five rooms, including three bedrooms, two full bathrooms, one family room, one living room, a kitchen, and a two-car garage. The kitchen has wood cabinets, laminate countertop, appliances, painted drywalls and linoleum flooring. Each bedroom has painted drywalls, carpet flooring and closet. Each bathroom has a shower fixture, single sink vanity, and linoleum flooring. Additional features include fireplace in the living room, built -in cabinets in the hallway, a patio, a porch, landscaping, and an attached, two-car garage.

The interior was minimally maintained over the years, and it is in below average condition. Overall, the improvements conform to the area and are well suited to various residential uses, including the existing single-family use. The functional utility of the property is below average based upon a comparison of similar properties in the market area.

RESIDENTIAL SITE

SUBJECT PHOTOGRAPHS

Typical exterior

RESIDENTIAL SITE

SUBJECT PHOTOGRAPHS

Typical interior view of kitchen

Typical interior view of bedroom

Additional photos are included in the Addendum

RESIDENTIAL SITE

ASSESSMENT AND TAX DATA

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 38 Assessment and Tax Data
The State of California has provided for a unified system to assess real estate for property taxes.

Assessment Districts are established on a county basis to assess real estate within the county. The appraised property falls under t he taxing jurisdiction of Santa Clara County and is subject to both general taxes and direct assessments. The property is City-owned, so exempt from tax. A buyer of the subject would need to consider the taxes that would be assessed at the current rate of 1.1753% plus all current special assessments.

RESIDENTIAL SITE

MARKET ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 39 Market Analysis
COVID-19 Pandemic
Market activity in all property sectors in 2021 and 2022 has shown little, if any, impact from COVID-19.

Most markets have experienced growth , fueled by low lending rates and inflationary pressures.

Demand for investment properties continues to be high in all markets and is expected to increase in secondary and tertiary markets as investors look for higher yields. Investors and owners are also expected to continue to watch federal involvement in business loans, as the government may need to intervene if inflation continues to grow. This will influence the decision of business owners to choose between buying or leasing their commercial space. Continued supply chain issues have the potential to impact both inflation and the ability to satisfy space demand. A shortage of supplies as well as labor continues to cause delays in construction across the country.

Inflation
Inflation is perhaps the biggest 2022 concern for CRE markets and investors. High inflation rates are being driven by both demand (stimulus, more businesses opening, high savings rates) and supply factors (labor shortages and supply chain disruptions). While at the highest rate in 30 years, inflation will likely stay high for the next year. The following table presents historical inflations rates:

ANNUAL CPI RATE OF CHANGE

Source: U.S. Bureau of Labor Statistics

The September 2022 CPI reading was an annual rate of 8.2%, down from the annual rate of 9.0% in June, which is a pace not seen since 1990. Because of the unique nature of the causes of this rate of inflation, the demand outlook does not point to accelerating inflation over the medium term, which is most important for the overall economic outlook and for decision makers at the Federal Reserve.

Market participants anticipate that the Fed will continue to hike interest rates in through 2022 to combat inflation. The biggest risk is that unexpected runaway inflation would be damaging to the economy and negatively affect commercial property markets. However, t his is not the expected scenario and elevated inflation can have a net positive impact on commercial property values.

RESIDENTIAL SITE

MARKET ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 40 Interest Rates
To combat inflation, the Federal Reserve raised the federal funds rate by 25 basis points in March 2022, reflecting the first increase since 2018. However, this increase had little impact to no impact in year over year inflation and the Federal Reserve raised rates by an additional 50 basis points in May 2022.

Interest rate increa ses affect capital -intensive industries like real estate. As credit becomes more expensive, investor return requirements increase, which can lead to higher capitalization rates expectations. As inflation persists and the market anticipates additional rate hikes by the Fed, slower growth in CRE pricing and transactions should be expected.

In general, nominal (non -inflation adjusted) real estate returns perform well under a variety of rate environments, while inflation -adjusted real estate returns are strong est during periods of stability, according to research done by Trepp. In a March 2022 report on interest rates and commercial real estate, moderate declines or slight increases (0 to 50 basis points) create the strongest returns, with median annual growth at 3.1%. Trepp outlined the following possible impacts of higher interest rates on major CRE sectors:

Multifamily
Issuance in this sector has surged in the low-interest-rate environment of the last two years. Sharply higher interest rates could put a dent in issuance in the near term, as higher borrowing costs could reduce demand for debt financing. In the long-term, issuance could rebound. Despite the current trend of declining unemployment and rising income, wage inflation is outpacing price inflation as of now. If this inflation trend continues, consumer demand could be pushed further toward rental properties.

However, the market is currently experiencing a shift away from renting. According to data from the United States Census Bureau, the homeownership rate increased to 65.5% in Q4 2021, a decline from the Q2 2020 peak of 67.9% (a rate height that has yet to be surpassed by those seen post-2008 financial crisis). Additionally, those between the ages of 25 to 29 have increased their homeownership share to

35.4%, up from 34.8% a year earlier, possibly suggesting that younger families are moving away from renting.

Office
The office sector also benefited from the low-interest-rate environment. However, rising interest rates could lead to an overall drag on growth in 2022 which may result in some companies reducing their projections for future office space needs. With that in mind, landlords may be more willing to lock in tenants at their current rates rather than risk losing them. However, firms are already in the midst of the debate over hybrid, in-person, and fully remote expectations from employees, and some are choosing to offload their excess office spaces and either downsize or do away with their in-person spaces for good.

Additionally, Trepp estimates that the CMBS market can expect to see $10.3 billion in office loan maturities for 2022, rising rates could be problematic when it comes to refinancing. The office market is already in turmoil and rising interest rates will likely not serve to alleviate the uncertainty in the market.

Retail
With rising interest rates and a slowing economy, retailers may curtail plans for growth in response to an up-and-coming potential drop in disposable consumer income. This curtailment may make it more

RESIDENTIAL SITE

MARKET ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 41 difficult to backfill vacant spaces and lead to consolidation by retailers. Investors could choose to approach 2022 with a more conservative view of retail occupancy going forward.

Lodging
The hotel industry faces challenges from both a supply and demand perspective. CMBS lenders abruptly stopped funding loans when the pandemic took effect in 2020, but, since then lodging loan issuance has picked up. While this seems like good news, the uptick in issuance could prove too fast and there is a potential for the supply to outpace demand. There may not be enough demand to absorb the new supply if consumers and businesses maintain and reduce their levels of spending.

Conclusions
Various market participants will feel the effects of rising interest rates. As highlighted above, each sector of the CRE space will react differently to these rising rates. Ultimately there may be some near- term volatility in 2023 seen across all sectors of CRE, but higher rates should attract capital later in the year and beyond.

RESIDENTIAL SITE

MARKET ANALYSIS

MARKET MAP

The property is a Single-Family Residence and competes within the Santa Clara submarket of the Santa Clara County metro, as shown in the market area map above. As such, we provide overviews of the local single-family submarket followed by a brief discussion on the residential land market.

Santa Clara Single-Family Housing Submarket
To assess market trends in housing sales for the City of Santa Clara and Santa Clara County, we relied on data provided by Multiple Listing Service (MLS). The following table highlights median prices for single- family housing within Santa Clara County as reported by MLS.

YE 2019 YE 2020 YE 2021 2022 YTD
2019-2020
% Change
2020-2021
% Change
2021-2022
% Change
95054 $1,298,000 $1,375,000 $1,530,000 $1,565,000 5.9% 11.3% 2.3% City $1,353,500 $1,426,000 $1,638,000 $1,810,000 5.4% 14.9% 10.5% County $1,250,000 $1,370,000 $1,615,000 $1,766,500 9.6% 17.9% 9.4% Historical Median Single-Family Residence (SFR) Prices
in the City of Santa Clara and Santa Clara County
SFR

RESIDENTIAL SITE

MARKET ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 43 The preceding table shows value depreciation over the past three years for single-family homes in Santa Clara County. In the three -year timeframe, the demand drove prices upward within the neighborhood, the city of Santa Clara submarket and Santa Clara County.

The following table and graph illustrate monthly market activity of detached single-family homes in Santa Clara from November 2021 to November 2022.

The table illustrates the following trends:

• Marketing periods changed widely, ranging from 2 to 23 days and averaging 10 days. From November 2021 to May 2022 marketing periods became shorter, demonstrating healthy demand. • Median sale prices wavered over the year. The larger increase is reported in March 2022 at 11.5% while the largest drop is recorded in November 2022 at 24.0% Overall median price decreased

0.6% since November 2021.
• The sale-to-list price ratio remained consistently robust throughout the year , ranging from 100.0% to 125.4%. Price ratios reached as high as 125.4% in January 2022.

Month Sale/List Median Price Change DOM
Nov-21 111.9% $1,621,750 9.4% 7
Dec-21 106.9% $1,475,000 -9.0% 6
Jan-22 125.4% $1,565,000 6.1% 7
Feb-22 113.9% $1,690,000 8.0% 8
Mar-22 118.1% $1,885,000 11.5% 7
Apr-22 115.3% $1,740,000 -7.7% 6
May-22 112.9% $1,550,000 -10.9% 7
Jun-22 103.9% $1,525,000 -1.6% 12
Jul-22 101.6% $1,400,000 -8.2% 11
Aug-22 102.0% $1,500,000 7.1% 22
Sep-22 101.8% $1,289,000 -14.1% 23
Oct-22 100.3% $1,390,000 7.8% 20
Nov-22 100.0% $1,056,000 -24.0% 2
Santa Clara - SFR Market

RESIDENTIAL SITE

MARKET ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 44 Residential Land Submarket
Residential land values are directly tied to supply and demand of current housing product. Land values vary depending on location, size, permitted uses, and allowable density. However, with the prices of homes elevated, land prices have als o experienced a notable upward trend over the past years. The Bay Area and Santa Clara County are both experiencing growth, in large part due to the various tech companies located in the area, and thus these areas command some of the highest home prices in the region.

Residential land is typically purchased contingent on project approval or with entitlements (tentative or final map) in place. When contingent upon approvals, the risk to a developer is significantly reduced, putting upward pressure on the price. Prices for land purchased without this contingency are typically lower than for land purchased on a contingency. The price differential is especially large as the risk increases. We note that citizen participation in planning activities is very high in certain municipalities; thus, the approval process for residential projects can become political, long and arduous. It is not uncommon for new projects to take three to four years for development approval.

The site’s R-1-6 zoning, and Low-Density Residential land use would permit low-density redevelopment.

Therefore, the property would be less attractive as an investment to residential developers seeking a higher density. However, the property offers desirable location withing a good school district and will be attractive to homebuyers.

Low-density residential land values in Santa Clara and surrounding cities are in the $60 to $140+ per square foot range depending on location and entitlements. Oftentimes, residential land is valued on the basis of price per unit as opposed to price per square foot of site area, utilized in valuing unentitled sites.

The following graph for the S&P/Case -Shiller San Francisco Home Price Index shows an increasing trend in housing prices. Demand for housing has increased through the recent economic recession stemming from the Covid -19 pandemic which has led to an increase in demand for residential development land. However, prices have been trending downward since June 2022 which corresponds with the federal funds rate increases as the Fed initiates quantitative tightening to curb inflation.

RESIDENTIAL SITE

MARKET ANALYSIS

Market Analysis Conclusions
As of the valuation date, the residential market was slowing down due to high interest rates. Investor and developer demand for residential land in the Bay Area was strong prior to the recent interest rate increases. Likely, we will continue to see a slowing trend for the Santa Clara County residential market in the near term.

Overall, the subject has a good general location in Santa Clara with good access to highway 101 and 237 and proximity to nearby amenities incl uding Levi’s Stadium, California’s Great America, and VTA Light Rail. The improvements conform to the area, however, considering the large lot size, the property would also appeal to a local developer. The property would be well-received if placed on the market for sale.

RESIDENTIAL SITE

HIGHEST AND BEST USE ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 46 Highest and Best Use Analysis
The Highest and Best Use of a property is the use that is legally permissible, physically possible, and financially feasible which results in the highest value. An opinion of the highest and best use results from consideration of the criteria noted above under the market conditions or likely conditions as of the effective date of value. Determination of highest and best use results from the judgment and analytical skills of the appraiser. It represents an opinion, not a fact. In appraisal practice, the concept of highest and best use represents the premise upon which value is based.

Highest and Best Use As Though Vacant
The primary determinants of the highest and best use as though vacant are (1) Legal permissibility, (2) Physical possibility, (3) Financial feasibility, and (4) Maximum productivity.

Legally Permissible
The property’s site is zoned R1-6L, Single Family Residential, which controls the general nature of permissible uses and is appropriate for the location and physical elements of the property. The General Plan land use designation of the site is Low Density Residential, which allows for redevelopment with up to 19 dwelling units per acre. The location of the property is appropriate for the uses allowed, as noted previously, and a change in zoning is unlikely. There are no known easements, encroachments, covenants or other use restrictions that would unduly limit or impede development.

Physically Possible
The physical attributes allow for a number of potential uses. Elements such as size, shape, availability of utilities, known hazards (flood, environmental, etc.), and other potential influences are described in the Site Description and have been considered. There are no items of a physical nature whi ch would adversely impact development with the legal permitted uses. The most probable use of the site is for residential development at the highest allowed density, which conforms to the pattern of land use in the immediate area.

Financially Feasible
A review of sale prices, rental and occupancy rates suggests that there is an undersupply of residential properties and demand is sufficient to support construction costs and timely absorption of additional inventory in this market. Therefore, near-term speculative development of the site is financially feasible.

Maximally Productive
Among the financially feasible uses, the use that results in the highest value (the maximally productive use) is the highest and best use. Redevelopment of the site at the highest allowed density if the most productive use.

Highest and Best Use As Though Vacant Conclusion
The conclusion of the highest and best use as though vacant is for residential development with up to 19 dwelling units per acre.

Highest and Best Use As Improved
The determination of the highest and best use of the subject property as improved is focused on three possible conditions that may represent the maximally productive use of the property: (1) continuation

RESIDENTIAL SITE

HIGHEST AND BEST USE ANALYSIS

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 47 of the existing use, (2) modification of the existing use, or (3) demolition and redevelopment of the land. In addition, the presence of surplus or excess land is identified.

As noted, the property is improved with 1 ,140-square-foot home with three bedrooms and two bathrooms. Improvements were completed in 1960s and, as of the date of value, were in below average condition.

Retaining the improvements meet the test for legally permissible and physically possible. However, it is unlikely they are economically fea sible. As shown below, the market value of the property, As Is, does not exceed the value of the site as vacant plus the cost of demolition.

To determine the value of the property, As Is, we have selected five comparables sales located in the Santa Clara and Campbell. We searched for smaller homes located on larger sites with similar redevelopment potential. The following table summarizes the sales utilized.

The high end of the range, Comparable Three is a recent sale of a larger three -bedroom home with one bathroom and similar in size lot. This comparable supports and indicator of $1,560,000. The low end of the range, Comparable Five is a pending sale of a property with superior location in Campbell.

This is a smaller home on a larger lot with superior quality of improvements. This comparable supports an indicator of $1,160,000. Three of the five comparables range between $1,424,000 and $1,457,000.

We estimate the market value of the property, As Is, at $1,430,000. The market value of the site as vacant redevelopment land is estimated at $1,620,000 as will be shown in the following section.

Therefore, demolition of the existing improvements and redevelopment of the site with up to 19 units per acre is the maximally productive use of the site, as improved.

Highest and Best Use As Improved Conclusion
The highest and best use of the property , as improved, is redevelopment with a residential complex, at the highest density allowed.

Most Probable Buyer
As of the date of value, the most probable buyer of the property is a local developer.

Improved Sales Summary
Comp. Year Lot Unadjusted
No. Date of Sale Location Built GBA Size Sale Price per Unit 1 April-22 2159 Avenida De Las Flores Santa Clara 1976 1,341 8,782 $1,550,000 $176.49 2 October-22 4472 Davis Street Santa Clara 1956 2,166 9,716 $1,390,000 $143.06 3 February-22 1742 Jackson Street Santa Clara 1900 1,432 12,066 $1,820,000 $150.84 4 July-21 93 Brookside Avenue Santa Clara 1940 1,839 13,690 $1,700,000 $124.18 5 Offer Pending 115 Memory Lane Campbell 1950 1,079 15,187 $1,698,000 $111.80

RESIDENTIAL SITE

APPRAISAL METHODOLOGY

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 48 Appraisal Methodology
Three Approaches to Value
There are three traditional approaches typically available to develop indications of real property value:
the cost, sales comparison, and income capitalization approaches.

Cost Approach
The cost approach is based upon the principle that a prudent purchaser would pa y no more for a property than the cost to purchase a similar site and construct similar improvements without undue delay, producing a property of equal desirability and utility. This approach is particularly applicable when the improvements being appraised are relatively new or proposed, or when the improvements are so specialized that there are too few comparable sales to develop a credible Sales Comparison Approach analysis.

Sales Comparison Approach
In the sales comparison approach, the appraiser analyze s sales and listings of similar properties, adjusting for differences between the property and the comparable properties. This method can be useful for valuing general purpose properties or vacant land. For improved properties, it is particularly applicable when there is an active sales market for the property type being appraised – either by owner-users or investors.

Income Capitalization Approach
The income capitalization approach is based on the principle that a prudent investor will pay no more for the property than he or she would for another investment of similar risk and cash flow characteristics. The income capitalization approach is widely used and relied upon in appraising income-producing properties, especially those for which there is an active investment sales market.

Subject Valuation
As stated within the Scope of Work, we have relied upon the Sales Comparison Approach. Income and Cost Approaches are not utilized. When valuing vacant land, the Cost and Income approach to value are not applicable.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

© 2023 VALBRIDGE PROPERTY ADVISORS | NORTHERN CALIFORNIA PAGE 49 Sales Comparison Approach
Methodology
This approach is based on the premise that a buyer would pay no more for a specific property than the cost of obtaining a property with the same quality, utility, and perceived benefits of ownership. It is based on the principles of supply and demand, balance, substitution and externalities. In the sales comparison approach, an indication of market value is developed by analyzing closed sales, listings, or pending sales of properties similar to the prope rty, using the most relevant units of comparison.

The comparative analysis focuses on the difference between the comparable sales and the subject property using all appropriate elements of comparison.

Unit of Comparison
The unit of comparison selected depends on the appraisal problem and nature of the property and is intended to explain or mirror market behavior . The primary unit of compar ison in the market for unentitled land is price per square foot of site area.

Elements of Comparison
Elements of comparison are the characteristics or attributes of properties and transactions that cause the prices of real estate to vary. The primary elements of comparison considered in sales comparison analysis are as follows: (1) real property rights conveyed, (2) financing terms, (3) conditions of sale, (4) expenditures made immediately after purchase, (5) market conditions, (6) location , (7) physical characteristics.

Comparable Sales Data
To obtain and verify comparable sales of vacant land properties, we conducted a search of public records, field surveys, interviews with knowledgeable real estate professionals in the area, and a review of our internal database. We include five sales in our analysis, as these sales were judged to be the most comparable to develop an indication of market value for the property.

The following is a table summarizing each sale comparable and a map illustrating the location of each in relation to the Gianera site. Details of each comparable follow the location map.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

COMPARABLE SALES MAP

Land Sales Summary
Comp. Date Gross Gross General Sales Price Per
No. of Sale Acres Sq. Ft. Location Zoning Plan Actual Sq. Ft. 1 June-22 0.386 16,800 2303 Gianera St Santa Clara R1-6L Low Den. Resid. $2,443,000 $145.42 2 January-21 0.471 20,504 1991 Colony St Mountain View R-3-2 Med. Den. Resid $2,850,000 $139.00 3 March-19 0.201 8,775 3424 Cecil Av Santa Clara R1-6L Very Low Den. Res. $1,160,000 $132.19 4 February-22 0.312 13,605 272 Bonita Av San Jose R-1-8 Resid. Neighbor. $825,000 $60.64

RESIDENTIAL SITE

SALES COMPARISON APPROACH

LAND COMPARABLE 1

Property Identification
Property/Sale ID 11287845/1626752
Address 2303 Gianera Street
City, State Zip Santa Clara, California 95054
County Santa Clara
Latitude/Longitude 37.400934/-121.965485
Tax ID 104-06-037
Transaction Data
Sale Date June 17, 2022
Sale Status Recorded
Grantor Nuno & Jose Trinida
Grantee Gianeral St EST LLC
Property Rights Fee Simple
Recording Number 0025354706
Sale Price $2,443,000

Property Description
Gross Acres 0.39
Gross SF 16,800
Shape Rectangular
Topography Level
Utilities All public utilities are
available to the site
Flood Hazard Zone X
Earthquake Zone The property is not located
in an Alquist-Priolo Special
Studies Zone for
earthquake hazard.

Earthquake hazard is
typical for the overall area.

Use Designation Low Density Residential
Zoning Jurisdiction City of Santa Clara
Zoning Code R1-6L
Zoning Description Single Family Residential

Indicators
$/Gross Acre $6,334,431.00 $/Gross SF $145.42

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Remarks X
The property consists of a single parcel located along the north side of Gianera Street in Santa Clara. The site has a rectangular shape and an interior lot configuration with approximately 120.00 feet of frontage along Gianera Street (with one curb cut).

The underlying site contains approximately16,800 square feet or 0.39 acres and is improved with an 1,812- square-foot single -family residence. The property is zoned Single Family Residential (R1 -6L) and the General Plan designation is Low -Density Residenti al. According to MLS the property was previously approved for redevelopment with six single-family homes and although approvals may have expired, they support the subdivision potential of the site.

Gianeral St EST LLC purchased this property from Nuno & J ose Trinida in August 2022. The property was listed in May 2022 for $1,999,999 and sold in 17 days for $2,443,000 or 1,348.23 per square foot. This is approximately 22.2% above asking. The buyer's broker reported the property was purchased as an investment, however, given to low coverage and the high sales price it appears that the price reflects its future redevelopment potential.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

LAND COMPARABLE 2

Property Identification
Property/Sale ID 11122215/1518918
Address 1991 Colony Street
City, State Zip Mountain View, California 94043
County Santa Clara
Latitude/Longitude 37.415685/-122.091049
Tax ID 153-04-014
Transaction Data
Sale Date January 15, 2021
Sale Status Recorded
Grantor Frank and Bruno Jr. Muzzi
Grantee Bei Jiang
Property Rights Fee Simple
Financing Cash
Conditions of Sale None
Recording Number 0024811488
Sale Price $2,850,000

Property Description
Gross Acres 0.47
Gross SF 20,504
Shape Rectangular
Topography Level
Utilities All are available to site
Flood Hazard Zone AO
Use Designation Medium-Density
Residential (13 to 25
DU/acres)
Zoning Jurisdiction City of Mountain View
Zoning Code R-3-2
Zoning Description Residential—Multiple-
Family

Indicators
$/Gross Acre $6,054,683.00
$/Gross SF $139.00
$/Unit $950,000

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Remarks X
The property consists of one parcel of residential land located east of Rengstorff Avenue in Mountain View.

The site measures 20,504 square feet, or 0.47 acres, with 88 feet of frontage along Colony Street (one curb cut). The parcel has an interior configuration with a depth of 233.66 feet. The property is tucked in a quiet residential neighborhood yet within one mile of Highway 101, providing good regional access. The site also benefits from proximity to Old Middlefield Way, a commercial corridor, as well as shopping centers and prominent employers, including Google headquarters.

The site is zoned R3-2: Residential--Multiple-Family, and the General Plan designation is Medium -Density Residential. The R3-2 zoning permits the construction of a variety of residential uses, including apartments, condominiums, rowhouses, townhomes, and single-family homes. Of note, the entire site lies within Flood Zone AO, which requires flood insurance.

This property was listed on and off the market for a year and in that timeframe, it went into escrow four times. While the zoning would permit up to six units, the City would not approve row housing on the site because its width is less than 100 feet. Also , there is a BMR requirement, which made some of the buyers drop out. The property was priced for an as is sale, and the sellers did not want to hold the property for 12- 18 months until the buyer received approvals.

The buyer of the property is planning on subdividing into three lots with the intention of selling two of the lots and potentially keeping one. At the time of sale, the property was improved with a single-family home and other structures, but they were in fair condition and added no value to th e property. The buyer purchased the property in an all -cash transaction with no contingencies. Close of escrow was very quick.

This is reflected in the sale price, which was 14% below the asking price.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

LAND COMPARABLE 3

Property Identification
Property/Sale ID 11024007/1472834
Address 3424 Cecil Avenue
City, State Zip Santa Clara, California 95050
County Santa Clara
Latitude/Longitude 37.324063/-121.958931
Tax ID 303-20-044
Transaction Data
Sale Date March 26, 2019
Sale Status Recorded
Grantor Dunn1 Family Trust
Grantee Kwong Cheng
Property Rights Fee Simple
Financing Cash
Conditions of Sale Typical
Recording Number 0024141709
Days on Market 7
Sale Price $1,160,000

Property Description
Gross Acres 0.20
Gross SF 8,775
Shape Rectangular
Topography Level
Utilities All utilities in place
Flood Hazard Zone D
Use Designation Very Low Density
Residential
Zoning Jurisdiction City of Santa Clara
Zoning Code R1-6L
Zoning Description Single Family Residential

Indicators
$/Gross Acre $5,758,253.00 $/Gross SF $132.19

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Remarks X
The property consists of a single parcel located along the south side of Cecil Avenue in Santa Clara. The site has a rectangular shape and an interior lot configuration with approximately 65.00 feet of frontage along Cecil Avenue (with one curb cut).

The underlying site contains approximately 8,775 square feet or 0.20 acres and is improved with a 1,798 - square-foot single-family residence completed in 1921 and updated in 1948. The property is zoned Single Family Residential (R1-6L) and the General Plan designation is Very Low-Density Residential.

Kwong Cheng purchased this property from Dunn1 Family Trust in March 2019. The property was listed on the market for seven days and sold above the asking price of $988,000. The sale price was $1,160,000. This is the sale of a home that was marketed as a "contractor's delight" with significant updating needed. There is also an un-permitted ADU. The property has the potential to be significantly updated and reconfigured or completely rebuilt with a larger home as well as an ADU.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

LAND COMPARABLE 4

Property Identification
Property/Sale ID 11255925/1604301
Address 272 Bonita Avenue
City, State Zip San Jose, California 95116
County Santa Clara
Latitude/Longitude 37.345414/-121.859191
Tax ID 472-06-008
Transaction Data
Sale Date February 7, 2022
Sale Status Recorded
Grantor Elena Vizcarra
Grantee Viam Bonita Partners LLC
Property Rights Fee Simple
Financing Cash
Conditions of Sale None
Recording Number 25265558
Sale Price $825,000

Property Description
Gross Acres 0.31
Gross SF 13,605
Shape Rectangular
Topography Level
Utilities Electricity available at the
street.

Flood Hazard Zone X (unshaded)
Use Designation Residential Neighborhood
Zoning Jurisdiction City of San Jose
Zoning Code R-1-8
Zoning Description Single Family Residential

Indicators
$/Gross Acre $2,641,437.00 $/Gross SF $60.64

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Remarks X
The site consists of a parcel of vacant, residential land, located one parcel east of Bonita Avenue in San Jose. The subject benefits from a central location within a 10-minute drive of Downtown San Jose and within one mile of Highway 101, near the interch ange with Interstate 280. The neighborhood is mostly a low - density, residential community that includes some mobile home parks.

The property contains 13,605 square feet, or 0.31, acres, and is one of the larger lots in the immediate neighborhood. It was previously used for operation of a demolition business. The site lacks street frontage.

Instead, access to the property is provided via an adjacent parcel that fronts Kelly Court.

The property has zoning of R -1-8 zoning and a land use designation of Reside ntial Neighborhood (RN) which permits up to eight dwelling units per acre. The site could therefore potentially be subdivided into two lots to accommodate two single-family homes.

The property was listed on the market for six months at an asking price of $995,000. It sold in February of 2021 for $825,000, approximately 17.1% below asking.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Land Sales Comparison Analysis
The data utilized are the best available at the time of this report. We analyzed the sales and made adjustments for differences in the elements of comparison previously listed. The comparable sales are adjusted to the Gianera property : if the comparable sale was superior, we applied a negative adjustment to the comparable sale. A positive adjustment to the comparable property was applied if it was inferior to the site.

Transaction Adjustments
These items are applied prior to the appl ication of property adjustments. Transaction adjustments include:

1. Real Property Rights Conveyed

2. Financing Terms

3. Conditions of Sale

4. Expenditures Made Immediately After Purchase

The adjustments are discussed as follows:

Real Property Rights Conveyed
The sale comparables all reflect the fee simple interest; thus, no adjustments for property rights are required.

Financing Terms
The transaction price of one property may differ from that of an identical property due to different financial arrangements. Sales involving financing terms that are not at or near market terms require adjustments for cash equivalency to reflect typical market terms. A cash equivalency procedure discounts the atypical mortgage terms to provide an indication of value at cash equivalent terms.

All comparable sales are financed at market, or they are all-cash sales. No adjustments are applied.

Conditions of Sale
When the conditions of sale are atypical, the result may be a price that is higher or lower than that of a normal transaction. Adjustments for conditions of sale usually reflect the motivations of either a buyer or a seller who is under duress to complete the transaction. No adjustments for condition of sale are required.

Expenditures Made Immediately After Purchase
A knowledgeable buyer considers expenditures that will have to be made upon purchase of a property because these costs affect the price the buyer agrees to pay. Such expenditures may include: (1) costs to demolish and remove any portion of the improvements, ( 2) costs to petition for a zoning change, and/or (3) costs to remediate environmental contamination.

The relevant figure is not the actual cost incurred, but the cost that was anticipated by both the buyer and seller. Unless the sales involved expenditures anticipated upon the purchase date, no adjustments to the comparable sales are required for this element of comparison. No adjustments are required in this category.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Market Conditions Adjustment
Market conditions change over time as a result of inflation, deflation, fluctuations in supply and demand and other factors. Changing market conditions creates the need for adjustments to sale comparables that represent transactions during periods of dissimilar market conditions.

Discussions with market participants indicate the vacant land market was strong prior to interest rate increases. We applied a 5% upward adjustment until June 2022, based on MLS and our experience with similar properties.

Property Adjustments
Property adjustments are usually expressed quantitatively as percentages that reflect the increase or decrease in value attributable to the various characteristics of the property. In some instances, however, qualitative adjustments are used. These adjustments are based on locational and physical characteristics and are applied after the application of transaction and market conditions adjustments.

We have summarized adjustmen ts to the sale comparables below and on the following page as delineated in the adjustment grid at the end of this section. These adjustments are based on our market research, best judgment, and experience in the appraisal of similar properties. The adjustments are discussed as follows:

Location
Location adjustments may be required when the locational characteristics of a comparable are different from those of the subject. These characteristics can include general neighborhood characteristics, freeway accessibility, street exposure, corner-versus-interior lot location, neighboring properties, view amenities and other factors.

The site is located along Gianera Street in Santa Clara. The location has average access and proximity to employment centers and it is located in an established residential neighborhood. Comparables Two and Three have superior locations within more desirable School Districts, and thus downward adjustments are applied. Comparable Fo ur has an inferior location in East San Jose. An upward adjustment is justified. Comparable One is similar, thus no further adjustment is required.

Size
The size adjustment identifies variances in the physical size of the comparable sites. Typically, the larger a parcel, the higher the sale price per unit and the lower the price per square foot. In considering the size adjustment, both the physical size of the subject is considered, as well as the investment (price) size. Both these factors determine the buyer pool of a property.

Comparable Four with 13,605 square feet is similar to the subject’s 12,478 square feet. No adjustment is required. Comparables One and Two with more than 16,000 square feet are inferior. Upward adjustments are applied. Comparable Three with less than 10,000 square feet is superior. A downward adjustment is justified.

Shape/Corner Exposure
All comparables have similar shape that does not impose any constraints in the development potential.

They are all interior sites, similar to the Gianera property. No adjustments are required.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Utilities
Comparable Four is adjusted upwards since only electricity is available on-site. All other comparables are similar. No further adjustments are required.

Zoning/General Plan/Density
The Gianera property has General Plan designation of Low Density Residential that allows redevelopment with up to 19 uni ts per acre. Comparable One is similar, thus no adjustment is supported. Comparable Two has superior development potential and is adjusted downwards. All other comparables have inferior development potential thus upward adjustments are required.

Demolition Cost
Comparables One, Two, and Three are previously improved sites that require demolition, similar to the Gianera site. No adjustments are required. Comparable Four is a vacant site. A downward adjustment is supported.

Entitlements
The Gianera site is an unentitled residential site. Comparable One was previously approved for redevelopment with multiple residences and although approvals have likely expired, it supports a discount for the low risk associated with the redevelopment potential of the site. All other comparables are similar unentitled sites. No further adjustments are warranted.

Proximity to Power lines
Comparable One is similar, located on Gianera Street with proximity to the power station and power lines. No adjustment is required. All other c omparables are not located in proximity to a substation.

However, based on our research and survey of active market participants, proximity to the power station has no impact on the value of the property. Therefore, no adjustments are justified.

Summary of Adjustments
Presented on the following page is a summary of the adjustments made to the sale comparables. As noted earlier, these quantitative adjustments were based on our market research, best judgment, and experience in the appraisal of similar properties.

RESIDENTIAL SITE

SALES COMPARISON APPROACH

COMPARABLE SALES ADJUSTMENT GRID

Subject Sale # 1 Sale # 2 Sale # 3 Sale # 4
Sale ID 1626752 1518918 1472834 1604301
Date of Value & Sale December-22 June-22 January-21 March-19 February-22 Unadjusted Sales Price $2,443,000 $2,850,000 $1,160,000 $825,000 Gross Square Feet 12,478 16,800 20,504 8,775 13,605
Unadjusted Sales Price per Gross Sq. Ft. $145.42 $139.00 $132.19 $60.64 Transactional Adjustments
Property Rights Conveyed Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Adjusted Sales Price $145.42 $139.00 $132.19 $60.64
Financing Terms None Cash Cash Cash Cash
Adjusted Sales Price $145.42 $139.00 $132.19 $60.64
Conditions of Sale None None None None None
Adjusted Sales Price $145.42 $139.00 $132.19 $60.64
Expenditures after Sale None
Adjusted Sales Price $145.42 $139.00 $132.19 $60.64
Market Conditions Adjustments
Elapsed Time from Date of Value 0.49 years 1.91 years 3.72 years 0.85 years Market Trend Through June-22 -0.2% 6.9% 15.9% 1.6%
Analyzed Sales Price $145.10 $148.56 $153.25 $61.590.0% 0.0% 0.0% 0.0% Physical Adjustments
Location 2319 Gianera 2303 Gianera St 1991 Colony St 3424 Cecil Ave 272 Bonita Santa Clara Santa Clara Mountain View Santa Clara San Jose Adjustment - -20.0% -10.0% 25.0%0.0% 0.0% 0.0% 0.0%
Size 12,478 sf 16,800 sf 20,504 sf 8,775 sf 13,605 sf
Adjustment 10.00% 15.0% -10.0%0.0% 0.0% 0.0% 0.0%
Shape Rectangular Rectangular Rectangular Rectangular Rectangular Adjustment - - - -0.0% 0.0% 0.0% 0.0%
Corner Exposure/ Interior Interior Interior Interior Interior Adjustment - - - -0.0% 0.0% 0.0% 0.0%
Utilities To the site Similar Similar Similar Electricity only Adjustment - - - 10.0%0.0% 0.0% 0.0% 0.0%
Zoning R1-6L R1-6L R-3-2 R1-6L R-1-8
General Plan Low-Dens. Res. Low-Dens. Res. Med.-Dens. Res Very Low-Dens.

Res.

Resid. Neighbor.

Density 8-19 DU/A 8-19 DU/A 13-25 DU/A Up to 10 DU/A Up to 8 DU/A Adjustment - -5.0% 5.0% 10.0%0.0% 0.0% 0.0% 0.0%
Demolition Cost House/Garage House House House Vacant
Adjustment - - - -1.0%0.0% 0.0% 0.0% 0.0%
Entitlements None Previously Approved None None None
Adjustment -25.0%
Proximity to Power Lines Yes Similar No No No
Adjustment
Net Physical Adjustment -15.0% -10.0% -15.0% 44.0%
Adjusted Sales Price per Gross Square Foot $123.33 $133.70 $130.27 $88.68

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Sales Comparison Approach Value Indication
From the market data available, sales in competitive market areas were selected as most comparable to the property. We have adjusted the comparable sales based on pertinent elements of comparison as discussed earlier. The following table summarizes the unadjusted and adjusted sale prices:

Before adjustments the comparables indicate a range between approximately $ 61 and $145 square foot. The adjusted sale prices reflected a range from approximately $89 to $134 per square foot with an average of $119 per square foot and median of approximately $127 per square foot.

In the final market value estimate, we place greater weight on Comparables One for its location on Gianera in the immediate neighborhood. This comp arable supports an indicator or $123 per square foot. Three of the four comparables range between $123 and $134 per square foot. Based on our analysis, the market value of the property “As Is” is $1,590,000 as follows:

Land Sale Statistics
Metric Unadjusted Analyzed Adjusted
Min. Sales Price per Gross Square Foot $60.64 $61.59 $88.68 Max. Sales Price per Gross Square Foot $145.42 $153.25 $133.70 Median Sales Price per Gross Square Foot $135.60 $146.83 $126.80 Mean Sales Price per Gross Square Foot $119.31 $127.12 $119.00 Land Value Conclusion
Reasonable Adjusted Comparable Range
12,478 square feet x $125.00 psf = $1,559,750
12,478 square feet x $130.00 psf = $1,622,140
Fair Market Value Opinion (Rounded)
12,478 square feet x $127.50 psf = $1,590,000

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

Estimate of Fair Market Rent
Per our client’s request we also develop an opinion of market rent for the existing single-family home.

We surveyed competitive properties in the local market area, focusing on single-family residences with similar locations, size and market appeal. As most single-family homes are purchased by owner/users we were unable to find many comparables located in the immediate neighborhood. Instead, we searched in a wider area and back in time. We looked for smaller properties located o n larger sites, similar to the Gianera property.

We used five rental comparables in the City of Santa Clara to derive an appropriate market rent for the property. The comparables utilized are the best available at the time of this report. Following is a table summarizing each rent comparable and a map illustrating the location of each comparable in relation to the Gianera home.

Market Rent Analysis
The property is located in the city of Santa Clara submarket. Rental comparables within the subject submarket were obtained, which reflect the average asking rents and occupancy rates for the selected comparables.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

Rent Comparable Summary
Comp. Lease Year Lot Bed Rental Lease
No. Commences Location Built NLA Size Bath Rate Rent / SF Parking 1 April-22 230 Tyler Ave Santa Clara 1949 1,264 9,295 3/2 $3,550 $2.93 Open 2 February-20 1818 Clay Str Santa Clara 1946 1,915 9,113 3/2 $3,800 $1.98 2 Grg 3 August-19 22 Brookside Ave Santa Clara 1940 1,704 13,689 3/1.5 $3,995 $2.34 2 Grg 4 August-21 2222 Gianera Str Santa Clara 1998 1,667 1,979 3/2.5 $3,650 $2.24 2 Grg 5 November-22 2189 Bohannon Dr Santa Clara 1952 1,165 10,903 3/2 $4,250 $3.65 2 Grg

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

RENT COMPARABLE 1

Property Identification
Property/Rent ID 11287836/639198
Property Type Single Family Residential
Address 230 Tyler Avenue
City, State Zip Santa Clara, California 95050
County Santa Clara
Latitude/Longitude 37.324674/-121.958398
Tax ID 303-20-015
Transaction Data
Commencement April 15, 2022
Xxx xxx
Rental Rates xxx
Initial Rent/SF $2.81

Property Description
Gross Building SF 1,264
Net Rentable SF 1,264
Year Built 1949
Building Condition Average
Gross Acres 0.21

Remarks X
The property consists of a single parcel located along the east side of Tyler Avenue in Santa Clara. The site has a rectangular shape and an interior lot configuration with approximately 65.09 feet of frontage along Tyler Avenue.

The underlying site contains approximately 9,295 square feet or 0.21 acres and is improved with a 1,264 - square-foot single-family residence. The house has three bathrooms and two bathrooms and is in average condition. Parking available for two cars on driveway. The property is zoned Single Family Residential (R1- 6L), and the General Plan designation is Very Low-Density Residential.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

RENT COMPARABLE 2

Property Identification
Property/Rent ID 11287837/639196
Property Type Single Family Residential
Address 1818 Clay Street
City, State Zip Santa Clara, California 95050
County Santa Clara
Latitude/Longitude 37.351112/-121.956932
Tax ID 269-01-042
Transaction Data
Commencement February 5, 2020
Xxx xxx
Rental Rates xxx
Initial Rent/SF $1.98

Property Description
Gross Building SF 1,915
Net Rentable SF 1,915
Year Built 1946
Building Condition Average
Gross Acres 0.21

Remarks X
The property consists of a single parcel located along the south side of Clay Street in Santa Clara. The site has a generally triangular shape and a corner lot configuration.

The underlying site contains approximately 9,113 square feet or 0.21 acres and is improved wit h a 1,915- square-foot single-family residence. The house has three bathrooms, two bathrooms, a 2 -car garage and is in below average condition. The property is zoned Single Family Residential (R1 -6L), and the General Plan designation is Very Low-Density Residential.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

RENT COMPARABLE 3

Property Identification
Property/Rent ID 11287838/639197
Property Type Single Family Residential
Address 22 Brookside Avenue
City, State Zip Santa Clara, California 95050
County Santa Clara
Latitude/Longitude 37.323996/-121.963086
Tax ID 303-22-040
Transaction Data
Commencement August 23, 2019
Xxx xxx
Rental Rates xxx
Initial Rent/SF $2.34

Property Description
Gross Building SF 1,704
Net Rentable SF 1,704
Year Built 1940
Building Condition Average
Gross Acres 0.31

Remarks X
The property consists of a single parcel located along the east side of Brookside Avenue in Santa Clara.

The site has a rectangular shape and an interior lot configuration with approximately 100.00 feet of frontage along Brookside Avenue.

The underlying site contains approximately 13,689 square feet or 0.31 acres and is improved with a 1,704- square-foot single-family residence. The house has three bathrooms, one full and one half -bathrooms, a 4-car garage and is in average condition. The property is zoned Professional and Administrative Office (OA), and the General Plan designation is Very Low-Density Residential.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

RENT COMPARABLE 4

Property Identification
Property/Rent ID 11287839/639199
Property Type Single Family Residential
Address 2222 Gianera Street
City, State Zip Santa Clara, California 95054
County Santa Clara
Latitude/Longitude 37.401146/-121.964075
Tax ID 104-59-016
Transaction Data
Commencement August 13, 2021
xxx xxx
Rental Rates xxx
Initial Rent/SF $2.19

Property Description
Gross Building SF 1,667
Net Rentable SF 1,667
Year Built 1998
Building Condition Average
Gross Acres 0.05

Remarks X
The property consists of a single parcel located along the south side of Gianera Street in Santa Clara. The site has a rectangular shape and an interior lot configuration with approximately 54.50 feet of frontage along Gianera Street.

The underlying site contains approximately 1,979 square feet or 0.05 acres and is improved with a 1,667 - square-foot single-family residence. The house has three bathrooms, two full and a half bathroom, a 2-car garage and is in average condition. $80 HOA include a community pool, hot tub, and clubhouse. The property is proximate to Highway 101, 237, and 880. The property is zoned Planned Development (PD), and the General Plan designation is Low-Density Residential.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

RENT COMPARABLE 5

Property Identification
Property/Rent ID 11287514/639018
Property Type Single Family Residential
Address 2189 Bohannon Drive
City, State Zip Santa Clara, California 95050
County Santa Clara
Latitude/Longitude 37.336024/-121.956265
Tax ID 303-08-014
Transaction Data
Commencement November 4, 2022
xxx xxx
Rental Rates xxx
Initial Rent/SF $3.65

Property Description
Gross Building SF 1,165
Net Rentable SF 1,165
Year Built 1952
Building Condition Average
Gross Acres 0.25

Remarks X
The property consists of a single parcel located along the north side of Bohannon Drive in Santa Clara.

The site has a generally rectangular shape and an interior lot configuration with approximately 57.14 feet of frontage along Bohannon Drive. The underlying site contains approximately 10,903 square feet or 0.25 acres and is improved with a 1,165 -square-foot single-family residence. The house has th ree bedrooms, two bathrooms, a 2-car garage, swimming pool and is in good condition.

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

Market Rent Analysis
When necessary, adjustments were made for differences in the various elements of comparison, including lease structure, market conditions, location, size and other relevant factors. If the element in comparison is considered superior to that of the subject, we applied a negative adjustment. Conversely, a positive adjustment is applied if inferior. A summary of the elements of comparison follows.

Property Adjustments
Property Adjustments are usually expressed quantitatively as percentages or dollar amounts t hat reflect differences in rental rates attributable to the various characteristics of the property. In some instances, however, qualitative adjustments are used. Property adjustments are based on locational and physical characteristics and are made after the application of transaction and market conditions adjustments.

Location
The subject is located along the north side of Gianera Street in Santa Clara. Comparables One and Two have superior locations and downward adjustments are applied. All other compar ables have similar locations in Santa Clara. No further adjustments are warranted.

Net Living Area
The size adjustment addresses variance in the net rentable area of the comparables and that of the subject, as a larger building typically commands a lower s ale price per unit than a smaller building.

This inverse relationship is due, in part, to the principle of “economies of scale.”

The subject’s improvements contain 1,140 square feet. Comparables One and Five are similar. No adjustments are warranted for this element of comparison. Comparables Two, Three and Four are adjusted upwards for their larger living area.

Lot Size
Comparable Four with less than 2,000 square feet of site area is inferior. Upward adjustment is required.

All other comparables are similar. No adjustments are applied.

Age/Condition
All else being equal, older properties typically command a lower price per square foot than newer properties. However, although a property may be physically older than another property, the effective age may be similar to a newer property and no adjustment may be indicated. This may be due to the older property being well maintained or a recent renovation.

The Gianera home was completed in the 1960’s and is in need of renovation. Comparable Four was built in 1998 and is superior, thus a downward adjustment is applied. All other comparables are similar.

No other adjustments are made for this element of comparison.

Bedroom/Bathroom
The property consists of three bedroom and two bathrooms. Comparable Three is adjusted upwards for its inferior bathroom count. Comparable Four is adjusted downwards for its superior bathroom count. No other adjustments are warranted for this element of comparison.

Garage/Pool
Comparable One has driveway parking for two cars inferior to the two-car garage parking available for the Gianera home. An upward adjustment is applied. Comparables Four and Five have swimming pool

RESIDENTIAL SITE

ESTIMATE OF FAIR MARKET RENT

and they are adjusted downwards for their superior amenities. All other comparables are similar. No other adjustments are required.

Proximity to Power Lines
As discussed earlier, and based on our discussion with market participants, there is no impact in the rental due to property’s location in proximity to the subst ation and power lines. No adjustments are required.

Presented on the following page is a summary of the adjustments made to the rent comparables. As noted earlier, these qualitative adjustments were based on our market research, best judgment, and experience in the appraisal of similar properties.

Rent Comparable Adjustment Grid

Rental # 1 Rental # 2 Rental # 3 Rental # 4 Rental # 5
Comparable ID 639198 639196 639197 639199 639018
December-22 April-22 February-20 August-19 July-21 November-22 Property Name SFR SFR SFR SFR SFR SFR
Net Rentable Area 1,140 sf 1,264 sf 1,915 sf 1,704 sf 1,667 sf 1,165 sf Land Area (acres) 0.286 0.21338 0.20921 0.31426 0.04543 0.2503 Annual Rental Rate $2.81 $1.98 $2.34 $2.19 $3.65
Transactional Adjustments
Expense Structure Gross Similar Similar Similar Similar Similar Effective Rental Rate $2.81 $1.98 $2.34 $2.19 $3.65
Conditions of Lease Executed Executed Executed Executed Executed Adjustment
Adjusted Rental Rate $2.81 $1.98 $2.34 $2.19 $3.65
FALSE FALSE FALSE FALSE FALSEMarket Conditions Adjustments Elapsed Time from Date of Value 0.67 years 2.86 years 3.31 years 1.39 years 0.11 years Market Trend Through June-22 0.7% 11.6% 13.9% 4.3%
Analyzed Rental Rate $2.83 $2.21 $2.66 $2.28 $3.65

0.0% 0.0% 0.0% 0.0% 0.0%Property Adjustments
Location 2319 Gianera
Street
230 Tyler Avenue 1818 Clay Street 22 Brookside Avenue 2222 Gianera Street
2189 Bohannon
Drive
Santa Clara Santa Clara Santa Clara Santa Clara Santa Clara Santa Clara Relative Comparison (-) (-)

0.0% 0.0% 0.0% 0.0% 0.0%NLA 1,140 sf 1,264 sf 1,915 sf 1,704 sf 1,667 sf 1,165 sf Relative Comparison - (+) (+) (+) -
Lot size 0.286 0.21338 0.20921 0.31426 0.04543 0.2503
Relative Comparison (+)

0.0% 0.0% 0.0% 0.0% 0.0%Age/Condition Year Built 1960's 1949 1946 1940 1998 1952 Condition Below Average Superior Similar Superior Superior Superior Relative Comparison (-)

0.0% 0.0% 0.0% 0.0% 0.0%Bedrooms/Baths 3Bed/2Bath 3Bed/2Bath 3Bed/2Bath 3Bed/1.5Bath 3Bed/2.5Bath 3Bed/2Bath Relative Comparison (+) (-)

0.0% 0.0% 0.0% 0.0% 0.0%Garage/Pool 2-car garage Driveway 2-car grg 2-car garage 2-car grg, pool 2-car grg, pool Relative Comparison (+) (-) (-)
Proximity to Power Lines Yes No No No Yes No
Relative Comparison
Overall Net Relative Comparison Similar to $2.83 Similar to $2.21 More than $2.66 Less than $2.28 Less than $3.65 Date of Value & Survey/Lease

RESIDENTIAL SITE

SALES COMPARISON APPROACH

Conclusions
We adjusted the rent comparables based on pertinent elements of comparison as discussed earlier and summarized them in the preceding adjustment grid. The final analyzed rental rate range from $2.21 to $3.65 per square foot of NLA with an average of $2.73 and a median of $2.66 as shown below:

Comparable Four is given most weight for its location in the immediate neighborhood. The property supports a rental rate less than $2.28 per square foot of living area. The high end of the range, comparable Fine is a smaller home on a similar lot but offers superior amenities on-site. The low end of the range, Comparable Two is a larger home on a similar lot with superior location in Santa Clara.

This comparable supports a rental rate of $2.21 per square foot of living area.

Based on our analysis, a rental rate of $2.25 per square foot of rentable are per month, gross, is supported for the Gianera home. The rental rate is based on a gross lease structure with the tenant being responsible for phone and electric while the landlord pays for most operating expenses including property taxes, insurance, water, trash, repairs and maintenance.

Rent Comparable Statistics
Metric Unadjusted Analyzed
Minimum Rental Rate $1.98 $2.21
Maximum Rental Rate $3.65 $3.65
Median Rental Rate $2.34 $2.66
Mean Rental Rate $2.59 $2.73
Fair Market Rent Conclusion
1,140 square feet $2.25 psf = $2,565
Rounded $2,600

RESIDENTIAL SITE

RECONCILIATION

Reconciliation
Summary of Value Indications
The indicated values from the approaches used and our concluded market values for the subject are summarized in the following table.

To reach a final opinion of value, the reliability and relevance of each value indication was considered based upon the quality of the data and applicability of the assumptions underlying each approach.

Given the availability and reliability of data within the Sales comparison Approach, this approach was given primary weight in reconciling to the final value conclusion.

The findings and conclusions are further contingent upon the following extraordinary assumptions and/or hypothetical conditions, the use of which might have affected the assignment results:

Extraordinary Assumptions:
• None
Hypothetical Conditions:
• None
Exposure Time
Based on statistical information about days on market, escrow length, and marketing times gathered through national investor surveys, sales verification, and interviews of market parti cipants, exposure time estimate of 6 to 9 months is considered reasonable and appropriate for the property.

RESIDENTIAL SITE

RECONCILIATION

National Quality Control
Valbridge’s top priority is delivering a quality report. Valbridge requires all reports to be reviewed by an experienced director with the MAI designation. This quality control assessment consists of reading the report, checking calculations, and providing feedback on its quality and consistency prior to report delivery. All Valbridge reports are signed by an experienced appraiser with the MAI designation.

Valbridge values all clients’ opinions, and any/all feedback is critical to the ongoing efforts to improve client servicing. Please feel free to c ontact the National Quality Control Director below with any feedback, questions, or comments.

Tye Neilson, MAI, SRA, MRICS, Esq.

Senior Managing Director
832.916.4608
[email protected]

RESIDENTIAL SITE

GENERAL ASSUMPTIONS & LIMITING CONDITIONS

General Assumptions and Limiting Conditions
This appraisal is subject to the following general assumptions and limiting conditions:

1. The legal description – if furnished to us – is assumed to be correct.

2. No responsibility is assumed for legal matters, questions of survey or title, soil or subsoil conditions, engineering, availability or capacity of utilities, or other similar technical matters. The appraisal does not constitute a survey of the property apprai sed. All existing liens and encumbrances have been disregarded and the property is appraised as though free and clear, under responsible ownership and competent management unless otherwise noted.

3. Unless otherwise noted, the appraisal will value the propert y as though free of contamination.

Valbridge Property Advisors | Northern California will conduct no hazardous materials or contamination inspection of any kind. It is recommended that the client hire an expe rt if the presence of hazardous materials or contamination poses any concern.

4. Unless otherwise noted, it is assumed there are no encroachments, zoning violations or restrictions existing in the subject property.

5. The appraiser is not required to give testim ony or attendance in court by reason of this appraisal, unless previous arrangements have been made.

6. Unless expressly specified in the engagement letter, the fee for this appraisal does not include the attendance or giving of testimony by Appraiser at any court, regulatory or other proceedings, or any conferences or other work in preparation for such proceeding. If any partner or employee of Valbridge Property Advisors | Northern California is asked or required to appear and/or testify at any deposition, trial, or other proceeding about the preparation, conclusions or any other aspect of this assignment, client shall compensate Appraiser for the time spent by the partner or employee in appearing and/or testifying and in preparing to testify according to the Appraiser’s then current hourly rate plus reimbursement of expenses.

7. The dates of value to which the opinions expressed in this report apply are set forth in this report.

We assume no res ponsibility for economic or physical factors occurring at some point at a later date, which may affect the opinions stated herein. The forecasts, projections, or operating estimates contained herein are based on current market conditions and anticipated sh ort-term supply and demand factors and are subject to change with future conditions. Appraiser is not responsible for determining whether the date of value requested by Client is appropriate for Client’s intended use.

8. The sketches, maps, plats and exhibits in this report are included to assist the reader in visualizing the property. The appraiser has made no survey of the property and assumed no responsibility in connection with such matters.

9. The information, estimates and opinions, which were obtained from sources outside of this office, are considered reliable. However, no liability for them can be assumed by the appraiser.

10. Possession of this report, or a copy thereof, does not carry with it the right of publication. Neither all, nor any part of the content of the report, or copy thereof (including conclusions as to property value, the identity of the appraisers, professional designations, reference to any professional appraisal organization or the firm with which the appraisers are connected), shall be dis seminated to the public through advertising, public relations, news, sales, or other media without prior written consent and approval.

11. No claim is intended to be expressed for matters of expertise that would require specialized investigation or knowledge beyond that ordinarily employed by real estate appraisers. We claim no expertise in areas such as, but not limited to, legal, survey, structural, environmental, pest control, mechanical, etc.

RESIDENTIAL SITE

GENERAL ASSUMPTIONS & LIMITING CONDITIONS

12. This appraisal was prepared for the sole and exclusive use of t he client for the function outlined herein. Any party who is not the client or intended user identified in the appraisal or engagement letter is not entitled to rely upon the contents of the appraisal without express written consent of Valbridge Property Advisors | Northern California and Client. The Client shall not include partners, affiliates, or relatives of the party addressed herein. The appraiser assumes no obligation, liability or accountability to any third party.

13. Distribution of this report is at the sole discretion of the client, but third -parties not listed as an intended user on the face of the appraisal or the engagement letter may not rely upon the contents of the appraisal. In no event shall client give a third-party a partial copy of the appraisal report. We will make no distribution of the report without the specific direction of the client.

14. This appraisal shall be used only for the function outlined herein, unless expressly authorized by Valbridge Property Advisors | Northern California.

15. This appraisal shall be considered in its entirety. No part thereof shall be used separately or out of context.

16. Unless otherwise noted in the body of this report, this appraisal assumes that the subject property does not fall within the areas where mandatory flood insurance is effective. Unless otherwise noted, we have not completed nor have we contracted to have completed an investigation to identify and/or quantify the presence of non-tidal wetland conditions on the subject property. Because the appraiser is not a surveyor, he or she makes no guarantees, express or implied, regarding this determination.

17. The flood maps are not site specific. We are not qualifie d to confirm the location of the subject property in relation to flood hazard areas based on the FEMA Flood Insurance Rate Maps or other surveying techniques. It is recommended that the client obtain a confirmation of the subject property’s flood zone classification from a licensed surveyor.

18. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or structures which would render it more or less valuable. No responsibility is assumed for such conditions or for engineering which may be required to discover them.

19. We have attempted to reconcile sources of data discovered or provided during the appraisal process, including assessment department data. Ultimately, the measurements that are deemed by us to be the most accurate and/or reliable are used within this report. While the measurements and any accompanying sketches are considered to be reasonably accurate and reliable, we cannot guarantee their accuracy. Should the client desire more precise measurement, they are urged to retain the measurement services of a qualified professional (space planner, architect or building engineer) as an alternative source. If this alternative measurement source reflects or reveals substantial differences with the measurements used within the rep ort, upon request of the client, the appraiser will submit a revised report for an additional fee.

20. In the absence of being provided with a detailed land survey, we have used assessment department data to ascertain the physical dimensions and acreage of the property. Should a survey prove this information to be inaccurate, upon request of the client, the appraiser will submit a revised report for an additional fee.

RESIDENTIAL SITE

GENERAL ASSUMPTIONS & LIMITING CONDITIONS

21. Unless otherwise stated in this report, the value conclusion is predicated on the assumption t hat the property is free of contamination, environmental impairment or hazardous materials. Unless otherwise stated, the existence of hazardous material was not observed by the appraiser and the appraiser has no knowledge of the existence of such materials on or in the property. The appraiser, however, is not qualified to detect such substances. The presence of substances such as asbestos, urea-formaldehyde foam insulation or other potentially hazardous materials may affect the value of the property. No res ponsibility is assumed for any such conditions, or for any expertise or engineering knowledge required for discovery. The client is urged to retain an expert in this field, if desired.

22. No changes in any federal, state or local laws, regulations or codes (i ncluding, without limitation, the Internal Revenue Code) are anticipated, unless specifically stated to the contrary.

23. The data gathered in the course of this assignment (except data furnished by the Client) shall remain the property of the Appraiser. The appraiser will not violate the confidential nature of the appraiser- client relationship by improperly disclosing any confidential information furnished to the appraiser.

Notwithstanding the foregoing, the Appraiser is authorized by the client to disclose a ll or any portion of the appraisal and related appraisal data to appropriate representatives of the Appraisal Institute if such disclosure is required to enable the appraiser to comply with the Bylaws and Regulations of such Institute now or hereafter in effect.

24. You and Valbridge Property Advisors | Northern California both agree that any dispute over matters in excess of $5,000 will be submitted for resolution by arbitration. This includes fee disputes and any claim of malpractice. The arbitrator shall be mutually selected. If Valbridge Property Advisors | Northern California and the client cannot agree on the arbitrator, the presiding head of the Local County Mediation & Arbitration panel shall select the arbitrator. Such arbitration shall be binding and final. In agreeing to arbitration, we both acknowledge that, by agreeing to binding arbitration, each of us is giving up the right to have the dispute decided in a court of law before a judge or jury.

In the event that the client, or any other party, makes a claim against Valbridge Property Advisors | Northern California or any of its employees in connections with o r in any way relating to this assignment, the maximum damages recoverable by such claimant shall be the amount actually received by Valbridge Property Advisors | Northern California for this assignment, and u nder no circumstances shall any claim for consequential damages be made.

25. Valbridge Property Advisors | Northern California shall have no obligation, liability, or accountability to any third party. Any party who is not the “client” or intended user identified on the face of the appraisal or in the engagement letter is not entitled to rely upon the contents of the appraisal without the express written consent of Valbridge Property Advisors | Northern California. “Client” shall not include partners, affiliates, or relatives of the party named in the engagement letter. Client shall hold Valbridge Property Advisors | Northern California and its employees harmless in the event of any lawsuit brought by any third party, lender, partner, or part -owner in any form of ownership or any other party as a result of this assignment. The client also agrees that in case of lawsuit arising from or in any way involving these appraisal services, client will hold Valbridge Property Advisors | Northern California harmless from and against any liability, loss, cost, or expense incurred or suffered by Valbridge Property Advisors | Northern California in such action, regardless of its outcome.

26. The Valbridge Property Advisors office responsible for the preparation of this report is independently owned and operated by San Francisco Bay Area | Silicon Valley | San Jose . Neither Valbridge Property Advisors, Inc., nor any of its affiliates has been engaged to provide this report.

Valbridge Property Advisors, Inc. does not provide valuation services, and has taken no part in the preparation of this report.

RESIDENTIAL SITE

GENERAL ASSUMPTIONS & LIMITING CONDITIONS

27. If any claim is filed against any of Valbridge Pr operty Advisors, Inc., a Florida Corporation, its affiliates, officers or employees, or the firm providing this report, in connection with, or in any way arising out of, or relating to, this report, or the engagement of the firm providing this report, then (1) under no circumstances shall such claimant be entitled to consequential, special or other damages, except only for direct compensatory damages, and (2) the maximum amount of such compensatory damages recoverable by such claimant shall be the amount actually received by the firm engaged to provide this report.

28. This report and any associated work files may be subject to evaluation by Valbridge Property Advisors, Inc., or its affiliates, for quality control purposes.

29. Acceptance and/or use of this appraisal report constitutes acceptance of the foregoing general assumptions and limiting conditions.

RESIDENTIAL SITE

CERTIFICATION

Certification – Norman C. Hulberg, MAI
I certify that, to the best of my knowledge and belief:

1. The statements of fact contained in this report are true and correct.

2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions.

3. I have no present or prospective interest in the properties that are the subject of this report and no personal interest with respect to the parties involved.

4. The undersigned has not performed services regarding the properties that are the subject of this report within the three-year period immediately preceding acceptance of this assignment.

5. I have no bias with respect to the propert ies that are the subject of this report or to the parties involved with this assignment.

6. My engagement in this assignment was not contingent upon developing or reporting predetermined results.

7. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of value opinion, the attainment of a stipulated re sult, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

8. My analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.

9. Norman C. Hulberg, MAI has not personally inspected the subject property.

10. No one provided significant real property appraisal assistance to the person signing this certification, unless otherwise noted.

11. The reported analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.

12. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

13. As of the date of this report, the undersigned has completed the continuing education program for Designated Members of the Appraisal Institute.

Norman C. Hulberg, MAI
Senior Managing Director
California Certified License #AG003542

RESIDENTIAL SITE

CERTIFICATION

Certification – Chrisoula Kantiotou, PhD
I certify that, to the best of my knowledge and belief:

1. The statements of fact contained in this report are true and correct.

3. I have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved.

4. The undersigned has not performed services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three -year period immediately preceding acceptance of this assignment.

5. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment.

6. My engagement in this assignment was not contingent upon developing or reporting predetermined results.

7. My compensation f or completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

8. My analyses, opinions and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice.

9. Chrisoula Kantiotou did not personally inspect the subject property.

10. Yulia Ferguson provided significant real property appraisal assistance to the person signing this certification. Specific details as to the assistance provided is included in the Scope of Work section of this report.

12. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

13. As of the date of this report, the undersigned has completed the Standards and Ethics Education Requirement for Candidates/Practicing Affiliates of the Appraisal Institute.

Chrisoula Kantiotou, PhD
Senior Appraiser
California Certified License #AG027334

RESIDENTIAL SITE

ADDENDA

Addenda
Additional Subject Photographs
Sketch
Glossary
Qualifications
• Norman C. Hulberg, MAI
• Chrisoula Kantiotou, Senior Appraiser
• Yulia Ferguson, Appraisal Analyst
Information on Valbridge Property Advisors
Office Locations

RESIDENTIAL SITE

ADDENDA

Additional Subject Photographs (Dated December 14, 2022)

Interior of residential structure -living room Interior of residential structure - bedroom

View of the property restroom View of the property restroom

View of the kitchen Typical interior of the garage

RESIDENTIAL SITE

ADDENDA

View of the back yard looking north View of back yard looking south

View of the front yard area Rear of residential structure

Street scene looking west on Gianera Street,
subject to the right
Street scene looking east on Gianera Street,
subject to the left

RESIDENTIAL SITE

ADDENDA

Sketch

RESIDENTIAL SITE

ADDENDA

Glossary
Definitions are taken from The Dictionary of Real Estate Appraisal, 7 th Edition (Dictionary), the Uniform Standards of Professional Appraisal Practice (USPAP) and Building Owners and Managers Association International (BOMA).

Absolute Net Lease
A lease in which the tenant pays all expenses including structural maintenance, building reserves, and
management; often a long-term lease to a credit tenant. (Dictionary)
Amortization
The process of retiring a debt or recovering a capital
investment, typically through scheduled, systematic
repayment of the principal; a program of periodic
contributions to a sinking fund or debt retirement fund. (Dictionary)
As Is Market Value
The estimate of the market value of real property in its current physical condition, use, and zoning as of the
appraisal date. (Interagency Appraisal and Evaluation
Guidelines) Note that the use of the “as is” phrase is
specific to appraisal regulations pursuant to FIRREA
applying to appraisals prepared for regulated lenders in the United States. The concept of an “as is” value is not included in the Standards of Valuation Practice of the
Appraisal Institute, Uniform Standards of Professional
Appraisal Practice, or International Valuation Standards. (Dictionary)
Base Rent
The minimum rent stipulated in a lease. (Dictionary)
Base Year
The year on which escalation clauses in a lease are based. (Dictionary)
Building Common Area
In office buildings, the areas of the building that provide services to building tenants but that are not included in the office area or store area of any specific tenant. These areas may include, but shall not be limited to, main and auxiliary lobbies, atrium spaces at the level of the finished floor, concierge areas or security desks, conference
rooms, lounges or vending areas, food service facilities, health or fitness centers, daycare facilities, locker or shower facilities, mail rooms, fire control roo ms, fully enclosed courtyards outside the exterior walls, and
building core and service areas such as fully enclosed
mechanical or equipment rooms. Specifically excluded
from building common area are floor common areas,
parking space, portions of loading d ocks outside the
building line, and major vertical penetrations. (BOMA)
Building Rentable Area
The sum of all floor rentable areas. Floor rentable area is the result of subtracting from the gross measured area of a floor the major vertical penetrations on that same floor.

It is generally fixed for the life of the building and is rarely affected by changes in corridor size or configuration.
(BOMA)
Bulk Value
The value of multiple units, subdivided plots, or
properties in a portfolio as though sold together i n a single transaction. (Dictionary)
Certificate of Occupancy (COO)
A formal written acknowledgment by an appropriate unit
of local government that a new construction or
renovation project is at the stage where it meets
applicable health and safety codes a nd is ready for
commercial or residential occupancy. (Dictionary)
Common Area Maintenance (CAM)
The expense of operating and maintaining common
areas; may or may not include management charges and
usually does not include capital expenditures on tenant improvements or other improvements to the property.
(Dictionary)

The amount of money charged to tenants for their shares of maintaining a [shopping] center’s common area. The
charge that a tenant pays for shared services and facilities such as electricity, security, and maintenance of parking lots. Items charged to common area maintenance may
include cleaning services, parking lot sweeping and
maintenance, snow removal, security, [amenities,] and
upkeep. (ICSC – International Council of Shopping
Centers, 4th Ed.)
Condominium
An attached, detached, or stacked unit within or attached to a structure with common areas that are held as tenants in common (an undivided interest) with other owners in
the project. The units can be residential, commercial,
industrial, or parking spaces or boat docks. These units are commonly defined by state laws in their locations.

Because units can be stacked on top of other units, these units can be defined both vertically and horizontally.
(Dictionary)
Conservation Easement
An interest in real estate restricting future land use to preservation, conservation, wildlife habitat, or some
combination of those uses. A conservation easement may

RESIDENTIAL SITE

ADDENDA

permit farming, timber harvesting, or other uses of a rural nature as well as some types of conservation -oriented
development to continue, subject to the easement.
(Dictionary)
Contributory Value
A type of value that reflects the amount a property or
component of a property contributes to the value of
another asset or to the property as a whole.

The change in the value of a property as a whole, whether positive or negative, resulting from the addition or
deletion of a property component. Also called deprival
value in some countries. (Dictionary)
Debt Coverage Ratio (DCR)
The ratio of net operating income to annual debt service (DCR = NOI÷I m), which measures the relative ability of a property to meet its debt service out of net operating
income; also called debt service coverage ratio (DSCR). A larger DCR typically indicates a greater ability for a
property to withstand a reduction of income, providing an improved safety margin for a lender. (Dictionary)
Deed Restriction
A provision written into a deed that limits the use of land.

Deed restrictions usually remain in effect when title
passes to subsequent owners. (Dictionary)
Depreciation
In appraisal, a loss in property value from any cause; the difference between the cost of an improvement on the
effective date of the appraisal and the value of the
improvement on the same date.

In accounting, an allocation of the origi nal cost of an asset, amortizing the cost over the asset’s life; calculated using a variety of standard techniques. (Dictionary)
Disposition Value
The most probable price that a specified interest in
property should bring under the following conditions:

1. Consummation of a sale within a specified time,
which is shorter than the typical exposure time for
such a property in that market.

2. The property is subjected to market conditions
prevailing as of the date of valuation;

3. Both the buyer and seller are acting p rudently and
knowledgeably;

4. The seller is under compulsion to sell;

5. The buyer is typically motivated;

6. Both parties are acting in what they consider to be
their best interests;

7. An adequate marketing effort will be made during
the exposure time;

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements
comparable thereto; and

9. The price represents the normal consideration for
the property sold, unaffected by special or creative
financing or sales concessions gra nted by anyone
associated with the sale.

This definition can also be modified to provide for
valuation with specified financing terms. (Dictionary)
Double Net (Net Net) Lease
An alternative term for a type of net lease. In some
markets, a net net lease is defined as a lease in which the tenant is responsible to pay both property taxes and
premiums for insuring the building(s). (Valbridge)

(The market definition of a double net lease varies
depending on the market)
Easement
The right to use another ’s land for a stated purpose.
(Dictionary)
EIFS
Exterior Insulation Finishing System. This is a type of exterior wall cladding system. Sometimes referred to as dry-vit.

Effective Date

1. The date on which the appraisal opinion applies.
(SVP)

2. The date to which an appraiser’s analyses, opinions, and conclusions apply; also referred to as date of
value. (USPAP, 2020-2021 ed.)

3. The date that a lease goes into effect. (Dictionary) Effective Gross Income (EGI)
The anticipated income from all operations of the real
estate after an allowance is made for vacancy and
collection losses and an addition is made for any other income. (Dictionary)
Effective Rent
Total base rent, or minimum rent stipulated in a lease, over the specified lease term minus rent concessions; the rent that is effectively paid by a tenant net of financial concessions provided by a landlord. (TIs). (Dictionary) EPDM
Ethylene Propylene Diene Monomer Rubber. A type of
synthetic rubber typically used for roof coverings.

RESIDENTIAL SITE

ADDENDA

Escalation Clause
A clause in an agreement that provides for the
adjustment of a price or rent based on some event or
index. e.g., a provision to increase rent if operating
expenses increase; also called escalator clause, expense recovery clause or stop clause. (Dictionary)
Estoppel Certificate
A signed statement by a party (such as a tenant or a
mortgagee) certifying, for another’s benefit, that certain facts are correct, such as that a lease exists, that there are no defaults, and that rent is paid to a certain date.
(Black’s) In real estate, a buyer of rental property typically requests estoppel certificates from existing tenants.

Sometimes referred to as an estoppel letter. (Dictionary) Excess Land
Land that is not needed to serve or support the existing use. The highest and best use of the excess land may or may not be the same as the highest and best use of the
improved parcel. Excess land has the potential to be sold separately and is valued separately. (Dictionary)
Excess Rent
The amount by which contract rent exceeds market rent
at the time of the appraisal; created by a lease favorable to the landlord (lessor) and may reflect unusual
management, unknowledgeable or unusually motivated
parties, a lease execution in an earlier, stronger rental market, or an agreement of the parties. (Dictionary)
Expense Stop
A clause in a lease that limits the landlord’s expense
obligation, which results in the lessee paying operating expenses above a stated level or amount. (Dictionary)
Exposure Time

1. The time a property remains on the market.

2. An opinion, based on supporting market data, of the
length of time that the property interest being
appraised would have been offered on the market
prior to the hypothetical consummation of a sale at
market value on the effective date of the appraisal.
(USPAP, 2020-2021 ed.)
Extraordinary Assumption
An assignment -specific assumption as of the effective
date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.

Comment: Uncertain information might include physical,
legal, or economic characteristics of the subject property; or conditions external to the property, such as market
conditions or trends; or the integrity of data used in an analysis. (USPAP)
Fee Simple Estate
Absolute ownership unencumbered by any other interest
or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain,
police power, and escheat. (Dictionary)
Floor Common Area
In an office building, the areas on a floor such as
washrooms, janitorial closets, electrical rooms, telephone rooms, mechanical rooms, elevator lobbies, and public
corridors which are available primarily for the use of
tenants on that floor. In essence, floor common area
represents all of the area on the floor that is common to that respective floor with the exception of those areas that penetrate through the floor, such as the elevator
shaft and stairwell. The significant point to be made is that floor common area is not part of the tenant’s usable area. (BOMA)
Full Service (Gross) Lease
A lease in which the landlord receives stipulated rent and is obligated to pay all of the property’s operating and fixed expenses; also called a full service lease. (Dictionary) Furniture, Fixtures, and Equipment (FF&E)
Business trade fixtures and personal property, exclusive of inventory. (Dictionary)
Going-Concern Value
An outdated label for the market value of all the tangible and intangible assets of an established and operating
business with an indefinite life, as if s old in aggregate; more accurately termed the market value of the going
concern or market value of the total assets of the business. (Dictionary)
Gross Building Area (GBA)

1. Total floor area of a building, excluding unenclosed areas, measured from the exterior of the walls of the
above-grade area. This includes mezzanines and
basements if and when typically included in the
market area of the type of property involved.

2. Gross leasable area plus all common areas.

3. For residential space, the total area of all floor levels measured from the exterior of the walls and
including the superstructure and substructure
basement; typically does not include garage space.
(Dictionary)
Gross Measured Area
The total area of a building enclosed by the dominant
portion (the portion of the inside finished surface of the permanent outer building wall which is 50 percent or
more of the vertical floor -to-ceiling dimension, at the given point being measured as one moves horizontally
along the wall), excluding parking areas and loading
docks (or portions of same) outside the building line. It is

RESIDENTIAL SITE

ADDENDA

generally not used for leasing purposes and is calculated on a floor by floor basis. (BOMA)
Gross Up Method
A method of cal culating variable operating expenses in income-producing properties when less than 100%
occupancy is assumed. Expenses reimbursed based on
the amount of occupied space, rather than on the total
building area, are described as “grossed up.” (Dictionary) Gross Sellout Value (Sum of the Retail Values)
The sum of the separate and distinct market value
opinions for each of the units in a condominium,
subdivision development, or portfolio of properties, as of the date of valuation. The aggregate of retail values does not represent the value of all the units as though sold together in a single transaction; it is simply the total of the individual market value conclusions. An appraisal has an effective date, but summing the sale prices of multiple units over an exte nded period of time will not be the
value on that one day unless the prices are discounted to make the value equivalent to what another developer or
investor would pay for the bulk purchase of the units. Also called the aggregate of the retail values, aggr egate retail selling price or sum of the retail values. (Dictionary) Ground Lease
A lease that grants the right to use and occupy land.

Improvements made by the ground lessee typically revert to the ground lessor at the end of the lease term.
(Dictionary)
Ground Rent
The rent paid for the right to use and occupy land
according to the terms of a ground lease; the portion of the total rent allocated to the underlying land.
(Dictionary)
HVAC
Heating, ventilation, air conditioning (HVAC) system. A unit that reg ulates the temperature and distribution of heat and fresh air throughout a building. (Dictionary)
Highest and Best Use

1. The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility,
physical possibility, financial feasibility, and
maximum productivity.

2. The use of an asset that maximizes its potential and that is possible, legally permissible, and financially
feasible. The highest and best use may be for
continuation of an asset’s existing use of for some
alternative use. This is determined by the use that a
market participant would have in mind for the asset
when formulating the price that it would be willing
to bid. (IVS)

3. [The] highest and most profitable use for which the property is adaptable and needed or likely to be
needed in the reasonably near future. (Uniform
Appraisal Standards for Federal Land Acquisitions)
(Dictionary)
Hypothetical Condition

1. A condition that is presumed to be true when it is
known to be false. (SVP)

2. A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser
to exist on the effective date of the assignment
results, but is used for the purpose of analysis.

Comment: Hypothetical conditions are contrary to
known facts about physical, legal, or economic
characteristics of the subject property; or about
conditions external to the property, such as market
conditions or trends; or about the integrity of data used in an analysis. (USPAP)
Insurable Value (Replacement Cost for Insurance
Purposes)
The estimated cost, at current prices as of the effective date of valuation, of a substitute for the building being valued, using modern materials and current standards,
design, and layout for insurance coverage purposes
guaranteeing that damaged property is replaced with
new property (i.e., depreciation is not deducted).
(Dictionary)
Investment Value

1. The value of a property to a particular investor or
class of investors based on the investor’s specific
requirements. Investment value may be different
from market value because it depends on a set of
investment criteria that are not necessarily typical of the market. (Dictionary)

2. The value of an asset to the owner or a prospective
owner given individual investment or operational
objectives (may also be known as worth). (IVS)
Just Compensation
In condemnation, the amount of loss for which a property owner is compensated when his or her property is taken.

Just compensation should put the owner in as good a
position pecuniarily as he or she would have been if the property had not been taken. (Dictionary)
Leased Fee Interest
The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires.
(Dictionary)

RESIDENTIAL SITE

ADDENDA

Leasehold Interest (Leasehold Estate)
The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease. (Dictionary)

See also Positive Leasehold and Negative Leasehold.

Lessee (Tenant)
One who has the right to occupancy and use of the
property of another for a period of time according to a lease agreement. (Dictionary)
Lessor (Landlord)
One who conveys the rights of occupancy and use to
others under a lease agreement. (Dictionary)
Liquidation Value
The most probable price that a specified interest in
property should bring under the following conditions:

1. Consummation of a sale within a short time period.

2. The property is subjected to market conditions
prevailing as of the date of valuation.

3. Both the buyer and seller are acting prudently and
knowledgeably.

4. The seller is under extreme compulsion to sell.

5. The buyer is typically motivated.

6. Both parties are acting in what they consider to be
their best interests.

7. A normal marketing effort is not possible due to the brief exposure time.

8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements
comparable thereto.

9. The price rep resents the normal consideration for
the property sold, unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale. (Dictionary)
Loan to Value Ratio (LTV)
The ratio between a mortgage loan and the value of the
property pledged as security, usually expressed as a
percentage. (Dictionary)
Major Vertical Penetrations
Stairs, elevator shafts, flues, pipe shafts, vertical ducts, and the like, and their enclosing walls. Atria, lightwells and similar penetrations above the finished floor are included in this definition. Not included, however, are vertical penetrations built for the private use of a tenant
occupying office areas on more than one floor. Structural columns, openings for vertical electric cable or telephone distribution, and openings for plumbing lines are not
considered to be major vertical penetrations. (BOMA)
Market Rent
The most probable rent that a property should bring in a competitive and open market under all the conditions
requisite to a fair le ase transaction, the lessee and the lessor each acting prudently and knowledgeably, and
assuming the rent is not affected by undue stimulus.

Implicit in this definition is the execution of a lease as of a specified date under conditions whereby:

1. Lessee and lessor are typically motivated;

2. Both parties are well informed or well advised, and
acting in what they consider their best interests;

3. Payment is made in terms of cash or in terms of
financial arrangements comparable thereto; and

4. The rent reflects specified terms and conditions, such as permitted uses, use restrictions, expense
obligations, duration, concessions, rental
adjustments and revaluations, renewal and purchase
options, and tenant improvements (TIs). (Appraisal
Institute)
Market Value
The followin g definition of market value is used by
agencies that regulate federally insured financial
institutions in the United States: The most probable price that a property should bring in a competitive and open
market under all conditions requisite to a fair sal e, the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the
consummation of a sale as of a specified date and the
passing of title from seller to buyer under conditions
whereby:

1. Buyer and seller are typically motivated;

2. Both parties are well informed or well advised, and
acting in what they consider their own best interests;

3. A reasonable time is allowed for exposure in the
open market;

4. Payment is made in terms of cash in United States
dollars or in terms of financial arrangements
comparable thereto; and

5. The price represents the normal consideration for
the property sold unaffected by special or creative
financing or sales concessions granted by anyone
associated with the sale. ( Dictionary; 12 C.F.R. Part

34.42(g); 55 Federal Register 34696, August 24, 1990,
as amended at 57 Federal Register 12202, April 9,
1992; 59 Federal Register 29499, June 7, 1994)
Marketing Time
An opinion of the amount of time it might take to sell a real or personal property interest at the concluded
market value level during the period immediately after
the effective date of an appraisal. Marketing time differs from exposure time, which is always presumed to precede

RESIDENTIAL SITE

ADDENDA

the effective date of an appraisal. (Advisory Opinion 7 of the Appraisal Standards Board of the Appraisal
Foundation)
Master Lease

1. A lease in which a part or the entire property is leased to a single entity (the master lessee) in return for a
stipulated rent. The master lessee then subleases the
property to multiple tenants.

2. The first lease in a sandwich lease. (Dictionary)
Modified Gross Lease
A lease in which the landlord receives stipulated rent and is obligated to pay some, but not all, of the property’s operating and fixed e xpenses. Since assignment of
expenses varies among modified gross leases, expense
responsibility must always be specified. In some markets, a modified gross lease may be called a double net lease, net net lease, partial net lease, or semi -gross le ase. (Dictionary)
Negative Leasehold
A lease situation in which the market rent is less than the contract rent. (Dictionary)
Operating Expense Ratio
The ratio of total operating expenses to effective gross income ( TOE/EGI); the complement of the net income
ratio, i.e., OER = 1 – NIR (Dictionary)
Option
A legal contract, typically purchased for a stated
consideration, that permits but does not require the
holder of the option (known as the optionee) to buy, sell, or lease r eal estate for a stipulated period of time in accordance with specified terms; a unilateral right to
exercise a privilege. (Dictionary)
Partial Interest
Divided or undivided rights in real estate that represent less than the whole, i.e., a fractional inter est such as a tenancy in common or easement. (Dictionary)
Pass Through
A tenant’s portion of operating expenses that may be
composed of common area maintenance (CAM), real
property taxes, property insurance, and any other
expenses determined in the lease a greement to be paid
by the tenant. (Dictionary)
Percentage Lease
A lease in which the rent or some portion of the rent
represents a specified percentage of the volume of
business, productivity, or use achieved by the tenant.
(Dictionary)
Positive Leasehold
A lease situation in which the market rent is greater than the contract rent. (Dictionary)
Potential Gross Income (PGI)
The total income attributable to property at full
occupancy before vacancy and operating expenses are
deducted. (Dictionary)
Prospective Opinion of Value
A value opinion effective as of a specified future date. The term does not define a type of value. Instead, it identifies a value opinion as being effective at some specific future date. An opinion of value as of a prospective date is
frequently sought in connection with projects that are
proposed, under construction, or under conversion to a
new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy. (Dictionary)
Replacement Cost
The estimated cost to construct, at current prices as of a specific date, a substitute for a building or other
improvements, using modern materials and current
standards, design, and layout. (Dictionary)
Reproduction Cost
The estimated cost to construct, at current prices as of the effective date of the appraisal, an exact duplicate or
replica of the building being appraised, using the same materials, construction standards, design, layout, and
quality of workmanship and embodying all of the
deficiencies, superadequacies, and obsolescence of the subject building. (Dictionary)
Retrospective Value Opinion
A value opinion effective as of a specified historical date.

The term retrospective does not define a type of value.

Instead, it identifies a value opinion as being effective a t some specific prior date. Value as of a historical date is frequently sought in connection with property tax
appeals, damage models, lease renegotiation, deficiency judgments, estate tax, and condemnation. Inclusion of
the type of value with this term is appropriate, e.g., “retrospective market value opinion.” (Dictionary)
Sandwich Leasehold Estate
The interest held by the sandwich leaseholder when the
property is subleased to another party; a type of
leasehold estate. (Dictionary)
Sublease
An agreement in which the lessee in a prior lease conveys the right of use and occupancy of a property to another, the sublessee, for a specific period of time, which may or may not be coterminous with the underlying lease term.
(Dictionary)

RESIDENTIAL SITE

ADDENDA

Subordination
A contractual arrangement in which a party with a claim to certain assets agrees to make that claim junior, or
subordinate, to the claims of another party. (Dictionary) Surplus Land
Land that is not currently needed to support the existing use but cannot be separated from the property and sold
off for another use. Surplus land does not have an
independent highest and best use and may or may not
contribute value to the improved parcel. (Dictionary)
TPO
Thermoplastic polyolefin, a resilient synthetic roof
covering.

Triple Net (Net Net Net) Lease
An alternative term for a type of net lease. In some
markets, a net net net lease is defined as a lease in which the tenant assumes all expenses (fixed and variable) of operating a property except that the landlord is
responsible for structural maintenance, building reserves, and management; also called NNN lease, net net net
lease, or fully net lease. (Dictionary)

(The market definition of a triple net lease varies; in some cases tenants pay for items such as roof rep airs, parking lot repairs, and other similar items.)
Usable Area
The measured area of an office area, store area, or
building common area on a floor. The total of all the
usable areas for a floor shall equal floor usable area of that same floor. (BOMA)
Value-in-Use

1. The amount determined by discounting the future
cash flows (including the ultimate proceeds of
disposal) expected to be derived from the use of an
asset at an appropriate rate that allows for the risk of the activities concerned. (FASB Accounting
Standards Codification, Master Glossary)

2. Formerly used in valuation practice as a synonym for contributory value or use value. (Dictionary)
VTAB (Value of the Total Assets of a Business)
The total amount that the real property, tangible personal property, and intangible property assets of a business
would sell for in an asset-based transaction. (Dictionary)

RESIDENTIAL SITE

ADDENDA

Qualifications

RESIDENTIAL SITE

ADDENDA

Val bridge

PROPERTY ADVISORS
Chrisoula Kantiotou, PhD
Senior Appraiser
Valbridge Property Advisors I Northern California

MEMBERSHIPS & AFFILIATIONS
Appraisal Institute
Member
Candidate for MAI
Valbridge Women 's Council
Member

APPRAISAL INSTITUTE & RELATED COURSES
Report Writing and Case Studies
USPAP
Capitalization Theory and Techniques

SPEAKING ENGAGEMENTS
Appraisal Institute 2022 Annual Spring Conference
Fractional Interest Valuation: Valuing a Piece of the Pie

EXPERIENCE
Valbridge Property Advisors I Northern California
Senior Appraiser , 2020-Present
Appraiser , 2015-2019
The Fillmore Group
Commercial Appraiser , 2003-2014
The Property Sciences Group, Inc.

Staff Appraiser , 1999-2002
Associate Appraiser , 1998-1999
With more than 20 years of experience , Ms. Kantiotou specializes in fractional interest valuations and comple x appraisals, including estate portfolios . In her tenure at Valbridge Property Advisors , she has completed more than 280 fractional interest valuations.

Appraisal/valuation and consulting assignments include:

Commercial (office buildings , community and strip retail centers , medical buildings , childcare centers , preschools , and vacant land) ; Industrial (light industrial , research and development , warehouses , condominiums , and vacant land); and Residential (apartments , condominiums , subd ivisions , single-family dwellings , vacant land, mixed-use developments , and affordable housing) .

RESIDENTIAL SITE

ADDENDA

Val bridge

PROPERTY ADVISORS
Norman C. Hulberg, MAI
Senior Managing Director
Valbridge Property Advisors I Northern California

MEMBERSHIPS & AFFILIATIONS
Appraisal Institute , Member
MAI Designation , 1982
Santa Clara County Estate Planning Council
Director
Rotary Club of San Jose
Member

APPRAISAL INSTITUTE & RELATED COURSES
Continuing education courses taken through the Appraisal Institute and other real estate organizations .

EXPERIENCE
Valbridge Property Advisors I Northern California
Senior Managing Director, 2013-Present
Valbridge Property Advisors , Inc.
• National Director, 2013-Present
• Member, Board of Directors, 2013-Present
Hulberg & Associates, Inc.
• President , 1976-2013
Mr. Hulberg has provided valuation services in a wide variety of complex civil litigation including real estate, land use cases, condemnation , estate matters, property taxation, contract disputes , partnership and corporate disputes , environmental lawsuits , professional negligence cases , construction defect, and bankruptcy/creditors matters.

He is qualified as an expert witness in most counties in the San Francisco Bay Area, Monterey Bay, and Central Valley regions , as well as and in the U.S. Tax Court in the U.S. District Courts in San Jose, San Francisco , Oakland , and Las Vegas. Mr. Hulberg is a highly experienced forensic appraiser , having provided testimony on over 300 occasions. This includes over 100 jury trials in state and federa l courts in addition to numerous court trials. He has also testified in major arbitrations and before state and federal courts, as well as private arbitrations .

Appraisal/valuation and consulting assignments include:

Residential (Single-family , condominium , apartments , land, mobile home parks), office buildings , hotels/motels , service stations, genera l retail, vacant land, industrial (plants, research and development , warehouses , data centers) . Fractional interest valuations , contaminated properties, special purpose properties , feasibility studies, market studies, condemnation , construction defects , litigation supper~ mediations , arbitrations , and review appraisals .

RESIDENTIAL SITE

ADDENDA

RESIDENTIAL SITE

ADDENDA

Valbridge Property Advisors Information / Office Locations

RESIDENTIAL SITE

ADDENDA

RESIDENTIAL SITE

ADDENDA

Resolution/To Declare the 2319 Gianera Street Property as Surplus Land Rev: 11/22/17

Page 1 of 3 ends

RESOLUTION NO. _

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA

CLARA, CALIFORNIA, TO DECLARE THE CITY OWNED
VACANT PROPERTY LOCATED AT 2319 GIANERA STREET
(APPROXIMATELY 12,478 SF LOT) OWNED BY THE CITY AS

SURPLUS LAND

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

WHEREAS, the City is the owner that certain property located at 2319 Gianera Street that

contains a single-family home on at 12,478 sf lot (“Property”); and

WHEREAS, the City purchased the property with general funds in 1983 for $155,000; and WHEREAS, the Property has not been utilized any purpose since approximately 2012; and WHEREAS, the SLA requires that before a local agency takes any action to sell or lease its property, it must declare the property to be either “surplus land” or “exempt surplus land;” and WHEREAS, under the Surplus Land Act (the “SLA”), Government Code § 54220-54233, “surplus land” means land owned in fee simple by any local agency for which the local agency’s governing body takes formal action in a regular meeting declaring that such land is surplus and is not necessary for the agency’s use; and
WHEREAS, the City owns the Property in fee simple, the City does not currently use the Property, and the City has no written or adopted plan for future use of the Property, so the Property is no longer necessary for the City’s use or operations; and WHEREAS, along with declaring the property surplus, the SLA also requires the City to give written notice of the availability of the Property to certain groups and entities prior to disposing of the Property; and

///

///
----
Resolution/To Declare the 2319 Gianera Street Property as Surplus Land Rev: 11/22/17

Page 2 of 3 ends

WHEREAS, the City Council therefore finds that the Property is surplus land as defined by the SLA and is not necessary for the City’s use.

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

1. That the aforementioned recitals are true and correct and are incorporated herein.

2. That the City Council finds that the 2319 Gianera Street Property is surplus land as defined in the Surplus Land Act (Gov. Code sections 54220 et seq.) and is not necessary for City use.

3. That the City Council finds that the declaration that the Property is surplus land is exempt from the California Environmental Quality Act ("CEQA") (Public Resources Code § 21000, et seq.) pursuant to State CEQA Guidelines Sections 15060(c)(2), 15060(c)(3), 15378, and 15061(b)(3), as the declaration and activity will not result in a direct or reasonably foreseeable indirect physical change in the environment, the declaration and activity are not a "project" as defined in CEQA, and it can be seen with certainty that there is no possibility that the declaration and activity will have a significant effect on the environment because no development or construction is proposed.

4. That the City’s officers and staff are hereby authorized to do all which may be deemed necessary or proper to effectuate the purpose of this Resolution, including but not limited to issuance of a Notice of Availability to the required entities and negotiation for the sale of the Property in accordance with the SLA.
///

///

///
Resolution/To Declare the 2319 Gianera Street Property as Surplus Land Rev: 11/22/17

Page 3 of 3 ends

5. 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 , 2023, 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
DRAFT
March , 2023

RE: Notice of Availability/Offer to Sell Surplus Property To All Interested Parties:

As required by Government Code Section 54220 of the State of California, the City of Santa Clara is providing notification that the City intends to sell the surplus property located at 2319 Gianera Street is further identified in Attachment A hereto.

In accordance with Government Code Section 54222, you have sixty (60) days from the date this offer was sent via certified mail or electronic mail to notify the City of your interest in acquiring the property. However, this offer shall not obligate the City to sell the Property to you. Instead, the City would enter into at least ninety (90) days of negotiations with you pursuant to Government Code Section 54223. If no agreement is reached on sales price and terms, the City may market the Property to the general public.

As required by Government Code Section 54227, if the City receives more than one letter of interest during this 60 day period, it will give first priority to entities proposing to develop housing where at least 25 percent of the units will be affordable to lower income households. If more than one such proposal is received, priority will be given to the proposal with the greatest number of affordable units. If more than one proposal specifies the same number of affordable units, priority will be given to the proposal that has the lowest average affordability level.

In the event your agency or company is interested in purchasing the property, you must notify the City in writing within sixty (60) days of the date this notice was sent via certified mail or electronic mail. Notice of your interest in acquiring the property shall be delivered to:

Manuel Pineda, Assistant City Manager/Chief Electric Utility Officer City of Santa Clara
1500 Warburton Avenue
Santa Clara, CA 95050
You may also direct your questions to [email protected] or by calling Manuel Pineda at 408-615-2217.

Entities proposing to submit a letter of interest are advised to review the requirements set forth in the Surplus Land Act (Government Code Section 54220-54234).

ATTACHMENT A
2319 Gianera Street

Property Location: 2319 Gianera Street
Santa Clara CA, 95054
Assessor Parcel Number: 104-05-052
Property Owner: City of Santa Clara

Site Information
Zoning: Single Family Residential (R1-6L)

FEMA Flood Map: 06085C0064H (Zone X)
Gross Land Area: 12,478 SF

Usable Land Area: 12,478 SF

Total Land Area 12,478 SF

City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
23-274 Agenda Date: 3/7/2023

REPORT TO COUNCIL

SUBJECT
Action on Resolution for an Exception to the 180 Day Waiting Period to Appoint Retired Annuitant, Eric Calleja, to Serve as Temporary Extra Help (Per Government Code Sections 7522.56 and 21224) in the Community Development Department to Perform Work as a Housing Development Officer

COUNCIL PILLAR
Manage Strategically Our Workforce Capacity and Resources

BACKGROUND
Generally, the Public Employment Retirement Law (PERL) requires that retired annuitants serve a 180-day wait period before working in a retired annuitant position. However, the PERL also provides for exceptions to this waiting period if certain criteria are met and the governing body of the public agency adopts a non-consent calendar resolution at a public meeting approving the appointment as a critically needed position before the 180 days has passed. The adoption of the resolution allows the employer to hire a retired annuitant to perform work of a limited duration, such as specialized work and limited term complex projects.

There are two types of post-retirement appointments possible under Government Code Section 7522.56: 1) Extra help retired annuitants hired to perform work of limited duration such as special projects (Government Code Section 21224); and 2) Appointment to a vacant position on an interim basis while a permanent replacement is being recruited (an active recruitment must be in place for this type of appointment, and the appointment must end when the replacement is hired, Government Code Section 21221(h)).

DISCUSSION
Eric Calleja was a Housing Development Officer in the Housing/Community Development Department. He retired on December 31, 2022. Mr. Calleja’s age at retirement was under the normal retirement age for his retirement benefit formula and has completed the 60-day bona fide separation in service requirement, in compliance with federal tax law and California retirement law.

Mr. Calleja was responsible for administering the City’s federal grant programs including Community Development Block Grants (CDBG), the CDBG Coronavirus Aid, Relieve and Economic Security Act (CDBG CARES Act or CDBG-CV) funds, and HUD HOME Investments Partnership Program (HOME) funds. He conducted Notice of Funding Availability (NOFA) processes, prepared contracts, reviewed invoices, processed draws from HUD, monitored programs and sub-recipients, prepared the Annual Action Plan and Consolidated Annual Performance and Evaluation Report (CAPER), maintained policies and procedures, and performed other related duties.

The City would like to rehire Mr. Calleja to provide continued assistance with several special projects City of Santa Clara Printed on 3/2/2023Page 1 of 3
powered by Legistar™
23-274 Agenda Date: 3/7/2023
related to the ongoing administration of the City’s HUD programs that would draw upon his expertise with both City and HUD procedures. Tasking new staff would be disadvantageous as some activities have an extremely steep learning curve and depth of knowledge required where there is no opportunity to delay. In addition, there is a large volume of HUD work at this time, including some deferred activities that need to be addressed. Mr. Calleja’s vast institutional knowledge and extensive HUD experience will greatly assist City staff with pending projects In particular, Mr. Calleja will support the department by responding to two outstanding HUD findings from the most recent HUD audit of the City’s programs and by helping the City to develop a strategy to address recently developed issue of timeliness challenges for the City for CDBG capital expenditures. Mr. Calleja will assist with accelerating the due diligence and construction process for three to five capital projects that are behind schedule or scheduled to begin in July 2023. Mr. Calleja will also help develop training and transition for the new HUD grants manager once that person is hired.

Mr. Calleja will be appointed to a limited term as-needed temporary employee position as a retired annuitant until such time that the vacant position is filled. This position will perform duties comparable to the Housing Development Officer classification. This position will provide expertise on HUD policies and procedures, project management of capital projects, and Santa Clara specific training for the new HUD grants manager. He will not participate in day-to-day administrative oversight of his former position. This employment arrangement would fall under the type 2 appointment (Government Code Section 21224) as Mr. Calleja will be providing services on an interim basis while a permanent replacement is being recruited; the appointment will end when the replacement is hired, Government Code Section 21221(h)).

The recommended actions would certify Mr. Calleja’s appointment meets the requirements as defined in Government Code Sections 7522.56 and 21224, specifically:

1. Appointment is necessary to perform critically needed duties prior to the expiration of the 180- day wait period;

2. He has not received a Golden Handshake or any other form of retirement-related incentive;

3. Adoption of resolution was not placed on the consent calendar;

4. Employment will be limited to 960 hours/fiscal year; and

5. Compensation will be within the posted salary range in the publicly available salary schedule.

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 organizational or administrative activity that will not result in direct or indirect changes in the environment.

FISCAL IMPACT
The Public Employees’ Pension Reform Act (PEPRA) sets forth limitations for compensating retired annuitants. All retirees must be paid hourly, at no less than the minimum, nor more than the maximum, paid to employees doing similar work. Based on the CalPERS formula for setting retired annuitant pay rates, the individual will be paid at the hourly rate for as-needed consultant position as follows:

Retired Annuitant Hourly Rate of Pay Fiscal Year Maximum Amount Eric Calleja $74.49 $71,510.40
City of Santa Clara Printed on 3/2/2023Page 2 of 3
powered by Legistar™
23-274 Agenda Date: 3/7/2023
Retired Annuitant Hourly Rate of Pay Fiscal Year Maximum Amount Eric Calleja $74.49 $71,510.40
Retirees also do not receive any benefits. Sufficient appropriations are available in the Community Development Department to fund this interim position.

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

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].

ALTERNATIVES

1. Adopt the attached Resolution to permit a Retired Annuitant to provide valuable service to the City post-retirement but within the first 180 days of their retirement; or

2. Direct Staff to return with other options.

RECOMMENDATION
Alternative 1: Adopt the attached Resolution for an Exception to the 180 Day Waiting Period To Appoint, Eric Calleja, A Retired Annuitant To Serve as Temporary Extra Help (Government Code Sections 7522.56 and 21224) in the Community Development Department to Perform Work as a Housing Development Officer
Reviewed by: Aracely Azevedo, Director of Human Resources Approved by: Office of the City Manager

ATTACHMENTS

1. Resolution for an Exception to the 180 Day Waiting Period To Appoint, Eric Calleja, a Retired Annuitant To Serve as Temporary Extra Help

2. Calleja, Eric - Offer Letter
City of Santa Clara Printed on 3/2/2023Page 3 of 3
powered by Legistar™
Resolution/CalPERS Resolution
Rev: 11/22/17

Page 1 of 3 ends

RESOLUTION NO. 23 - _

A RESOLUTION OF THE CITY OF SANTA CLARA, CALIFORNIA
FOR EXCEPTION TO THE 180 -DAY WAITING PERIOD TO HIRE ,

ERIC CALLEJA, A RETIRED ANNUITANT AS A TEMPORARY

EXTRA HELP EMPLOYEE (GOVERNMENT CODE SECTIONS
7522.56 AND 21224) TO PERFORM WORK IN THE COMMUNITY

DEVELOPMENT DEPARTMENT AS A HOUSING

DEVELOPMENT OFFICER

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

WHEREAS, in compliance with Government Code section 7522.56 the City of Santa Clara must provide CalPERS this certification resolution when hiring a retiree before 180 days has passed since his or her retirement date;
WHEREAS, Eric Calleja (CalPERS ID 9856093535) retired from the City of Santa Clara in the position of Housing Development Officer in the Community Development Department, effective December 31, 2022;
WHEREAS, section 7522.56 requires that post-retirement employment commence no earlier than 180 days after the retirement date, which is June 29, 2023, w ithout this certification resolution;
WHEREAS, section 7522.56 provides that this exception to the 180 day wait period shall not apply if the retiree accepts any retirement-related incentive; WHEREAS, the City of Santa Clara and Eric Calleja certify that Eric Calleja has not and will not receive a Golden Handshake or any other retirement-related incentive; WHEREAS, the City of Santa Clara hereby appoints Eric Calleja as an extra help retired annuitant to perform the critically needed duties of Temporary Employee for the City of Santa Clara under Government Code section 21224, effective March 20, 2023; WHEREAS, the entire employment agreement, contract or appointment document between the City of Santa Clara and Eric Calleja has been reviewed by this body and is attached herein; WHEREAS, no matters, issues, terms or conditions related to this employment and appointment have been or will be placed on a consent calendar;
----
Resolution/CalPERS Resolution
Rev: 11/22/17

Page 2 of 3 ends

WHEREAS, the employment shall be limited to 960 hours per fiscal year;

WHEREAS, the compensation paid to retirees cannot be less than the minimum nor exceed the maximum monthly base salary paid to other employees performing comparable duties; WHEREAS, effective December 25, 2022, the maximum hourly salary rate for the Temporary Employee position is $214.06, and the minimum hourly equivalent is $17.20; WHEREAS, the hourly rate paid to Eric Calleja will be $74.49; and

WHEREAS, Eric Calleja has not and will not receive any other benefit, incentive, compensation in lieu of benefit or other form of compensation in addition to this hourly pay rate.

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

1. The City of Santa Clara hereby certifies the appointment of Eric Calleja and that this appointment is necessary to fill the critically needed position of Temporary Employee for the City of Santa Clara by March 20, 2023. The retired annuitant was the Housing Development Officer for the Housing/Community Development Department and will be rehired performing the comparable duties of the Housing Development Officer classification. The City would like to rehire Eric Calleja to aid with several special projects related to the ongoing administration of the City’s Housing and Urban Development (HUD) programs that would draw upon his expertise with both City and HUD procedures, project management of capital projects, and developing Santa Clara-specific training for the new HUD grants manager .

Resolution/CalPERS Resolution
Rev: 11/22/17

Page 3 of 3 ends

2. 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 __, 2023, 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:

1. Calleja, Eric – Offer Letter

1500 Warburton Avenue ● Santa Clara, CA 95050 ● Phone: 408-615-2080 ● Fax: 408-985-0667 ● www.SantaClaraCA.gov 1

Human Resources

March 8, 2023

Eric Calleja
826 Devonshire Way
Sunnyvale, CA 94087

Dear Eric,

Congratulations! This is to confirm our offer of employment for the As-Needed position of Temporary Employee (Housing Development Officer) in the Community Development Department with the City of Santa Clara.

Below are a few key provisions for your offer of employment:

• Effective Date: Monday, March 20, 2023

• Salary: Your hourly pay rate is $74.49 per hour.

• Employment Status: As-Needed employment is not to be considered permanent.

This is an “at-will” position and hours in any given week is not guaranteed. Under CalPERS regulations and the City of Santa Clara practices, As-Needed retired annuitants are not permitted to work more than 960 hours per fiscal year (July 1 through June 30). If you reach 960 hours during the fiscal year, your assignment will end. As-Needed employees will be enrolled in PARS retirement system in lieu of participation in CalPERS and Social Security. However, if you have been previously employed by a CalPERS employer and have funds on deposit with CalPERS, you will be enrolled in CalPERS and Social Security upon your first date of As-Needed employment with the City of Santa Clara.

• New Employee Orientation (NEO): You are required to attend NEO with the Human Resources Department to continue your employment. You have been scheduled to attend on:
o Monday, March 20, 2023 at 3:30PM at Santa Clara City Hall (City Cafeteria) at 1500 Warburton Avenue, Santa Clara, CA 95050

• Form I-9 Employment Eligibility Verification: All new employees are required to show documentation which proves their identity and their eligibility to work in the United States. A list of acceptable documentation can be found at http://uscis.gov/i- 9-central/acceptable-documents. Please bring I-9 employment verification identification with you on your first day of employment; original documents are required. This verification must be completed in person at the Human Resources Department within the first 3 days of your employment start date. If this City of
Santa Clara
ThP. CentP.r of What's Possible
Re: City of Santa Clara Offer of Employment – Eric Calleja March 8, 2023

Page 2 of 2 ends

2 is not completed within the deadline, you will be ineligible to work until you have completed your I-9 verification.

Please sign and date this offer letter and return it to me by Friday, March 17, 2023. If you have questions, please contact the Human Resources Department at (408) 615- 2080.

Sincerely,

xxxx

Aracely Azevedo
Director of Human Resources

I accept the terms and conditions of my employment with the City of Santa Clara.

______________________________________ Date: ______________________ Eric Calleja

1111
City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
23-264 Agenda Date: 3/7/2023

REPORT TO COUNCIL

SUBJECT
Action to Waive First Reading and Approve Introduction of an Ordinance Amending Sections

17.30.040 (“Supplies, Goods and Equipment”), 17.30.080 (“Best Value Selection Procedures”),

17.30.090 (“Formal Bidding Procedure”), 17.30.120 (“Service Contracts - Signature Authority”), and

17.30.130 (“Public Works”) of Title 17 (“Development”) of “The Code of the City of Santa Clara, California” to Provide the Executive Director of the Stadium Authority With Signature Authority For Contracts Up To $100,000 in Allocated Value

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

BACKGROUND
On October 8, 2019, the City Council approved Ordinance No. 2005 amending Chapter 17.30 (Stadium Authority Procurement Policy) of “The Code of the City of Santa Clara, California” (SCCC), which rescinded delegation to the Executive Director to enter into agreements without prior Stadium Authority Board approval. Prior to Ordinance No. 2005, the Executive Director had delegated authority to enter into contracts to acquire supplies, materials, and equipment with a contract amount less than $250,000 and purchase professional, nonprofessional, and personal services required by the Stadium Authority and execute contracts for such services on behalf of the Stadium Authority in contract amounts up to and including $250,000 per contract, subject to approved budgetary amount, so long as such persons are specifically trained and experienced and competent to perform the special services required (Source: Ordinance No. 1900).

Generally, the Forty Niners Stadium Management Company LLC (Stadium Manager) has the authority to execute contracts only insofar as the Executive Director has such authority. Under Section 2 (Delegation of Contracting Authority) of the First Amendment to the Stadium Management Agreement between the Stadium Authority, Stadium Manager, and Forty Niners SC Stadium Company, LLC (StadCo), the Stadium Manager is provided certain delegated authority to enter into contracts on behalf of the Stadium Authority. The applicable provision within Section 2.1 (Stadium Procurement Contracts) reads as follows:
…In addition to contracting authority that may be granted to the Stadium Manager from time to time pursuant to Section 6.4 of the Existing Management Agreement, the Stadium Authority hereby agrees that the Stadium Manager shall have full authority and discretion to select the providers, and to negotiate, approve, enter into and administer contracts with such providers on behalf of the Stadium Authority, for the purchase of supplies, materials and equipment, and for services, relating to the Stadium and its operations ("Stadium Procurement Contracts"), as and to the extent the Executive Director has authority to enter into such Stadium Procurement Contracts pursuant to Sections 17.30.010 through 17.30.180 of the Santa Clara City Code City of Santa Clara Printed on 3/2/2023Page 1 of 4
powered by Legistar™
23-264 Agenda Date: 3/7/2023
("SCCC"), as approved on first reading by the Santa Clara City Council on November 13, 2012. Manager shall provide the Stadium Authority with information, including the contracting party and the contract amount, regarding all Stadium Procurement Contracts entered into with contract amounts greater than $100,000 within thirty (30) days of entering into any such contract. The foregoing constitutes the Executive Director's delegation to the Stadium Manager, pursuant to Section 17.30.010(c) of the SCCC, of the authority granted to the Executive Director to enter into such Stadium Procurement Contracts… As result of Ordinance No. 2005, therefore, the Stadium Manager is also required to request Board approval before entering into agreements in any amount for services and to acquire supplies, materials, and equipment on behalf of the Stadium Authority. As of the effective date of Ordinance No. 2005 (November 8, 2019), all Stadium Authority agreements for services, supplies, materials, and equipment require the approval of the Stadium Authority Board. The Stadium Authority Procurement Policy in its current form is silent on delegated signature authority for public works projects.

The August 31, 2022 Settlement Agreement and Mutual Release between the Stadium Authority, StadCo, and Stadium Manager provides that Stadium Authority and City staff will recommend for City Council consideration an Ordinance to reinstate the Executive Director’s signature authority to execute contracts that are no greater than $100,000 in value to the Stadium Authority. Section 5 (City Procurement Ordinance) of the Settlement Agreement reads more specifically as follows:

SCSA and City staff will request and recommend to the City Council of Santa Clara that the City should amend the City Ordinance, Section 17.30.120, in order to reinstate to the SCSA Executive Director, or his or her designee, the authority to enter into contracts on behalf of the Stadium Authority that are no greater than $100,000 in value to the Stadium Authority, subject to an approved budget amount, and with persons competent to perform the services.

The Ordinance that is being introduced is intended to comply with Section 5 of the Settlement Agreement.

DISCUSSION
The proposed amendments to Sections 17.30.040 (“Supplies, Goods and Equipment”), 17.30.080 (“Best Value Selection Procedures”), 17.30.090 (“Formal Bidding Procedure”), 17.30.120 (“Service Contracts - Signature Authority”), and 17.30.130 (“Public Works”) will 1) remove language that requires Board approval for contracts in any amount, and 2) provide the Executive Director with signature authority to execute contracts for services and public works and to acquire supplies, goods and equipment in an amount up to and including $100,000 as allocated to and authorized by the Stadium Authority by adoption of the annual budget. These changes have been coordinated with the Stadium Manager’s Director of Procurement.

It should be noted that the Settlement Agreement states, “in value to the Stadium Authority”, which means that agreements for Shared Stadium Manager Expenses (Shared Expenses) will have a higher dollar threshold before they require Board approval. Most Shared Expenses are split 50/50 between the Tenant of Levi’s Stadium (StadCo) and Stadium Authority. Groundskeeping is the exception with a 70/30 split, with StadCo responsible for the larger share. As such, agreements for Shared Expenses will not require Board approval until they reach $200,000 or $333,333 (for groundskeeping only) in total value.

City of Santa Clara Printed on 3/2/2023Page 2 of 4
powered by Legistar™
23-264 Agenda Date: 3/7/2023
Staff has also discussed updating other sections/provisions within Chapter 17.30 with the Stadium Manager’s Director of Procurement to better align the Stadium Authority Procurement Policy with public procurement best practices similar to those in the City’s purchasing code and address existing gaps within the policy (e.g., no competitive process required for services, definition of public works does not comply with City Charter and State requirements, etc.). The Stadium Manager’s Director of Procurement has indicated willingness to work collaboratively with staff in the upcoming months on these updates and provided written confirmation that the Stadium Manager will continue to follow applicable purchasing requirements under SCCC Chapter 2.105 as a best practice, including the bidding thresholds and procurement methods set forth in SCCC 2.105.140, and continue their practice of conducting public works construction/projects as set forth in City Charter Section 1310 as a best practice until a subsequent ordinance that incorporates public procurement best practices is adopted at a later date. It is staff’s understanding that the Stadium Manager has followed the City’s procurement and public works requirements, in addition to the Stadium Authority’s, since Ordinance No. 2005 became effective in November 2019.

The proposed Ordinance does not expand any authority that existed prior to the Council’s October 2019 adoption of Ordinance No. 2005, with the exception of providing the Executive Director with delegated signature authority for public works projects.

FISCAL IMPACT
The changes being proposed in the Ordinance may provide some staff cost savings since staff will no longer have to review and coordinate requests or prepare agenda reports for Board approval for agreements that have an amount up to and including $100,000 as allocated to and authorized by the Stadium Authority by adoption of the annual budget.

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

RECOMMENDATION
Waive First Reading and approve the Introduction of an Ordinance amending Sections 17.30.040 (“Supplies, Goods and Equipment”), 17.30.080 (“Best Value Selection Procedures”), 17.30.090 (“Formal Bidding Procedure”), 17.30.120 (“Service Contracts - Signature Authority”), and 17.30.130 (“Public Works”) of Title 17 (“Development”) of “The Code of the City of Santa Clara, California” to City of Santa Clara Printed on 3/2/2023Page 3 of 4
powered by Legistar™
23-264 Agenda Date: 3/7/2023
provide the Stadium Authority Executive Director with signature authority to execute contracts for services and public works and to acquire supplies, goods, and equipment, in an amount up to and including $100,000 as allocated to and authorized by the Stadium Authority by adoption of the annual budget.

Prepared by: Christine Jung, Assistant to the City Manager Approved by: Office of the City Manager

ATTACHMENTS

1. Proposed Ordinance SCCC Chapter 17.30 - Clean

2. Proposed Ordinance Language SCCC Chapter 17.30 - Redline City of Santa Clara Printed on 3/2/2023Page 4 of 4
powered by Legistar™
Ordinance/Stadium Authority Procurement Policy Page 1 of 9 Rev: 09/2019
ORDINANCE NO. _____

AN ORDINANCE OF THE CITY OF SANTA CLARA ,
CALIFORNIA, AMENDING SECTIONS 17.30.040
(SUPPLIES, GOODS AND EQUIPMENT), 17.30.080 (BEST
VALUE SELECTION PROCEDURES), 17.30.090 (FORMAL
BIDDING PROCEDURE), 17.30.120 (SERVICE CONTRACTS
– SIGNATURE AUTHORITY), and 17.30.130 ( PUBLIC
WORKS) OF TITLE 17 (D EVELOPMENT) OF “ THE CODE
OF THE CITY OF SANTA CLARA , CALIFORNIA” TO

PROVIDE THE EXECUTIVE DIRECTOR OF SANTA CLARA

STADIUM AUTHORITY WITH DELEGATED AUTHORITY TO
EXECUTE CONTRACTS UP TO AND INCLUDING $100,000

AS ALLOCATED TO AND AUTHORIZED BY THE STADIUM

AUTHORITY BY ADOPTION OF THE ANNUAL BUDGET

FOR SUPPLIES, GOODS, EQUIPMENT, SERVICES, AND

PUBLIC WORKS

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

WHEREAS, Chapter 17.30 (Stadium Authority Procurement Policy) provides the formalized policies and procedures with respect to procurement for the Santa Clara Stadium Authority (Stadium Authority);
WHEREAS, on October 8, 2019, the City Council approved Ordinance No. 2005 amending the Stadium Authority Procurement Policy, which rescinded delegation to the Executive Director to enter into agreements without prior Stadium Authority Board approval; WHEREAS, the Forty Niners Stadium Management Company LLC (Stadium Manager) has the authority to execute cont racts on behalf of the Stadium Authority only insofar as the Executive Director has such authority as described in Section 2 of the First Amendment to the Stadium Management Agreement between the Stadium Authority, Stadium Manager, and Forty Niners SC Stadium Company, LLC;
WHEREAS, as of the effective date of Ordinance No. 2005, November 8, 2019, all Stadium Authority agreements for services, supplies, materials, and equipment require the approval Ordinance/Stadium Authority Procurement Policy Page 2 of 9 Rev: 09/2019
of the Stadium Authority Board; and,
WHEREAS, the August 31, 2022 Settlement Agreement and Mutual Release between the Santa Clara Stadium Authority, Forty Niners SC Stadium Company , LLC, and Stadium Manager provides that Stadium Authority and City staff will recommend for City Council consideration an Ordinance to r einstate the Executive Director’s signature authority to execute contracts that are no greater than $100,000 in value to the Stadium Authority; and, WHEREAS, Stadium Authority and City staff and the Stadium Manager have worked collaboratively to pr opose changes to the Stadium Authority Procurement Policy as reflected in this Ordinance, that is intended to comply with Section 5 of the Settlement Agreement and Mutual Release.

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

SECTION 1 : That Section 17.30.040 ( entitled “Supplies, Goods and Equipment”), of Chapter 17.30 (entitled “Stadium Authority Procurement Policy ”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended to read as follows:
“17.30.040 Supplies, goods and equipment.
(a) The procurement policies apply to all purchases or contracts for supplies, goods, materials, and equipment by and on behalf of the Stadium Authority. Purchases of supplies, materials, and equipment by bid procedures shall be pursuant to SCCC 17.30.050 through 17.30.110.
(b) The Executive Director is authorized to execute a contract to acquire supplies, materials, and equipment on behalf of the Stadium Authority in an amount up to and Ordinance/Stadium Authority Procurement Policy Page 3 of 9 Rev: 09/2019
including one hundred thousand dollars ($100,000.00) as allocated to and authorized by the Stadium Authority by adoption of the annual budget. A contract or agreement amount with an allocated value above this dollar limit requires approval by the Stadium Authority Board.”
SECTION 2: That Section 17.30.080 (entitled “Best Value Selection Procedures”) , of Chapter 17.30 (entitled “Stadium Authority Procurement Policy ”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended to read as follows:
“17.30.080 Best value selection procedures.

Except as otherwise p rovided, purchases and contracts for supplies, materials, or equipment of estimated value in the amount of two hundred fifty thousand dollars ($250,000.00) or more, but less than one million dollars ($1,000,000.00), may be made by the Executive Director, in the open market as follows:
(a) Minimum Number of Bids. Open market purchases shall be based on at least three bids unless the Executive Director determines that obtaining three bids is not feasible as a result of the lack of firms qualified to provide the required materials and supplies. (b) Request for Bids. The Executive Director, in his or her discretion, may solicit bids by telephone request, written request to prospective vendors by mail, including electronic mail, and/or by notice posted on a public bulletin board in or near the office of the Stadium Authority.
(c) The Request for Bid. The request for bid made subject to this section shall describe the supplies, materials, or equipment desired in specific terms and how to obtain more detailed information, and shall state the time and place for submission and opening of Ordinance/Stadium Authority Procurement Policy Page 4 of 9 Rev: 09/2019
bids; provided, however, the bid specifications shall ensure that more than one vendor could meet the bid requirements.
(d) Submission of Bids. Bids may be submitted to the Executive Director in writing or verbally. The award of the contract by the Executive Director shall be on the basis of best value. The Executive Director may reject any and al l bids. The Executive Director shall keep a record of all open market orders and bids for a period of one year after the submission of bids or the placing of orders. Such record, while so kept, shall be open to public inspection.
(e) Evaluation of Bids. In the evaluation of bids under this section, the Executive Director may consider any of the following illustrative evaluation factors in determining the best value bid, but will take all necessary measures to ensure that the contracts are awarded fairly:
(1) Price, dollar value of procurement pricing information and quotations; (2) Demonstrated ability to perform all requirements and delivery of the quantity of supplies, materials, and equipment within the time specified; (3) Specific examples of similar past performance and demonstrated experience in providing the quality and quantity of supplies, materials, and equipment for projects of comparable size, scope and complexity;
(4) Evaluation of the ability to provide future maintenance and services, if applicable;
(5) Quality of supplies, materials and equipment to be provided under the contract; and
(6) Compliance or responsiveness of bid with bid specifications.” Ordinance/Stadium Authority Procurement Policy Page 5 of 9 Rev: 09/2019
SECTION 3: That Section 17.30.090 (entitled “Formal Bidding Procedure”) , of Chapter

17.30 (entitled “Stadium Authority Procurement Policy”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended to read as follows:
“17.30.090 Formal bidding procedure.

Except as otherwise provided, purchases and contracts for supplies, materials, or equipment of one million dollars ($1,000,000.00) or more shall be by written contract with the lowest responsible bidder, pursuant to the following procedures:
(a) Notices Inviting Bids. Notices inviting sealed bids shall include a general description of the articles to be purchased, where bid blanks and specifications may be secured, and the time and place for opening bids.
(1) Published Notices. Notices inviting bids shall be published and/or posted at least ten days before the date of opening the bids. Such notices shall be published at least once in a newspaper of general circulation, and/or notices shall be posted in at least three public places in the City that have been designated as places for posting public notices. Whichever notice is given shall be determined by the Executive Director as being in the best interest of the City to attract bids.
(2) Bidders List. The Executive Director shall also solicit sealed bids from all responsible prospective suppliers. It shall be within the discretion of the Executive Director to add, delete, reject, and change the bidders list so as to maintain a current list of suppliers who are capable of responsible and efficient service to the Stadium Authority. (b) Bidder’s Security. When deemed necessary by the Executive Director, bidder’s security may be prescribed in the public notices inviting bids. Bidders shall be entitled to the Ordinance/Stadium Authority Procurement Policy Page 6 of 9 Rev: 09/2019
return of their bid securities; provided, however, that a successful bidder shall forfeit the bid security upon refusal or failure to execute the contract within ten days after the notice of award of the contract has been mailed unless the Stadium Authority is responsible for the delay. On refusal or failure of the successful bidder to execute the cont ract, the contract may be awarded to the next lowest responsible bidder. If the contract is awarded to the next lowest responsible bidder, the amount of the lowest bidder’s security shall be applied by the Stadium Authority to the difference between the low bid and the second lowest bid, and the surplus, if any, shall be returned to the lowest bidder. (c) Bid Opening Procedure. Sealed written bids shall be submitted to the Executive Director and shall be identified as bids on the envelope. Bids shall be opened in public at the time and place stated in the public notices. A tabulation of all bids shall be open for public inspection during regular business hours for a period of not less than thirty (30) calendar days after the bid opening.
(d) Rejection of Bids. The Executive Director may reject any and all bids presented and re-advertise for bids.
(e) Award of Contracts. All contracts shall be awarded by the Executive Director to the lowest responsible bidder except as otherwise provided in these procedures. (f) Tie Bids. If two or more bids received are for the same total amount or unit price, quality and service being equal, and if the public interest will not permit the delay of re- advertising for bids, the successful bidder may be determined by the casting of lots with the bidders in public at the time designated by the Executive Director. (g) Performance Bonds. The Executive Director shall have the authority to require a performance bond in such amounts as the Executive Director shall find reasonably Ordinance/Stadium Authority Procurement Policy Page 7 of 9 Rev: 09/2019
necessary to protect the best interests of the Stadium Authority before entering into a contract. If the Executive Director requires a performance bond, the form and amount of the bond shall be described in the notice inviting bids.”
SECTION 4: That Section 17.30.120 (entitled “Service Contracts – Signature Authority”), of Chapter 17.30 (entitled “Stadium Authority Procurement Policy ”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended to read as follows:
“17.30.120 Service contracts – Signature authority.

The Executive Director is authorized to execute a contract with third parties for services required by the Stadium Authority in an amount up to and including one hundred thousand dollars ($100,000.00), as allocated to and authorized by the Stadium Authority by adoption of the annual budget, and provided that the third party is specially trained and experienced and competent to perform the services. A contract amount with an allocated value above this dollar limit requires approval by the Stadium Authority Board.” SECTION 5: That Section 17.30.130 (entitled “Public Works”), of Chapter 17.30 (entitled “Stadium Authority Procurement Policy”) of Title 17 (entitled “Development”) of “The Code of the City of Santa Clara, California” (“SCCC”) is amended to read as follows:
“17.30.130 Public works.
(a) Stadium Project. Government Code Section 6532 authorizes the Stadium Authority to award a contract for the development of the Stadium Project to a qualified design builder under specified conditions. As a requirement of Government Code Section 6532, any subcontracts awarded by the design builder to be funded with either Redevelopment Agency funds or Community Facility District funds must be awarded to the Ordinance/Stadium Authority Procurement Policy Page 8 of 9 Rev: 09/2019
lowest responsible bidder in accordance with procedures consistent with the City Charter.

All other subcontracts awarded by the design- builder may be awarded on a best value basis consistent with the Subcontractor Selection and Procurement Plan adopted by the Stadium Authority.
(b) Other Public Works. For all other expenditures required for a public project, but which are not associated with the Stadium Project, the Stadium Authority shall comply with the requirements of Public Contract Code Section 20162 and all applic able City Charter provisions.
(c) The Executive Director is authorized to execute a contract for public works on behalf of the Stadium Authority in an amount up to and including one hundred thousand dollars ($100,000.00), as allocated to and authorized by the Stadium Authority by adoption of the annual budget. A contract amount with an allocated value above this dollar limit requires approval by the Stadium Authority Board.”
SECTION 6: 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 7: S
avings 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 effective date of this ordinance. All fee schedules shall remain in force until superseded by the fee schedules adopted by the City Council.

Ordinance/Stadium Authority Procurement Policy Page 9 of 9 Rev: 09/2019
SECTION 10: 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 7 th day of March, 2023, 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
Chapter 17.30

STADIUM AUTHORITY PROCUREMENT POLICY
Sections:

Article I. General Provisions and Definitions

17.30.010 General purpose, intent and authority.

17.30.020 Definitions.

17.30.030 Exemptions from centralized purchasing.

Article II. General Provisions and Definitions

17.30.040 Supplies, goods and equipment.

17.30.050 Bidding.

17.30.060 Purchase orders.

17.30.070 Encumbrance of funds.

17.30.080 Best value selection procedures.

17.30.090 Formal bidding procedure.

17.30.100 Action by Stadium Authority Board.

17.30.110 Exclusion.

17.30.120 Service contracts – Signature authority.

17.30.130 Public works.

17.30.140 Bid contest procedures.

17.30.150 Enforcement and remedies.

17.30.160 Information collection and reporting.

17.30.170 Conflict of interest.

17.30.180 Amendments.

Article I. General Provisions and Definitions

17.30.010 General purpose, intent and authority.
(a) General Purpose. The purpose and intent of this chapter is to formalize the policies and procedures with respect to procurement for the Santa Clara Stadium Authority (“Stadium Authority”).
(b) Intent. The Stadium Authority was formed to facilitate the acquisition, financing, development, operation and maintenance of the Stadium Project. The Stadium Authority intends, through the adoption of these procurement policies, to:
(1) Establish efficient, equitable and effective procedures for the procurement activities of the Stadium Authority;
(2) Ensure the integrity and equity in the procurement activities of the Stadium Authority and provide safeguards for the impartial application of the procurement policies; and (3) Enable the Stadium Authority to operate and maintain equipment and facilities responsibly and to complete projects on time and on budget. (c) Authority. The Executive Director shall be appointed as the purchasing officer of the Stadium Authority and shall have the authority to:
(1) Purchase or contract for supplies, materials, and equipment required by the Stadium Authority in accordance with prescribed purchasing and bidding procedures and such other rules and regulations;
(2) Negotiate and execute contracts for the purchase of supplies, materials, and equipment, or delegate said duties to a designee;
(3) Act to procure for the Stadium Authority the needed quality and quantity of supplies, materials, and equipment at least expense to the Stadium Authority; (4) Endeavor to obtain as full and open competition as possible on all purchases; (5) Prepare and recommend to the Stadium Authority Board revisions to the rules governing the purchase of supplies, materials, and equipment for the Stadium Authority; (6) Keep informed of current developments in the field of purchasing, prices, market conditions, and new products;
(7) Prescribe and maintain such forms as are reasonably necessary to the operation of the purchasing system and other rules and regulations;
(8) Supervise the inspection of all supplies, materials, and equipment purchased to ensure conformance with specifications, or delegate said duties to a designee; (9) Maintain a bidders list, vendor catalog file(s), and the records needed for the efficient implementation of the procurement policies, or delegate said duties to a designee.

Any of the Executive Director’s authority may be delegated to contractors with the Stadium Authority; provided, that the contract delegating such authority is approved by the Stadium Authority Board and the procurement performed by the contractor is within the limits of a budget approved by the Stadium Authority Board for the year in which the contract is awarded. (d) Waiver. The Executive Director (but not a contractor to whom the Executive Director has delegated its authority) shall have the authority to waive or modify any provisions of this chapter without any further action of the Stadium Authority Board. (Ord. 1900 § 1, 11-27-12).

17.30.020 Definitions.

For the purposes of this chapter, the following terms, phrases and words shall have the meaning respectively prescribed to them by this section:
(a) “Contract amount” means the value of the entire contract, including any option. With respect to contracts for materials and supplies, the contract amount includes the costs of the materials and supplies as well as any installation and servicing costs including in the acquisition of the materials and supplies. In determining the contract amount, (1) multiple contracts with a single vendor for similar materials and supplies shall be considered a single contract, and (2) in the case of multi-year contracts covering years for which a budget has not yet been adopted shall not include amounts due in subsequent years that are conditioned on approval of the appropriate year’s budget.
(b) “Days” means calendar days.
(c) “Executive Director” means the Executive Director of the Stadium Authority, or a designee, including (except as otherwise specifically provided herein) any contractor to whom the Executive Director has delegated authority pursuant to SCCC 17.30.010(c). (d) “Other public works” means other infrastructure, including, but not limited to, streets and highways, public rail transit, or water resource facilities and infrastructure not located on the stadium site or adjacent City streets and property.
(e) “Proposal” means the response by an offer or to a solicitation to obtain supplies or services. (f) “Responsive” means a bid or offer submitted in response to a solicitation that conforms in all material respects to the requirements contained in the solicitation. (g) “Stadium Authority” means the Santa Clara Stadium Authority. (h) “Stadium Authority Board” means the governing board of the Santa Clara Stadium Authority. (i) “Stadium Project” means the construction, operation, and maintenance of a stadium, including all appurtenant improvements and related facilities located on the stadium site or adjacent City streets and property.
(j) “Services” means the rendering of time, effort, or work, rather than the furnishing of a specified physical product other than reports incidental to the required performance. (k) “Supplies” means all tangible personal property, including furniture, commodities, goods, equipment, leases of equipment, and insurance, including incidental insurance. (Ord. 1900 § 1, 11-27-12).

17.30.030 Exemptions from centralized purchasing.

The Stadium Authority, as a joint exercise of power authority established under Articles 1 through 4 of Chapter 5 of Title 1 of the Government Code (Government Code Sections 6500 et seq.), is not a department of the City and shall be exempt from the requirements that City departments purchase or contract or specify supplies, materials, and equipment through the purchasing division. (Ord. 1900 § 1, 11-27-12).

Article II. General Provisions and Definitions

17.30.040 Supplies, goods and equipment.
(a) The procurement policies apply to all purchases or contracts for supplies, goods, materials, and equipment by and on behalf of the Stadium Authority. Purchases of supplies, materials, and equipment by bid procedures shall be pursuant to SCCC 17.30.050 through 17.30.110. (Ord. 1900 § 1, 11-27-12).
(b) The Executive Director is authorized to execute a contract to acquire supplies, materials, and equipment on behalf of the Stadium Authority in an amount up to and including one hundred thousand dollars ($100,000.00) as allocated to and authorized by the Stadium Authority by adoption of the annual budget. A contract or agreement amount with an allocated value above this dollar limit requires approval by the Stadium Authority Board.

17.30.050 Bidding.

Bidding for supplies, goods, and equipment may be dispensed with only when:
(a) An emergency requires that an order be placed with the source of supply that can furnish the personal property most expeditiously. For purposes of this section, “emergency” shall be considered to mean the situations where delay caused by obtaining competitive bids would result in health and safety risks; or
(b) The contract amount involved is less than two hundred fifty thousand dollars ($250,000.00) for supplies, goods and equipment if said expenditure has been included in the Stadium Authority’s approved annual budget; or
(c) The personal property can be obtained from only one vendor.

Informal selection procedures (SCCC 17.30.080) shall be conducted for purchases or contract amounts of two hundred fifty thousand dollars ($250,000.00) or more, but less than one million dollars ($1,000,000.00); and
Formal bidding procedures (SCCC 17.30.090) shall be conducted for purchases or contract amounts of one million dollars ($1,000,000.00) or more.

Bidders will be deemed to be doing business in the City of Santa Clara and are required to pay taxes locally, unless required otherwise by State law. (Ord. 1900 § 1, 11-27-12).

17.30.060 Purchase orders.
(a) Purchases of supplies, materials, and equipment not subject to bid procedures shall be made only by purchase order approved by the Executive Director. (b) Prior to making contractual payments, the Executive Director shall verify that the goods or services have been provided according to the terms and conditions set forth in the contract. (Ord. 1900 § 1, 11-27-12).

17.30.070 Encumbrance of funds.

Except for reserved purchase order numbers assigned by the purchasing officer, the purchasing officer shall not issue any purchase order or award any contract for supplies, materials, or equipment unless there exists an unencumbered appropriation in the proper account of the Stadium Authority to which the purchase is to be charged. (Ord. 1900 § 1, 11-27- 12).

17.30.080 Best value selection procedures.

The award of the contract by the Executive Director shall be on the basis of best value. The Executive Director may reject any and all bids. The Executive Director shall keep a record of all open market orders and bids for a period of one year after the submission of bids or the placing of orders. Such record, while so kept, shall be open to public inspection. (e) Evaluation of Bids. In the evaluation of bids under this section, the Executive Director may consider any of the following illustrative evaluation factors in determining the best value bid, but will take all necessary measures to ensure that the contracts are awarded fairly:
(1) Price, dollar value of procurement pricing information and quotations; (2) Demonstrated ability to perform all requirements and delivery of the quantity of supplies, materials, and equipment within the time specified; (3) Specific examples of similar past performance and demonstrated experience in providing the quality and quantity of supplies, materials, and equipment for projects of comparable size, scope and complexity;
(4) Evaluation of the ability to provide future maintenance and services, if applicable; (5) Quality of supplies, materials and equipment to be provided under the contract; and (6) Compliance or responsiveness of bid with bid specifications. (f) Board Approval. All contracts or agreements to acquire supplies, materials, and equipment shall require the approval of the Stadium Authority Board. (Ord. 1900 § 1, 11-27-12; Ord. 2005 § 1, 10-8-19).

17.30.090 Formal bidding procedure.

Whichever notice is given shall be determined by the Executive Director as being in the best interest of the City to attract bids.
(2) Bidders List. The Executive Director shall also solicit sealed bids from all responsible prospective suppliers. It shall be within the discretion of the Executive Director to add, delete, reject, and change the bidders list so as to maintain a current list of suppliers who are capable of responsible and efficient service to the Stadium Authority. (b) Bidder’s Security. When deemed necessary by the Executive Director, bidder’s security may be prescribed in the public notices inviting bids. Bidders shall be entitled to the return of their bid securities; provided, however, that a successful bidder shall forfeit the bid security upon refusal or failure to execute the contract within ten days after the notice of award of the contract has been mailed unless the Stadium Authority is responsible for the delay. On refusal or failure of the successful bidder to execute the contract, the contract may be awarded to the next lowest responsible bidder. If the contract is awarded to the next lowest responsible bidder, the amount of the lowest bidder’s security shall be applied by the Stadium Authority to the difference between the low bid and the second lowest bid, and the surplus, if any, shall be returned to the lowest bidder.
(c) Bid Opening Procedure. Sealed written bids shall be submitted to the Executive Director and shall be identified as bids on the envelope. Bids shall be opened in public at the time and place stated in the public notices. A tabulation of all bids shall be open for public inspection during regular business hours for a period of not less than thirty (30) calendar days after the bid opening.
(d) Rejection of Bids. The Executive Director may reject any and all bids presented and re- advertise for bids.
(e) Award of Contracts. All contracts shall be awarded by the Executive Director to the lowest responsible bidder except as otherwise provided in these procedures. (f) Tie Bids. If two or more bids received are for the same total amount or unit price, quality and service being equal, and if the public interest will not permit the delay of re-advertising for bids, the successful bidder may be determined by the casting of lots with the bidders in public at the time designated by the Executive Director.
(g) Performance Bonds. The Executive Director shall have the authority to require a performance bond in such amounts as the Executive Director shall find reasonably necessary to protect the best interests of the Stadium Authority before entering into a contract. If the Executive Director requires a performance bond, the form and amount of the bond shall be described in the notice inviting bids.
(h) Board Approval. All contracts or agreements to acquire supplies, materials, and equipment shall require the approval of the Stadium Authority Board. (Ord. 1900 § 1, 11-27-12; Ord. 2005 § 2, 10-8-19).

17.30.100 Action by Stadium Authority Board.

The Executive Director shall conduct all purchasing procedures for acquisition of supplies, materials, and equipment for users as authorized by the Stadium Authority by adoption of the annual budget. No award of contract shall be made for a cost in excess of the authorized budget amount through the Executive Director without first obtaining approval of the Stadium Authority Board for a budget amendment by addition, cancellation, or transfer; provided, however, that the foregoing shall not preclude award of multi-year contracts covering years for which a budget has not yet been adopted so long as the contract is within the limits of a budget approved by the Stadium Authority Board for the year in which the contract is awarded and subsequent years are conditioned on approval of the appropriate year’s budget. (Ord. 1900 § 1, 11-27-12).

17.30.110 Exclusion.

These policies and procedures do not apply to the following:
(a) Contracts with or procurements from a State agency, political subdivision of the State, or any agency or political subdivision or a local, State or Federal government; (b) Acquisition of real property or permanent or temporary interest in real estate; (c) Disposal of real or personal property;
(d) Contracts for professional services in connection with threatened or pending litigation; (e) Agreements with professional sports teams and with lessees and licenses for events in the Stadium, such as concerts, conferences, and sporting events in the Stadium; and (f) Contracts for materials and supplies required during construction of the Stadium Project related to the construction of the Stadium Project. (Ord. 1900 § 1, 11-27-12).

17.30.120 Service contracts – Signature authority.

The Executive Director shall have no authority to execute contracts with third parties for services provided to the Stadium Authority. All Stadium Authority contracts shall be approved by the Stadium Authority Board prior to execution by the Executive Director. (Ord. 1900 § 1, 11- 27-12; Ord. 2005 § 3, 10-8-19).

17.30.130 Public works.
(a) Stadium Project. Government Code Section 6532 authorizes the Stadium Authority to award a contract for the development of the Stadium Project to a qualified design builder under specified conditions. As a requirement of Government Code Section 6532, any subcontracts awarded by the design builder to be funded with either Redevelopment Agency funds or Community Facility District funds must be awarded to the lowest responsible bidder in accordance with procedures consistent with the City Charter. All other subcontracts awarded by the design-builder may be awarded on a best value basis consistent with the Subcontractor Selection and Procurement Plan adopted by the Stadium Authority. (b) Other Public Works. For all other expenditures required for a public project, but which are not associated with the Stadium Project, the Stadium Authority shall comply with the requirements of Public Contract Code Section 20162 and all applicable City Charter provisions. (Ord. 1900 § 1, 11-27-12).
(c) The Executive Director is authorized to execute a contract for public works on behalf of the Stadium Authority in an amount up to and including one hundred thousand dollars ($100,000.00), as allocated to and authorized by the Stadium Authority by adoption of the annual budget. A contract amount with an allocated value above this dollar limit requires approval by the Stadium Authority Board.

17.30.140 Bid contest procedures.
(a) A protest based on alleged improprieties in the application of this chapter shall be submitted to the Executive Director, not later than seven days after the basis for the protest is known or should have been known. The Executive Director’s responsibilities under this section may not be delegated to a contractor. An untimely protest shall be denied on that basis. (b) The written protest must include all of the following:
(1) Name and address of the protestor;
(2) Identification of the procurement or contract at issue; (3) A detailed statement of the reasons for the protest along with supporting exhibits, evidence, or documents to substantiate the reasons for the protest. (c) The Executive Director shall review each protest filed and consider the protest and shall issue a written determination and finding regarding the protest and shall forward to the protestor, by certified mail, return receipt requested, or by any other method deemed suitable which provides evidence of receipt.
(d) The protestor may appeal the determination and finding to the Stadium Authority Board within seven days after receipt of said written determination and finding from the Executive Director. The appeal must be in writing and must include a copy of the original protest application and the determination and finding letter, along with a written explanation of the grounds for disagreement with the determination and finding letter. If the protestor desires a hearing on the protest, a request for a hearing must be made, in writing, at the time of the appeal. An untimely appeal shall be denied on that basis. If a protestor fails to appeal the determination and finding letter, said letter will constitute the final decision of the Stadium Authority.
(e) If a timely request for a hearing on a protest appeal is received, the Stadium Authority Board shall conduct a hearing at its next regularly scheduled meeting but in no event later than twenty-one (21) days after the receipt of the hearing request. (f) The Stadium Authority Board shall issue a decision on the protest, which shall represent the final decision of the Stadium Authority, subject to judicial review. (g) When a protest has been timely filed, the Stadium Authority shall not award the contract subject of the protest until there is a final Stadium Authority decision on the protest. (Ord. 1900 § 1, 11-27-12).

17.30.150 Enforcement and remedies.
(a) If the Executive Director (but not a contractor to whom the Executive Director has delegated authority) or Stadium Authority Board determines that a procurement violates these policies and procedures, the Stadium Authority may determine that the procurement contract is voidable, and not automatically voided, if:
(1) All parties acted in good faith;
(2) Ratification of the contract would not undermine the intent and purpose of these procurement policies; and
(3) The violation(s) is insignificant or did not prevent substantial compliance with these procurement policies.
(b) If the Executive Director (but not a contractor to whom the Executive Director has delegated authority) or the Stadium Authority Board determines that a procurement violates these policies and procedures but satisfies the conditions in subsections (a)(1) through (3) of this section, then the Executive Director (but not a contractor to whom the Executive Director has delegated authority) or the Stadium Authority Board may choose to ratify the contract if the contract is in the best interest of the Stadium Authority, or alternatively choose to void the contract.
(c) If the Executive Director or Stadium Authority Board determines that a procurement violates these policies and procedures and is voidable under subsection (a) of this section, and that the contractor has acted in violation of these policies and procedures, the Executive Director or Stadium Authority Board may void the contract or ratify the contract without prejudice to the Stadium Authority’s right to appropriate legal action. (Ord. 1900 § 1, 11-27-12).

17.30.160 Information collection and reporting.
(a) The Executive Director will create and maintain a bidders list, consisting of information about all firms that bid or quote on its contracts. The bidders list will include the name, address, and annual gross receipts of firms. The Stadium Authority shall provide a procedure requiring that bidders provide all requested information in their submission or upon the letting of a contract.
(b) The Executive Director shall prepare, and submit to the Stadium Authority Board, a report at the end of the Stadium Authority’s fiscal year summarizing the total number of contracts let by the Stadium Authority, the number of contracts approved under an exception, the number of contracts approved under best value procedures and the number of contracts approved under formal bidding procedures, and to the extent possible listing information related to application and outreach efforts conducted to implement the DBE program. (Ord. 1900 § 1, 11-27-12).

17.30.170 Conflict of interest.
(a) The Stadium Authority and Stadium Authority staff and agents are subject to the State ethics law and its provisions dealing with conflict of interest, including but not limited to Government Code Sections 81000 et seq. and shall be subject to the requirements of the City’s Code of Ethics and Values adopted by the City Council in March 2000 and modified by the City Council in August 2001.
(b) The Stadium Authority and Stadium Authority staff may not accept or receive, directly or indirectly, any money, property, or other benefit from any person or entity doing business with, or interested in doing business with, the Stadium
Authority. The Stadium Authority, the Executive Director, and Stadium Authority staff may not have any financial interest in any firm or company doing business with the Stadium Authority, or in any contract to which the Stadium Authority is a party. Any exception to this policy requires the approval of the Stadium Authority Board. (Ord. 1900 § 1, 11-27-12).

17.30.180 Amendments.

The policy may be amended by the City Council from time to time by a duly adopted resolution. (Ord. 1900 § 1, 11-27-12).

City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
23-351 Agenda Date: 3/7/2023

REPORT TO COUNCIL

SUBJECT
Action on Adoption of Resolution to Delegate Signature Authority and Appoint Acting Director of Emergency Services

COUNCIL PILLAR
Enhance Community Engagement and Transparency

BACKGROUND
On April 6, 2022, the City Council of Santa Clara appointed Rajeev Batra Interim City Manager.

Also, on April 6, 2022, Mr. Batra authorized in writing certain employees of the City Manager’s Office- Nadine Nader, Manuel Pineda, Cynthia Bojorquez, Ruth Shikada, and Christine Jung - to approve and execute agreements and other documents on behalf of the City of Santa Clara, Santa Clara Stadium Authority and/or Silicon Valley Power, as designee of the City Manager/Executive Director, in his absence or due to conflict.

On January 31, 2023, Rajeev Batra resigned from the position of Interim City Manager.

On February 7, 2023, the City Council of the City of Santa Clara appointed Jovan D. Grogan to serve as the City Manager for the City of Santa Clara commencing on May 1, 2023.

On February 19, 2023, Lisa Schoenthal retired from the position of Chief Emergency Services Officer (also serving as the Deputy Director of Emergency Services).

DISCUSSION
The City Council of the City of Santa Clara has elected not to appoint an Interim City Manager prior to City Manager Jovan D. Grogan commencing his employment on May 1, 2023.

Santa Clara City Code section 2.140.050 provides that the City Manager shall serve as the Director of Emergency Services and that the City Manager shall appoint a Deputy Director of Emergency Services.

In recognition of the importance of clearly establishing signing authority within the City to ensure continuous, efficient, and effective management of city business, and promptly responding to or addressing emergency situations that may arise within the City, and out of an abundance of caution, the proposed action would formally delegate signature authority to particular employees of the City Manager’s Office for a limited term, and would appoint Chief Operating Officer Nadine Nader as the acting Director of Emergency Services until such time as the new City Manager takes office.

City of Santa Clara Printed on 3/2/2023Page 1 of 2
powered by Legistar™
23-351 Agenda Date: 3/7/2023

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 an administrative activity that will not result in direct or indirect physical changes to the environment.

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

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

RECOMMENDATION
Adopt the Resolution to Delegate Signature Authority and Appoint Acting Director of Emergency Services
Reviewed by: Jenica Maldonado, Outside Legal Counsel, Renne Public Law Group Sujata Reuter, Chief Assistant City Attorney

ATTACHMENTS

1. Resolution - Delegate Authority to Certain Employees to Act on Behalf of the Office of the City Manager for a Limited Term, and to Appoint an Acting Director of Emergency Services City of Santa Clara Printed on 3/2/2023Page 2 of 2
powered by Legistar™
Resolution/Signing Authority Page 1 of 3
Rev: 11/22/17
RESOLUTION NO. 23- _____

A RESOLUTION OF THE CITY OF SANTA CLARA TO

DELEGATE AUTHORITY TO CERTAIN EMPLOYEES TO

ACT ON BEHALF OF THE OFFICE OF THE CITY

MANAGER FOR A LIMITED TERM, AND TO APPOINT AN

ACTING DIRECTOR OF EMERGENCY SERVICES
BE IT RESOLVED BY THE CITY OF SANTA CLARA AS FOLLOWS:

WHEREAS, on April 6, 2022, the City Council of Santa Clara appointed Rajeev Batra Interim City Manager,
WHEREAS, on April 6, 2022, the Interim City Manager Rajeev Batra, authorized in writing certain employees of the City Manager’s Office – Nadine Nader, Manuel Pineda, Cynthia Bojorquez, Ruth Shikada, and Christine Jung – to approve and execute agreements and other documents on behalf of the City of Santa Clara, Santa Clara Stadium Authority and/or Silicon Valley Power, as designee of the City Manager/Executive Director, in his absence or due to conflict; and, WHEREAS, on January 31, 2023, Rajeev Batra resigned from the position of Interim City Manager;
WHEREAS, on February 7, 2023, the City Council of the City of Santa Clara appointed Jovan D. Grogan to serve as the City Manager for the City of Santa Clara commencing on May 1, 2023;
WHEREAS, the City Council of the City of Santa Clara has elected not to appoint an Interim City Manager prior to City Manager Jovan D. Grogan commencing his employment on May 1, 2023;
WHEREAS, Santa Clara City Code section 2.140.050 provides that the City Manager shall be the Director of Emergency Services and that the City Manager shall appoint a Deputy Director of Emergency Services. On February 19, 2023, Lisa Schoenthal retired

Resolution/Signing Authority Page 2 of 3
Rev: 11/22/17
from the position of Chief Emergency Services Officer (also serving as the Deputy Director of Emergency Services); and
WHEREAS, the City Council of the City of Santa Clara recognizes the importance of clearly establishing signing authority within the city to ensure continuous, efficient, and effective management of city business, and promptly responding to or addressing emergency situations that may arise within the City, and wishes to formally delegate signature authority to particular employees of the City Manager’s Office for a limited term, to ensure the same.

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

1. That out of an abundance of caution, the City Council affirmatively and expressly ratifies the actions taken by employees of the City Manager’s Office pursuant to a continuation of the April 6, 2022 delegation of powers, for the period January 31, 2023 through the effective date of this Resolution.

2. That the City Council affirmatively and expressly authorizes the following employees of the City Manager ’s Office to execute agreements and other documents, and to take actions (including but not limited to making a determination of incapacity pursuant to the Public Employees’ Retirement Law), within the limits of authority granted to the City Manager under applicable State law, ordinance, resolution, or policy until May 1, 2023 or until such time that forthcoming City Manager Jovan Grogan directs otherwise in writing, whichever is later. a. Nadine Nader
b. Manuel Pineda
c. Cynthia Bojorquez
d. Ruth Shikada
e. Christine Jung

3. That the City Council hereby appoints Chief Operating Officer Nadine Nader as the acting Director of Emergency Services until May 1, 2023, or until such time that forthcoming City Manager Jovan Grogan shall assume such role pursuant to Santa Clara City Code section 2.140.050. The City Council authorizes Nadine Nader to appoint a Deputy Director of Emergency Services. If such an appointment is made, the appointment is effective until May 1, 2023 or until such time that forthcoming City Manager Jovan Grogan directs otherwise in writing, whichever is later.

Resolution/Signing Authority Page 3 of 3
Rev: 11/22/17

4. 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 ____, 2023, BY THE FOLLOWING VOTE:

AYES: COUNCILORS:

NOES: COUNCILORS:

ABSENT: COUNCILORS:

ABSTAINED: COUNCILORS:

ATTEST: ______________________________

NORA PIMENTEL, MMC

ASSISTANT CITY CLERK

CITY OF SANTA CLARA

City of Santa Clara
Agenda Report
1500 Warburton Avenue
Santa Clara, CA 95050
santaclaraca.gov
@SantaClaraCity
23-1479 Agenda Date: 3/7/2023

REPORT TO STADIUM AUTHORITY BOARD

SUBJECT
Action on the Proposed Santa Clara Stadium Authority Fiscal Year 2023/24 Budget, Stadium Operation and Maintenance Plan, and 2023 Non-NFL Events Marketing Plan

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

BACKGROUND
The Stadium Management Agreement (Management Agreement) defines the Stadium Operation and Maintenance Plan (SOMP) as the plan designed to achieve a safe and well maintained Stadium, and shall include the standards for management and operation of the Stadium, including the required security, staffing, and other required elements of hosting Stadium events. The Forty Niners Stadium Management Company LLC (ManagementCo or Stadium Manager) is responsible for preparing the SOMP with the following items included, each of which shall be presented annually to the Santa Clara Stadium Authority (Stadium Authority):

1. Annual Shared Stadium Expenses Budget;

2. Annual Public Safety Budget;

3. Capital Expenditure Plan; and,

4. Non-NFL Events Marketing Plan (Marketing Plan).

Each year, the Stadium Authority staff prepares, in coordination with the Stadium Manager, the proposed Santa Clara Stadium Authority Operating, Debt Service, and Capital Budget for the Stadium Authority’s twelve month fiscal year (April 1 through March 31) in accordance with Article 4 “ Records, Accounts, Budgets, and Reports” of the Management Agreement. The 2023/24 Proposed Budget, Annual Public Safety Budget, and 2023 Marketing Plan are included as Attachment 2, Attachment 3, and Attachment 4 to this report, respectively. The 2023/24 Proposed Budget was developed based on the Stadium Authority Budget Policy (Attachment 5) and the Stadium Authority Compliance and Management Policy (Attachment 6). It should be noted that while the Annual Public Safety Budget is presented here for information submitted by the Stadium Manager, the budget appropriations are approved annually through the City Budget Process as these costs are budgeted in respective City Department Budgets.

DISCUSSION
The Stadium Authority FY 2023/24 Budget includes key components such as the Stadium Operating Budget, which includes a breakdown of the Stadium Authority’s General and Administrative (G&A) costs; Shared Stadium Manager Expenses; Debt Service budget; and the Capital Expense Budget. A glossary of financial terms used to facilitate understanding of the types of revenues, expenses, debt, and capital expenses is also included in the budget document.

City of Santa Clara Printed on 3/2/2023Page 1 of 6
powered by Legistar™
23-1479 Agenda Date: 3/7/2023
In accordance with Sections 4.5 through 4.8 of the Management Agreement, ManagementCo submitted the operating, capital, and debt budget for the FY 2023/24 Stadium Authority Budget. Staff followed the approved budget development process outlined in the Stadium Authority Budget Policy (Attachment 5) in preparing the Proposed FY 2023/24 Stadium Authority Budget.

FY 2023/24 Budget Process
The following summarizes the timeline of this year’s budget process:
· October 2022: Stadium Authority staff worked with ManagementCo to discuss the annual budget plan which included the dates that ManagementCo would provide all necessary documents as required by the Stadium Lease and Stadium Management Agreement. During this dialogue, a calendar of deliverables was agreed upon. · December 2022: Stadium Authority staff provided the Stadium Authority G&A, Public Safety Capital Expenses, and Discretionary Fund costs to ManagementCo for review and incorporation into the annual budget.
· January 2023: At least 45 days prior to the start of the fiscal year (January 31), ManagementCo provided annual documents as outlined in the Stadium Agreements, which were reviewed and/or used in the Budget Development Process:
o Stadium Operation and Management Plan (Source: Stadium Management Agreement) o Annual Shared Expenses Budget with Five Year Projection (Source: Stadium Management Agreement)
o Annual Stadium Authority Operations Budget (Source: Stadium Management Agreement)
o Annual Public Safety Budget (Source: Stadium Management Agreement) o Capital Expenditure Plan with Five-Year Projection (Source: Stadium Management Agreement)
o Marketing Plan (Source: Stadium Management Agreement) o Public Safety Document Updates (Source: Stadium Operations Agreement) · February 2023: Stadium Authority staff analyzed ManagementCo’s budget submission including but not limited to capital projects and the number of full-time equivalents (FTEs) recommended and related personnel costs as well as non-personnel costs. The Stadium Authority submitted a series of questions to ManagementCo on February 6, 2023 and received responses on February 14, 2023. Stadium Authority Staff and the ManagementCo met via Zoom to review Shared Expenses budget detail on February 15. This is consistent with past practice developed over the last two years to verify and confirm budgeted Shared Expenses amounts.

Key Highlights for the Stadium Authority’s FY 2023/24 Budget The Proposed Fiscal Year 2023/24 Operating, Debt Service, and Capital Budget continues to be presented under unusual circumstances. On August 31, 2022, Stadium Authority, ManagementCo, and Forty-Niners SC Stadium Company LLC (StadCo or Tenant) settled the arbitration and disputes City of Santa Clara Printed on 3/2/2023Page 2 of 6
powered by Legistar™
23-1479 Agenda Date: 3/7/2023
regarding the partially suspended Shared Stadium Manager Expenses and Operating and Management Expenses. As part of the settlement, the Stadium Authority agreed to timely pay invoices from Stadium Manager in accordance with the Stadium Authority’s annual budget. This settlement does not cover Public Safety Costs and NFL-SBL Buffet costs which are part of an unsettled claim.

A summary of key assumptions for the Proposed Budget include:
· General and Administrative expenditures in the amount of $3.6 million. · Legal Contingency of $3.1 million for NFL-SBL Buffet costs ($1.1 million) and excess Public Safety Costs ($2.0 million) to reflect disputed liabilities, costs or credits budgeted for these areas, that are subject of ongoing litigation.
· Projected Net Non-NFL events income of $4.5 million for FY 2023/24. · Proposed Capital Expenditures totaling $20.5 million including general building, security, furnishings and equipment, and public safety investments. · Total estimated Debt Service expenses of $27.8 million including debt related to the CFD Advance ($2.3 million) and Term A Loan ($25.5 million). · Transfer of $11.8 million cash from reserves for disputed Shared Stadium Manager Expenses back to excess cash revenue account for the annual Excess Revenue Distribution in FY 2022/23.

The Proposed Budget is also being delivered in the context of a distribution of excess revenue that are distributed in the order set forth in the Stadium Lease Agreement. In response to requests from the Board, and in order to provide additional transparency to the public, the budget includes a new section that details the flow of excess revenues and summary of reserve balances that result from annual operations.

Operating Budget
Revenues
The FY 2023/24 projected revenues of $64.9 million include $24.8 million in facility rent, $12.6 million in Stadium Builder License (SBL) revenue, $12.2 million in NFL ticket surcharge, $7.6 million in Naming Rights revenue, $4.5 million in Net Non-NFL Events revenues, and $3.2 million in other revenues.

Expenditures
The proposed Operating Budget totals $62.4 million and includes the Stadium Authority’s share of expenses covered under the Management Agreement in the amount of $13.8 million along with $12.3 million for operating expenses including funds to reimburse the City for its staff support and payments for ground rent, Senior and Youth Program Fees, and funding for SBL sales and service, insurance, legal contingency, and other expenses. It also includes transfers out of $36.3 million.

The proposed shared expenses increased by $1.3 million or 10% as compared to the prior year’s submittal. This is primarily due to three (3) additional Stadium Operations positions (Director of City of Santa Clara Printed on 3/2/2023Page 3 of 6
powered by Legistar™
23-1479 Agenda Date: 3/7/2023
Parking and Traffic, Senior Manager of Parking and Traffic, Parking and Traffic Coordinator) recommended to be added to the budget and increases in Engineering and Groundskeeping outside service costs and Guest Services uniform costs.

The budget includes a Legal Contingency of $3.1 million, which includes a contingency for budgeted, but disputed, liabilities, costs or credits of Public Safety costs and NFL-SBL Buffet costs, which are the subject of ongoing litigation. The August 31, 2022 Settlement Agreement between StadCo, Stadium Manager and Stadium Authority did not include resolution terms regarding NFL-SBL Buffet costs and Public Safety costs disputes. Thus, consistent with past practice for costs that are the subject of ongoing litigation, the $1.1 million requested for NFL-SBL Buffet costs by ManagementCo is proposed to be allocated in Legal Contingency. The Stadium Authority also included $2.0 million in Legal Contingency to reserve for the ongoing Public Safety litigation. The reserve represents the estimated Performance Rent credits StadCo would be able to use for the excess Public Safety costs previously paid.

The budget also includes $3.6 million for Stadium Authority’s administrative oversight of the Stadium. The General and Administrative (G&A) portion of the budget reflects expenses required to support and implement the Board’s policy direction related to its oversight of Levi’s Stadium.

These resources are necessary to advance and support the Board’s directives and strategic initiatives and manage the day-to-day operations of the Stadium Authority including but not limited to accounting and management of Stadium Authority financials, preparing the annual financial statement and quarterly financial updates, reviewing procurement requests for Board approval, managing Public Records Act requests and implementing various efforts to mitigate impacts to residents and businesses resulting from events at the Stadium, and responding to ongoing litigation with ManagementCo.

In addition, the proposed budget includes a total transfer out of $36.3 million. The transfers include a $3.9 million transfer to the Capital Fund for future Stadium capital improvements, a $25.5 million transfer to the Debt Service Fund, a $648 thousand transfer to Discretionary Fund, a $600 thousand transfer to the Operating Reserve, and a $5.7 million transfer to the Renovation/Demolition Reserve.

Debt Service Budget
The proposed FY 2023/24 Debt Service Budget of $27.8 million (principal of $16.1 million and interest of $11.7 million) is based on the required debt service payments. It excludes payment to the StadCo Subordinated Loan because the Stadium Authority project it to be paid off with the excess cash in FY 2022/23. Total outstanding debt is projected to decrease by $16.1 million from $245.3 million to $229.1 million.

Capital Budget
The proposed FY 2023/24 Capital Budget totals $20.5 million. Of this total, $17.2 million of prior year appropriations are projected to be carried over from FY 2022/23 ($1.5 million of the projected carryover amount is for warranty-related construction, and the other $15.7 million is for prior year CapEx projects). New capital improvement appropriations equal $3.3 million.

Subsequent Revisions to the Stadium Authority’s FY 2023/24 Budget City of Santa Clara Printed on 3/2/2023Page 4 of 6
powered by Legistar™
23-1479 Agenda Date: 3/7/2023
The Proposed Fiscal Year 2023/24 Operating, Debt Service, and Capital Budget was revised to correct a technical error in the budget after the posting of the budget and public hearing notice on February 22, 2023 (Attachment 1). Staff corrected the presentation of the Legal Contingency Reserves in the Fund Balance section (page 16 of Attachment 2) to reflect the ongoing litigation reserves for NFL-SBL Buffet costs and excess Public Safety Costs and the assumed carryover of expenses to FY 2023/24 as these expenses will not occur in FY 2022/23. The corrected and revised 2023/24 Proposed Budget is included as Attachment 2 and is recommended for adoption as part of this report.

FY 2023/24 SOMP
In addition to the Annual Shared Stadium Expenses Budget, the Annual Public Safety Budget, the Capital Expense Plan, and the Marketing Plan, the SOMP contains a plan for the operation and maintenance of Levi’s Stadium. The Stadium Lease and Management Agreement requires the Stadium Manager to prepare the SOMP and present it annually to the Stadium Authority and StadCo for consideration and approval. At the time of writing this report, staff is reviewing this confidential document and will share the City and Stadium Authority’s comments with the Stadium Manager directly. The SOMP document is approved administratively. 2023 Marketing Plan
In past years, the Stadium Authority Board has acted on the Marketing Plan as part its consideration and adoption of the Stadium Authority Operating, Debt Service, and Capital Budget. As discussed under the budget timeline above, the Stadium Manager submitted a 2023 Marketing Plan, which staff is transmitting to the Board through this report. Staff will work with the Stadium Manager in the upcoming year to continue to refine and implement the Marketing Plan.

ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environment Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a)(4) in that it is a fiscal activity that does not involve any commitment to any specific project which may result in a potential significant impact on the environment.

FISCAL IMPACT
The proposed Stadium Authority FY 2023/24 Budget includes $62.4 million for Operating (includes $36.3 million in transfers-out to Debt Service, Capital Expenditures, and Reserves); $27.8 million for Debt Service (includes $2.4 million funded by the Community Facilities District); and $20.5 million for Capital (includes a $17.2 million carryover from the prior year).

COORDINATION
This report has been coordinated with the Executive Director and Stadium Authority Counsel’s Offices.

PUBLIC CONTACT
On February 22, 2023, a notice of the public hearing was published in the Santa Clara Weekly and the Proposed Budget (Attachment 1) was available to the public on the City’s website and in the City of Santa Clara Printed on 3/2/2023Page 5 of 6
powered by Legistar™
23-1479 Agenda Date: 3/7/2023
City Clerk’s Office.

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.

ALTERNATIVES

1. Adopt the Santa Clara Stadium Authority Fiscal Year 2023/24 Operating, Debt Service, and Capital Budget;

2. Note and file the 2023 Marketing Plan; or

3. Take any other action the Board deems appropriate.

RECOMMENDATION
Staff recommends Alternatives 1 and 2:

1. Adopt the Santa Clara Stadium Authority Fiscal Year 2023/24 Operating, Debt Service, and Capital Budget;

2. Note and file the 2023 Marketing Plan.

Reviewed by: Kenn Lee, Treasurer
Approved by: Office of the Executive Director

ATTACHMENTS

1. Proposed Santa Clara Stadium Authority Fiscal Year 2023-24 Operating, Debt Service, and Capital Budget - Original Posted Version

2. Proposed Santa Clara Stadium Authority Fiscal Year 2023-24 Operating, Debt Service, and Capital Budget - Revised Version

3. Annual Public Safety Budget

4. 2023 Marketing Plan

5. Stadium Authority Budget Policy

6. Stadium Authority Compliance and Management Policy
City of Santa Clara Printed on 3/2/2023Page 6 of 6
powered by Legistar™

n June 8, 2010 the residents of Santa Clara voted to adopt Measure J, the Santa Clara Stadium Taxpayer Protection and Economic Progress Act, resulting in the approval to construct a new stadium to be leased by the San Francisco 49ers. Measure J called for the creation of the Santa Clara Stadium Authority (Stadium Authority) to own, develop, construct, operate, and maintain the Stadium. The Stadium Authority ex ists as a public body, separate and distinct from the City. The St adium Authority is structured so that the City is not liable for the debts or obligations of the Stadium Authority.

This budget and additional financial information on the Stadium Authority can be found at: “santaclaraca.gov/our-city/santa-clara- stadium-authority”.

PROPOSED

FISCAL YEAR
2023/24

OPERATING,
DEBT

SERVICE

AND CAPITAL
BUDGET
1500 Warburton Avenue
Santa Clara, CA 95050
Phone: (408) 615-2210
Website:
https://www.santaclaraca.gov/our
-city/santa-clara-stadium-
authority
Email: communications@
santaclaraca.gov
Santa Clara Stadium
Authority

2 Levi’s
® Stadium

3 Table of Contents

General Information ................................................................................................................. 4

Organizational Chart .......................................................................................................... ..... 6 NFL Event Highlights - Year in Review ................................................................................... 7 Non-NFL Event Highlights - Year in Review ............................................................................ 8 Excess Revenues Distribution ................................................................................................. 9 Stadium Authority Operating Budget ..................................................................................... 11 Stadium Authority Operating Budget Glossary .................................................................. 19 Shared Stadium Manager Expenses ..................................................................................... 25 Shared Stadium Manager Expenses Glossary .................................................................. 27 Stadium Debt Service Budget ............................................................................................... 29 Stadium Debt Service Budget Glossary ............................................................................. 32 Stadium Authority Capital Expense Budget ........................................................................... 33 Stadium Authority Work Plan ................................................................................................ 46

Santa Clara Stadium
Authority

4 Introduction
This Santa Clara Stadium Aut hority (“Stadium Aut hority”) Budget Report provides information covering the Proposed Fiscal Year 2023/24 Operating, Debt Service, and Capital Budget as well as comparative data from prior fiscal years. Estimated revenue and expense information (three quarters of actuals and one project ed quarter) included in this report for the FY 2022/23 is unaudited and, therefore, subject to change as a result of final results and the annual audit conducted by an external and independent auditing firm.

This budget provides the necessary funding to adm inister the duties of t he Stadium Authority, including:

 Support for operating Levi’s
® Stadium for Non-National F ootball League (Non-NFL) events through a management company, the Forty Ni ners Stadium Management Company LLC (ManagementCo or Stadium Manager);
 Advancement of the FY 2023/24 Work Plan;
 Payment of debt service obligations; and,
 Maintenance of a five-year capital plan.

The Stadium Authority Board (“Board”) provides overall governance and oversight of this operational structure. Amongst other due dili gence requirements to support thes e duties, the Board is also responsible for: setting policy; debt and fiscal management; and ensuring implementation of required duties related to operations and capital projects.

In addition to this report, the Stadium Authority produces annual financial statements within six months of the fiscal year-end (March 31
st). These financial statements are audited by an external auditing firm and presented to the Stadium Authority’s Audit Committee and Board. Once presented to the Board, the financial st atements are published on the Stadium Author ity’s web page. The FY 2022/23 audited financial statements will be pres ented to the Board by the end of September 2023.

The Stadium Authority is structured so that the City of Santa Clara (“City”) is not liable for the debts or obligations of the Stadium Authority.

All services provided by the Cit y to ManagementCo or the Stadium Authority are fully reimbursed.

Types of services include the following:

 Administrative General Fund costs that are spent during operations are separately tracked using special account codes in the City’s fi nancial system and all such costs are billed for reimbursement.
 General Fund public safety costs for NFL and Non-NFL events are separately tracked and all such costs are billed for reimbursement.

GENERAL INFORMATION

5 Methodology
Information provided in this report was based in part on documentation submitted by ManagementCo on January 31, 2023. The Capital Budget included proposals by both the St adium Authority and Stadium Manager. Per Section 4. 6 of the Management Agreement, ManagementCo is required to submit a budget 45 days prior to the start of the fiscal year.

On August 31, 2022, Stadium Au thority, ManagementCo, and Fort y-Niners SC Stadium Company LLC (StadCo or Tenant) settled the arbitration and disputes regarding the partially suspended Shared Stadium Manager Expenses and O perating and Management Expenses. As part of the settlement, the Stadium Authority agr eed to timely pay invoices from St adium Manager in accordance with the Stadium Authority’s annual budget. This settlement does not cover Public Safety Costs and NFL-SBL Buffet costs which are part of an unsettled claim.

Proposed Budget in Brief
The Proposed Budget is present ed on an accrual basis which provides increased transparency for projected revenues and expenses, with added detail about financial transfers.

The total Stadium Authority O perating Budget for FY 2023/24 is $64.9 million and represents a decrease of $4.0 million or -6%, co mpared to the prior fiscal year. This decrease is mainly due to 2023 being the last year of payments for a large number of financed SBL payment plans, offset by increases from NFL and Non-NFL events ticket surcharges, net revenues from Non-NFL events, and interest income.

A summary of key assumptions for the Proposed Budget include:

 General and Administrative expendi tures in the amount of $3.6 million.  Legal Contingency of $3.1 millio n for NFL-SBL Buffet costs ($1. 1 million) and excess Public Safety Costs ($2.0 million) to reflect disputed li abilities, costs or cred its budgeted for these areas, that are subject of ongoing litigation.
 Projected Net Non-NFL events income of $4.5 million for FY 2023/24.  Proposed Capital Expenditures totaling $20.5 millio n including general building, security, furnishings and equipment, and public safety investments.  Total estimated Debt Service expenses of $27.8 million including debt related to the CFD Advance ($2.3 million) and Term A Loan ($25.5 million).  Transfer of $11.8 million cash from reserves for disputed Shared Stadium Manager Expenses back to excess cash revenue account for t he annual Excess Revenue Distribution in FY 2022/23.

6 The seven elected members of the City Council se rve as the governing Boar d of the Santa Clara Stadium Authority with the Mayor serving as Chairperson of the Authority.

In addition, City of Santa Clara staff serve as Officers of the Stadium Authority with the City Manager serving as the Executive Director.

ORGANIZATIONAL CHART
r
.Stadium Authorit y
Board
j
I

I I I I
• • · ■ •
.Stadium Authority Execut ive Director Secre tary Auditor Counse l ~ --' , ,
I
· ■
Treasu rer
....

7 NFL EVENT HIGHLIGHTS - YEAR IN REVIEW

The San Francisco 49ers played one (1) pre-season, ten (10) regular season, and two (2) post-season National Football League (NFL) games in FY 2022/23. Ticket sales resulted in about $11.4 million of NFL ticket surcharge revenue to Stadium Authority (based on the 10% NFL ticket surcharge on each ticket sold) and $250 thousand of Senior and Yout h Program Fees (based on $0.35 per NFL game ticket, with a maximum of $250 thousand) that are collected and forwarded to the City.

Operators who wish to operate a parking lot for sports or entertainment venues are required to secure approvals through the City’s permitting process. If approved, per the City’s Municipal Fee Schedule, these operators remit an offs ite parking fee for each car that is parked for sports or entertainment events. This fee was designed to recover the public safety costs associated with these permitted offsite parking lots. Therefore, when invoic ing for NFL or Non-NFL public safe ty costs for a particular event held at Levi’s
® Stadium (Stadium), the offsite parking fee that is collected for such event partly offsets the total public safety costs owed for that event. The offsite parking fee is $6.13 for the City’s FY 2022/23 (July 1, 2022 through June 30, 2023). The offsite parking fees are projected at about $569 thousand in FY 2022/23.

NFL EVENT HIGHLIGHTS - YEAR IN REVIEW

8 As of this report, there were seven (7) public Non-NFL events held at t he Stadium, representing a significant recovery from the COVID-19 pandemic. A total of 319,778 tickets sold in FY 2022/23 for the seven events, resulting in $1.3 million in Non-NFL event ticket surcharge revenue (from the $4 per ticket Non-NFL event surcharge).

There were also 31 smaller event s held with 14,775 total attendees in the first two quarters of FY 2022/23. Examples of these specia l events include corporate events of various sizes, weddings, holiday parties, etc.

The table below shows the Non-NFL events, event date and tickets sold for each event.

Event Date
Tickets
Sold
Coldplay Concert 5/15/2022 50,478
Grupo Firme Concert 7/2/2022 31,169
Red Hot Chili Peppers Concert 7/29/2022 45,977
The Weeknd Concert 8/27/2022 48,801
Mexico vs. Colombia Soccer Game 9/27/2022 63,939
Elton John Concert (Day 1) 10/8/2022 44,134
Elton John Concert (Day 2) 10/9/2022 35,280
Total to date 319,778
2022/23 Non-NFL Events

NON -NFL EVENT HIGHLIGHTS - YEAR IN REVIEW

9 The Stadium Authority is consid ered to have Excess Revenues if the Stadium Authority revenues exceeds expenses in a lease year. The Excess Revenues are required to be distributed in the order as set forth in Article 14 of the Stadium Lease agreement. The below Excess Revenues flow chart shows the order of distribution after applying t he required annual contri bution to the Capital Expenditure Reserve and Operating Reserve.

EXCESS REVENUES DISTRIBUTION

1. Payoff any outstanding Management Company
Revolving Loan
(Section 14.1 of the Agreement)

3. Fund Stadium Capital Expenditure Reserve up to $1
million
(Section 14.3 of the Agreement)

2. Fund future Stadium Authority Expenses up to $2
million
(Section 14.2 of the Agreement)

4. Fund Operating Expense Reserve up to $10 million
(Section 14.4 of the Agreement)

5. Repay any outstanding principal balance on the
Subordinate Loan
(Section 14.5 of the Agreement)
Not Applicable - The Stadium
Authority does not have any
outstanding Revolving Loan
Completed in Fiscal Year 2014/15
Completed in Fiscal Year 2014/15
Completed in Fiscal Year 2014/15
To be completed by the end of
Fiscal Year 2022/23
Excess Revenues Distribution Order
(Per Article 14 of the Agreement)

6. Fund Operating Expense Reserve up to $20 million
(Section 14.6 of the Agreement)

7. Fund Renovation/Demolition Reserve if the balance is less than $70 million
(Section 14.7 of the Agreement)

8. Any additional disbursements can be used to pay
Stadium Authority Discretionary Expense, or for any
purpose including distribution to constituent partners of the Stadium Authority, including the City's general fund (Section 14.8 of the Agreement)
Estimated to be completed by the
end of Fiscal Year 2022/23
In progress; projected at $12.7
million by end of Fiscal Year
2023/24; $57.3 million still needed
Future Allocation - Distributions in
the sections above will have to be
met before using excess cash for
this section.
r
'
'- ./ / -..,,
-
\..
/
' '
'- ,I '-
/
'
/ "I
. -
'- ./ ,I
r
-
..
'-
[ ]
/
'
-
•
,I '-
/
'
/
'
'- ,I
/
'
/
-

10 A summary of the Stadium Authority’s FY 2023/24 Excess Revenue Reserves is as follows:

2021/22 2022/23 2022/23 2023/24
Year-end Adopted Pro jected Proposed
Actuals Budget Actuals Budget
Beginning Balance
Capital Expenditures Reserve(1) 19,513,719$ 22,103,296 $ 21,892,683 $ 21,709,270 $ Operating Reserve 11,944,292 11,960,870 12,301,659 20,011,919 Renovation/Demolition Reserve - - - 7,030,317 Total Beginning Balance 31,458,011 $ 34,064,166 $ 34,194,342 $ 48,751,506 $ Revenues
Interest Income - Capital Expenditure Reserve 12,967$ - $ 92,260$ - $ Interest Income - Operating Reserve 1,242 - 11,716 - Total Revenues 14,209 $ - $ 103,976$ - $ Transfers In from Operating
Contribution to Capital Expenditures Reserve 3,689,622$ 3,801,000 $ 3,801,000 $ 3,915,000 $ Contribution to Operating Reserve 358,215 369,000 7,701,261 600,000 Contribution to Renovation/Demolition Reserve - - 7,030,317 5,693,000 Total Transfers In 4,047,837 $ 4,170,000 $ 18,532,578 $ 10,208,000 $ Total Source of Funds 35,520,057 $ 38,234,166 $ 52,830,896 $ 58,959,506 $ Expenses
Capital Expenditures(2) 1,323,625$ 21,745,812 $ 4,076,673 $ 20,492,186 $ Operating Expenditures(3) 2,090 - 2,717 - Renovation/Demolition Reserve Expenditures - - - - Total Expenses 1,325,715 $ 21,745,812 $ 4,079,390 $ 20,492,186 $ Ending Balance
Capital Expenditures Reserve 21,892,683 $ 4,158,484 $ 21,709,270 $ 5,132,084 $ Operating Reserve 12,301,659 12,329,870 20,011,919 20,611,919 Renovation/Demolition Reserve - - 7,030,317 12,723,317 Total Ending Balance 34,194,342 $ 16,488,354 $ 48,751,506 $ 38,467,320 $ Total Use of Funds 35,520,057 $ 38,234,166 $ 52,830,896 $ 58,959,506 $ (1) Capital Expenditures Reserve balance excludes the balance in the Stadium Warranty Related Construction. (2) Expenses include both Capital Expenditures and bank fees. (3) Expenses represent bank fees associated with the reserve account.

Santa Clara Stadium Authority
Excess Revenue Reserves Summary
EXCESS REVENUES DISTRIBUTION (CONT .)

11 The Stadium Authority FY 2023/24 Budget covers t he Stadium Authority’s twelve-month fiscal year which runs April 1, 2023 through March 31, 2024.

Key highlights for the Stadium Authority’s FY 2023/24 Operating Budget are as follows:

Revenues

 FY 2023/24 total projected revenues of $64.9 million include $24.8 million in facility rent, $12.6 million in SBL revenue, $12.2 million in NFL ti cket surcharge, $7.6 million in naming rights revenue, $4.5 million in net revenues from Non-NFL events, and $3.2 million in other revenues.

 SBL revenue are projected to decrease by 48%, from $24.4 million in FY 2022/23 to $12.6 million, due to the completion of payments for a large number of financed SBL payment plans.

SBL revenues are anticipated to continue to decrease over the years as SBL holders complete their payment plans. The decrease in SBL re venues will significantly impact the Stadium Authority’s year-end excess cash distribution to various debt service and reserve accounts because they represent over 30% of the Stadium Authority’s revenues from inception to date.

 Net revenues from Non-NFL events are projected to continue to reflect recovery from the pandemic with an estimated $4.5 million expected, based on the projection of five (5) concerts, two (2) soccer events, and seventy-five (75) non-ticketed events. Performance rent generated from Non-NFL events is proposed to be allocated to a litigation contingency reserve for the public safety costs disputes.

Expenses

 The Operating Budget of $62.4 m illion includes the Stadium Auth ority’s share of expenses covered under the Management Ag reement in the amount of $13.8 million along with $12.3 million for operating expenses including funds to reimburse the City for its staff support and payments for ground rent, Senior and Youth Pr ogram Fees, and funding for SBL sales and service, insurance, legal cont ingency, and other expenses. It also includes transfers out of $36.3 million.

As shown in the table above, $25.5 million will be transferred from the Operating Fund to the Debt Service Fund for principal and interest debt service payments. The remaining $10.8 million are transfers to the Capital Expenditure Fund, Discretionary Fund, Operating Reserve Fund Transfers Out Transfers In
Operating 36,313,000 $ - $
Discretionary Fund - 648,000 Operating Reserve - 600,000 Renovation/Demolition Reserve - 5,693,000 Debt Service - 25,457,000 Capital Expenditure Fund - 3,915,000 Total 36,313,000$ 36,313,000 $

STADIUM AUTHORITY OPERATING BUDGET

12 STADIUM AUTHORITY OPERATING BUDGET (CONT .)
and Renovation/Demolition Reserve. Total transfers out decreased by $9.1 million or -20% from the prior year budget due to lower excess revenues from operations.

 Shared Stadium Manager Expenses are proposed to increase by $1.3 million or 10% from $12.5 million in the prior year budget to $13.8 million. This increase is mainly due to three (3) additional Stadium Operations po sitions (Director of Parking and Traffic, Senior Manager of Parking and Traffic, and Parking and Traffic Coordinator) and increases in Engineering and Groundskeeping outside service costs and Guest Services uniform costs.

 SBL Sales and Service is proposed to increase by $244 thousand or 12% from the prior year budget. This increase is due to adding one (1) additional Service position (Membership Service Consultant) and cost of living increases for Stadium Manager staff.

 Legal Contingency is proposed to be at $3.1 million, which includes contingency for budgeted, but disputed, liabilities, costs or credits of Public Safety costs and NFL-SBL Buffet costs, which are the subject of ongoing litigation. The August 31, 2022 Settlement Agreement between StadCo, Stadium Manager and Stadi um Authority did not include resolution terms regarding NFL-SBL Buffet costs and Public Safety costs disputes. Thus, consistent with past practice for costs that are the subject of ongoing litigation, the $1.1 milli on requested for NFL-SBL Buffet costs by ManagementCo is proposed to be allo cated in Legal Contingency. The Stadium Authority also included $2.0 m illion in Legal Contingency to reserve for the ongoing Public Safety litigation. The reserve represents t he estimated Performance Rent credits StadCo would be able to use for the excess Public Safety costs previously paid.

 Stadium Authority General & Ad ministrative costs total $3. 6 million, a dec rease of $633 thousand or -15% when compared to the prior y ear budget of $4.2 million. This decrease is mainly due to decrease in Stadium Authority Legal Services. These costs are further described in detail on Page 17 of this report.

Reserves

 With the complete repayment of the Stadium Authority Subordinate Loan expected at the end of FY 2022/23, the bui ld-up of reserve balances in a ccordance with the Stadium Lease Agreement is projected for FY 2023/24. Additional detail can be found in the Excess Revenue Distribution section and Stadium Authority Operating Budget Glossary, Excess Revenue, section of this document.

 The Operating Reserve and Renovation/Demolition Reserve are projected to have a balance of $20.6 million and $12.7 million at the end of FY 2023/24, respectively.

 The Discretionary Fund Reserve is projected to have a balance of $2.1 million at the end of FY 2023/24. The decrease of $260 thousand is pr imarily due to a $1.3 m illion distribution to the General Fund and Stadium Authority operations partially offset by the annual contribution.

 The Contingency Reserve totals $8.6 million at the end of FY 2023/24 and accounts for the disputed NFL-SBL Buffet costs and Public Safe ty Costs. For the disputed NFL-SBL Buffet

13 STADIUM AUTHORITY OPERATING BUDGET (CONT .)
expenses, cash proceeds are transferred to the Stadium Authority and these funds are placed in reserve pending final outcome of the ongoing dispute resolution. The disputed Public Safety Costs are included in the net Non-NFL events revenues the Stadium Authority receives.

OPERATING REVENUES
$64.9 Million
■ Rent - $24.8M, 38%
■ SSL Proceeds - $12.6M, 19%
■ NFL Ticket Surcharge - $12.2M , 19%
■ Naming Rights - $7.6M, 12%
■ Non-NFL Events Revenue - $4.5M , 7%
■ Interest - $1 .3M, 2%
■ Non-NFL Event Ticket Surcharge - $1.2M ,
2%
■ Sponsorship Revenue (STR)-$0 .SM , 1%
Senior & Youth Program Fees - $0.2M , 0%

14 STADIUM AUTHORITY OPERATING BUDGET (CONT .)

OPERATING EXPENSES
Transfers Out - $36.3M, 58%
Shared Stadium Manager Expenses -
$13.8M, 22%
Stadium Authority General &
Administrative - $3.6M, 6%
SBL Sales and Service - $2.3M, 4%
Utilities - $1.4M, 2%
Legal Contingency - $3.1M, 5%
Other Expenses - $0.7M, 1%
Ground Rent (paid to City) - $0.5M, 1%
Discretionary Fund Expense - $0.3M, 1%
Senior & Youth Program Fees (paid to
City) - $0.2M, 0%
Naming Rights - $0.1M, 0%
Use of StadCo Tenant Improvements -
$0.1M, 0%
$62.4 Million
■
■
■
■
■
■
■
■
■
■
■
■

15 STADIUM AUTHORITY OPERATING BUDGET (CONT .)

2021/22 2022/23 2022/23 2023/24
Year-end Adopted Projected Proposed
Actuals Budget Actuals Budget
Beginning Fund Balance
Unrestricted 4,770,763 $ 5,076,581 $ 18,190,965 $ 6,101,782 $ Contingency Reserve 6,524,484 11,366,540 902,081 5,476,070 Stadium Funding Trust Reserve 5,579,272 4,583,726 5,550,348 5,163,080 Total Beginning Fund Balance 16,874,519 $ 21,026,847 $ 24,643,394 $ 16,740,932 $ Revenues
NFL Ticket Surcharge 9,809,009 $ 10,822,000 $ 11,367,000 $ 12,178,000 $ SBL Proceeds 27,279,416 24,398,000 24,528,000 12,589,000 Interest 24,692 15,000 1,037,000 1,249,000 Net Revenues from Non-NFL Events (4) - 250,000 7,262,000 4,500,000 Naming Rights 3,529,738 7,380,000 11,016,000 7,602,000 Sponsorship Revenue (STR) 343,426 405,000 410,000 475,000 Rent 24,762,000 24,762,000 24,762,000 24,762,000 Senior & Youth Program Fees 235,975 237,000 250,000 234,000 Non-NFL Events Ticket Surcharge - 574,000 1,284,000 1,296,000 Other Revenue 550,600 - 650,000 - Total Revenues 66,534,856 $ 68,843,000 $ 82,566,000 $ 64,885,000 $ 2021/22 2022/23 2022/23 2023/24
Year-end Adopted Projected Proposed
Actuals Budget Actuals Budget
Transfers In
Transfers In from Debt Service Fund(9) 6,790,483$ - $ - $ - $ Total Transfers In 6,790,483 $ - $ - $ - $ Total Source of Funds 90,199,858 $ 89,869,847 $ 107,209,394 $ 81,625,932 $ Santa Clara Stadium Authority
Operating Budget Summary

16 STADIUM AUTHORITY OPERATING BUDGET (CONT .)

2021/22 2022/23 2022/23 2023/24
Year-end Adopted Projected Proposed
Actuals Budget Actuals Budget
Expenses
Shared Stadium Manager Expenses
Stadium Operations 8,709,773 $ - $ 1,295,855$ 4,550,000 $ Engineering 5,081,922 - 3,527,012 2,694,000 Guest Services 1,237,953 - 2,443,763 645,000 Groundskeeping 636,655 - 390,343 650,000 Security 3,264,973 - 452,753 1,564,000 Procurement - - - - Insurance 3,204,179 3,230,000 3,230,000 3,327,000 Stadium Management Fee 716,640 - 253,000 354,000 Shared Stadium Manager Expenses Subtotal 22,852,095$ 3,230,000 $ 11,592,726 $ 13,784,000 $ Other Operating Expenses
SBL Sales and Service (1) 1,753,451 2,089,000 2,061,011 2,333,000 Senior & Youth Program Fees (paid to City) (1) 235,975 237,000 250,000 234,000 Net Loss from Non-NFL Events (5) 288,741 - - - Ground Rent (paid to City) (2) 425,000 460,000 460,000 495,000 Performance Rent (paid to City) (2) - - - - Discretionary Fund Expense (3) - 250,000 1,300,000 250,000 Utilities (1) 1,079,233 1,444,000 1,288,000 1,391,000 Use of StadCo Tenant Improvements (1) 164,826 48,000 82,000 108,000 Stadium Authority General & Administrative (3) 2,923,587 2,905,000 1,824,140 3,272,000 Stadium Authority Legal Services (3) - 1,300,000 974,217 300,000 Naming Rights Commission (1) 88,244 91,000 91,000 94,000 Legal Contingency (6) - 10,542,420 1,172,989 1,077,000 Legal Contingency - Public Safety Costs (7) - - 3,401,000 2,002,500 Other Expenses (1) 1,564,804 723,000 456,000 734,000 Other Operating Expenses Subtotal 8,523,861 $ 20,089,420 $ 13,360,357 $ 12,290,500 $ Total Expenses 31,375,956 $ 23,319,420 $ 24,953,083 $ 26,074,500 $ Transfers Out
Debt Service (2) 30,132,671$ 40,984,580 $ 46,340,801 $ 25,457,000 $ Discretionary Fund Reserve (2) - 287,000 642,000 648,000 Capital Expenditures Reserve (2) 3,689,622 3,801,000 3,801,000 3,915,000 Operating Reserve (2) 358,215 369,000 7,701,261 600,000 Renovation/Demolition Reserve (2) - - 7,030,317 5,693,000 Total Transfers Out 34,180,508 $ 45,441,580 $ 65,515,379 $ 36,313,000 $ Ending Fund Balance
Unrestricted 18,190,965 4,034,307 6,101,782 4,284,862 Contingency Reserve (8) 902,081 11,366,540 5,476,070 8,555,570 Stadium Funding Trust Reserve 5,550,348 5,708,000 5,163,080 6,398,000 Total Ending Fund Balance 24,643,394 $ 21,108,847 $ 16,740,932 $ 19,238,432 $ Total Use of Funds 90,199,858 $ 89,869,847 $ 107,209,394 $ 81,625,932 $ (1) Recommended by ManagementCo
(2) Amounts are based on payment schedule or calculated as instructed per relevant agreements (3) Recommended by Stadium Authority staff
(4) Net Revenues from Non-NFL Events are provided by ManCo on a cash basis, and table above reflects accrual basis; ManCo anticipating Non-NFL Events net profit to range from $4,500,000 to $5,500,000 for FY2023/24. (5) Net Loss from Non-NFL Events is provided by ManCo on a cash basis, and table above reflects accrual basis. (6) Shared Expenses and NFL-SBL Buffet costs were under arbitration and reserved under FY2022/23 Adopted Budget. Disputes over Shared Expenses were settled at the end of FY2021/22, and amounts reported are related to NFL-SBL Buffet costs which are part of an unsettled claim. (7) Amounts reserved for Public Safety Costs which are part of an unsettled claim. (8) Amounts reserved for disputed NFL-SBL Buffet costs and Public Safety Costs which are part of an unsettled claim. (9) SCSA recorded receivables under Debt Service Fund for payments diverted for disputed Shared Expenses. Disputed Shared Expenses were recognized under Operating Fund in FY2021/22 as part of the settlement, and receivables recorded under Debt Service Fund were transferred to Operating Fund to offset the recognition of disputed Shared Expenses.

Santa Clara Stadium Authority
Operating Budget Summary (Cont.)

17 STADIUM AUTHORITY OPERATING BUDGET (CONT .)
Stadium Authority Board Duties and Proposed General and Administrative Budget

The Board is a public entity responsible fo r governing the matters concerning Levi’s ® Stadium. As
such, the Board is responsible for setting policy direction, ensuring impl ementation of its policy direction and other due diligence requirements through Stadium Authority staff, and auditing/oversight of its policy implementation, as reasonable and necessary.

The administrative budget totals $3.6 million, or 6%, of the Fi scal Year 2023/24 Proposed Stadium Authority Operating Expense Budget of $62.4 million. With this budget, staff will support the Board with its oversight of Levi’s
® Stadium per the vari ous agreements with M anagementCo and StadCo, such as:

1. Uphold fiduciary responsib ilities and debt obligations;

2. Maintain a productive and functional business relationship with the Tenant;

3. Ensure that Levi’s
® Stadium is maintained in the required condition and operated as a quality NFL and multi-purpose public sports, public assembly, exhibit, and entertainment facility;

4. Work collaboratively with the Stadium Manager to hold safe events at Levi’s® Stadium with minimal impacts to the surrounding residential and business community;

5. Develop Board policies as required for proper governance and transparency efforts concerning the Stadium Authority oversight efforts;

6. Continue the current noise monitoring program;

7. Implement public safety expert’s recommendations during events held at Levi’s® Stadium;

8. Develop and implement over sight initiatives consistent with public entity organizations;

9. Create and participate in the Ne ighborhood Stadium Relations Committee.

Stadium Authority staff are responsible for the programmatic oversight and audit of Stadium activities.

As part of this budget, the oversight of Stadium activities is allo cated primarily to the Executive Director, Stadium Authority Counsel, Auditor, Treasurer, and various supporting professional staff.

As such, the Stadium Authority G&A expense budget of $3.6 million provides the financial means to fulfill the Board’s policy direction and strategic initiatives and m anage the day-to-day operations of the Stadium Authority. A breakdow n of the Stadium Authority’s po rtion of the overall operating expense budget of $62.4 million is shown on the following page.

18 STADIUM AUTHORITY OPERATING BUDGET (CONT .)

Budget Comments
Staff support 2,472,000$ To support the Stadium Authority with its oversight duties of stadium activities Legal Services 300,000 As needed for outside legal services Audit Services 275,000 Financial and performance audits performed by external auditors Consultants
- Community Outreach/Communications 100,000 Community engagement effo rts and/or Board initiatives consistent with the work plan - Noise Monitoring 62,000 Cont inued noise monitoring of Levi's Stadium Executive Director & Board Directives 174,000 Funding for unanticipated Board directives, Executive Director assignments, etc.

Administrative Services 157,000 Laserfiche repository and contractor compliance monitoring services Other Expenses 20,000 Routine office expenses Board Stipends 12,000 Stadium Authority meetings Total 3,572,000$
Stadium Authority FY2023/24 General and Administrative Proposed Budget Expense Type
Stadium Authority FY2023/24 General and Administrative Budget ■ Staff Support
■ Audit Services
■ Noise Monitoring
■ Administrative Services
Board stipends
■ Legal Services
■ Community Outreach
■ Executive Directors and Board Directives
■ Other expenses

19 Accrual Basis Accounting: The method of recording revenues and expenses when they are incurred, regardless of when cash is exchanged.

Contribution to Operating Reserve: The contributions to the oper ating reserve are funded by means of excess revenues (see Excess Revenue below). ( Source: The Amended and Restated Stadium Lease Agreement).

Discretionary Fund Expense: This is funded by half of the Non-NFL ticket surcharge (see Non-NFL Event Ticket Surcharge on Page 21) and has been used to cover NFL public safety costs above the public safety cost threshold in the first three fiscal years of operation and other items at the Stadium Authority’s discretion.

Excess Revenue: If Stadium Authority revenue exceeds expenses for any lease year, such excess revenues shall be distributed as described in the t able below. This table reflects how the excess revenues are projected to distribute in the 2022/23 fiscal year. (Source: The Amended and Restated Stadium Lease Agreement)

Discretionary Fund Balance
Summary
FY 2022/23
Year-end
Actual
FY 2022/23
Adopted
Budget
FY 2022/23
Projection
FY 2023/24
Proposed
Budget
Beginning Balance 2,327,850 $ 2,327,850 $ 2,327,850 $ 1,669,850 $ Transfers in from Operating(1) - 287,000 642,000 648,000 Discretionary Fund Expenditures - (250,000) (1,300,000) (250,000) Ending Balance 2,327,850 $ 2,364,850 $ 1,669,850 $ 2,067,850 $ (1) Tranfer amount equal 50% of Non-NFL Event Ticket Surcharge # Description
Amount
Funded Balance Notes
Projected Excess Revenues at Year-end 19,124,744 $
Release of Previously Withheld Unpaid Shared Expenses 11,763,462 $ Total Projected Excess Revenues at Year-end 30,888,206 $ 1 Payment of ManCo Revolving Loan - $ 30,888,206$ N/A 2 Funding Operating Reserve up to $2 Million +3% annually - $ 30,888,206$ Funding requirement met 3 Funding CapEx Reserve an Additional $1 Million +3% annually (1,267,000)$ 29,621,206 $ Funding annual CapEx Reserve 4 Funding Operating Reserve up to $10 Million +3% annually - $ 29,621,206$ Funding requirement met 5 Prepayment of StadCo Subordinated Loan (14,889,628) $ 14,731,578 $ Project to fully repay in FY 2022/23 6 Funding Operating Reserve up to $20 Million +3% annually (7,701,261)$ 7,030,317 $ Funding requirement met 7 Funding Renovation/Demolition Reserve up to $70 Million (7,030,317)$ - $ Project to start funding in FY 2022/23 8 Available for Additional Disbursements as described in the Stadium Lease -$ - $ N/A 2022/23 Projected Actual Result - Use of Excess Revenues

STADIUM AUTHORITY OPERATING BUDGET GLOSSARY

20 STADIUM AUTHORITY OPERATING BUDGET GLOSSARY
(CONT .)
The FY 2022/23’s projected excess revenues allocation included a cash transfer in of $11.8 million that the Stadium Authority withheld from the previously disputed Shared Stadium Manager Expenses and Operating and Management Expenses in FY 2019/20, FY 2020/21, and FY 2021/22. This cash transfer enables the Stadium Authority to pay off the StadCo Subordinated Loan in FY 2022/23.

Ground Rent: The City has agreed to lease the land under Levi’s ® Stadium to Stadium Authority for
an initial term of 40 years. The fixed ground rent schedule is noted below for the 40-year initial term. (Source: Ground Lease Agreement)

Insurance: ManagementCo procures insurance for Levi’s
® Stadium for the entire year and the cost
is split between Stadium Aut hority and StadCo (see Shared Stad ium Manager Expenses on Page 22). The Stadium Lease sets the St adium Authority’s share of insurance expense at $2,550,000 for the first lease year with each succeeding lease year’s insurance expense increasing by 3%. (Source:

Stadium Management Agreement & The Amended and Restated Lease Agreement)

Interest: This is interest earned from cash on hand.

Naming Rights: Levi Strauss & Co (Levi’s®) pays an annual naming rights fee to Stadium Authority.

The annual fee increases by 3% each contract year through the 20-year term. This annual fee is paid in two equal semi-annual installments on or before March 1st and October 1st. (Source: Naming Rights Agreement)

The Naming Rights Agreement with Levi’s
® requires the Stadium Authority to hold at least 36 “Major Events” (with 25,000+ attendees) every three contract years. Ho wever, the Second Amendment to the Stadium Management Agreement states that ManagementCo woul d pay the Stadium Authority as liquidated damages the amount owed by the Stadium Authority to Levi’s®. ManagementCo has acknowledged responsibility for liquidated damages. During discussion between the Stadium Manager and Levi’s®, it was determined based on the contract language that the first contract year Lease
Year(s) Fiscal Year(s)
Annual Fixed
Ground Rent
1 2014-15 180,000 $
2 2015-16 215,000 $
3 2016-17 250,000 $
4 2017-18 285,000 $
5 2018-19 320,000 $
6 2019-20 355,000 $
7 2020-21 390,000 $
8 2021-22 425,000 $
9 2022-23 460,000 $
10 2023-24 495,000 $
11-15 2024-25 through 2028-29 1,000,000$
16-20 2029-30 through 2033-34 1,100,000$
21-25 2034-35 through 2038-39 1,200,000$
26-30 2039-40 through 2043-44 1,300,000$
31-35 2044-45 throu gh 2048-49 1,400,000$
36-40 2049-50 throu gh 2053-54 1,500,000$

21 STADIUM AUTHORITY OPERATING BUDGET GLOSSARY
(CONT .)

began March 1, 2015. As of this report, the curr ent number of Major Events held at Levi’s® Stadium was seven (7) through the current three-year period.

The below table reflects the number of major events from March 1, 2015 to date:

Net Revenues from Non-NFL Events : ManagementCo provides management services for Levi’s® Stadium year-round. As such, ManagementCo is responsible for booking and scheduling all Non-NFL events on behalf of Stadium Author ity. ManagementCo is required by the agreement to maintain complete and accurate books and records relating to the net income from the Non-NFL events. Those records are reviewed by Stadium Authority staf f and/or outside consultant s and audited by an independent auditor. After the comp letion of the fiscal year, the net revenues are paid to Stadium Authority by ManagementCo. (Source: Stadium Management Agreement)

NFL Ticket Surcharge : The Forty Niners Football Company, LLC (the Team) collects a 10% NFL ticket surcharge on the price of admission to all NFL games occurring in Levi’s® Stadium on behalf of Stadium Authority. (Source: Amended and Restated Non-Relocation Agreement)

Non-NFL Event Expense: The gross expenses for Non-NFL events held at Levi’s ® Stadium.

Non-NFL Event Revenue: The gross receipts from Non-NFL events held at Levi’s® Stadium.

Non-NFL Event Ticket Surcharge : Promoters or sponsors of any ticketed Non-NFL event that is held at Levi’s® Stadium are required to collect a $4 per ticket surcharge on behalf of Stadium Authority.

The one-half of this surcharge that is paid to Stadium Authority co vers general stadium operations and the other half funds the Stadium Authority Discretionary Fund. (Source: Amended and Restated Stadium Lease Agreement)

Other Expenses: Miscellaneous Stadium Authority expenses such as bank fees.

Other Revenue: Miscellaneous Stadium Authority revenues.

Number of
Major Events
March 1, 2015 to February 28, 2018 40
March 1, 2018 to February 28, 2021 12
March 1, 2021 to February 28, 2024 7
Naming Rights Agreement
Three-Year Periods

22 STADIUM AUTHORITY OPERATING BUDGET GLOSSARY
(CONT .)

Performance-Based Rent: Stadium Authority pays the City per formance-based rent on top of the fixed ground rent. The basic calculation for the performance-based rent is 50% of the net income from Non-NFL events for any given lease year less the sum of performance-based rent credits. The performance-based rent credits in clude 50% of the current year ’s base ground rent and credited public safety costs. Per Stadium Lease Paragraph 7.5.3(a), credited public safety costs is the amount by which public safety costs exceed the public safe ty costs threshold. The table below represents a projection of the 2022/23 and 2023/24 fiscal years’ performance-based rent. (Source: Ground Lease Agreement & Amended and Restated Stadium Lease Agreement)

Rent: The facility rent was originally set at $24.5 million for StadCo to lease the Stadium for their half of the year. As a result of the rent reset arbitration award in favor of Stadium Authority, the facility rent was reset to $24.8 million retro-active to the first lease year. The rent adjustment process is outlined in the Amended and Rest ated Stadium Lease. ( Source: Amended and Restated Stadium Lease Agreement)

Senior and Youth Program Fees : During the lease terms, StadCo collects a City of Santa Clara Senior and Youth Program Fees on behalf of Stadium Authority. The fee is $0.35 per NFL game ticket up to a maximum of $250,000 per lease year. ( Source: Amended and Re stated Stadium Lease Agreement)

Shared Stadium Manager Expenses : ManagementCo oversees the day-to-day operations of Levi’s® Stadium year-round. Since StadC o leases the Stadium from St adium Authority for half of each fiscal year, expenses incurred by the Stadium Manager are shar ed between StadCo and Stadium Authority. Mo st Shared Stadium Manager Expenses are split 50/ 50 between StadCo and Stadium Authority; grounds-keeping is the exception with a 70/30 sp lit, with StadCo responsible for the larger share. In addition, M anagementCo procures insurance for Levi’s® Stadium that is shared between StadCo and Stadium Authority (see Insurance on Page 20). (Source: Stadium Management Agreement & The Amended and Restated Stadium Lease Agreement)

In FY 2019/20, the Stadium Au thority Board instructed the conditioning of payments until ManagementCo presents the required supporting documentation for t he expenses. As part of the settlement on August 31, 2022, the St adium Authority agreed to timely pay invoices from Stadium Manager in accordance with the Stadium Authority’s annual budget except for NFL-SBL Buffet costs which are part of an unsettled clai m. The FY 2022/23 projection and FY 2023/24 proposed budget assume the continuation of withholding payments for the disputed NFL-SBL Buffet costs . The funding
Performance Rent Calculation
Fiscal Year 2022/23
Projection
Fiscal Year 2023/24
Budget
Ground Rent 460,000 $ 495,000 $
Net Non-NFL Event Revenue (Expense) 7,262,000 4,500,000 50% of Net Non-NFL Event Revenue (Expense) 3,631,000 $ 2,250,000 $ Performance Rent Credit from Ground Rent (50% of Ground Rent) (230,000) (247,500) Net Performance Rent after Ground Rent Credit 3,401,000$ 2,002,500 $ Reserve for Litigation Contingency - Public Safety Costs (3,401,000) (2,002,500) Final Performance Rent paid to the City of Santa Clara 0$ 0 $

23 STADIUM AUTHORITY OPERATING BUDGET GLOSSARY
(CONT .)
requested for NFL-SBL Buffet costs by ManagementCo will be allocated in a Legal Contingency until pending dispute resolution.

Sponsorship Revenue (STR) : STR Marketplace, LLC (STR) established a secondary market website to facilitate the trans fer and resale of SBLs. In e xchange for the use of the Levi’s® Stadium trademarks and links on the websit e (hence the title Sponsorship Revenue), STR pays Stadium Authority a minimum annua l fee of $325,000 based on the commissions that are collected by STR.

In addition to the minimum annual fee, Stadium Auth ority also receives 50% of any commissions in excess of $650,000. (Source: SBL Website Marketing Agreement)

Stadium Authority General & Administrative : As an independent public entity, Stadium Authority incurs its own expenses in relation to Board gover nance, fiduciary responsibilities, oversight, and operations of Levi’s® Stadium. These include but are not limited to Stadium Authority staff time and various outside contractors and consultants who ar e hired to support staff with administering the necessary requirements for owning and operating Levi’s® Stadium and the day-to-day operations of the Stadium Authority. Also included are various administrative type costs such as bank fees, phone charges, IT equipment maintenance, etc.

Stadium Builder License (SBL) Proceeds: SBL holders who are on a payment plan make annual payments. Additionally, some SBL holders make payments above and beyond their annual scheduled payment plan. There are also sa les of new SBLs and/or SBLs that were defaulted and resold. SBL cash collections from all these sources make up SBL proceeds.

Stadium Builder License (SBL) Sales and Service: ManagementCo provides sales and service to SBL holders on behalf of Stadium Authority. This includes all SBL collecti on efforts and customer service support. (Source: Agreement for Stadium Builder License Sales & Fourth Amendment to the Stadium Management Agreement)

Stadium Management Fee: ManagementCo receives an annual base management fee to manage Levi’s® Stadium. The fee was $400,000 in the first l ease year and increases by 3% annually. This annual base management fee is sp lit 50/50 between StadCo and Stadium Authority since ManagementCo manages the Stadium year-round for both entities. In addition to the base management fee, ManagementCo receives a stadium marketing and booking fee (incentive fee) which is based on a percentage of the amount that the net income from Non-NFL events exceeds the marketing and booking fee benchmark. The table below shows the first 10 years of the base management fee and the stadium marketing and booking fee benchmark. It also shows the first eight years of net income from Non-NFL events and a projection of the ninth year as well as the applicable marketing and booking fee which was 5% for the firs t three (3) fiscal years and 10% for the fourth (4th) fiscal year and continuing thereafter of the net Non-NFL income over the benchmark. (Source:

The Stadium Management Agreement)

24 STADIUM AUTHORITY OPERATING BUDGET GLOSSARY
(CONT .)

Transfers Out: Transfers from the Stadium Authority Operating Fund to fu nd Debt Service, Capital Funds, Discretionary Fund, Operating Reserve, and Renovation/Demolition Reserve.

Utilities: StadCo leases the Stadium from Stadium Author ity for six months of each fiscal year from August through January. StadCo is therefore responsible for the day-to-day utilities during that period.

Stadium Authority pays for the day-to-day utilities from February through July. Utilities associated with large ticketed Non-NFL events are charged as an expense to the event which is included in the Non- NFL events expense.

Use of StadCo Tenant Improvements: StadCo charges Stadium Authority for use of various StadCo tenant improvements (such as the use of the scoreboard) during Non-NFL events. (Source: Amended and Restated Lease Agreement)
Fiscal Year
Lease
Year
Annual Base
Stadium
Management Fee
(SCSA Share)
Stadium
Marketing and
Booking Fee
Benchmark
Actual/Projected
Net Income from
Non-NFL Events
Actual Stadium
Marketing and
Booking Fee
Total Stadium
Management Fee
2014/15 1 200,000 $ 5,000,000$ 5,207,553 $ 10,378 $ 210,378 $ 2015/16 2 206,000 $ 5,150,000$ 6,079,016 $ 46,451 $ 252,451 $ 2016/17 3 212,180 $ 5,304,500$ 5,316,894$ 620$ 212,800$ 2017/18 4 218,545 $ 5,463,635$ 5,163,329$ -$ 218,545$ 2018/19 5 225,102 $ 5,627,544$ 18,591$ -$ 225,102$ 2019/20 6 231,855 $ 5,796,370$ (2,741,014)$ -$ 231,855$ 2020/21 7 238,810 $ 5,970,261$ (476,960)$ -$ 238,810$ 2021/22 8 245,975 $ 6,149,369$ (288,741)$ -$ 245,975$ 2022/23(1) 9 253,354$ 6,333,850$ 7,262,000$ 92,815$ 346,169 $ 2023/24 10 260,955 $ 6,523,866$
(1) Net income from Non-NFL events for FY2022/23 is projected To be determined

25 The Stadium Management Agreement is between
the Stadium Author ity, StadCo and
ManagementCo and was entered into as of March
28, 2012. This agreement was developed to
provide the Stadium Authority with the expertise of
an outside manager to ov ersee the day-to-day
operations of Levi’s
® Stadium. Additionally, the
Amended and Restated Stadium Lease
Agreement between the St adium Authority and
StadCo was made and entered into as of June 19,
2013.

This agreement amended the original stadium
lease to set the initial rent, to allow StadCo to enter into agreements with alternative energy providers,
to cap Stadium Authority’s share of the insurance
costs at a fixed amount each year, and to require
Stadium Authority to fund various reserves.

Per the terms of the St adium Lease Agreement,
StadCo leases the Stadi um from the Stadium
Authority for half of each fiscal year and is
responsible for the Stadi um Manager’s operating
expenses during that period. The Stadium
Manager’s operating expenses for the other half of
the year are the respons ibility of the Stadium
Authority. Section 8.3.1 describes the
proportionate share of Stadium Manager
expenses that are owed by the Stadium Authority
and StadCo. Namely that most Stadium Manager’s
operating expenses are sp lit 50/50 with grounds-
keeping being the exception with a 70/30 split,
StadCo being responsible for the larger share.

ManagementCo procures insurance for Levi’s ®
Stadium for the entire year and the cost is shared
between Stadium Authority and StadCo.

Section 4.7 of the M anagement Agreement notes
that ManagementCo wil l provide an Annual
Shared Stadium Expense Budget to be adopted
annually by Stadium Authority and StadCo.

Once the budget has been adopted,
ManagementCo invoices Stadium Authority
monthly for its budgeted portion of shared
expenses which include Stadium
Manager’s operating expenses. As part of
the year-end work, the budgeted amounts
that were paid are to be trued up with actual
expenditures.

SHARED STADIUM MANAGER EXPENSES

26 SHARED STADIUM MANAGER EXPENSES (C ONT .)

Security
Stadium
Operations Engineering Guest Services Groundskeeping Total Total Compensation 771,038 $ 5,917,558 $ 3,452,634 $ 664,862 $ 277,150 $ 11,083,242$ Travel, Meals & Entertainment 17,054 454,550 5,620 16,940 8,050 502,214 Outside Services 1,998,380 1,857,992 1,792,234 2,200 1,713,967 7,364,773 General Supplies 161,850 173,350 660 137,506 155,260 628,626 Telephone 19,500 481,500 16,800 7,200 1,440 526,440 Equipment 154,520 196,600 99,592 83,004 9,000 542,716 Uniforms 6,600 - 17,612 265,328 3,000 292,540 Other - 16,900 3,000 113,332 - 133,232 Subtotal 3,128,942 $ 9,098,450 $ 5,388,152 $ 1,290,372 $ 2,167,867 $ 21,073,783 $ Security
Stadium
Operations Engineering Guest Services Groundskeeping Total Total Compensation (2) 385,519$ 2,958,779 $ 1,726,317 $ 332,431 $ 83,145 $ 5,486,191$ Travel, Meals & Entertainment 8,527 227,275 2,810 8,470 2,415 249,497 Outside Services 999,190 928,996 896,117 1,100 514,190 3,339,593 General Supplies 80,925 86,675 330 68,753 46,578 283,261 Telephone 9,750 240,750 8,400 3,600 432 262,932 Equipment 77,260 98,300 49,796 41,502 2,700 269,558 Uniforms 3,300 - 8,806 132,664 900 145,670 Other - 8,450 1,500 56,666 - 66,616 Subtotal 1,564,471 $ 4,549,225 $ 2,694,076 $ 645,186 $ 650,360 $ 10,103,318$ Insurance (3) 3,327,000
Management Fee (4) 354,000
Total 13,784,318$
(2) Total compensation is based on a total of 55 full time equivalent positions. (3) The stadium lease sets Stadium Authority's share of insurance expense at $2,550,000 for the first lease year with each succeeding lease year's expense increasing 3%.
(4) The stadium management agreement sets the base management fee at $400,000 for the first lease year with each succeeding lease year's management fee increasing 3%. This base management fee is split 50/50 between Stadium Authority and StadCo.

Stadium Manager
2023/24 Total Shared Stadium Expenses
Between the Santa Clara Stadium Authority and Forty Niners SC Stadium Company (StadCo) Santa Clara Stadium Authority Proportionate Share of Stadium Expenses (1) (1) The Santa Clara Stadium Authority proportionate share of stadium expenses is rounded to the nearest $1,000 in the operating budget.

27 Total Compensation: This cost includes full-time staff (55 employees), part-time staff, and benefits.

Stadium Authority pays for 50% of these costs except for Groundskeeping which is set at 30%.

 Full-time wages are costs for all management company full-time employees.

 Part-time wages are costs for all management company part-time employees. Wages include annual training for all Guest Services Representatives.

 Benefits are costs of employees’ health insurance, pension, vacation time, and all employer taxes.

Travel, Meals & Entertainment: These are costs for employee travel (airfare, ground, lodging, and meals) to stadium management conferences. In addition, this category includes costs for staff meals for general food and beverage, v endor engagement, and the year-end guest service employee appreciation banquet.

Outside Services: Costs for outside service providers, which include the following:

 Janitorial and Medical costs related to the janitorial, cleaning, landscaping, and trash services of the interior and exterior of the Stadium and medical services for the Stadium during regular business hours.

 Stadium Security costs for staffing 24/7 security guards in and around the Stadium and explosive detection canines.

 Engineering & Maintenance for mandatory safety and general maintenance costs associated with fire sprinklers, fire alarms, elevators, and backflows. Also includes outside sub-contracted calls for services for windows, signage and roof repair, HVAC & electrical, carpet, concrete or other miscellaneous repairs.

General Supplies: Supplies for stadium operations, janitorial, engineering, and Guest Services (For example: janitorial supplies, gen eral printing costs for stadium signage, deployment sheet, notes, handbooks etc.).

Telephone: These are costs for land lines and internet/data service for the Stadium, net of the costs for the Team’s business offices, and cell service for Stadium Mana ger’s Stadium Operations and Security Department personnel.

Equipment: Costs associated with stadi um operations and security so ftware, including incident tracking, mobile safety application, stadium staff scheduling/event cale ndar software, video surveillance licensing software, X-ray machine rental for deliveries, and monthly cost for off-site equipment storage.

SHARED STADIUM MANAGER EXPENSES GLOSSARY

28 STADIUM MANAGER SHARED EXPENSES GLOSSARY (CONT .)

Uniforms: Guest Services Department’s replacement and replenishment of uniforms.

Other Costs: Costs associated with Stadium Operations (For example: specialized training, command post, CPR first aid, background checks, recr uiting, marketing/advertising, and employee retention program).

Tenant Improvements: Interior improvements within Tenant's exclusive facilities and any other improvements within the Stadium that are to be owned by, and constructed at the cost of, Tenant or any Tenant transferee as may be agreed by the Partie s (Stadium Authority and StadCo). (Source:

Stadium Lease Agreement).

2024/25 2025/26 2026/27 2027/28 2028/29
Total Compensation 5,650,776 $ 5,820,300 $ 5,994,909 $ 6,174,756 $ 6,359,999 $ Travel, Meals & Entertainment 256,982 264,691 272,632 280,811 289,235 Outside Services 3,439,781 3,542,974 3,649,263 3,758,741 3,871,504 General Supplies 291,759 300,511 309,527 318,813 328,377 Telephone 270,820 278,945 287,313 295,932 304,810 Equipment 277,645 285,974 294,553 303,390 312,492 Uniforms 150,040 154,542 159,178 163,953 168,872 Other 68,615 70,673 72,793 74,977 77,226 Total 10,406,418 $ 10,718,610 $ 11,040,168 $ 11,371,373 $ 11,712,515 $ Insurance (1) 3,426,987 3,529,796 3,635,690 3,744,761 3,857,104 Management Fee (2) 268,783 276,847 285,152 293,707 302,518 Total 14,102,188 $ 14,525,253 $ 14,961,010 $ 15,409,841 $ 15,872,137 $ succeeding lease year's management fee increasing 3%. This base management fee is split 50/50 between SCSA and StadCo.

Stadium Manager
Santa Clara Stadium Authority Proportionate Share of Stadium Expenses - Five Year Forecast
(1) The stadium lease sets SCSA's share of insurance expense at $2,550,000 for the first lease year with each succeeding lease year's expense increasing 3%.
(2) The stadium management agreement sets the base management fee at $400,000 for the first lease year with each

29 Debt Service Payment : The FY 2023/24 Debt Service Budget of $27.8 million is based on the required and additional principal and interest debt se rvice payments. It excl udes payment to the StadCo Subordinated Loan because the Stadium Authority project it to be paid off with the excess cash in FY 2022/23. A glossary is included at the end of this section that describes the type of debt and the applicable source documents for each l oan. Of the $27.8 million budget, $2.3 million represents anticipated contributions from the Community Facilities District (CFD). The total Debt 2021/22 2022/23 2022/23 2023/24
Year-end Adopted Pro jected Proposed
Actuals Budget Actuals Budget
Beginning Fund Balance
Required Debt Service Reserve 11,536,235$ 11,536,235 $ 11,536,235 $ 11,536,235 $ Debt Service Reserve 21,499,383 12,532,334 14,103,958 14,431,075 Total Beginning Fund Balance 33,035,618 $ 24,068,569 $ 25,640,193 $ 25,967,310 $ Revenues
Contribution from CFD 1,085,574 $ 2,124,000 $ 2,567,861 $ 2,696,000 $ Total Revenues 1,085,574 $ 2,124,000 $ 2,567,861 $ 2,696,000 $ Transfers In
Transfers In from Operating 30,132,671 $ 40,984,580 $ 46,340,801 $ 25,457,000 $ Total Transfers In 30,132,671 $ 40,984,580 $ 46,340,801 $ 25,457,000 $ Total Source of Funds 64,253,863 $ 67,177,149 $ 74,548,855 $ 54,120,310 $ 2021/22 2022/23 2022/23 2023/24
Year-end Adopted Projected Proposed
Actuals Budget Actuals Budget
Expenses
CFD Advance 1,690,516 $ 2,042,000 $ 2,240,744 $ 2,379,000 $ Term A Loan 25,528,912 25,494,000 25,493,762 25,457,000 StadCo Subordinated Loan 4,603,759 15,490,580 20,847,039 - Total Expenses 31,823,187 $ 43,026,580 $ 48,581,545 $ 27,836,000 $ Transfers Out
Transfers Out to Operating Fund(1) 6,790,483$ - $ - $ - $ Total Transfers Out 6,790,483 $ - $ - $ - $ Ending Fund Balance
Required Debt Service Reserve 11,536,235$ 11,536,235 $ 11,536,235 $ 11,536,235 $ Debt Service Reserve 14,103,958 12,614,334 14,431,075 14,748,075 Total Ending Fund Balance 25,640,193 $ 24,150,569 $ 25,967,310 $ 26,284,310 $ Total Use of Funds 64,253,863 $ 67,177,149 $ 74,548,855 $ 54,120,310 $ (1) SCSA recorded receivables under Debt Service Fund for payments diverted for disputed Shared Expenses. Disputed Shared Expenses were recognized underOperating Fund in FY2021/22 as part of the settlement, and receivables recorded under Debt Service Fund were transferred to Operating Fund to offset the recognition of disputed Shared Expenses.

Santa Clara Stadium Authority
Debt Service Budget Summary

STADIUM DEBT SERVICE BUDGET

30 Service Reserves are projected at $26.3 million.

The schedule on page 31 provides a breakdown of th e principal and interest payments budgeted in FY 2023/24 for each loan as well as the beginning and ending balances. The total outstanding debt is projected to decrease by $16.1 million in FY 2023/24 from $245.3 million to $229.1 million.

31 2023/24 2023/24 2023/24
Debt Interest 2023/24 Beginning Principal Ending
Obligations rates Interest Balance Payments Balance
Stadium Funding Trust Term A Loan 5.00% 9,998,000$ 215,415,240$ (15,459,000)$ 199,956,240$ StadCo CFD Advance(1) 5.73% 1,703,000 29,867,229 (676,000) 29,191,229 Total 11,701,000 $ 245,282,469$ (16,135,000)$ 229,147,469$ Santa Clara Stadium Authority
Debt Service Payment Schedule
(1)Community Facilities District (CFD) principal payment is an estimate based on anticipated contributions from the CFD.

Any increase in principal for the year is due to adding unpaid interest to the principal.

STADIUM DEBT SERVICE BUDGET (CONT .)
$700
$600
$500
$400
$300
$200
$100
$-
Total Outstanding Debt (in millions)
$653.4
March March March March March March March March March March March March March 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 (forecast) (forecast)
■ Construction Loan ■ StadCo Agency Advance ■ Term B Loan ■ Term A Loan ■ StadCo CFO Advance ■ StadCo Subordinated Loan

32 Contribution from the Community Facilities District (CFD) : The CFD was established for the purpose of financing and constructing publicly owned facilities. To s upport that, the CFD levies and collects a special hotel tax of 2% on hotel rooms withi n the CFD. During the construction of Levi’s® Stadium, Stadium Authority spent $35.0 million on CFD infrastructure. All collections from the special CFD hotel taxes are contributed to Stadium Authority to pay down the CFD Advance which was used to fund the construction of the CFD publicly owned facilities. (Source: The Reimbursement Agreement Relating to the CFD)

CFD Advance: StadCo agreed to loan Stadium Authority a not to exceed amount of $35.0 million for CFD infrastructure and with a maximum principa l amount of $38.0 million including capitalized interest. This loan bears interest at a fixed rate of 5.73% and the loan is payable solely from amounts received by Stadium Authority from the CFD. (Source: The Authority Promissory Note in Respect of StadCo CFD Advance)

Term A Loan : The Stadium Funding Trust (FinanceCo) agreed to loan Stadium Authority $282.8 million to fund construction of Levi’s® Stadium. This loan bears interest at a fixed rate of 5% payable semi-annually, with annual principal payments due beginning in April 2018. It has a maturity date in 2039 and is subject to certain prepayment premiums. The principal payment schedule is noted below. (Source: The Restated Credit Agreement)

StadCo Subordinated Loan : StadCo agreed to loan Stadium Authority an am ount not to exceed $500 million to fund construction of Levi’s ® Stadium. The actual am ount loaned to the Stadium Authority was $236.9 million. This loan bears a fixed interest rate of 5.5% with annual principal payments due beginning in March 2016 and it may be prepaid at any time without penalties. The Stadium Authority anticipate to fully pay off th is loan in FY 2022/23. (Source: The Restated StadCo Obligations Agreement)

Date
Annual Principal
Payment Date
Annual Principal
Payment Date
Annual Principal
Payment
April 1, 2018 12,110,000$ April 1, 2026 8,404,934 $ April 1, 2033 13,306,164 $ April 1, 2019 12,718,000$ April 1, 2027 9,001,865 $ April 1, 2034 14,160,901 $ April 1, 2020 13,354,000$ April 1, 2028 9,630,410 $ April 1, 2035 15,060,270 $ April 1, 2021 14,022,000$ April 1, 2029 10,292,166 $ April 1, 2036 16,006,521 $ April 1, 2022 14,723,000$ April 1, 2030 10,988,812 $ April 1, 2037 17,002,017 $ April 1, 2023 15,459,000$ April 1, 2031 11,722,111 $ April 1, 2038 18,049,239 $ April 1, 2024 7,299,896$ April 1, 2032 12,493,914 $ April 1, 2039 19,150,794 $ April 1, 2025 7,838,094$
Term A Loan Amortization

STADIUM DEBT SERVICE BUDGET GLOSSARY

33 The Capital Expense (CapEx) Budget is used to fund the purchase or upgrade of fixed assets for the Stadium. While the funding for appropriations occur on an annual basis, the Capital Expense Plan extends for a five-year period (shown on Page 45 of this report). Changes to existing projects, as well as the addition of new projects, may occur during the five-year pl anning period as new needs are identified. The appropriations for c apital projects do not lapse at y ear-end but carryover into future years until the project is complete.

The FY 2023/24 CapEx Budget totals $20.5 million . Of this total, $17.2 million of prior year appropriations are projected to be carried over from FY 2022/23 ($1.5 m illion of the projected carryover amount is for warranty-related constructi on, and the other $15.7 mill ion is for prior year CapEx projects). New capital improvement appropriations equal $3.3 million.

A detailed listing of proposed FY 2023/24 projects is provided starting on Page 35 of this report.

Stadium Authority is submitting it as transmitted by the Stadium Manager.

STADIUM AUTHORITY CAPITAL EXPENSE BUDGET

34 2021/22 2022/23 2022/23 2023/24 2023/24 2023/24
Total
Year-end Adopted Projected Projected Proposed Proposed
Actuals Budget Actuals Carryover Budget Budget
Beginning Fund Balance 20,805,741 $ 22,103,296 $ 23,001,058 $ 22,742,271 $ 22,742,271 $ Transfers In
3,689,622 3,801,000 3,801,000 - 3,915,000 3,915,000 Total Transfers In 3,689,622 $ 3,801,000 $ 3,801,000 $ - $ 3,915,000$ 3,915,000 $ Total Source of Funds 24,495,363 $ 25,904,296 $ 26,802,058 $ 22,742,271 $ 3,915,000 $ 26,657,271 $ 2021/22 2022/23 2022/23 2023/24 2023/24 2023/24
Total
Year-end Adopted Projected Projected Proposed Proposed
Actuals Budget Actuals Carryover Budget Budget
Expenses
Construction 757,485 12,699,189 3,298,666 9,261,180 1,635,000 10,896,180 Equipment 736,820 6,555,678 761,121 5,687,920 1,476,832 7,164,752 Contingency - 962,743 - 747,460 155,592 903,052 Stadium Warranty Related Construction - 1,528,202 - 1,528,202 - 1,528,202 Total Expenses 1,494,305 $ 21,745,812 $ 4,059,787 $ 17,224,762 $ 3,267,424 $ 20,492,186 $ Ending Fund Balance 23,001,058 $ 4,158,484 $ 22,742,271 $ 5,517,509 $ 647,576 $ 6,165,085$ Total Use of Funds 24,495,363 $ 25,904,296 $ 26,802,058 $ 22,742,271 $ 3,915,000 $ 26,657,271 $ Santa Clara Stadium Authority
Capital Expense Budget Summary
Transfers In from Operating
STADIUM AUTHORITY CAPITAL EXPENSE BUDGET (C ONT .)

35 Item Type SCSA
Requested Description Cost Contingency
(5%) Total Cost
Electrical Distribution - High Voltage (480V Electrical Power Study, Assessment and Replacements - Phase 2)
300,000$ 15,000 $ 315,000 $
This project is Phase 2 of a multi-year study and assessment of stadium high voltage equipment. This phase will focus on studying and assessing the condition of electrical equipment including, but not limited to, the four electrical quadrant substations located within the stadium. This equipment is critical to the electrical integrity of the stadium. Regular assessment such as this project help identify necessary upgrades, while improving system reliability.

Electrical Li
ghting System - Controls System 75,000 3,750 78,750 This project replaces the stadium lighting control system server. The current server has reached its end of useful life and is not compatible with future software upgrades. Upgrading the lighting control system server ensures the lighting control system remains supported and operational.

Electrical Li
ghting System - Field / Sport Lighting LED Retrofit 350,000 17,500 367,500 This project replaces the current metal halide stadium field / sport lights ("field lights") with an outdoor LED retrofit. LED field lights will dramatically reduce the carbon footprint, lower the number of mercury containing fixtures and cut energy consumption caused by the field lights by up to as much as 40%, which is one of the largest energy consuming systems in the stadium. LED field lights provide an energy efficient solution to upgrade a product that may soon be phased out. LED lights tend to last much longer and require less maintenance than metal halide lights. This project was previously shown in FY24, but the project was pulled forward in anticipation that some of the existing lighting components may be phased out. This is the design and permitting phase for this project.

General Buildin
g Engineering Shop Enhancements 50,000 2,500 52,500 The project invests into the stadium Engineering shop by providing improvements to shop work stations and key shop facilities. It provides necessary resources for stadium Engineering staff to perform maintenance and repair activities. Work station enhancements will improve shop work and storage capabilities. The key shop enhancements provide necessary programming for inventory and key tracking capabilities.

General Buildin
g Exterior Stairwell Traffic Coating Refurbishment 50,000 2,500 52,500 The project removes and reinstalls traffic coating material on the exterior stadium emergency and exit staircases in areas where the traffic coating is compromised. The traffic coating replacement at the staircase landings will prevent trip and fall hazards, as well as protect the staircase structures from rust and corrosion. This project will extend the life of the staircases.

This project was not part of the 5-year Capex project list in previous years, but was determined that this project is necessary due to the unanticipated spalling of the traffic coating materials in specific areas on the staircases.

General Buildin
g Field Tunnel Synthetic Turf Replacement 25,000 1,250 26,250 The project replaces the synthetic turf material in the Northeast, Northwest and South field tunnels. The existing synthetic turf material experiences a high volume of traffic from carts, equipment, vehicles and cranes during the annual event schedule. The wear and tear from the traffic in the tunnels has caused the flooring material to reach the end of life. The turf provides a slip resistant surface for all guests and staff using the tunnels in any weather. The current synthetic turf material will be demolished and properly disposed by the contractor during this project.

General Buildin
g Field Turf Equipment 400,000 20,000 420,000 This project installs a field turf ventilation and vacuum system, to included associated mechanical and miscellaneous equipment. The ventilation and vacuum system extends the growing season by stimulating earlier growth in spring and continuing growth in late fall/winter. This project improves the turf system and may reduce the number of field replacements in the future as a result of impacts from Non-NFL Events. This system promotes and maintains a healthier turf. This is the design and permitting phase for this project.

Santa Clara Stadium Authority
2023/24 CapEx Budget

36 Item Type SCSA
Requested Description Cost Contingency
(5%) Total Cost
General Building Permanent Tunnel Tarp and Event Emergency Exit Sign Replacement 38,000$ 1,900 $ 39,900 $ This project replaces the permanent tunnel tarps and emergency exit signage in the Northeast, Northwest and South field tunnels. The current tunnel tarps are sun faded and in need of replacement. The existing tunnel tarps will be removed and disposed and new tunnel tarps will be furnished and installed by the contractor. The existing tunnel tarp structures will be reused for the project. Emergency exit signage will be refurbished or replaced. This project will maintain the applicable standard of appearance and care expected at the stadium.

General Buildin
g Project and Construction Management Firm 172,000 8,600 180,600 This budget line item is intended to be used for the four (4) Construction Management / Project Management firms selected to assist in managing various SCSA Capex projects. The fees incurred by these firms will be tracked to the various projects that are being supported and will be reported as part of the final costs for each project.

Plumbin
g Plumbing 100,000 5,000 105,000 This project addresses general renewal and replacement of necessary plumbing equipment in the stadium to include, but not limited to, replacement of piping, fittings, vents, joints, switches, cleanouts, valves, drains, traps, primers, strainers, pumps, water heaters, interceptors, filters and/or water softener systems.

Plumbin
g Plumbing Fixtures 75,000 3,750 78,750 The project includes the purchase of plumbing fixtures needed to replace existing end of life components. Labor for this project will be performed by stadium Engineering staff. Components that will be purchased as part of this project include, but are not limited to, toilet, urinal and sink components. The project will start a phased replacement program of existing fixtures in stadium restrooms. This is the first of several phases to replace aging plumbing fixtures and components.

Subtotal New Ca
pEx Construction Costs 1,635,000 $ 81,750 $ 1,716,750$ Public Safety - Fire PPE Re placement (Nomex Tops) 4,500$ 225 $ 4,725$ x This allocation funds the replacement/additions of Stadium battle dress uniform tops for the team.

Public Safety - Fire PPE Re placement (Nomex Bottoms) 2,500 125 2,625 x This allocation funds the replacement/additions of Stadium battle dress uniform bottoms for the team.

Public Safety - Fire Lucas CPR Assist Device 35,000 1,750 36,750 x Santa Clara Fire Department is placing Lucas devices in service on all apparatus. This project replaces current Zoll Auto Pulses that are used at the Stadium with Lucas devices to maintain continuity and training on these seldom-used but extremely valuable tools.

Public Safet
y - Fire Blackline Combustible Gas Indicators 4,500 225 4,725 x This project replaces the current Joint Hazard Assessment Team (JHAT) MultiRae Combustible Gas Indicator (CGI) that is no longer being supported by the department. This replacement enables a common operating picture with other resources in the City.

Public Safet
y - IT Re placement of end of life Network equipment 105,000 5,250 110,250 x The project replaces network equipment that was originally installed several years ago and is now end of life and not supported. Replacement costs include equipment, shipping/tax and installation.

Public Safety - IT Re placement of end of life End User equipment 25,332 1,267 26,599 x This project replaces five 7390 laptops that are end of life and also budgets for the replacements of four desktops, ten monitors, and four printers that are no longer under warranty, in case of failure. Costs include equipment, taxes, shipping, and deployment costs.

Public Safet
y - Police Bod y Worn Cameras (BWCs) for Special Event Officers (SEO) 90,000 4,500 94,500 x This project funds body worn cameras that are worn by Special Event Officers (SEOs). Body worn cameras improve police accountability, lower reports of misconduct, and provide visual and audio evidence that can independently verify events. Body worn cameras are issued to all SEO’s working stadium events.

Public Safet
y - Police Kawasaki Mules 132,500 6,625 139,125 x This projects replaces 5 Kawasaki Mules (utility vehicles) originally purchased in 2014 that are at the end of the 10-year useful life. Mules are used up to 261 hours/year with an average of approx. 96 per mule in 2022.

Santa Clara Stadium Authority
2023/24 CapEx Budget (Cont.)

37 Item Type SCSA
Requested Description Cost Contingency
(5%) Total Cost
Public Safety - Police Safet y Gear for SEOs & TCs 7,000$ 350 $ 7,350$ x This project funds safety gear for traffic control personnel, such as rain suits, high visibility jackets, and flashlights. Traffic control personnel are a critical element to our public safety deployment. Beyond this application, they also provide welcomed guidance and direction to visitors and our neighborhood residents. Upon directing traffic and pedestrians, our traffic control staff works amongst vehicles in all types of weather for extended periods of time. Rain suits would afford this staff the ability to effectively and safely work in these conditions while remaining dry. High visibility jackets will increase our staff’s visual recognition increasing their personal safety while performing their duties around vehicles. Flashlights and high visibility jackets will increase the public’s ability to notice the traffic control staff leading to overall safety of all who visit our footprint and increased recognition of direction offered by this staff.

Public Safet
y - Police Radio Batteries 15,500 775 16,275 x This project replaces Police hand pack batteries originally purchased in 2021 that are at the end of the 3-year useful life.

Audio/Visual A/V - Renewal and Re placements 75,000 3,750 78,750 This project improves Audio and Visual ("A/V") infrastructure by replacing broadcast patch panel equipment and other A/V equipment that is used by all events. Existing A/V equipment is worn and/or partially damaged due to regular wear and tear on equipment from typical use during events. The existing equipment is original to the building and is in need of replacement.

Audio/Visual Crestron Control & Buildin
g Operating System Upgrades - Phase 2 30,000 1,500 31,500 The project upgrades the existing Crestron Control system. This upgrade allows the stadium Engineers to utilize the Crestron system to monitor HVAC, lighting, electrical, and fire alarms. The comprehensive system shall enable these items to interface with one another for stadium Engineers to see a real time view of the building's systems. This project is phase 2 to a project that was completed in FY 22/23 which evaluated the project and provided direction for phase 2.

HVAC/Mechanical Heatin
g, Ventilation, and Air Conditioning (HVAC) 100,000 5,000 105,000 This project includes general renewal and replacement of stadium HVAC equipment. Most of the stadium HVAC equipment is quickly approaching ten years old and more replacements and upgrades may be expected.

Equipment enhancements may include, but are not limited to, cooling equipment, condenser equipment, heating equipment, and other HVAC equipment.

HVAC/Mechanical HVAC Boiler Im
provements 125,000 6,250 131,250 This project funds improvements to the boiler flue exhaust ducts. The current stadium condensing boilers have flues exhaust ducts which are experiencing premature failure of the duct joints, resulting in significant condensation leaking. This issue has required additional maintenance and supervision from the stadium Engineering staff to address the leaking duct work. The condensate is an acidic form that can eventually cause corrosion to the boiler components. The flue exhaust ducts will be replaced and/or reconfigured to mitigate future issues. Proactively addressing this issue now will extend the life of the boilers. The project also reduces maintenance requirements Engineering staff.

Securit
y Mobile Security Closed Circuit Television (CCTV) Pop Up Trailers 375,000 18,750 393,750 This project funds the purchase of five (5) additional mobile CCTV pop up trailer units in order to enhance video coverage and audio messaging to remote locations. These trailers provide flexibility to our security operation.

Security has the ability to deploy the CCTV units to various locations given current demand. The CCTV units can be used to direct law enforcement to different areas on an as needed basis. These units can be deployed on event days to parking lots outside of the stadium footprint that currently have no camera coverage. They can also be used on both event or non- event days in the occurrence that stadium CCTV camera goes down for maintenance or other video coverage is required. These CCTV pop up trailers will aid in maintaining compliance with the Department of Homeland Security Safety Act requirements. This project is new due to the successful deployment of the CCTV pop up trailers purchased in recent years.

Securit
y Security General Allowance 350,000 17,500 367,500 This project allocates funding for security enhancements. Security enhancements include, but are not limited to, Command Post video display improvements, virtualizing archivers, incident management system equipment, Security Control Desk work stations and monitors, X-Ray machines upgrades and CCTV camera display improvements.

Subtotal New Ca
pEx Equipment Costs 1,476,832 $ 73,842 $ 1,550,674$ Total New CapEx Project Costs 3,111,832 $ 155,592 $ 3,267,424$ 2023/24 CapEx Budget (Cont.)
Santa Clara Stadium Authority

38 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Electrical Broadcast Booth Power (2019/20 Carryover) 30,167$ 1,508 $ 31,675 $ The project designs supplemental lighting power and controls in the Broadcast Booth (Room 04.50.02). The existing lighting grid in the ceiling has inadequate lighting and is currently controlled with a dimmer switch near the door of the room. The architect shall evaluate the power needs and provide a solution for better control methods for the broadcast lighting power in the room.

Electrical Concessions Cart Cablin
g for Portable Carts (2019/20 Carryover) 50,000 2,500 52,500 This project funds the installation of code rated low voltage cabling (CAT6) to portable concession carts. This will provide Internet Protocol (IP) based access to the IPTV menu boards and Point of Sale (POS) systems for credit card transactions, as well as deliver emergency signage to be displayed at the concession stands.

Electrical Distribution - High Voltage (Primary Main Switch Gear Transformer, Battery & 12KV Main Circuit Breakers) (2022/23 Carryover) 194,971 9,749 204,720
The project replaces a bad Control Power Transformer (CPT) on the Primary Main Switch Gear (PMSG). The faulty CPT was identified during preventative maintenance, inspection and testing of the PMSG earlier this year. The project will replace the current CPT, CPT drawer and CPT drawer rails with new like-in-kind equipment. Additionally, the switch gear inspection and testing identified that the PMSG, Primary Switch Gear A (PSGA) and Primary Switch Gear B (PSGB) are in need of replacement.

This project will replace the current batteries with new like-in-kind batteries, which were original from the time of construction. Finally, the electrical testing company and contractor recommended purchasing two custom 12KV main circuit breakers which will be maintained as spare stock and can be used in either the PMSG, PSGA or PSGB in the event of a future breaker failure. The lead time for the 12KV breakers can be as long as 12- 16 weeks. Purchasing these spare 12KV breakers as spare stock ensures that the stadium can quickly recover in the event of a breaker failure to PMSG equipment, which is critical to the operation of the stadium.

Electrical Distribution - High Voltage (12KV Electrical Power Study, Assessment and Replacement at Primary Switch Gear at Quadrant Substations) (2022/23 Carryover)
350,000 17,500 367,500
The project will test, inspect and assess primary electrical 12KV switchgear equipment located in, or associated with, the four stadium quadrant electrical substations. The assessment will provide a report and recommendation for necessary replacement and modifications necessary to maintain full and safe electrical operation at the stadium. The project includes an allowance for any necessary replacements and / or enhancements identified during the assessment. Replacements and / or modifications are dependent upon the results of the assessment.

Additionally, the project will establish a baseline for this electrical equipment and may determine the need and frequency of future testing and inspection of electrical equipment.

General Buildin
g Additional Gate and Fence at Gate D (2016/17 Carryover) 73,095 3,655 76,750 This project adds a gate and fence in the Quadrant D to assist in the control of people movement and screening operations. A study will take place to ensure the gate and fence meet all operational and regulatory compliance. Material will be furnished and installed. The project was originally approved in FY 2016/17 but was not completed.

General Building Aesthetic Improvements - Premium Areas / Special Event Spaces (2022/23 Carryover)
941,905 47,095 989,000
This project will renovate and refresh the premium club spaces in the stadium by replacing carpet and paint in the BNY Clubs, Fii Club, United Club, Yahoo Club and special event spaces. These club spaces are used for numerous events throughout the year. The high traffic experienced in these spaces have worn on finishes and caused the carpet to near the end of life. This project will enhance these premium spaces and ensure Levi's Stadium remains an attractive destination for any and all events.

General Building Automatic Logic Control Building Engineering System (2019/20 Carr
yover)
18,333 917 19,250 This project installs an automatic logic controller system upgrade to monitor the building's HVAC in all quadrants simultaneously. This updated system will enable graphic interface and help the system to operate more efficiently with time clock management and assist in potential lighting control energy savings.

Santa Clara Stadium Authority
2023/24 CapEx Budget Carryover

39 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
General Building General Areas / Coatings Main Deck (2021/22 Carryover) 2,065,485$ 103,274 $ 2,168,759$ This project replaces and recoats lymtal traffic deck coating at the lower seating bowl and on the 300 and 700 Level Concourses, which are currently showing signs of wear. The deck coating serves as a secondary waterproofing system for the occupied spaces below these areas and also protects and extends the life of the concrete. Periodic replacement and recoating of this system is necessary to maintain the current waterproofing system and maintain the expected life of the structure.

General Buildin
g Levi's Naming Rights Signage Refurbishment (2022/23 Carryover) 1,200,000 60,000 1,260,000 The project refurbishes the current four (4) Levi's Naming Rights signs located above the North and South Scoreboards, west side of the suite tower, and on the east side of the grandstands. The current signs continue to experience lighting failures despite repeated attempts to repair the signs.

General Buildin
g Miscellaneous (2016/17 Carryover) 100,000 5,000 105,000 This project funds general renewal and replacement of flooring, carpeting, millwork, tiles, masonry, granite counters, stainless steel panels and counters, cladding, wall acoustic panels etc. throughout the building as items reach their end of life. The project was originally approved in FY2016/17 but was not completed.

General Buildin
g Miscellaneous (2022/23 Carryover) 100,000 5,000 105,000 This project funds renewal and replacement of general building items to include, but not limited to, architectural finishes, fixtures, coatings, equipment, etc.

General Building New Seating - Bowl Padded Seat Replacement Project - Lower and Mid Level Club Seatin
g Bowl (2022/23 Carryover)
2,905,373 145,269 3,050,642
The approximately 9,500 existing padded seats in the lower seating bowl and middle seating bowl levels will be replaced in this project. The existing padded seats are original from construction and have reached end of life.

The upholstery material on nearly every seat has faded, torn or cracked due to sun and heat exposure. Minor repairs and spot replacements can no longer keep up with the amount of damaged seats found in these locations.

This project will also evaluate the opportunity to replace the existing padded seats with a different breathable elastomeric mesh seating, which may provide a cooler experience on hot days. This project is necessary to provide the expected level of experience to patrons attending Levi's Stadium.

General Building Overhead Doors, Motors, Sensors and Track Replacements (2022/23 Carr
yover)
89,333 4,467 93,800
This project will furnish and install a replacement gate and necessary ancillary equipment at the 200 Level of the exterior ramp location at the south end of the stadium. The original overhead roll gate is damaged and is unable to be repaired. The original gate was installed as part of the stadium construction to assist in the flow of pedestrian traffic at the ramp location.

Stadium Operations staff have used operational procedures to substitute for the non-functional gate. However, replacing the gate will restore the original operational intent of the gate at the ramp.

General Buildin
g Stadium Event Signage (2019/20 Carryover) 128,355 6,418 134,773 This project funds the design, furnishing and installation of new stadium event signage including, but not limited to, tunnel awnings, accessible seating reference areas, lower bowl sections placards, security, mobile signage, and additional fire and building code signage.

General Buildin
g Updated Stadium Wayfinding Signage (2020/21 Carryover) 125,000 6,250 131,250 This project funds the design, furnishing and installation of new wayfinding and information signage to include, but not limited to, new premium/club wayfinding, suite wayfinding, smoking section signs, no smoking signs for around the main and upper concourses, section numbers/floor decals, ADA accessibility signs, Tunnel signs for "no photos/no autographs", etc.

General Buildin
g Women's Locker Room (2019/20 Carryover) 313,450 15,673 329,123 This project converts a portion of the auxiliary locker room area to accommodate a larger private space for female athletes, performers, officials, and other female event day sporting and entertainment professionals visiting or working events at Levi's Stadium. The project will include the design, permitting and construction of alterations necessary to accommodate these new designated spaces necessary to provide equal accommodations.

Santa Clara Stadium Authority
2023/24 CapEx Budget Carryover (Cont.)

40 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Plumbing Plumbing (2020/21 Carryover) 74,734$ 3,737 $ 78,471 $ This project addresses general renewal and replacement of necessary plumbing equipment in the stadium to include, but not limited to, replacement of Pressure Reducting Valves (PRV) and other parts on domestic and recycled water systems.

Site As
phalt (2018/19 Carryover) 158,095 7,905 166,000 The project will evaluate the current pavement status and provide asphalt overlay and/or seal coat at the visitor parking on Tasman, Gold 4 & 5 parking lots and South Access Road. Design services will be engaged to evaluate the current condition of pavement and recommend the correct application. Proper overlay and crack fill seals the pavement and prevents the infiltration of water which prevents pavement failure.

Site Brid
ge - Pedestrian (2018/19 Carryover) 30,000 1,500 31,500 The project will seal walkways and paint bridges to enhance public safety access areas and extend the useful life of the bridges. This project was originally approved in FY2018/19 but was not completed.

Site Concrete Re
placements (2022/23 Carryover) 133,333 6,667 140,000 This project will address the concrete at the Northwest stairwell landing on the 700 Level North Plaza area. The railing at the stairwell has been compromised in the past. This project will restore the handrail and concrete at the stairwell, as well as improve the condition by strengthening the reinforcement at the stairwell railing. The project will require demolition of the existing concrete, potentially patch the waterproofing layer of the structural slab, add reinforcing steel, pour concrete, apply lymtal coating and re-install the existing handrail at the stairwell. The improved and additionally reinforced slab will improve safety and prevent future damage from carts and other equipment that are used in the nearby area.

Site LED Retrofit Project - Exterior Luminaire Light Fixtures - Gold Lot 4, Gold Lot 5, Bill Walsh Way and Other Exterior Poles (2022/23 Carr
yover)
125,500 6,275 131,775
This project is phase 2 of the exterior lighting replacement in Gold Lot 4 and Gold Lot 5 parking lot areas. This project replaces the existing HID lighting with new LED lighting to enhance and improve the exterior lighting during stadium event load in and load out. This lighting improves safety conditions for stadium personnel and provides energy cost savings with more efficient fixtures. Project lighting includes light poles located in Gold Lot 4, Gold Lot 5, Bill Walsh Way and other exterior locations around the stadium.

Site Stadium Event Power Upgrades & Switchgear Electrical (2019/20 Carr
yover)
28,181 1,409 29,590
The project will study, design, install and enhance remote visibility to the 12KV PMSG (primary switch gear) to main electrical panel using the Schneider Power Monitoring Expert system. The project will establish capability to monitor and report the Switch Gear Event Mode Status through the building Schneider Power Monitoring Expert (PME) system for remote monitoring. The plans and specifications required will include any electrical and communication wiring, as well as any controls upgrades necessary to complete the project.

Site Stationar
y Electric Pressure Washers (2020/21 Carryover) 25,870 1,294 27,164 This project installs one (1) to two (2) demo stations on the 300 concourse.

If these are effective, we would look to replace all gas-powered pressure washers with electrically powered ones.

Subtotal Carr
yover CapEx Construction Costs 9,261,180 $ 463,062 $ 9,724,242$ Audio/Visual Radio Booth Cablin g (2019/20 Carryover) 523,708$ 26,185 $ 549,893 $ The project will install fiber optic cabling to increase the low voltage cabling backbone. This installation will accommodate the expanding requests received for booth usage during stadium events and will help the stadium keep up with emerging trends. The project will install fiber optics between multiple booths located on the 800 level suite tower location and the broadcast patch panel (Room 01.69.08) near the loading dock on the exterior south end of the stadium. Fiber design shall include TAC-12 and DT-12, or better. Design will consider new fiber termination panels in each booth. Design shall investigate and determine if additional conduit and raceway are necessary during the installation phase.

Furniture, Fixtures & E
quipment Guest Service Booths (2018/19 Carryover) 70,000 3,500 73,500 This project adds two additional guest services booths on the main concourse for better enhanced customer service touchpoints. New booths will provide increased operational space for guest service representatives on game day.
2023/24 CapEx Budget Carryover (Cont.)
Santa Clara Stadium Authority

41 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Furniture, Fixtures & Equipment Replace Furniture for BNY Field Clubs, United, Levi's 501 & Yahoo clubs and Special Event spaces (2019/20 Carryover)
1,431,429$ 71,571 $ 1,503,000$
This project funds replacement furniture for clubs (BNY, United, Levi's 501 and Yahoo) and special event spaces to enhance areas and meet client expectations. These spaces are amongst the most utilized in the entire stadium. The current furniture has been in place since the building opened in 2014 and is aging due to normal wear and tear as a result of numerous events in the stadium over the last eight years.

Food and Bevera
geB e v e r a ge Distribution System (2020/21 Carryover) 50,000 2,500 52,500 This project funds equipment to assist with the distribution of beer and sodas throughout the stadium concession areas and bars. This project includes general renewal and replacement of beverage distribution system lines, CO2 and glycol dispensing equipment.

Food and Beverage CO2 Monitoring & Sensors for Code Compliance (2020/21 Carryover) 184,318 9,216 193,534 The project will design and install remote CO2 monitoring equipment utilizing the existing Automatic Logic Controller (ALC) system. The current CO2 monitoring has a local alarm three stage alarm, but is not connected to any Building Management System for remote monitoring. A recent CO2 assessment was performed that found the current monitoring system is compliant with all requirements, but the assessment recommended this remote monitoring upgrade as a best practice for safety. This project will evaluate, recommend and design a remote CO2 monitoring system for enhanced safety for stadium staff per Authorities having jurisdiction. All Beer Cooler locations and Concession Soda Box Locations shall be monitored by the remote monitoring system.

Food and Bevera
ge Main Kitchen E quipment (2016/17 Carryover) 350,000 17,500 367,500 This project funds general renewal and replacement of kitchen service equipment in the Main Kitchen. The project will include any necessary design, permit, purchase and installation of aging kitchen equipment that is near or at the end of life. The project was originally approved in FY2016/17 but was not completed.

HVAC/Mechanical Coolin
g Towers (2020/21 Carryover) 122,938 6,147 129,085 This project funds general renewal and replacement of stadium cooling tower internal parts and systems. This includes, but is not limited to, motors, fans, fill, controls, and piping which support the mechanical cooling functions for the HVAC system.

HVAC/Mechanical Install New Kitchen Exhaust Fans Throughout the Building (2019/20 Carr
yover)
230,770 11,539 242,309
This project installs variable frequency drive (VFD) Units on kitchen exhaust fans for soft start (slow ramp up) capabilities. Kitchen exhaust fans currently operate 100 percent of the time. Installing VFD units will modulate the power and save energy whenever the fan is in use. Soft start extends the life of the equipment and saves energy.

HVAC/Mechanical
Variable Frequency Drive(s) (2020/21 Carryover) 102,253 5,113 107,366 This project funds general renewal and replacement of Variable Frequency Drives (VFD) units for cooling tower, boilers and other mechanical equipment due to life expectancy issues. These systems support the mechanical heating and cooling functions for the stadium.

Life Safety / Fire Smoke Evacuation System - Fire Smoke Curtain Replacement (2022/23 Carryover)
39,770 1,989 41,759
This project replaces an existing Elevator C6 Smoke Curtain and miscellaneous life safety / fire equipment which has been identified for replacement during preventative maintenance. The current smoke curtain experienced issues with the control box and fuses. A temporary repair was performed, but a full replacement of the smoke curtain is required. This project will remove the existing curtain and reinstall a new fire and smoke rated curtain.

Public Safet
y - Fire Medixsafe Narcotics Safe (2022/23 Carryover) 1,857 93 1,950 x This project funds the purchase of a controlled substances safe. Controlled substances used in Emergency Medical Services (EMS) provided at Levi’s Stadium events are required to be secured in a biometric-style safe when not in the possession of a certified paramedic. Stadium EMS equipment is currently being moved from Fire Station 1 to Fire Station 8 to make operations more efficient. In order to store all the equipment in a DEA- compliant manner, a safe needs to be purchased and will be dedicated to the controlled substances used at Levi’s Stadium.

Santa Clara Stadium Authority
2023/24 CapEx Budget Carryover (Cont.)

42 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Public Safety - Fire Ro pe Rescue Equipment (2022/23 Carryover) 2,000$ 100 $ 2,100$ x This project funds miscellaneous rope, hardware, and bags used by the Fire Department Stadium Team. This equipment will be added to the current Rope Rescue cache at the stadium to make it identical to what is carried on Fire Department apparatus.

Public Safet
y - IT Re placement of end of life Network equipment (2022/23 Carryover) 105,000 5,250 110,250 x This projects replaces network equipment. Network equipment was originally installed several years ago and is now end of life and not supported. This replacement cost includes equipment, shipping/tax and installation.

Public Safety - Police Communication Equipment - Police Radio Hand Packs (2022/23 Carr
yover)
437,500 21,875 459,375
x This project replaces Motorola police radio hand packs purchased in 2013 that are at the end of the 10-year useful life.

Public Safety - Police Fencin g on Tasman & Lafayette (2019/20 Carryover) 70,000 3,500 73,500 x This project funds fencing to prevent stadium event pedestrian traffic from crossing unsafely between Lafayette St. and the Tasman St. overcrossing.

Public Safety - Police GPS Software for Trackin g Personnel (2019/20 Carryover) 25,000 1,250 26,250 x This project funds GPS software to track personnel. Live tracking of law enforcement personnel is critical in providing an accurate picture of public safety coverage. This technology and software will allow the Command Post to know where our personnel are at all times and make necessary assignment adjustments on the go. It is desired that the software also be capable of retaining data for historical analysis. The funding of $25,000 is estimated to cover the initial purchase price for approximately 100 devices and the software. There is a monthly operating cost of $30/month each; $36,000 total annually.

Public Safet
y - Police Kawasaki Mule (2021/22 Carryover) 25,000 1,250 26,250 x This project funds the purchase of a new Kawasaki Mule for the Explosive Ordinance Disposal (EOD) team. The cost includes unfitting the Kawasaki Mule with Police labels and markings, lighting and locking storage boxes.

The EOD team does not currently have a dedicated vehicle and is currently walking with canines and EOD gear during response calls for suspicious packages and drone payloads. The EOD team is first on scene sweeping the stadium for safety issues and the last to leave. Shifts can extend past 10 hours. Purchase of a vehicle would reduce fatigue for officers and canines and reduce response time.

Public Safet
y - Police Kawasaki Mule (2021/22 Carryover) 20,000 1,000 21,000 x This project funds the purchase of a new Kawasaki Mule for the Special Response Team (SRT). The cost includes unfitting the Kawasaki Mule with Police labels and markings, lighting, equipment storage boxes and Type 3 IME box that is approved by the U.S. Bureau of Alcohol Tobacco and Firearms (ATF) to transport/store breacher explosives. The SRT equipment is currently in a standard size vehicle that upon deployment would not easily maneuver the stadium or crowds of attendees; the team would be required to go to the vehicle to retrieve the required equipment extending response time. The vehicle may also be deployed to City issues and the equipment would not be readily available for use. The SRT does not currently have a dedicated vehicle. Purchase of a vehicle would allow the SRT to mobilize needed equipment and will reduce response time.

Public Safet
y - Police Radios (2020/21 Carryover) 79,000 3,950 82,950 x This project funds new radios that are required for equipping additional staff in our public safety deployment. These radios allow for communication to the command post and between public safety partners working our events.

Without these critical radios, personnel would not be able to function in their capacity and as expected to provide public safety services including emergency response. The department is currently waiting on Silicon Valley Regional Interoperability Authority to upgrade their radio infrastructure to complete these new radio purchases. There is a yearly operating cost; requesting quote.

Santa Clara Stadium Authority
2023/24 CapEx Budget Carryover (Cont.)

43 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Public Safety - Police Radio Char gers (2020/21 Carryover) 3,000$ 150 $ 3,150$ x This project funds new radio charging stations. Our radio equipment is critical and, therefore, their serviceability must be maintained. Each new radio will require a charging port. These three charging stations each have a 6-radio capacity and three are needed to maintain radios at their peak power and usability. Having these three charging stations will ensure all radios are ready for use by public safety without the risk of personnel being without this crucial equipment in a functional state.

Public Safet
y - Police Staff Schedulin g Software (2019/20 Carryover) 16,250 813 17,063 x This project funds staff scheduling software. The Stadium requires SEOs to operate safely. Notifying and communicating with our SEOs is critical in properly planning our staffing needs. We currently use an out of date version of “Game Day Staffing.”
Public Safet
y - Police x 1st Aid Medical Equipment (2022/23 Carryover) 1,592 80 1,672 Santa Clara Police Department patrol vehicles are equipped with essential gear for public safety success. One example is medical rescue and 1st Aid supplies. Each vehicle is assigned this gear and it is not a transferable item—it remains with the assigned vehicle to ensure the equipment is there in case of an emergency. There are 11 patrol vehicles and several Kawasaki mules (all-terrain vehicles) dedicated solely for Stadium event use. These vehicles and their officers are deployed in neighboring areas and surrounding event parking lots. Often, these areas patrolled are far away from medical staff and medical equipment. These vehicles are not yet equipped with the essential medical rescue and 1st Aid supplies. This project would ensure the vehicles have the needed gear. This gear would be used and stored exclusively with these Stadium vehicles.

Public Safety - Public
Works
Street Signage (2017/18 Carryover) 1,000,000 50,000 1,050,000 x This project funds street signage to inform Levi's Stadium patrons and the public. Working with the Dept. of Public Works, the Executive Director's office and the Chief of Police's office, staff will identify appropriate locations on surrounding city streets (Great America Parkway, Tasman Drive, etc.) to place signage to better protect, inform and serve patrons visiting Levi's Stadium, non-event day traffic, community event advisories and emergency public safety and traffic advisories. This item was brought before the SCSA Board and approved in the 2017/18 budget.

Security Enhance Stadium Security Access Control (2020/21 Carryover) 235,000 11,750 246,750 This project installs card readers on manual doors to increase access control features and security. Based on operational demands, doors have been identified via staff request and event activity in order to improve operational awareness and enhance the access control abilities by automating the doors. This also increases security to areas deemed by staff to hold sensitive or high value assets. The access control enhancements include Vertx/Mercury upgrade, EvoE400/Mercury upgrade, and various doors with access control upgrade or enhancement requirements.

Security Enhance Stadium Security Coverage (2020/21 Carryover) 330,000 16,500 346,500 This project evaluates and replaces existing cameras with technologically advanced multi-lens panoramic/360/multi-directional cameras. Design locations and camera styles have created visual obstructions and gaps in coverage. Height locations with fixed lens cameras create the inability to adjust field of views. Installation of television monitors/signage near camera mounts have created field of view obstructions. Due to high volume of club space usage for large scale, and smaller events, request for video investigations become frequent. Low lighting situations are constant with event type needs, and enhanced technology from newer cameras will enable greater video quality. Club Space Enhancements: Club spaces which need to be evaluated include, but are not limited to: BNY Mellon East and West Club, Yahoo Club, United Club, FII Club, 501 Club, Citrix Owners Club, Entry Gates, and Perimeter fences.
2023/24 CapEx Budget Carryover (Cont.)
Santa Clara Stadium Authority

44 Item Type SCSA
Requested Description Cost Remaining
Contingency Total Cost
Security Install Stadium Camera Booths Card Readers (2019/20 Carryover) 84,000$ 4,200 $ 88,200 $ This project installs card readers for north and south camera booths to secure the spaces that enter into/from general public access areas.

Security North East Lobby Security Desk Enhancements (2022/23 Carryover) 22,712 1,136 23,848 The scope of this project will enhance security in the east stadium lobby on major non-event days and for private events. This security checkpoint will screen everything entering the stadium at this location. These enhancements will add electrical and data connections necessary to support security screening equipment at the point of entry, which doesn't currently exist at this location today. The new electrical infrastructure allows Security to position security desk and equipment closer to entrance. This project is necessary to maintain compliance with Department of Homeland Security Safety Act requirements.

Security Security Control Situation Room Enhancements (2022/23 Carryover) 62,000 3,100 65,100 This project purchases equipment and technology necessary to utilize the Security 24/7 Control Situation Room as a Secondary Command Post Location in the event of an emergency situation. Multifunctional use of the space will utilize the equipment to hold daily security briefings, daily security officer administrative duties, ongoing security officer training, and can readily be converted into an Auxiliary Command Post Situation Room, on an as needed basis. New equipment and technology enhancements for this room will include new monitors, workspaces, radios, and video wall.

Enhancing this room provides Security a multifunctional space that can be used both during daily operations, as well as in an emergency situation.

This technology aids in our compliance with the Department of Homeland Security Safety Act requirements.

Security Security - Electrical / Data Distribution Expansion - Security Screening Locations
(2022/23 Carryover)
42,823 2,141 44,964
Department of Homeland Security requires exterior screening of all patrons entering the facility. This scope of work will add electrical and data distribution to exterior screening locations. The new electrical and data allows stadium security staff to utilize critical security screening technology and avoids the use of temporary extension cords, which are prohibited in a permanent location by building and fire code. Specifically, this project adds new electrical and data to the exterior portion of the stadium on level 100 in Quadrant D. This project aids in compliance with DHS Safety Act requirements.

Vertical Transport Elevator Door Re placement (2019/20 Carryover) 20,000 1,000 21,000 This project replaces the vestibule door frame, doors, hardware and equipment at the 200 level elevator lobby doors in the stadium. The current door system does not allow the necessary door swing radius to navigate larger janitorial and operational equipment into the elevator lobby. The current door system was damaged due to the limitations in design and thus must be completely replaced to restore and establish ultimate operational function.

Subtotal Carr
yover CapEx Equipment Costs 5,687,920 $ 284,398 $ 5,972,318$ Total Carryover CapEx Project Costs 14,949,100 $ 747,460 $ 15,696,560$ Santa Clara Stadium Authority
2023/24 CapEx Budget Carryover (Cont.)

45 2023/24 2024/25 2025/26 2026/27 2027/28
Budget Budget Budget Budget Budget
Electrical 1,350,138 $ 2,950,000 $ 225,000 $ 300,000 $ 500,000 $ General Building 8,795,329 5,250,000 1,120,000 850,000 800,714 Plumbing 249,734 100,000 600,000 35,000 70,000 Security - - - 500,000 - Site 500,979 - - - 275,000 Subtotal CapEx Construction Costs 10,896,180$ 8,300,000 $ 1,945,000 $ 1,685,000 $ 1,645,714 $ Audio/Visual 628,708 $ - $ 870,000$ - $ - $ FF&E 1,501,429 - 61,669 - 60,000 Food & Beverage 584,318 - - 1,200,000 1,000,000 HVAC/Mechanical 680,961 75,000 200,000 175,000 650,000 Life Safety/Fire 39,770 - - 225,000 150,000 Security 1,501,535 300,000 500,000 - 100,000 Public Safety Equipment 2,208,031 252,500 115,000 22,500 7,000 Vertical Support 20,000 - - 400,000 250,000 Subtotal CapEx Equipment Costs 7,164,752$ 627,500 $ 1,746,669$ 2,022,500 $ 2,217,000 $ Contingency (5%) 903,052 446,375 184,583 185,375 193,136 Total CapEx Project Costs(1)
18,963,984$ 9,373,875 $ 3,876,252 $ 3,892,875 $ 4,055,850 $ (1) Total CapEx Project Costs does not include budget requested for Stadium Warranty Related Construction.

Santa Clara Stadium Authority
Capital Expense Plan Summary - 5 Year Forecast
Stadium Authority Work Plan

Page 1 of 3 ends

City Council and Authorities ConcurrentMarch 7, 2023

City Council and Authorities Concurrent
March 7, 2023