Santa Cruz City Council
May 23, 2023

CITY OF SANTA CRUZ
809 Center Street
Santa Cruz, California 95060

CITY COUNCIL AGENDA
Regular Meeting – May 23, 2023
1:30 P.M. CLOSED SESSION, ZOOM/COURTYARD CONFERENCE ROOM 2:00 P.M. CONSENT, GENERAL BUSINESS, ORAL COMMUNICATIONS, AND

DEPARTMENT BUDGET PRESENTATIONS, ZOOM/COUNCIL CHAMBERS
The meeting may be viewed remotely, using any of the following sources:
 Click on Zoom link (no time delay): https://zoom.us/j/94684401344  Online at http://www.cityofsantacruz.com/government/city-council/council-meetings  Online at Watch – Community Television of Santa Cruz County  Comcast Channel 25
Or: Call any of the numbers below. If one is busy, try the next one.  1-833-548-0276 (Toll Free)
 1-833-548-0282 (Toll Free)
 1-877-853-5247 (Toll Free)
 1-669-900-9128
 Enter the meeting ID number: 946 8440 1344
 When prompted for a Participant ID, press #.
 Press *9 on your phone to “raise your hand” when the Mayor calls for public comment.  It will be your turn to speak when the Mayor calls on you. Press *6 to unmute yourself. The timer will then be set.

Correspondence to be included in the agenda packet must be received by 5:00 pm on Monday, May 22nd
May 23, 2023 City Council 2
PLEASE NOTE:
 Council may take a break(s) as needed.
 Requests for extra speaking time on items other than Oral Communications must be made by 5:00 p.m. on Sunday, May 21st by emailing the Mayor and the City Clerk.

Approval will be confirmed via email.
[email protected] [email protected]
The City of Santa Cruz does not discriminate against persons with disabilities. Out of consideration for people with chemical sensitivities we ask that you attend fragrance free. Upon request, the agenda can be provided in a format to accommodate special needs. Additionally, if you wish to attend this public meeting and will require assistance such as an interpreter for American Sign Language, Spanish, or other special equipment, please call the City Clerk’s Department at 420-5030 at least five days in advance so that we can arrange for such special assistance, or email [email protected]. The CalRelay system number: 1-800-735-2922.

Si desea asistir a esta reunión pública y necesita ayuda - como un intérprete de lenguaje de señas americano, español u otro equipo especial - favor de llamar al Departamento de la Secretaría de la Ciudad al 420-5030 al menos cinco días antes para que podamos coordinar dicha asistencia especial o envié un correo electrónico a [email protected]. El número del sistema Cal-Relay es: 1-800-735-2922.

Agenda and Agenda Packet Materials: The City Council agenda and the complete agenda packet containing public records, which are not exempt from disclosure pursuant to the California Public Records Act, are available for review on the City’s website:
www.cityofsantacruz.com/government/city-council-meetings and at the Office of the City Clerk located at 809 Center Street, Room 9, Santa Cruz, California, during normal business hours.

Agenda Materials Submitted after Publication of the Agenda Packet: Pursuant to Government Code §54957.5, public records related to an open session agenda item submitted after distribution of the agenda packet are available at the same time they are distributed or made available to the legislative body on the City’s website at: www.cityofsantacruz.com/government/city-councilmeetings and are also available for public inspection at the Office of the City Clerk, 809 Center Street Room 8, Santa Cruz, California, during normal business hours, and at the Council meeting.

Need more information? Contact the City Clerk’s office at 831-420-5030.

May 23, 2023 City Council 3
Closed Session
1:30 PM
Closed Session

1. Conference With Legal Counsel – Liability Claims (Government Code §54956.95)
1) Claimant: Ezekiel C. Tidmore
2) Claimant: Judith Laing
3) Claimant: Justin Laing
4) Claimant: Deborah Marie Guadian
Claims against the City of Santa Cruz
May 23, 2023 City Council 4
City Council
2:00 PM
Call to Order
Roll Call
Presentations
The below presentation #2 will occur at or around 4:00 p.m.

2. Outstanding Volunteer Recognition

3. Beach Safety Week

4. Mayoral Proclamation Declaring May 21 through May 27, 2023, as Public Works Week

5. Citywide Housing Project Interactive Map
Presiding Officer's Announcements
Statements of Disqualification
Additions and Deletions
City Attorney Report on Closed Session
Council Meeting Calendar

6. The City Council will review the meeting calendar attached to the agenda and revise it as necessary.

May 23, 2023 City Council 5
Consent Agenda

7. Minutes of the May 9, 2023 City Council Meeting (CC) Motion to approve as submitted.

8. Council Sugar-Sweetened Beverage Tax Ad Hoc Committee (CN) Motion to create a City Council ad hoc committee to explore the feasibility of placing a sugar-sweetened beverage tax measure on the March or November 2024 ballot.

9. Downtown Association: Parking and Business Improvement Area Assessments for FY 2024 (ED)
Motion to:
1) Approve, or to modify and approve, the plan prepared by the Downtown Association for FY 2024; and
2) Adopt a Resolution of Intention to levy a Downtown Association Parking and Business Improvement Assessment for FY 2024 and schedule a public hearing for June 13, 2023 on the levy of the assessments for FY 2024.

10. 223 Darwin Street CFSC Loan Extension (APN: 011-122-04) (ED) Authorize the City Manager to execute any and all loan documents necessary, in a form approved by the City Attorney, to extend the terms of existing Red Cross-funded loan in the amount of $75,000 to CFSC for the property located at 223 Darwin Street for 30 years with 3% simple interest and deferred payments.

11. Pacific Collegiate Foundation – Approval of Issuance by the California Municipal Public Financing Authority of Refunding Revenue Bonds for the Purpose of Refinancing the 2016 Variable Rate Revenue Bonds (ED) Resolution to approve a non-charter membership agreement (the “NonCharter Agreement”) with the California Municipal Public Financing Authority (“CalMuni PFA”) to assist the Pacific Collegiate Foundation with the issuance of refunding revenue bonds in an amount not to exceed $6,000,000 for the purpose of refinancing their 2016 Variable Rate Revenue Bonds.

May 23, 2023 City Council 6
Consent Agenda (continued)

12. Liability Claims Filed Against the City of Santa Cruz (FN) Motion to reject the liability claims of 1) Ezekiel C. Tidmore, 2) Judith Laing, 3) Justin Laing; and to return as late claim of 4) Deborah Marie Guadian, based on staff recommendation.

13. Award Contract for eProcurement Solution (FN)
Motion to:
1) Amend the existing software services agreement, in a form to be approved by the City Attorney, with OpenGov (San Jose, California) to include the purchase of an integrated web-based electronic procurement (eProcurement) and contract management platform for a 3-year term, along with related business process, implementation and support services from June 1, 2023, through May 30, 2026; and, 2) Authorize the City Manager to execute the agreement and any amendments within the approved operating budget.

14. Resolution Approving the Tentative Agreement and Adopting the Memorandum of Understanding with Temporary Service Employees SEIU Local 521 (HR)
Resolution approving the Tentative Agreement and adopting the Memorandum of Understanding with Temporary Service Employees SEIU Local 521.

15. Award Contract for Portable Digital Radios (PD)
Motion to authorize and direct the City Manager to execute an agreement in a form acceptable to the City Attorney with Motorola Solutions for the lease-purchase of portable digital radios and portable digital radio accessories for the Santa Cruz Police Department in the amount of $899,077.13.

16. Housing Matters Hygiene Bay Remodel Project (c102205) – Notice of Completion (PW)
Motion to accept the work of Selden & Son (Watsonville, CA) and authorize the filing of the Notice of Completion for the Housing Matters Hygiene Bay Remodel Project (c102205).

May 23, 2023 City Council 7
Consent Agenda (continued)

17. Contract Renewal with Hope Services, Inc. for the Resource Recovery Facility (PW)
Motion to authorize and direct the City Manager to execute renewal of an agreement in a form acceptable to the City Attorney with Hope Services, Inc., (Santa Cruz, CA) for recycling and litter control services at the City’s Resource Recovery Facility on Dimeo Lane.

18. 2024 Isuzu NRR Cab Chassis with 9-yard Heil Mini Rear Loader – Award Contract (PW)
Motion to:
1) Award a contract for the purchase of a 2024 Isuzu NRR Cab Chassis with a 9-yard Heil Rear Loader from TEC of California (San Francisco, CA); and
2) Adopt a resolution transferring and appropriating funds in the FY 2023 budget in the amount of $165,355.40 from Public Works’ Homelessness Response Field salary savings and from the City Manager's Office Homelessness Response Action Plan, California grant project.

19. Water Supply Augmentation, Aquifer Storage and Recovery Beltz 9 Pilot Test, Pueblo Water Resources Professional Services Contract (WT) Motion to authorize the City Manager to execute an agreement in a form to be approved by the City Attorney with Pueblo Water Resources of Ventura, CA in the amount of $216,425 to conduct pilot testing of Aquifer Storage and Recovery (ASR) at Beltz Well 9 and authorizing the Water Director to execute amendments within the approved project budget.

End Consent Agenda
Public Hearing

20. Technology Surcharge (PL)
This item is continued to the meeting of June 13, 2023, and will not be discussed on May 23, 2023.

May 23, 2023 City Council 8
General Business

21. West Cliff Update, including Infrastructure, Transportation, and Roadmap Development (PW/CM)
Motion to:
1) Receive an update on citywide West Cliff work, including infrastructure, transportation, and the development of a roadmap for a resilient and accessible West Cliff; and
2) Kick-off community review of the in-process roadmap and provide feedback to staff.

Oral Communications Announcement – Members of the public may address Council on matters not on the agenda, but within the jurisdiction of the Council. 30 minutes is allocated for Oral Communications. No extra time for groups will be granted.

Oral Communications
Presentations
The proposed Fiscal Year 2024 Budget can be found here:
https://www.cityofsantacruz.com/government/city-departments/finance/citybudget/fy-2024-budget

22. FY 2024 Proposed Budget
Conduct the Fiscal Year (FY) 2024 Budget Hearings, receive presentations from the following departments, and provide feedback to staff for preparation of the FY 2024 Adopted Budget.

Schedule of presentations (subject to change):
1) City Fiscal Overview
2) Public Comment
3) Economic Development and Housing
4) Planning and Community Development
5) City Attorney’s Office
6) Homelessness Response
Adjournment
May 23, 2023 City Council 9

INFORMATION ITEMS PREVIOUSLY DISTRIBUTED TO CITY COUNCILMEMBERS ADDENDUM TO CITY COUNCIL AGENDA – MAY 23, 2023

23. Finance Department: Sales Tax - 5/10/23 (FNFYI 367)

24. Library: Incident Report – Santa Cruz Public Library 3rd Quarter Fiscal Year 2022–2023 - 5/17/23 (LBFYI 014)

MAYOR'S PROCLAMATIONS
ADDENDUM TO CITY COUNCIL AGENDA – MAY 23, 2023

25. Proclaiming the week of May 14–20, 2023 as “National Police Week” and encouraging all citizens to observe the week with law enforcement officers, past and present, who, by their faithful and loyal devotion to their responsibilities, have rendered a dedicated service to their communities, and proclaiming May 15, 2023 as “National Peace Officers’ Memorial Day” in honor of those law enforcement officers who, through their courageous deeds, have made the ultimate sacrifice in service to their community or have become disabled in the performance of duty.

26. Proclaiming May 16, 2023 as “Dirtbag Baseball Day” and encouraging all residents to play ball!

27. Proclaiming the week of May 21–27, 2023 as “National Public Works Week” and urging all citizens to join in celebrating our public works employees with recognition of all that they do to benefit the quality of life and well-being of the people of the City of Santa Cruz.

28. Proclaiming the month of May 2023 as “Building Safety Month” and encouraging all citizens to participate in Building Safety Month activities.

May 23, 2023 City Council 10
MAYOR'S PROCLAMATIONS (continued)

29. Proclaiming May 20–26, 2023 as “Safe Boating Week” and the start of the year-round effort to promote safe boating and encouraging all citizens to join in supporting the goals of the North American Safe Boating Campaign (Wear It!) and urging those who boat to “Wear It!” and practice safe boating habits throughout the year.

30. Proclaiming May 21, 2023 as “Humanities Institute Day” and encouraging all citizens to join in acknowledging its efforts to advance public-facing scholarly activity, vibrant public programs, and humanities work that builds a more just and equitable society, helping us all better see the forest and the trees.

31. Proclaiming May 21, 2023 as “Ezra Klein Day” and encouraging all citizens to join in acknowledging him for his significant work to inform, inspire deep thought, and encouraging action in the face of the impacts of climate change here on the coast and around the world.

32. Proclaiming May 21, 2023 as “Elizabeth Kolbert Day” and encouraging all citizens to join in acknowledging her for her significant work to inform, inspire deep thought, and encouraging action in the face of the impacts of climate change here on the coast and around the world.

The following positions are vacant. Council will make the appointments at a future meeting.

County Latino Affairs Commission One opening – at-large nomination Sister Cities Committee Two openings – at-large nominations May 23, 2023 City Council 11
Public Hearing
If, in the future, you wish to challenge in court any of the matters on this agenda for which a public hearing is to be conducted, you may be limited to raising only those issues which you (or someone else) raised orally at the public hearing or in written correspondence received by the City at or before the hearing.

Any person seeking to challenge a City Council decision made as a result of a proceeding in which, by law, a hearing is required to be given, evidence is required to be taken, and the discretion in the determination of facts is vested in the City Council, shall be required to commence that action either 60 days or 90 days following the date on which the decision becomes final as provided in Code of Civil Procedure Section 1094.6 Please refer to code of Civil Procedure 1094.6 to determine how to calculate when a decision becomes “final.” The 60-day rule applies to all public hearings conducted pursuant to the City’s Zoning Ordinance, Title 24, Santa Cruz Municipal Code. The 90-day rule applies to all other public hearings.

City Council Agenda Legislative History Addendum
No information was submitted.

City staff is responsible for providing the City Clerk with such documentation and information for the Legislative History Addendum. The information will be on file in the City Clerk’s Department.

The Addendum is a listing of information specific to City Council business, but which does not appear on a Council meeting agenda. Such entities would include, but not be limited to: Court decisions, Coastal Commission Appeals of City Council actions, Closed Session Agreements/Settlements, which are public record, Association of Monterey Bay Area Governments, Local Agency Formation Commission.

5.1 5.2

5.3 5.4

5.5 5.6

5.7 Meeting Type
Holiday
Jewish Holiday
Regular Meeting
Special Meeting
Study Session (will be added as scheduled)
Budget Hearing
DATE Location Meeting Type
May 29
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public June 19
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public July 4
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public September 4
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public September 15/16
September 24/25
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public November 10
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public November 23
November 24
December 7/8
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public December 25
December 26 Meeting Cancelled ‐ CITY COUNCIL DARK
City Hall Closure ‐ Christmas Day
Hanukkah (City observed ‐  sundown to sundown)
Rosh Hashanah (City observed ‐  sundown to sundown)
November 14
October 10
October 24
City Hall Closure ‐ Veteran's Day (observed)
July 11 and 25 Meetings Cancelled ‐ CITY COUNCIL DARK
City Hall Closure ‐ Independence Day
City Hall Closure ‐ Memorial Day
City Hall Closure ‐ Labor Day
August 22
August 8
June 13
City Hall Closure ‐ Juneteenth
Please note: Meeting times are not final and are likely to change Yom Kippur (City observed ‐  sundown to sundown)
City Council Meeting Calendar for 2023
November 28
December 12
City Hall Closure ‐ Thanksgiving Day
City Hall Closure ‐ Day After Thanksgiving Day
June 27
September 12
September 26

6.1 MINUTES ARE UNOFFICIAL UNTIL APPROVED BY COUNCIL
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
May 9, 2023
12:00 PM
Mayor Keeley opened the City Council Closed Session at 12:03 p.m. in a public meeting via Zoom and in Council Chambers, for the purpose of announcing the agenda, and receiving public testimony.

Roll Call

Present: Councilmembers Newsome, Brown, Watkins, Brunner, KalantariJohnson; Vice Mayor Golder; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, Assistant City Manager L. Schmidt, City Attorney T. Condotti, Director of Information Technology K. Morgan (via Zoom), Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

Public Comment
Mayor Keeley opened the public comment period at 12:04 p.m. There were no speakers. Mayor Keeley closed the public comment period at 12:04 p.m., at which time the meeting was closed to the public and Council adjourned to the Courtyard Conference Room.

7.1 May 9, 2023 CITY COUNCIL MINUTES 6466
Closed Session

1. Conference with Legal Counsel - Existing Litigation (Government Code §54956.9(d)(1))
1) City of Santa Cruz v. Service Employees International Union, Local 521, PERB Unfair Practice Charge No: SF-CO-511-M
2) City of Santa Cruz v. The Regents of the University of California, et al. (Santa Cruz County Superior Court Case No. 22CV00373)
3) Regents of the University of California, et al. v. City of Santa Cruz (Santa Cruz County Superior Court Case No. 20CV02152)
By motion Council uniformly voted to direct outside special counsel to dismiss the case City of Santa Cruz v. Service Employees International Union, Local 521, PERB Unfair Practice Charge No: SF-CO-511-M
Council received a status report and took no reportable action on the remaining two cases.

2. Conference with Legal Counsel – Anticipated Litigation (Government Code §54956.9(d)(2)
Significant exposure to litigation (one potential case to be discussed) Council received a status report, and took no reportable action.

3. Conference with Legal Counsel – Anticipated Litigation (Government Code §54956.9(d)(4))
Initiation of litigation (one potential case to be discussed) Council consulted with legal counsel and took no reportable action.

7.2 May 9, 2023 CITY COUNCIL MINUTES 6467
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
May 9, 2023
2:15 PM
Call to Order – Mayor Keeley called the meeting to order at 2:16 p.m. in Council Chambers.

Roll Call

Present: Councilmembers Newsome, Brown, Watkins, Brunner, KalantariJohnson; Vice Mayor Golder; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Assistant City Manager L. Schmidt (via Zoom), Deputy City Manager L. Murphy, Chief of Fire R. Oatey, Director of Planning and Community Development L.

Butler, Chief of Police B. Escalante, Director of Economic Development and Housing B. Lipscomb (via Zoom), Finance Director E. Cabell (via Zoom), Director of Information Technology K. Morgan (via Zoom), Director of Public Works N. Nguyen (via Zoom), Water Director R.

Menard (via Zoom), Chief People Officer S. De Leon (via Zoom), Senior Programs Coordinator K. Mercer-Lebov, Homelessness Response Manager L. Imwalle, Senior Planner S. Neuse, Principal Planner M. VanHua, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B.

Bush.

Presentations

4. Mayoral Proclamation Declaring May as Older Americans Month Senior Programs Coordinator K. Mercer-Lebov gave a presentation on Older Americans Month.

7.3 May 9, 2023 CITY COUNCIL MINUTES 6468
Presentations (continued)

5. Crisis Consulting for the Development of a City-Based Integrated Health Response Team
Deputy City Manager L. Murphy introduced Ben Adam Climer with Crisis Consulting, who gave a presentation and responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke:

Jeff Warren
Unidentified person
James Ewing Whitman
Unidentified person
Joy Schendledecker
Unidentified person
Ann Simonton
Mayor Keeley closed the public comment period.

6. Hans Christian Andersen Contest Awards
Mayor Keeley, Michele Peregrin, Chair of the Santa Cruz Sister Cities Committee, and Isabella Tuncer, Chair of the Subcommittee for our Sister City Sestri Levante spoke about the Hans Christian Andersen writing awards and announced this year’s winners.

Presiding Officer's Announcements – Mayor Keeley called on Councilmember Kalantari-Johnson, who spoke about Community Action Month.

Statements of Disqualification – None.

Additions and Deletions – None.

City Attorney Report on Closed Session – See page 6466 for the report.

Council Meeting Calendar

7. The City Council reviewed and did not revise the meeting calendar attached to the agenda.

7.4 May 9, 2023 CITY COUNCIL MINUTES 6469
Consent Agenda
Vice Mayor Golder and Councilmember Brown made a comment on item 17.

Councilmember Brown pulled items 10 and 11 for further discussion.

Mayor Keeley opened the public comment period. The following person spoke:

James Ewing Whitman made a comment on item 8.

Mayor Keeley closed the public comment period.

MOTION: Councilmember Watkins moved, seconded by Vice Mayor Golder, to approve the remaining Consent Agenda.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner, KalantariJohnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

8. Resolution Extending the Emergency Declaration in Connection with the December 2022 and January 2023 Winter Storms (CA/CM)
Resolution No. NS-30,145 was adopted extending by sixty days the Local Emergency Declaration in connection with the December 2022 and January 2023 winter storms.

9. Minutes of the April 25, 2023 City Council Meeting (CC) Motion carried to approve as submitted.

7.5 May 9, 2023 CITY COUNCIL MINUTES 6470
Consent Agenda (continued)

10. Homelessness Response Quarterly Update (CM)
Homelessness Response Manager L. Imwalle responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke.

Garrett
Unidentified person
James Ewing Whitman
Reggie Meisler
Mayor Keeley closed the public comment period.

MOTION: Councilmember Kalantari-Johnson moved, seconded by Councilmember Brown, to receive the quarterly update regarding City Councildirected homelessness response programs and services.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner,
Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

11. Pogonip Encampment Closure Refuse Disposal and Abatement Contract Approval (CM)
Deputy City Manager L. Murphy responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke.

Garrett
Unidentified person
Michael
James Ewing Whitman
Reggie Meisler
Joy Schendledecker
Keith McHenry
Robert Norse
Mayor Keeley closed the public comment period.

7.6 May 9, 2023 CITY COUNCIL MINUTES 6471
Consent Agenda (continued)

11. Pogonip Encampment Closure Refuse Disposal and Abatement Contract Approval (CM) (continued)
MOTION: Vice Mayor Golder moved, seconded by Councilmember Watkins, to authorize the City Manager to execute an agreement, in a form to be approved by the City Attorney, between the City of Santa Cruz and Clean Team Associates in an amount not to exceed $250,000, to remove encampment debris in the Pogonip.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner,
Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

12. Award Contract for Services for Disaster Cost Recovery (FN) Motion carried to:
 Award a contract for services for disaster cost recovery to Kermani Consulting Group, Novato, California; and
 Adopt Resolution No. NS-30,146 amending the FY 2023 budget to increase appropriations in the amount of $70,000 for disaster cost recovery services in FY 2023; and
 Authorize the City Manager to execute an agreement in a form approved by the City Attorney with Kermani Consulting Group.

13. Neary Lagoon Fence Rehabilitation and Improvement Project (m409668) – Approval of Plans and Authorization to Award (PW)
Motion carried to approve the fence plans and authorize the City Manager to execute the construction contract with Abacherli Fence Company (Watsonville, CA) in the amount of $130,850.00 in a form acceptable to the City Attorney.

The Public Works Director is authorized to execute change orders within the approved project budget.

7.7 May 9, 2023 CITY COUNCIL MINUTES 6472
Consent Agenda (continued)

14. Highway 1/9 Intersection - Approval of an Amendment to Consultant Agreement and Construction Budget Adjustment (c400805 and c401402) (PW) Motion carried to:
 Authorize and direct the City Manager to execute a contract amendment in the amount of $356,562, in a form approved by the City Attorney, to the contract with BKF Engineers (San Jose, CA) for the Highway 1/9 Intersection Alternative Analysis consultant services and additional construction support services due to delays and changes; and
 Adopt Resolution No. NS-30,147 amending the FY 2023 budget by transferring funds from the Traffic Impact Fee Fund to fully fund the increased State Route 1/9 Intersection Improvement Project construction costs.

15. Murray Street Bridge Seismic Retrofit (c409321) TRC Engineers, Inc.- Contract Amendment 10 (PW)
Motion carried to approve and authorize the City Manager to execute Contract Amendment 10 with TRC Engineers Inc. (Rancho Cordova, CA) to provide Utility Coordination and Design Completion Services for the Murray Street Bridge Seismic Retrofit Project, in a form approved by the City Attorney. The Public Works Director is authorized to approve contract amendments within the approved project budget.

16. Dimeo Lane Paving and Storm Drain Project (c401312) – Approve Project as an Addendum to the Ocean Street Pavement Rehabilitation Project (c400809) (PW)
Motion carried to retroactively approve the Dimeo Lane Paving and Storm Drain Project (c401312) as an addendum to the Ocean Street Pavement Rehabilitation Project (c400809). The Director of Public Works is hereby authorized to execute change orders within the approved project budget.

7.8 May 9, 2023 CITY COUNCIL MINUTES 6473
Consent Agenda (continued)

17. Bay Drive Protected Bike Lanes and Pedestrian Path (c402304) – Advertise for Bids and Award Contract (PW)
Motion carried to approve the plans and specifications for the Bay Drive Protected Bike Lanes and Pedestrian Path (c402304) and authorize staff to advertise for bids and award the contract. The City Manager is hereby authorized and directed to execute the contract in a form acceptable to the City Attorney. The Public Works Director is authorized to execute change orders within the approved budget.

18. Newell Creek Instream Habitat Restoration – Large Woody Debris Project Professional Services Agreement Amendment (WT)
Motion carried to:
 Accept the proposal dated April 14, 2023 of cbec, inc. eco engineering (West Sacramento, CA) for bid support and construction services for the Newell Creek Instream Habitat Restoration – Large Woody Debris Project in the amount of $141,103.00 and to authorize the City Manager to execute Contract Amendment No. 1 in a form to be approved by the City Attorney; and
 Authorize the Water Director to approve change orders with cbec, inc. eco engineering in a form to be approved by the City Attorney for amounts that are within in the approved adjusted budget.

End Consent Agenda
At this time, the Council returned to item 6.

7.9 May 9, 2023 CITY COUNCIL MINUTES 6474
General Business

19. Coral Street Visioning Report (PL)
Senior Planner S. Neuse, Principal Planner M. VanHua, and Justin Doull, Consultant with DAHLIN Architecture, gave a presentation and responded to Councilmember questions.

Director of Planning and Community Development L. Butler responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke.

Unidentified person
Tom Stagg
Unidentified person
Paul Gallacher
Unidentified person
Kim Salisbury
Jennifer Gallacher
Unidentified person
Unidentified person
Casey Beyer
Unidentified person
Mayor Keeley closed the public comment period.

MOTION: Councilmember Brown moved, seconded by Mayor Keeley, to accept and file the Coral Street Visioning Report and direct staff to:
• Pursue Option 4.1 (outlined below), as the preferred development option for the property at 125 Coral Street;
Option 4.1:

Ground Level
2,000 sf lobby
3,000 sf Programmable Space
8,000 sf Navigation Center
11 surface parking spaces
Second Level
5,500 sf Programmable Space
11,200 sf Navigation Center

7.10 May 9, 2023 CITY COUNCIL MINUTES 6475
General Business (continued)

19. Coral Street Visioning Report (PL) (continued)
MOTION (continued):

Option 4.1 (continued):

Third Level
16,700 sf Programmable Space
Upper Level
13,800 sf Residential Units (per floor)
• Initiate a process to more fully evaluate potential changes to the general plan and zoning of City-owned property (or properties) on the south side of Coral Street to facilitate the preferred project;
• Begin pursuing funding to support full design and construction of the preferred option for the site, including evaluating the funding for long-term operation, in coordination with the County and other community partners; • Continue to work with neighboring businesses and other stakeholders to find ways to mitigate parking impacts and identify parking resources in proximity to the Coral Street neighborhood, which calls for exploration of transportation demand management strategies and off-site parking options; and
• Adjust the boundaries of the Visioning Report Project Area to exclude the three parcels on the western boundary of the project area that are held by private property owners.

FRIENDLY AMENDMENT: Councilmember Kalantari-Johnson requested to add direction for appropriate departments to address concerns expressed by local businesses in the Coral Street area to adopt a “good neighbor” clause.

Councilmember Brown and Mayor Keeley accepted.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner,
Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

At this time, Mayor Keeley rearranged the agenda and heard Oral Communications.

7.11 May 9, 2023 CITY COUNCIL MINUTES 6476
General Business (continued)

20. 2024 Affordable Workforce Housing Bond (CN)
Mayor Keeley spoke and responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke.

Unidentified person
James Ewing Whitman
Unidentified person
Garrett
Unidentified person
Unidentified person
Unidentified person
Mayor Keeley closed the public comment period.

MOTION: Councilmember Brown moved, seconded by Councilmember Kalantari-Johnson, to direct the Council Budget and Revenue Subcommittee and staff to initiate a process to engage the public regarding consideration of an affordable workforce measure, via public signature gathering on the March 2024 ballot, including engagement of a research firm and scheduling community meetings and outreach.

FRIENDLY AMENDMENT: Councilmember Watkins requested to amend the motion language to, “direct the Council Budget and Revenue Subcommittee and staff to initiate a process to engage the public, including engagement of a research firm and scheduling community meetings and outreach, regarding consideration of an affordable workforce measure, via public signature gathering on the March 2024 ballot.” Councilmembers Brown and KalantariJohnson accepted.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner,
Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

7.12 May 9, 2023 CITY COUNCIL MINUTES 6477
General Business (continued)

21. Independent Police Auditor Report (CM)
Michael Gennaco and Samara Marion with the OIR Group gave a presentation and responded to Councilmember questions.

Chief of Police B. Escalante responded to Councilmember questions.

Mayor Keeley opened the public comment period. The following people spoke.

Unidentified person
Unidentified person
Justin Laing
Unidentified person
Unidentified person
Unidentified person
Mayor Keeley closed the public comment period.

MOTION: Councilmember Kalantari-Johnson moved, seconded by Vice Mayor Golder, to receive the annual report from the City’s Independent Police Auditor, OIR Group.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Newsome, Brown, Watkins, Brunner,
Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

Oral Communications Announcement - The Mayor provided a brief announcement about Oral Communications.

Oral Communications
At 6:46 p.m. Mayor Keeley opened Oral Communications for members of the public who wished to speak regarding items not listed on the City Council agenda.

Shelley Silva spoke regarding the plan for Jump Bikes to be placed in front of her home.

Reggie Meisler spoke regarding Health and Human Services.

7.13 May 9, 2023 CITY COUNCIL MINUTES 6478
Oral Communications (continued)
Unidentified person spoke regarding Jump Bikes and about the George Floyd Justice and Policing Act.

Garrett spoke regarding the West Cliff Response Plan.

Unidentified person spoke regarding the Brown Act and public comment.

At 7:00 p.m. Mayor Keeley closed Oral Communications.

Council took a break at 7:00 p.m. and returned at 7:33 p.m., at which time they returned to item 20.

Adjournment – Vice Mayor Golder moved, seconded by Councilmember Watkins, to adjourn. By consensus City Council adjourned at 9:16 p.m.

Respectfully Submitted:

Julia Wood, Deputy City Clerk Administrator
Attest:

Bonnie Bush, City Clerk Administrator
Approved:

Fred Keeley, Mayor

7.14 City Council

AGENDA REPORT
DATE: 05/02/2023
AGENDA OF: 05/23/2023
DEPARTMENT: City Council
SUBJECT: Council Sugar-Sweetened Beverage Tax Ad Hoc Committee (CN) RECOMMENDATION: Motion to create a City Council ad hoc committee to explore the feasibility of placing a sugar-sweetened beverage tax measure on the March or November 2024 ballot.

BACKGROUND: Results from a 2018 poll conducted by the City indicated that 76% of voters in this community supported a two cent per ounce sugar-sweetened beverage tax. In early June 2018, a 1.5 cent per ounce sugar-sweetened beverage tax ballot initiative had been approved by the Santa Cruz City Council to go to a vote by city residents that November, but the initiative was brought to a halt when then-Governor Jerry Brown signed the Keep Groceries Affordable Act into law June 2018, forcing the City to remove the item from the ballot.

The law prevented taxes on grocery items and included a penalty provision for any charter city that attempted to implement a sugar-sweetened beverage tax, or other grocery-related tax that would take away the city’s sales tax revenue and was prompted by pressure on California lawmakers from the beverage industry.

In 2018, Fresno-based nonprofit, Cultiva La Salud, and Councilmember Martine Watkins sued the state, arguing that the penalties stipulated by the Keep Groceries Affordable Act were unconstitutional. In 2021, a Sacramento County Superior Court judge agreed and struck down the law. In a ruling at the end of March 2023, the California Third District Court of Appeals found that charter cities such as Santa Cruz cannot be financially penalized by the state for lawfully implementing a sugar-sweetened beverage tax, or soda tax, on residents.

DISCUSSION: With the recent court ruling in the City’s favor, Councilmembers Watkins, Brunner, and Kalantari-Johnson wish to do further work to evaluate the feasibility of placing a sugar-sweetened beverage tax measure on either the March or November 2024 ballot. They are requesting the City Council establish a Council ad hoc committee for this scope and are volunteering to serve, with the Council’s direction and the Mayor’s appointment.

The new Council ad hoc committee, in coordination with the existing work the Council Budget and Revenue Ad Hoc Committee, would update previous data and financial projections and return to the City Council with a recommendation as to whether or not to bring a sugarsweetened tax initiative to the voters, and when.

8.1 FISCAL IMPACT: At the time the tax was first analyzed in 2018, it was expected to generate between $800,000 and $1 million in additional revenue in the first full year. However, it was also anticipated that future annual tax receipts were likely to decline to a new, lower base as business and consumers change purchasing and consumption behavior.

Submitted By:

Martine Watkins
Councilmember
Submitted By:

Shebreh Kalantari-Johnson
Councilmember
Submitted By:

Sonja Brunner
Councilmember
ATTACHMENTS:

1. AGENDA REPORT AND ATTACHMENTS FROM FEBRUARY 13, 2018 COUNCIL MEETING.PDF

2. AGENDA REPORT AND ATTACHMENTS FROM JUNE 26, 2018 COUNCIL MEETING.PDF

3. AGENDA REPORT AND ATTACHMENTS FROM APRIL 28, 2020 COUNCIL MEETING.PDF

4. AGENDA REPORT AND ATTACHMENTS FROM FEBRUARY 23, 2021 COUNCIL MEETING.PDF

8.2 CITY COUNCIL

AGENDA REPORT
DATE: February 6, 2018
AGENDA OF: February 13, 2018
DEPARTMENT: City Council Ad-Hoc Revenue Committee
SUBJECT: City Council Ad-Hoc Revenue Committee Recommendations Related To Placement Of General Purpose Revenue Tax Measure On June 5, 2018 Special Election (CN)
RECOMMENDATION:

1. Resolution making emergency findings for placing a general purpose one-quarter of one percent sales tax ballot measure and general purpose two cents per ounce sugar sweetened beverage tax ballot measure on the June 5, 2018 special election.

2. Motion to direct staff to return on February 27, 2018 with a resolution ordering a special election on June 5, 2018, and requesting consolidation of such election to place a general purpose one-quarter of one percent sales tax ballot measure and general purpose two cents per ounce sugar sweetened beverage tax ballot measure.

BACKGROUND: In response to projected budget deficits the City of Santa Cruz (City) has embarked on a proactive fiscal sustainability strategy. The strategy involves expenditure reductions as well as increasing revenues to sustain critical city services. Accordingly, on August 22, 2017 the City Council authorized the Mayor to appoint an Ad-Hoc Revenue Committee charged with exploring the potential for a revenue tax ballot measure. The Committee, comprised of Councilmembers Chase, Krohn, and Mathews, has met over the past several months to review a variety of revenue options as well as worked with pollster Gene Bregman to develop a public opinion poll which was conducted in late January.

DISCUSSION: After a comprehensive review and analysis of revenue tax options and the results of the public opinion poll, the committee recommends that two general purpose tax revenue measures be placed on the June 5, 2018 ballot: a one-quarter of one percent sales tax ballot measure and two cents per ounce sugar sweetened beverage tax ballot measure.

In order to proceed, the Council must take two actions. The first is to adopt a resolution making emergency findings. Article XIII C of the California Constitution requires that general tax measures be consolidated with a regularly scheduled general election for members of the local governing body, except in cases of emergency declared by a unanimous vote of the governing body. The attached resolution has been prepared for City Council consideration and adoption.

8.3 The second action is for the City Council to adopt a resolution ordering a special election and requesting consolidation of such election. Therefore the Committee recommends that the City Council direct staff to return on February 27, 2018 with a resolution ordering a special election on June 5, 2018, and requesting consolidation of such election to place a general purpose onequarter of one percent sales tax ballot measure and general purpose two cents per ounce sugar sweetened beverage tax ballot measure.

FISCAL IMPACT: Voter approval of the proposed revenue tax ballot measures would generate approximately $4 to $5 million in additional annual revenue to the City’s General Fund. Placing the measure on the ballot is expected to cost from $75,000 to $150,000.

Submitted by:

Cynthia Chase Chris Krohn Cynthia Mathews
Councilmember Councilmember Councilmember
Attachment: Resolution

8.4 RESOLUTION NO. NSRESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ

DECLARING A FISCAL EMERGENCY IN ORDER TO PLACE GENERAL PURPOSE TAX BALLOT MEASURES ON THE JUNE 5, 2018 SPECIAL ELECTION WHEREAS, pursuant to Article XIII C of the California State Constitution, the election for a general tax increase is required to be consolidated with a regularly scheduled general election for members of the governing body of the local government, except in cases of emergency declared by a unanimous vote of the governing body; and
WHEREAS, the City faces a budget crisis of unprecedented proportions; and WHEREAS, the City has experienced revenue disruption and significant increases in expenses; and
WHEREAS, the City Council has already made significant reductions to the City budget in the current fiscal year; and
WHEREAS, the City faces a known budget deficit of at least $5.5 million in the next fiscal year (Fiscal Year 2019); and
WHEREAS, the City faces a growing budget deficit of up to $23 million by Fiscal Year 2022; and
WHEREAS, additional reductions at the magnitude faced by the City in the next fiscal years will jeopardize the public health and safety of the residents of the City of Santa Cruz by requiring the reduction of critical City services; and
WHEREAS, the residents of the City of Santa Cruz have expressed their desire to avoid further cuts in essential City services; and
WHEREAS, the City’s fiscal crisis herein described is of sufficient gravity and severity that the City must at the earliest feasible juncture propose revenue enhancement measures to the electorate in order, to the extent possible, to preserve the minimal level of governmental services necessary to protect and preserve the health and general welfare of the City’s residents, workers, and visitors; and
WHEREAS, the City Council Ad-Hoc Revenue Committee has recommended the adoption of a resolution ordering a special election on June 5, 2018 and requesting consolidation of such election to place a general purpose tax ballot measure to add one-quarter of one percent to the sales tax rate and a general purpose tax ballot measure to impose a two cents per ounce sugar sweetened beverage tax.

8.5 RESOLUTION NO. NSNOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz that it hereby unanimously declares a fiscal emergency.

PASSED AND ADOPTED this 13th day of February, 2018, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED:

Mayor
ATTEST:

City Clerk
2 8.6
2 3.23
City Council AdHoc Revenue
Committee
Recommendation
/13/18, Item #23
Today: Emergency declaration for
purpose of placing general tax
measures on June 5, 2018 special
election
Next Meeting: Adopt content of Ballot Measure
Language 8.7
2 2

3.24 Pro-active actions now to protect critical services while balancing shared need to support Housing
• Unprecedented funding gaps threaten City service levels • $2.7 Million in budgetary changes already in current year • $5.5 Million will be required next year; escalating to $10 million the following year
• Escalating erosion of revenue basis, massive increases in payments to the State, looming economic slowdown and decaying facilities and infrastructure • Actions by June will eliminate $10+ million shortfall in FY2020 and reduce severity of $20+ million shortfall in three years • Preserve and support November 2018 county-wide efforts to provide comprehensive Housing Solutions

8.8 Dependable Projections indicate action now
5-Year City forecast of General Fund operations threatens ability to protect and maintain critical public safety & quality of life services 3 2

3.25 8.9
4 2

3.26 Oct’ 2017- Feb’2018 Ad-Hoc Revenue Committee
• Cynthia Chase (Chair), Chris Krohn,
Cynthia Mathews
• Investigate current and long-term
resource options for 2018 ballot
considerations
• Funding to maintain critical service
levels
• Funding to provide essential capital
investments for infrastructure and
community facilities
• Approaches to balance general
community needs

8.10 Bond Rating 2

3.27 Pension Reforms
5 Examples of Leading Fiscal Stewardship
Awards • National Budget Award recognition (GFOA)
• National Financial Reporting- CAFR (GFOA)
• Increased Bond Rating in 2014 to AA+
• Within 9 comparable cities, only Berkeley& Palm Springs at this level • Voluntarily adopted lower tier (before State reforms) • Reset lower salary levels & higher employee contributions • See next slide for more
Fiscal success
Financial
Planning
• Adopted major policies for Reserve, Surplus and Trusts • Restrained position growth & streamlined operations
• Pro-active budget balancing including ensuring cost recovery for requested services • Unique service contracts lowering tax payer costs (Library, UCSC, Lifeguards, Utilities) • Developed long-range, dependable forecasts
• Developed fiscal sustainability plan to maintain services and limit community tax increases • Inclusion and support of community stakeholders (citizen, non-profit, business, education, etc.)

8.11 6
Develop plan to pay down
liability
Consider local ballot
measures
Create pension rate
stabilization
2 3.28
January 2018 League of California Cities: What
Cities can do today (re: increased payments to State for pensions) • 2016- City created Ad-Hoc committee providing first review of ballot measures • 2017- Ad-Hoc committee created to continue and recommend 2018 ballot measures • Restrained position growth & streamlined operations
• Unique service contracts lowering tax payer costs (County Library, UCSC Fire, Lifeguards, utility services beyond City limits)
• All employees pay 2.5% to 5.0% of their salary towards pensions (beyond State required levels) • 2011- Adopted pension reforms prior to later State wide efforts • Reset to lower, base levels all salaries
Issue Pension Obligation
Bond • 2011- City paid down significant portion of public safety liability Change in Service Levels
Use Bargaining to increase
Employee payments

8.12 2

3.29 Committee
Work Plan

8.13 Confirm
Committee’s Evaluate and
prioritize potential
8 Recommend use of
Prioritize top resources to preserve
Committee Work Plan
2 3.30

8.14 Evaluation of various new revenue options
2 3.31
Examples of committee
considerations
• Competition with other ballot
measures (i.e. November countywide housing
• Success rate of a ballot measure
balance with cost of election
• Revenue potential of new resource
• Voter support patterns of current and
prior elections
• Community support
• Any urgency or timing considerations
Resource Options Evaluated
Admission
Tax
Business
License Tax
Cannabis
Excise Tax
Franchise
Taxes Parcel taxes
Other
Property
taxes
Parking Tax Property
Transfer Tax Sales Tax
SugarSweetened
Tax
Transient
Occupancy
Tax
Utility Users
Tax

8.15 2

3.32 10
Key Ballot Measure Considerations
Success rates fall quickly when measures
“restricted” for a purpose
Nearly 75% of general purpose Sales Tax
ballot measures have passed Statewide
since 2012

8.16 Rate
per
ounce
City & Type Voter
Approval
1-cent Berkeley- General 76%
San Francisco- General* 62.5%
Albany- General 72%
Oakland- General 61.4%

1.5-2.0 Philadelphia, PA (1.5) n/a
cents Seattle, WA (1.75) n/a
Boulder, CO (2.0) 55%
2 3.33
Key Ballot Measure Considerations
City would remain competitive with
local sales tax rates
Sugar Sweetened Beverage Tax has been
successful in like communities
*San Francisco’s initial 2014 “Special Purpose” restricted11 tax failed 8.17 12 Committee recommendations of top considerations
2 3.34
Key decision points for June 5 thitems
• Sales tax
• Provide a credible $3 Million resource
• Risk of losing local control of last 1/4-
cent left
• Any count-wide entity could propose a
ballot measure for their use
• Sugar Sweetened Tax
• Similar communities have supported
this measure
• Local poll results incredibly strong
and support acting now
Prioritized Resource options
June 2018
Ballot
November
2018 or later
SugarSweetened
Tax
Transient
Occupancy
Tax
Sales Tax Property
Transfer Tax
• TOT & Transfer tax considerations
• Require significant outreach with stakeholders and community partners before taking action 8.18 2 3.35
Poll Results
Gene Bregman & Associates
Public Opinion & Marketing Research

8.19 Questions
Actions
1) Resolution making emergency findings for
placing ballot measures indicated on the
June 5, 2018 special election
2) Motion directing staff to return February
27, 2018 to order election, request
consolidation and place general purpose
1/4-cent sales tax and 2-cents sugar
sweetened beverage tax ballot measures
2 3.36

8.20 23.37

8.21 Chart 1
2 3.38

8.22 Chart 2
80%
2 3.39
40%
70%
20%
60%
50%
30%
10%
otes on Tax Measures
76%
0%
Q.3a: Quarter Cent Sales Tax Q.3b: Two Cent Sugary Beverage Tax Total Yes Total No Undecided

GENEBREGMAN&ASSOCIATES

8.23 Chart 3 0

8.24 2

3.41 A
B
D
E
F
C
Chart 4
Proportions Much More Likely to Oppos
Sales Tax Measure
We cannot trust the City Council to keep its promise to use the money properly unless the tax measure specifically says how the money must be used
We should not increase our taxes to pay for the excessive salaries and benefits of city bureaucrats
This is a regressive tax that hurts the people who can least afford it This tax will hurt small businesses that already struggle to survive Taxes are already too high without this tax increase
The City needs pension reform rather than new taxes
if it wants to get control of its budget

GENEBREGMAN&ASSOCIATES

8.25 All the money will be used here in our local community Without this tax money, children and at-risk youths may lose opportunities for safe places to go after school and during summers This measure will maintain safety and security for families with children, seniors and everyone else who uses the parks, beaches and open space areas throughout the City
B
E
2X42
Reducing park patrols and park maintenance will likely lead to some areas N becoming hot spots for drugs, gangs and other criminal activity A
D 44%
46%
This measure is needed to maintain
many different kinds of fire prevention programs
If this measure fails, critical city services and popular programs will have to be reduced or eliminated
A sales tax is the fairest way to raise money,
especially since it means that people who shop here
but do not live here will support services that benefit them, too 30%
35%
34%
F 30%
G
C
H
Chart 5
Proportions Much More Likely to Favor
Sales Tax Measure:

More Effective Than Reasons to Oppose
Adequate funding is needed to maintain
the recreational and cultural opportunities for Santa Cruz residents

GENEBREGMAN&ASSOCIATES

8.26 23%
15%
F
A
D
G
B
C
H
E
Chart 6
Proportions Much More Likely to Oppose
Sugary Beverage Tax Measure:

Less Effective Than Reasons to Oppose Sales Ta
We cannot trust the City Council to keep its promise
to use the money properly unless the tax measure specifically says how the money must be used
This is a regressive tax that hurts the people who can least afford it Even Senator Bernie Sanders disagrees with this tax, saying that it disproportionately affects low income and middle class Americans 2 3.43
We should not increase our taxes to pay for
the excessive salaries and benefits of city bureaucrats The City needs pension reform rather than new taxes
if it wants to get control of its budget
With the cost of living already out of control, we don't need another tax that makes it more expensive every time we go grocery shopping Two cents is just too high a tax;
every other city in California that has a beverage tax
is just one cent, including Berkeley, San Francisco, and Oakland This tax will hurt small businesses that already struggle to survive

GENEBREGMAN&ASSOCIATES

8.27 Chart 7
2:L44

8.28 CITY COUNCIL

AGENDA REPORT
DATE: June 20, 2018
AGENDA OF: June 26, 2018
DEPARTMENT: City Council Ad-Hoc Revenue Committee
SUBJECT: City Council Ad-Hoc Revenue Committee Recommendations Related to the Placement of a General Purpose Tax Measure of One-Cent Per Ounce on Distributors of Sugar-Sweetened Beverages on the November 6, 2018 Ballot (CN)
RECOMMENDATION:

1. Resolution to submit to a vote of the electors at the November 6, 2018 General Municipal Election a general tax of one-cent per fluid ounce on distributors of sugar-sweetened beverages, and creation of a Community Oversight Panel to transmit an annual report and make recommendations to the City Council.; and

2. Motion supporting the measure for the purpose of authorizing arguments; directing the Mayor to designate up to three Councilmembers to identify authors and signers for the arguments in favor of this measure, working with members of the community if they so choose; directing the City Attorney to prepare the impartial analysis; and providing direction to the City Manager regarding the preparation of the fiscal analysis, as appropriate.

BACKGROUND: On February 13th, 2018, the City Council established a City Council Revenue Ad-Hoc Committee to evaluate revenue considerations including potential ballot measure(s) for the November 2018 general election. The Committee was comprised of Councilmembers Martine Watkins (chair), Chris Krohn and Cynthia Mathews.

The committee evaluated potential revenue measures as well as reviewed the analysis of the prior ad-hoc revenue committee. The Committee became apprised of the significant health impacts sugar-sweetened beverages have on people as well as actions taken by some jurisdictions to combat these health impacts. That reviewed analysis included information from other jurisdictions as well as the January 2018 poll results that indicated 76% support for a two-cent sugar-sweetened distribution tax.

Since 2014, four California cities and several cities in other states have instituted a sugarsweetened beverage tax as a critical measure to both improve community health and support local programs and facilities that contribute to community wellness. The Ad-Hoc committee has evaluated resources, advisory committees, and studies from Berkeley, San Francisco, Oakland as well as public health reports.

28.1 8.29
Various studies have linked a daily sugary drink habit to a 26 percent higher risk of type 2 diabetes(12), a 27 percent increased risk of adult obesity(8) and a 55 percent greater risk of childhood obesity(8), as well as higher incidences of heart disease, liver disease and metabolic disorder. Santa Cruz County health data indicates that although Santa Cruz is doing relatively better than other jurisdictions in the state, they are seeing a rise in diabetes and other harmful health impacts. In addition to these health risk factors, following are some key facts about sugarsweetened beverages (see attachment for full source information):
· Infants who drink sugary drinks have an 83% chance of cavities at age 6(11) · A 20 ounce bottle of soda is equivalent to 16 packets of sugar. · A single can of soda provides 1.5-times the amount of sugar that the American Heart Association recommends for children(2)
· 2 in 3 California teenagers drink at least one soda or other sugary drink each day(5). · When sugar is delivered in a liquid form it bypasses the body’s defense against consuming too many calories(14).
· Beverage companies spend hundreds of millions annually marketing directly to youth, bypassing parents, and market more heavily to youth of color(7). · 46% more of Hispanic children aged 2-8 have cavities in their baby teeth(11) · 40% of all children will develop Type 2 diabetes in their lifetimes; the projected rate for Latino and African American children is even greater, at 50%(1).

Berkeley was the first California City to lead this effort with support from nearly 70 community organizations like the Federation of Teachers, the Latinos Unidos, Health and Active before 5, leading public health experts and local restaurants and grocers(5). A year after Berkeley’s tax was implemented in March 2015, studies showed a decrease in soda consumption of 9.6% and a corresponding 15.6% increase in drinking bottled or tap water(9). Another Berkeley poll indicated that 5% of residents reported switching purchases to another city but only 2% of them said it was because of the tax(4).

In San Francisco research found that sugary drink consumption is highest among youth (middle school more than high school), young adults (age 18-29), and ethnic minorities, particularly Black and Latino populations. In their March 2018 committee report, preliminary data indicated that there were also reductions in sugary drink consumption and increases in water consumption.

The City of Santa Cruz has invested for many years in promoting community health through its parks and beaches, public facilities, recreation programs, public safety and youth development initiatives, and partnership with schools, public and non-profit organizations delivering a broad spectrum of health and wellness services for residents of all ages. During times of severe fiscal constraints, these investments have often been among the first to be eliminated, decreased or delayed.

It is clear from the experience of other communities that sugar sweetened beverage taxes yield a two-fold benefit of healthier consumer choices and additional revenue to sustain and support community wellness investments. Community values and recent polling indicate strong support in Santa Cruz for such a measure. A successful outcome will require a strong independent campaign that is broadbased and well-funded with robust community involvement.

Locally, the committee has thus far conducted outreach to stakeholders such as the Santa Cruz Chamber of Commerce, the Santa Cruz Business Council, Seaside Company, Community Bridges, Santa Cruz Downtown Association, Health Improvement Partnership of Santa Cruz

28.2 8.30
County (leadership of our community’s healthcare, dental and medical care providers including medical groups, hospitals, non-profit clinics and public health agencies.) The Committee has also reached out to representatives of Costco. Additional outreach will continue through the Fall.

DISCUSSION: After a comprehensive review and analysis of revenue tax options, prior ad-hoc committee evaluations, and new considerations of the health challenges in our community, the City Council Ad-Hoc Revenue Committee recommends the placement of a one-cent per fluid ounce tax measure on distributors of sugar-sweetened beverages on the November 6, 2018 General Municipal Election. The goal of this measure would be to improve community health, and support investments that advance community wellness in the City of Santa Cruz.

This measure would also establish a Community Oversight Panel to report annually on the impact of this tax and include recommendations to support and improve community wellness.

The Oversight Panel will include members from: the City’s Parks and Recreation Commission, Santa Cruz City schools, a youth organization (like First 5), three health or wellness related organizations or practitioners (like a local doctor, pediatrician, and dentist), and three at-large community members.

The Ad-Hoc Revenue Committee favored the one-cent rate to be in alignment with the other California tax rates, although the two-cent rate polling had a 76% favorable rating. Future proceeds from this general tax would support the City’s ability to maintain its broad range of recreation and education programs and facilities, maintain funding for community-based and safety-net services. These could include programs such as:
· Keeping parks and facilities accessible, safe and well maintained · Supporting programs that provide positive opportunities for children and youth · Maintaining active recreation programs and facilities for people of all ages · Supporting community based organizations that contribute to community wellness In order to proceed, the Council must adopt a resolution requesting the consolidation of the November election by June 26, 2018, their last regularly scheduled meeting before the August 10, 2018 deadline.

There are some common misconceptions about a sugar-sweetened distribution tax that are explained in the ordinance. A Frequently Asked Questions (FAQ) document will clear up many of these misconceptions and will be made available soon. Some of the primary points in this FAQ will include:
· The tax is on the distribution of the beverage/syrup into the City and is accordingly paid by the distributors, not the community or local retail and restaurants. o However, like other communities have seen, the large beverage distributors will pass on this cost in the form of higher beverage prices. · There are many common sense tax exemptions including that the tax does not apply to:
o Diet Soda
o Any natural juices that have sugar (like apple and orange juice, coconut water) o Milk and milk substitute products (like almond or soy milk) o Any beverage for diet supplements or for medical purposes o All alcohol
· The Santa Cruz measure, like others passed in California, includes a small business exemption. Based on local business feedback, the Santa Cruz measure sets the

28.3 8.31
exemption at $500,000 gross annual revenues, the largest exemption to date among other sugar-sweetened tax measures
· This tax only applies to beverages with sugar; it does not apply to any grocery or consumer food products including packaged sugar or drink powders. o It would not apply to any beverages where the customer adds their own sugar (like coffee or tea).

Finally, it is expected that the American Beverage Association (ABA) and other corporate and business associations will aggressively mount a well-funded campaign against this tax that will outspend supporters 3 or 4 to 1. In Berkeley, large corporations led the campaign against the proposed tax and poured in over $2.4 million to fight it(3). In San Francisco, the opposition poured in $22.5 million(6). The measures in these communities passed in spite of the disproportionate opposition spending. A similar tax is well positioned to pass in Santa Cruz as well, even with substantial opposition funding. However, a successful effort here will require a strong, well-funded independent campaign that represents and engages broad community support.

FISCAL IMPACT: Voter approval of the proposed revenue tax ballot measures could generate $800,000 to $1-million in additional revenue in the first full year for the City to support its vital parks, facilities, recreational, wellness and community programs. This amount was credibly estimated by comparing online tax calculators to the proportional amounts that were actually collected in Berkeley and San Francisco, as well as using per-capita calculations for those agencies with the tax, while factoring in tourist-generated sales from the Santa Cruz Beach Boardwalk, local restaurants, and stores. However, future annual tax receipts are likely to decline to a new, lower base as business and consumers change purchasing and consumption behavior.

By adding a measure to the November 2018 election, it would increase the City’s proportional cost of the November 2018 election between $30,000 and $40,000 (depending on the total number of local measures that are added on the ballot and the City’s approximate 37,000 of registered voters).

Submitted by:

Martine Watkins-Chair Chris Krohn Cynthia Mathews
Vice Mayor Councilmember Councilmember
Attachment:

Resolution
Berkeley vs. Big Soda list of supporters
Source Information
Proposed Ordinance

28.4 8.32
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

RESOLUTION NO. NS _________

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ REQUESTING THAT THE CONSOLIDATED NOVEMBER 2018 GENERAL ELECTION INCLUDE A

BALLOT MEASURE FOR THE CITY OF SANTA CRUZ TO IMPOSE AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE DISTRIBUTION OF SUGARSWEETENED BEVERAGE PRODUCTS IN THE CITY OF SANTA CRUZ WHEREAS, the City Council Ad Hoc Revenue Committee was established on or about February 13, 2018, to evaluate revenue considerations, including ballot measure(s) for the November, 2018 general election;
WHEREAS, the City Council Ad Hoc Revenue Committee became aware of significant harmful health risks of sugar-sweetened beverages to the public and has evaluated health reports relating thereto;
WHEREAS, the City Council Ad Hoc Revenue Committee has considered and reviewed the experience of other local jurisdictions in seeking to combat the negative health impacts of sugar sweetened beverages;
WHEREAS, the City Council accepts the Ad Hoc Revenue Committee’s recommendation for placement of a tax measure on the November 6, 2018 General Municipal Election to levy a tax of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products in the city for unrestricted general revenue purposes, in order to promote community health & wellness, and sustain vital city services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families; and facilities for community activities - and establish a community oversight panel, with all funds to be used locally.

WHEREAS, pursuant to Elections Code Section 10002, the governing body of any city may by resolution request the Board of Supervisors of the county to permit the county elections official to render specified services to the city relating to the conduct of an election; and WHEREAS, the resolution of the governing body of the city shall specify the services requested; and
WHEREAS, pursuant to Elections Code Section 10002, the city shall reimburse the county in full for the services performed upon presentation of a bill to the city; and WHEREAS, pursuant to Elections Code Section 10400, whenever two or more elections, including bond elections, of any legislative or congressional district, public district, city county, or other political subdivision are called to be held on the same day, in the same territory, or in territory that is in part the same, they may be consolidated upon the order of the governing body or bodies or officer or officers calling the elections; and
WHEREAS, pursuant to Elections Code Section 10400, such election for cities and special districts may be either completely or partially consolidated; and

28.5 8.33
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RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

WHEREAS, pursuant to Elections Code Section 10403, whenever an election called by a district, city or other political subdivision for the submission of any question, proposition, or office to be filled is to be consolidated with a statewide election, and the question, proposition, or office to be filled is to appear upon the same ballot as that provided for that statewide election, the district, city or other political subdivision shall, at least 88 days prior to the date of the election, file with the board of supervisors, and a copy with the elections official, a resolution of its governing board requesting the consolidation, and setting forth the exact form of any question, proposition, or office to be voted upon at the election, as it is to appear on the ballot. Upon such request, the Board of Supervisors may order the consolidation; and
WHEREAS, pursuant to Elections Code Section 10418, if consolidated, the consolidated election shall be held and conducted, election boards appointed, voting precincts designated, candidates nominated, ballots printed, polls opened and closed, voter challenges determined, ballots counted and returned, returns canvassed, results declared, certificates of election issued, recounts conducted, election contests presented, and all other proceedings incidental to and connected with the election shall be regulated and done in accordance with the provisions of law regulating the statewide or special election, or the election held pursuant to Section 1302 or 1303, as applicable; and
WHEREAS, the resolution requesting the consolidation shall be adopted and filed at the same time as the adoption of the ordinance, resolution, or order calling the election; and WHEREAS, various district, county state and other political subdivision elections may be or have been called to be held on November 6, 2018.

NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the City Council of the City of Santa Cruz that it hereby orders an election be called and consolidated with any and all elections also called to be held on November 6, 2018 insofar as said elections are to be held in the same territory that is in part the same as the territory of the City of Santa Cruz, and hereby requests the Board of Supervisors of the County of Santa Cruz to order such consolidation under Elections Code Section 10401, 10403, and 10418.

BE IT FURTHER RESOLVED AND ORDERED that the City Council of the City of Santa Cruz hereby requests the Board of Supervisors to permit the Santa Cruz County Elections Department to provide any and all services necessary for conducting the election and agrees to pay for said services, and
BE IT FURTHER RESOLVED AND ORDERED that the Santa Cruz County Elections Department shall conduct the election for the following measure to be voted on as the November 6, 2018 election:

Measure to be voted on:

Deleted: 10403

28.6 8.34
RESOLUTION NO. NS-_____________________
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

Ballot Question:
“In order to promote community health & wellness, and sustain vital City services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families; and facilities for community activities - shall the City levy a tax for unrestricted general revenue purposes of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products, and establish a community oversight panel, with all funds to be used locally?” Yes__________ No____________
The City Council of the City of Santa Cruz submits to the qualified electors said Ballot Measure Question as set forth above and designates and refers to said measure as the measure to be set forth on the ballots for use in said election. The full text of the measure is as set forth in Exhibit A.

In accordance with the provisions of Section 9280 of the California Elections Code, the City Attorney is hereby directed to prepare an impartial analysis of this measure. In accordance with the provisions of Section 9212 of the California Elections Code, the Finance Director is hereby directed to prepare a fiscal impact statement of this measure.

BE IT FURTHER RESOLVED AND ORDERED that Santa Cruz County Elections Department is requested to:
 Print the attached measure text exactly as filed or indicated on the filed document in the County Voter Information Guide for the November 6, 2018 election. Cost of printing and distribution of the measure text will be paid for by the city.

BE IT FURTHER RESOLVED AND ORDERED that the City Clerk Administrator of the City of Santa Cruz is hereby ordered and directed to cause said proposed ordinance (Exhibit A) and notice of election to be published in accordance with the provisions of the California State Election Code.

PASSED AND ADOPTED this 26th day of June, 2018, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: _________________________
David Terrazas, Mayor
ATTEST:
___________________________________
Bonnie Bush
City Clerk Administrator
Deleted: ¶
¶
APPROVED: ¶
Deleted: , City Clerk Administrator

28.7 8.35
RESOLUTION NO. NS-____________
Exhibit A

EXHIBIT A
BE IT ORDAINED by the electorate of the City of Santa Cruz that Section 3.38 of the Santa Cruz Municipal Code is hereby added as follows:

ORDINANCE NO._________

AN ORDINANCE OF THE CITY OF SANTA CRUZ
IMPOSING AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE

DISTRIBUTION OF SUGAR-SWEETENED BEVERAGE PRODUCTS IN THE CITY OF

SANTA CRUZ
Section 1. Chapter 3.38 – SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX is hereby added to Title 3 – REVENUE AND FINANCE of the City of Santa Cruz Municipal Code, to read as follows:
“Chapter 3.38 - SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX

3.38.005 - SHORT TITLE.

This chapter shall be known as the "Sugar-Sweetened Beverage Distribution Tax Ordinance."

3.38.010 – PURPOSE OF THIS CHAPTER
This chapter imposes a general tax on the Distribution of Sugar-Sweetened Beverage Products for unrestricted general revenue purposes, including, but not limited to, promoting community health & wellness, and sustaining vital City services. This chapter is enacted solely to raise revenue for general municipal purposes, and not for purposes of regulation.

3.38.015 - COMMUNITY OVERSIGHT PANEL.

There is hereby established a Community Oversight Panel:
1) A Community Oversight Panel shall report on the impact of the tax, review expenditures, and include recommendations on the use of future revenues to promote community health & wellness and general revenue purposes, as consistent with this chapter. 2) The Community Oversight Panel shall be comprised of a minimum of 9 members with a term of 4 years as follows:
a) A representative designated by the City’s Parks and Recreation Commission,

28.8 8.36
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

b) A representative designated by the Santa Cruz City School District c) City Council appointed representatives from a youth organization, three health or wellness-related organizations or practitioners, and three at-large community members. 3) The Community Oversight Panel will transmit its annual report and recommendations to the City Council.

3.38.020 - DEFINITIONS.

Except where the context otherwise requires, the following definitions govern the construction of this chapter:
"Alcoholic Beverage" means any beverage that is subject to taxation as an Alcoholic beverage under California Revenue and Taxation Code, Sections 32001 et seq., as may be amended from time to time.
"Beverage for Medical Use" means a beverage suitable for human consumption and manufactured for use as an oral nutritional therapy for persons who cannot absorb or metabolize dietary nutrients from food or beverages, or for use as an oral rehydration electrolyte solution formulated to prevent or treat dehydration due to illness. "Beverage for Medical Use" also means a "medical food" as defined in Section 109971 of the California Health and Safety Code. "Beverage for Medical Use" shall not include beverages commonly referred to as "sports drinks" or any other common names that are derivations thereof. "Business Entity" means any Person except for a natural person. "Caloric Sweetener" means any substance or combination of substances that meets all of the following criteria:

1. Is suitable for human consumption,

2. Adds calories to the diet when consumed,

3. Is perceived as sweet when consumed, and

4. Is added for making, mixing, or compounding Sugar-Sweetened Beverages by combining the substance or substances with one or more ingredients including, but not limited to, water, ice, powder, coffee, tea, fruit juice, vegetable juice, or carbonation or other gas.
“Caloric Sweetener” may take any form, including but not limited to a concentrate, liquid, syrup, gel, and powder, whether or not frozen. "Caloric Sweetener" includes, without limitation, sucrose, fructose, glucose, other sugars, and high fructose corn syrup, honey; but does not include a substance that exclusively contains natural, concentrated, or reconstituted fruit or vegetable juice or any combination thereof. "City" means the City of Santa Cruz, California.
"Community Oversight Panel" means the Sugar-Sweetened Beverage Distribution Tax Community Oversight Panel described in this chapter.

28.9 8.37
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

“Concentrate” means a syrup, powder, frozen or gel mixture, or other product containing one or more sweeteners as an ingredient, intended to be used in making, mixing, or compounding a sweetened beverage by combining the concentrate with one or more other ingredients. "Consumer" or "Consumers" means a natural person or persons who purchase a SugarSweetened Beverage Product(s) in the City for a purpose other than resale in the ordinary course of business.
"Distribution", "Distribute" or "Distributing" means the transfer of title, ownership, or possession other than by a common carrier: (a) from one Business Entity to another for consideration; or (b) within a single Business Entity, such as by a wholesale or warehousing unit to a retail outlet or between two or more employees or contractors of said Business Entity. "Distribution" or "Distribute" shall not mean the retail sale to a Consumer. "Distributor" means any Person who engages in the business of Distribution of SugarSweetened Beverage Product(s) within the City. "General Tax" means any tax imposed for unrestricted general governmental purposes. "Milk Product" means: (a) any beverage in which natural milk secreted by an animal is the primary and first ingredient in the product ingredient list; and (b) any plant-based substance or combination of substances in which (i) water and (ii) grains, nuts, legumes, or seeds, constitute the first two ingredients in the product ingredient list. For purposes of this definition, " Milk Product" includes concentrate and dehydrated forms, whether or not reconstituted. For purposes of this definition, "Milk Product" includes, but is not limited to, soy milk, almond milk, rice milk, coconut milk, hemp milk, oat milk, hazelnut milk, flax milk. “Natural Fruit Juice” means the original liquid resulting from the pressing of fruit, and includes natural fruit juice concentrate, and dehydrated natural fruit juice. “Natural Vegetable Juice” means the original liquid resulting from the pressing of vegetables, and includes natural vegetable juice concentrate, and dehydrated natural vegetable juice. "Natural or Common Sweetener" means: a sweetening agent on its own and independent of any Sugar-Sweetened Beverage Product, including but not limited to, granulated white sugar, brown sugar, honey, molasses, xylem sap of maple trees, agave nectar, or corn syrup. “Nonalcoholic Beverage” means any beverage that is not subject to tax under California Revenue and Taxation Code sections 32001 et seq.”
"Person" means any natural person, partnership, cooperative, association, limited liability company, corporation, personal representative, receiver, trustee, assignee, or any other legal entity.
"Powder" means any solid mixture containing one or more Caloric Sweeteners as an ingredient intended to be used in making, mixing or compounding a Sugar-Sweetened Beverage by combining the Powder with one or more other ingredients.

Deleted: , or stevia

28.10 8.38
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

"Retailer" means any Person who serves a Sugar-Sweetened Beverage Product(s) to Consumer(s) for payment.
"Small Business" means any Person with less than $500,000 in annual gross receipts in the most recent calendar year that distributes, sells, serves or provides Sugar-Sweetened Beverage Product(s) directly to final Consumers.
"Sugar-Sweetened Beverage" means any nonalcoholic beverage prepared in any form intended for human consumption to which one or more Caloric Sweeteners has been added and that contains 40 or more calories per 12 fluid ounces of beverage including, but not limited to, drinks and beverages commonly referred to as "soda," "pop," "cola," "soft drinks," "sports drinks," "energy drinks," "slushies," "sweetened ice teas and coffees," or any other common names that are derivations thereof.
"Sugar-Sweetened Beverage Distribution Tax" or "Tax" is the general excise tax imposed under Section 3.38.030.
"Sugar-Sweetened Beverage Product(s)" means a Sugar-Sweetened Beverage, including Concentrates.
"Syrup" means any liquid or frozen mixture, containing one or more Caloric Sweeteners as an ingredient, intended to be used, or actually used, in making, mixing, or compounding a SugarSweetened Beverage by combining the Syrup with one or more other ingredients. "Tax Administrator" means the Director of Finance for the City of Santa Cruz or his or her designee.

3.38.025 - EXEMPTIONS.
"Sugar-Sweetened Beverage" and “Sugar-Sweetened Beverage Product” shall not include:
1) any beverage that contains less than 40 calories per 12 fluid ounces of beverage; 2) any beverage sold for consumption by infants, which is commonly referred to as "infant formula" or "baby formula," or oral rehydration fluids for children; 3) any beverage for medical use;
4) any beverage designed as supplemental, meal replacement, or sole-source nutrition that includes proteins, carbohydrates, and multiple vitamins and minerals; 5) Milk Products;
6) 100 percent natural fruit or vegetable juice or combination thereof with no added caloric sweetener;
7) Any Caloric Sweetener or Concentrate that the Consumer combines with other ingredients to create a Sugar Sweetened Beverage;
8) Sweetened medication such as cough syrup, liquid pain relievers, fever reducers, and similar products; or
9) Any alcoholic beverage.

The Tax shall not apply to:

Deleted: or Caloric Sweetener

28.11 8.39
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

1. To any Distributor that is not subject to taxation by the City under the laws of the United States or the State of California.

2. The Distribution of any Sugar-Sweetened Beverage Product by a Small Business as defined in this chapter.

3. To any Distributor of Natural or Common Sweeteners.

3.38.030 - EXCISE TAX.

In addition to any other taxes imposed by the City, the City hereby levies a General Tax of one cent ($0.01) per fluid ounce on the Distribution of Sugar-Sweetened Beverage Products in the City.

For the purposes of this chapter, the volume, in ounces, of a Sugar-Sweetened Beverage Product shall be calculated as follows:

1. For a Sugar-Sweetened Beverage, the volume, in fluid ounces, of Sugar-Sweetened Beverages distributed to any Person in the course of business in the City.

2. For Sugar-Sweetened Beverages that are Concentrates, the tax shall be calculated using the largest volume, in fluid ounces, of Sugar-Sweetened Beverages that could be produced from the Concentrate. In accordance with rules and regulations promulgated by the City pursuant to Section 3.38.040, the largest volume, in fluid ounces, that would typically be produced from the Concentrates shall be determined based on the manufacturer's instructions or, if the Distributor uses that Concentrate to produce a Sugar-Sweetened Beverage, the regular practice of the Distributor.

3. The Tax shall be paid upon the first nonexempt Distribution of a Sugar-Sweetened Beverage Product in the City. To the extent that there is a chain of Distribution within Santa Cruz involving more than one Distributor, the tax shall be levied on the first Distributor subject to the jurisdiction of the City. To the extent the Tax is not paid as set forth above for any reason, it shall be payable on subsequent Distributions and by subsequent Distributors; provided, that the Distribution of Sugar-Sweetened Beverage Products may not be taxed more than once in the chain of commerce.

3.38.040 - ADMINISTRATION OF TAX.

It shall be the duty of the Tax Administrator to collect and receive all taxes imposed by this chapter, and to keep an accurate record thereof.

The Tax Administrator is hereby charged with the enforcement of this chapter, except as otherwise provided herein, and may prescribe, adopt, and enforce rules and regulations relating to the administration and enforcement of this chapter. Such rules and regulations shall include, but are not limited to:

1. Clarify the inclusion or exclusion of particular products.

2. The calculation of tax for concentrates based on manufacturer’s instructions or industry practice and the designation of caloric sweeteners
Deleted: added Caloric Sweeteners,
Deleted: added Caloric Sweeteners.

Deleted: added Caloric Sweeteners
Deleted: added Caloric Sweeteners

28.12 8.40
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

3. The reexamination and correction of returns and payments, and for reporting.

4. Prescribing the methods, frequency, and schedules for the calculation, collection and payment of the tax.

5. The manner and form in which a Distributor must register with the City, and shall report and remit the tax.

6. How a Distributor or a Retailer who receives, in the City, Sugar-Sweetened Beverage Product(s) from a Distributor must report to the City the name of that Distributor and the volume of Sugar-Sweetened Beverage Product(s).

7. The documentation to be created or maintained by a Distributor or a Retailer.

8. The administrative process and procedures for any Person against whom a determination is made by the Tax Administrator under this chapter or any Person directly interested in such determination, shall follow to dispute or otherwise challenge a determination, and the form, manner and time within which a determination may be disputed or challenged.

Adoption and implementation by the Tax Administrator of rules and regulations authorized by this Section shall not constitute new or increased tax requiring approval by the voters of the City.

The Tax Administrator shall annually verify that the taxes owed under this chapter have been properly applied, exempted, collected and remitted.

3.38.050 - COLLECTION OF TAX AND REGISTRATION OF DISTRIBUTORS.

Every Person engaged in or about to engage in business as a Distributor in the City shall immediately register with the City in the manner and form determined by the Tax Administrator. Persons engaged in such business must be registered no later than thirty (30) days after the date the tax imposed by this chapter becomes effective on May 1, 2019, but such privilege of such registration after the date of imposition of such tax shall not relieve any Person from the obligation or payment or collection of tax on and after the date of imposition thereof, regardless of registration.

In order to aid in the collection of taxes due to the City under this chapter, any Distributor or Retailer that distributes, receives or sells Sugar-Sweetened Beverage Product(s) shall provide information to the City regarding the Distribution of these products in accordance with rules and regulations adopted by the Tax Administrator.

The City Council is authorized to have the taxes imposed by this chapter collected by the County of Santa Cruz or the California Board of Equalization in conjunction with the collection of other taxes for the City. If the City Council exercises this authorization, the duties and responsibilities of the Tax Administrator shall be given, as appropriate, to the County of Santa Cruz or the California Board of Equalization, which may delegate such duties and responsibilities as necessary and as authorized by law.

28.13 8.41
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

3.38.055 - PENALTIES AND INTEREST
Any Distributor who fails to file a tax return and pay any amount of tax required to be collected and paid to the City within the time required by the rules and regulations established by the Tax Administrator shall pay a penalty of ten (10) percent of the tax, in addition to the tax, plus interest, computed on the amount of delinquent tax, inclusive of penalties, at the rate of one and one-half (1.5) percent per month, or fraction thereof, from the date on which the tax or the amount of tax required to be collected became due and payable to the City and until the date of payment.

If the Tax Administrator determines that any tax found to be due under this chapter or the delinquent filing of a tax return is due to fraud, intentional disregard or an intent to evade this part or authorized rules and regulations, a penalty of fifteen (15) percent shall be added thereto in addition to any other penalties which may be imposed.

3.38.060 - TAX DEEMED DEBT TO CITY
The amount of any tax, penalties and interest imposed by the provisions of this chapter shall be deemed a debt to the city and any Person carrying on any business taxable under this chapter without first having paid such tax shall be liable in an action in the name of the City in any court of competent jurisdiction for the amount of the tax, and penalties and interest imposed on such Person and for any and all cost recovery, including attorneys’ fees in the enforcement of this chapter.

3.38.070 - CREDITS AND REFUNDS.

Any tax under this chapter that has been paid more than once or has been erroneously or illegally collected or received by the City shall be refunded as determined by the Tax Administrator.

Any tax under this chapter that has been returned to the Distributor within six (6) months of the initial Distribution and for which the entire purchase price has been refunded in cash or credit shall be refunded as determined by the Tax Administrator.

Claims must be filed with the Tax Administrator and determined in accordance with the rules and regulations to be established by the Tax Administrator, within one year from the date of payment of the tax to the City. No refund shall be paid under this section unless claimant establishes entitlement thereto by written documentation.

3.38.080 EXAMINATION OF BOOKS, RECORDS, WITNESSES - CONFIDENTIALITY OF INFORMATION - PENALTY.

It shall be the duty of a Distributor liable for the payment to the City of the tax imposed by this chapter to keep and preserve, for a period of four years, all records, complete and accurate, as

28.14 8.42
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Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

may be necessary to determine the amount of such tax, interest, penalties and enforcement charges as the Distributor may be liable for payment to the City.

The Tax Administrator shall have the power to audit and examine all books and records of every Person liable for the payment to the City of the tax imposed by this chapter, including both state and federal income tax returns, California sales tax returns, or other evidence documenting the gross receipts of Persons engaged in Distribution in the City for the purpose of ascertaining the amount of tax, if any, required to be paid by the provisions hereof, and for the purpose of verifying any statements or any item thereof when filed by any Person pursuant to the provisions of this chapter. If such Person, after written demand by the Tax administrator, refuses to make available for audit, examination or verification such books, records or other evidence as the Tax Administrator requests, the Tax Administrator may, after full consideration of all information within his or her knowledge concerning the business and activities of the Person, make an assessment in the manner provided in this chapter of any taxes estimated to be due.

Every Person subject to the provisions of this chapter is directed and required to furnish to the Tax Administrator or duly authorized agent or employee, the means, facilities and opportunity for making such examination and investigations. The Tax Administrator is authorized to examine a Person under oath, for the purpose of verifying the accuracy of any declaration made, or if no declaration was made, to ascertain the tax or, if applicable, registration fees, due under this chapter. In order to ascertain the tax due under this chapter, the Tax Administrator may compel, by administrative subpoena, the production of relevant books, papers and records and the attendance of all Persons as parties or witnesses.

Except for disclosures to agents, attorneys, or employees of the City necessary to the purpose of administering or enforcing the tax, or in compliance with a court order, or in connection with an appeal, hearing or court action, City employees shall maintain the confidentiality of all business and personal information and documents furnished to or obtained by the Tax Administrator in connection with the collection or administrative proceedings relating to the determination and assessment of taxes.

The refusal to submit to such examination or production by any employer or Person subject to the provisions of this chapter shall be deemed a violation of this chapter, and administrative subpoenas shall be enforced pursuant to applicable state law.

3.38.085 FAILURE TO COLLECT AND REPORT TAX – DETERMINATION OF TAX BY DIRECTOR OF FINANCE.

If any Person shall fail or refuse to provide records for audit, or to collect the tax and to make, within the time provided any report and remittance of said tax or any portion thereof required by this chapter, the Tax Administrator shall have the discretion to make an estimate of the tax due based on the facts and information available.

As soon as Tax Administrator shall procure such facts and information upon which to base the assessment of any tax imposed by this chapter and payable by the Distributor who has failed or

28.15 8.43
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

refused to provide any requested records, the Tax Administrator shall proceed to determine and assess against such Distributor the tax, interest and penalties provided for by this chapter.

In case such determination is made, the Tax Administrator shall give a notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the Distributor so assessed at the last known place of address.

Such Distributor may within ten (10) days after the serving or mailing of such notice make application in writing to the Tax Administrator for a hearing on the amount assessed. If application by the Person for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the Tax Administrator shall become final and conclusive and immediately due and payable. If such application is made, the Tax Administrator shall give not less than five (5) days’ written notice in the manner prescribed herein to the Person to show cause at a time and place fixed in the notice why the amount specified therein should not be fixed for such tax, interest and penalties. At such hearing the Distributor may appear and offer evidence why such specified tax, interest and penalties should not be so fixed.

After such hearing the Tax Administrator shall determine the proper tax to be remitted and shall thereafter give written notice to the Distributor in the manner prescribed herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable after fifteen days unless an appeal is taken as provided in Section

3.38.090.

3.38.090 APPEAL.

Any Distributor aggrieved by any decision of the Tax Administrator with respect to the amount of such tax, interest and penalties, if any, owed under this chapter, may appeal to the city council in accordance with the provisions of Chapter 1.16 of the Santa Cruz Municipal Code.

3.38.100 PENALTY FOR VIOLATIONS.

Any Distributor violating any of the provisions of this chapter shall be guilty of a misdemeanor and shall be punishable by a fine of not more than one thousand dollars or by imprisonment in the county jail for a period of not more than six months or by both fine and imprisonment, as provided in Title 4 of this code, in addition to the penalties provided for in this chapter or elsewhere in this code.

Any Distributor who fails or refuses to register as required in this chapter, or to furnish any return required to be made or who fails or refuses to furnish a supplemental return or other data required by the Tax Administrator, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor, and is punishable as stated above in subsection (a), in addition to being subject to the other penalties provided for in this chapter or code, or elsewhere. Any Person required to make, render, sign or verify any report or claim who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by this chapter to be made is guilty of a misdemeanor and is punishable as stated

28.16 8.44
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Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

above in subsection (a), in addition to the penalties provided for in this chapter or code, or elsewhere.

All remedies prescribed by this chapter or code, or any other provisions of law, and the use of one or more remedies by the City are cumulative, and shall not bar the use of any other remedy for the purpose of enforcing the provisions of this chapter.

3.38.110 - COLLECTION DATE.

Collection of the tax shall begin on May 1, 2019.

3.38.120 UNRESTRICTED GENERAL REVENUE PURPOSES.

Notwithstanding the provisions of section 3.38.010, all tax revenue collected and remitted to the City pursuant to this chapter shall be deposited in the City of Santa Cruz unrestricted general fund and can be spent for unrestricted general revenue purposes.

3.38.130 NOT A SALES AND USE TAX.

The tax imposed by this measure is a general excise tax on conducting business within the City of Santa Cruz. It is not a sales tax or use tax or other excise tax on the sale, consumption, or use of Sugar-Sweetened Beverage Product(s).

3.38.140 SEVERABILITY.

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

28.17 8.45
RESOLUTION NO. NS-_____________________
Exhibit A
RESOLUTION – Sugar Sweetened Beverage Distribution Tax Measure

Section 2. EFFECTIVE DATE. This ordinance relates to the levying and collecting a general tax and shall take effect immediately if the tax imposed is approved by a simple majority of voters voting on the question at the November 6, 2018 election, and shall become operative on the date specified in Section 3.38.140.

PASSED AND ADOPTED by a majority vote of the electorate of the City of Santa Cruz on November 6, 2018. Pursuant to Section 2, above, the ordinance became effective immediately upon such adoption.

Attest:
(Signature)

(Title)

28.18 8.46
RESOLUTION NO.

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ REQUESTING THAT THE CONSOLIDATED NOVEMBER 2018 GENERAL ELECTION INCLUDE A

BALLOT MEASURE FOR THE CITY OF SANTA CRUZ TO IMPOSE AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE DISTRIBUTION OF SUGARSWEETENED BEVERAGE PRODUCTS IN THE CITY OF SANTA CRUZ WHEREAS, the City Council Ad Hoc Revenue Committee was established on or about February 13, 2018, to evaluate revenue considerations, including ballot measure(s) for the November, 2018 general election;
WHEREAS, the City Council Ad Hoc Revenue Committee became aware of significant harmful health risks of sugar-sweetened beverages to the public and has evaluated health reports relating thereto;
WHEREAS, the City Council Ad Hoc Revenue Committee has considered and reviewed the experience of other local jurisdictions in seeking to combat the negative health impacts of sugar sweetened beverages;
WHEREAS, the City Council accepts the Ad Hoc Revenue Committee’s recommendation for placement of a tax measure on the November 6, 2018 General Municipal Election to levy a tax of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products in the city for unrestricted general revenue purposes, in order to promote community health & wellness, and sustain vital city services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families; and facilities for community activities - and establish a community oversight panel, with all funds to be used locally.

WHEREAS, pursuant to Elections Code Section 10002, the governing body of any city may by resolution request the Board of Supervisors of the county to permit the county elections official to render specified services to the city relating to the conduct of an election; and WHEREAS, the resolution of the governing body of the city shall specify the services requested; and
WHEREAS, pursuant to Elections Code Section 10002, the city shall reimburse the county in full for the services performed upon presentation of a bill to the city; and WHEREAS, pursuant to Elections Code Section 10400, whenever two or more elections, including bond elections, of any legislative or congressional district, public district, city county, or other political subdivision are called to be held on the same day, in the same territory, or in territory that is in part the same, they may be consolidated upon the order of the governing body or bodies or officer or officers calling the elections; and
WHEREAS, pursuant to Elections Code Section 10400, such election for cities and special districts may be either completely or partially consolidated; and

28.19 8.47
RESOLUTION NO. NSWHEREAS, pursuant to Elections Code Section 10403, whenever an election called by a district, city or other political subdivision for the submission of any question, proposition, or office to be filled is to be consolidated with a statewide election, and the question, proposition, or office to be filled is to appear upon the same ballot as that provided for that statewide election, the district, city or other political subdivision shall, at least 88 days prior to the date of the election, file with the board of supervisors, and a copy with the elections official, a resolution of its governing board requesting the consolidation, and setting forth the exact form of any question, proposition, or office to be voted upon at the election, as it is to appear on the ballot. Upon such request, the Board of Supervisors may order the consolidation; and
WHEREAS, pursuant to Elections Code Section 10418, if consolidated, the consolidated election shall be held and conducted, election boards appointed, voting precincts designated, candidates nominated, ballots printed, polls opened and closed, voter challenges determined, ballots counted and returned, returns canvassed, results declared, certificates of election issued, recounts conducted, election contests presented, and all other proceedings incidental to and connected with the election shall be regulated and done in accordance with the provisions of law regulating the statewide or special election, or the election held pursuant to Section 1302 or 1303, as applicable; and
WHEREAS, the resolution requesting the consolidation shall be adopted and filed at the same time as the adoption of the ordinance, resolution, or order calling the election; and WHEREAS, various district, county state and other political subdivision elections may be or have been called to be held on November 6, 2018.

NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the City Council of the City of Santa Cruz that it hereby orders an election be called and consolidated with any and all elections also called to be held on November 6, 2018 insofar as said elections are to be held in the same territory that is in part the same as the territory of the City of Santa Cruz, and hereby requests the Board of Supervisors of the County of Santa Cruz to order such consolidation under Elections Code Section 10401, 10403, and 10418.

BE IT FURTHER RESOLVED AND ORDERED that the City Council of the City of Santa Cruz hereby requests the Board of Supervisors to permit the Santa Cruz County Elections Department to provide any and all services necessary for conducting the election and agrees to pay for said services, and
BE IT FURTHER RESOLVED AND ORDERED that the Santa Cruz County Elections Department shall conduct the election for the following measure to be voted on as the November 6, 2018 election:

Measure to be voted on:

Ballot Question:
“In order to promote community health & wellness, and sustain vital City services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families;

28.20 8.48
RESOLUTION NO. NSand facilities for community activities - shall the City levy a tax for unrestricted general revenue purposes of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products, and establish a community oversight panel, with all funds to be used locally?” Yes__________ No____________
The City Council of the City of Santa Cruz submits to the qualified electors said Ballot Measure Question as set forth above and designates and refers to said measure as the measure to be set forth on the ballots for use in said election. The full text of the measure is as set forth in Exhibit A.

In accordance with the provisions of Section 9280 of the California Elections Code, the City Attorney is hereby directed to prepare an impartial analysis of this measure. In accordance with the provisions of Section 9212 of the California Elections Code, the Finance Director is hereby directed to prepare a fiscal impact statement of this measure.

BE IT FURTHER RESOLVED AND ORDERED that Santa Cruz County Elections Department is requested to:

Print the attached measure text exactly as filed or indicated on the filed document in the County Voter Information Guide for the November 6, 2018 election. Cost of printing and distribution of the measure text will be paid for by the city.

BE IT FURTHER RESOLVED AND ORDERED that the City Clerk Administrator of the City of Santa Cruz is hereby ordered and directed to cause said proposed ordinance (Exhibit A) and notice of election to be published in accordance with the provisions of the California State Election Code.

PASSED AND ADOPTED this 26th day of June, 2018, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: _________________________
David Terrazas, Mayor
ATTEST:
___________________________________
Bonnie Bush, City Clerk Administrator

28.21 8.49
RESOLUTION NO. NS-____________
Exhibit A

EXHIBIT A
BE IT ORDAINED by the electorate of the City of Santa Cruz that Section 3.38 of the Santa Cruz Municipal Code is hereby added as follows:

ORDINANCE NO._________

AN ORDINANCE OF THE CITY OF SANTA CRUZ
IMPOSING AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE

DISTRIBUTION OF SUGAR-SWEETENED BEVERAGE PRODUCTS IN THE CITY OF

SANTA CRUZ
Section 1. Chapter 3.38 – SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX is hereby added to Title 3 – REVENUE AND FINANCE of the City of Santa Cruz Municipal Code, to read as follows:
“Chapter 3.38 - SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX

3.38.005 - SHORT TITLE.

This chapter shall be known as the "Sugar-Sweetened Beverage Distribution Tax Ordinance."

3.38.010 – PURPOSE OF THIS CHAPTER
This chapter imposes a general tax on the Distribution of Sugar-Sweetened Beverage Products for unrestricted general revenue purposes, including, but not limited to, promoting community health & wellness, and sustaining vital City services. This chapter is enacted solely to raise revenue for general municipal purposes, and not for purposes of regulation.

3.38.015 - COMMUNITY OVERSIGHT PANEL.

There is hereby established a Community Oversight Panel:
1) A Community Oversight Panel shall report on the impact of the tax, review expenditures, and include recommendations on the use of future revenues to promote community health & wellness and general revenue purposes, as consistent with this chapter. 2) The Community Oversight Panel shall be comprised of a minimum of 9 members with a term of 4 years as follows:
a) A representative designated by the City’s Parks and Recreation Commission,

28.22 8.50
RESOLUTION NO. NS-_____________________
Exhibit A
b) A representative designated by the Santa Cruz City School District c) City Council appointed representatives from a youth organization, three health or wellness-related organizations or practitioners, and three at-large community members. 3) The Community Oversight Panel will transmit its annual report and recommendations to the City Council.

3.38.020 - DEFINITIONS.

Except where the context otherwise requires, the following definitions govern the construction of this chapter:
"Alcoholic Beverage" means any beverage that is subject to taxation as an Alcoholic beverage under California Revenue and Taxation Code, Sections 32001 et seq., as may be amended from time to time.
"Beverage for Medical Use" means a beverage suitable for human consumption and manufactured for use as an oral nutritional therapy for persons who cannot absorb or metabolize dietary nutrients from food or beverages, or for use as an oral rehydration electrolyte solution formulated to prevent or treat dehydration due to illness. "Beverage for Medical Use" also means a "medical food" as defined in Section 109971 of the California Health and Safety Code. "Beverage for Medical Use" shall not include beverages commonly referred to as "sports drinks" or any other common names that are derivations thereof. "Business Entity" means any Person except for a natural person. "Caloric Sweetener" means any substance or combination of substances that meets all of the following criteria:

1. Is suitable for human consumption,

2. Adds calories to the diet when consumed,

3. Is perceived as sweet when consumed, and

4. Is added for making, mixing, or compounding Sugar-Sweetened Beverages by combining the substance or substances with one or more ingredients including, but not limited to, water, ice, powder, coffee, tea, fruit juice, vegetable juice, or carbonation or other gas.
“Caloric Sweetener” may take any form, including but not limited to a concentrate, liquid, syrup, gel, and powder, whether or not frozen. "Caloric Sweetener" includes, without limitation, sucrose, fructose, glucose, other sugars, and high fructose corn syrup, honey; but does not include a substance that exclusively contains natural, concentrated, or reconstituted fruit or vegetable juice or any combination thereof. "City" means the City of Santa Cruz, California.
"Community Oversight Panel" means the Sugar-Sweetened Beverage Distribution Tax Community Oversight Panel described in this chapter.

28.23 8.51
RESOLUTION NO. NS-_____________________
Exhibit A
“Concentrate” means a syrup, powder, frozen or gel mixture, or other product containing one or more sweeteners as an ingredient, intended to be used in making, mixing, or compounding a sweetened beverage by combining the concentrate with one or more other ingredients. "Consumer" or "Consumers" means a natural person or persons who purchase a SugarSweetened Beverage Product(s) in the City for a purpose other than resale in the ordinary course of business.
"Distribution", "Distribute" or "Distributing" means the transfer of title, ownership, or possession other than by a common carrier: (a) from one Business Entity to another for consideration; or (b) within a single Business Entity, such as by a wholesale or warehousing unit to a retail outlet or between two or more employees or contractors of said Business Entity. "Distribution" or "Distribute" shall not mean the retail sale to a Consumer. "Distributor" means any Person who engages in the business of Distribution of SugarSweetened Beverage Product(s) within the City. "General Tax" means any tax imposed for unrestricted general governmental purposes. "Milk Product" means: (a) any beverage in which natural milk secreted by an animal is the primary and first ingredient in the product ingredient list; and (b) any plant-based substance or combination of substances in which (i) water and (ii) grains, nuts, legumes, or seeds, constitute the first two ingredients in the product ingredient list. For purposes of this definition, " Milk Product" includes concentrate and dehydrated forms, whether or not reconstituted. For purposes of this definition, "Milk Product" includes, but is not limited to, soy milk, almond milk, rice milk, coconut milk, hemp milk, oat milk, hazelnut milk, flax milk. “Natural Fruit Juice” means the original liquid resulting from the pressing of fruit, and includes natural fruit juice concentrate, and dehydrated natural fruit juice. “Natural Vegetable Juice” means the original liquid resulting from the pressing of vegetables, and includes natural vegetable juice concentrate, and dehydrated natural vegetable juice. "Natural or Common Sweetener" means: a sweetening agent on its own and independent of any Sugar-Sweetened Beverage Product, including but not limited to, granulated white sugar, brown sugar, honey, molasses, xylem sap of maple trees, agave nectar, or corn syrup. “Nonalcoholic Beverage” means any beverage that is not subject to tax under California Revenue and Taxation Code sections 32001 et seq.”
"Person" means any natural person, partnership, cooperative, association, limited liability company, corporation, personal representative, receiver, trustee, assignee, or any other legal entity.
"Powder" means any solid mixture containing one or more Caloric Sweeteners as an ingredient intended to be used in making, mixing or compounding a Sugar-Sweetened Beverage by combining the Powder with one or more other ingredients. "Retailer" means any Person who serves a Sugar-Sweetened Beverage Product(s) to Consumer(s) for payment.

28.24 8.52
RESOLUTION NO. NS-_____________________
Exhibit A
"Small Business" means any Person with less than $500,000 in annual gross receipts in the most recent calendar year that distributes, sells, serves or provides Sugar-Sweetened Beverage Product(s) directly to final Consumers.
"Sugar-Sweetened Beverage" means any nonalcoholic beverage prepared in any form intended for human consumption to which one or more Caloric Sweeteners has been added and that contains 40 or more calories per 12 fluid ounces of beverage including, but not limited to, drinks and beverages commonly referred to as "soda," "pop," "cola," "soft drinks," "sports drinks," "energy drinks," "slushies," "sweetened ice teas and coffees," or any other common names that are derivations thereof.
"Sugar-Sweetened Beverage Distribution Tax" or "Tax" is the general excise tax imposed under Section 3.38.030.
"Sugar-Sweetened Beverage Product(s)" means a Sugar-Sweetened Beverage, including Concentrates.
"Syrup" means any liquid or frozen mixture, containing one or more Caloric Sweeteners as an ingredient, intended to be used, or actually used, in making, mixing, or compounding a SugarSweetened Beverage by combining the Syrup with one or more other ingredients. "Tax Administrator" means the Director of Finance for the City of Santa Cruz or his or her designee.

3.38.025 - EXEMPTIONS.
"Sugar-Sweetened Beverage" and “Sugar-Sweetened Beverage Product” shall not include:
1) any beverage that contains less than 40 calories per 12 fluid ounces of beverage; 2) any beverage sold for consumption by infants, which is commonly referred to as "infant formula" or "baby formula," or oral rehydration fluids for children; 3) any beverage for medical use;
4) any beverage designed as supplemental, meal replacement, or sole-source nutrition that includes proteins, carbohydrates, and multiple vitamins and minerals; 5) Milk Products;
6) 100 percent natural fruit or vegetable juice or combination thereof with no added caloric sweetener;
7) Any Caloric Sweetener or Concentrate that the Consumer combines with other ingredients to create a Sugar Sweetened Beverage;
8) Sweetened medication such as cough syrup, liquid pain relievers, fever reducers, and similar products; or
9) Any alcoholic beverage.

The Tax shall not apply to:

1. To any Distributor that is not subject to taxation by the City under the laws of the United States or the State of California.

28.25 8.53
RESOLUTION NO. NS-_____________________
Exhibit A

2. The Distribution of any Sugar-Sweetened Beverage Product by a Small Business as defined in this chapter.

3. To any Distributor of Natural or Common Sweeteners.

3.38.030 - EXCISE TAX.

In addition to any other taxes imposed by the City, the City hereby levies a General Tax of one cent ($0.01) per fluid ounce on the Distribution of Sugar-Sweetened Beverage Products in the City.

For the purposes of this chapter, the volume, in ounces, of a Sugar-Sweetened Beverage Product shall be calculated as follows:

1. For a Sugar-Sweetened Beverage, the volume, in fluid ounces, of Sugar-Sweetened Beverages distributed to any Person in the course of business in the City.

2. For Sugar-Sweetened Beverages that are Concentrates, the tax shall be calculated using the largest volume, in fluid ounces, of Sugar-Sweetened Beverages that could be produced from the Concentrate. In accordance with rules and regulations promulgated by the City pursuant to Section 3.38.040, the largest volume, in fluid ounces, that would typically be produced from the Concentrates shall be determined based on the manufacturer's instructions or, if the Distributor uses that Concentrate to produce a Sugar-Sweetened Beverage, the regular practice of the Distributor.

3. The Tax shall be paid upon the first nonexempt Distribution of a Sugar-Sweetened Beverage Product in the City. To the extent that there is a chain of Distribution within Santa Cruz involving more than one Distributor, the tax shall be levied on the first Distributor subject to the jurisdiction of the City. To the extent the Tax is not paid as set forth above for any reason, it shall be payable on subsequent Distributions and by subsequent Distributors; provided, that the Distribution of Sugar-Sweetened Beverage Products may not be taxed more than once in the chain of commerce.

3.38.040 - ADMINISTRATION OF TAX.

It shall be the duty of the Tax Administrator to collect and receive all taxes imposed by this chapter, and to keep an accurate record thereof.

The Tax Administrator is hereby charged with the enforcement of this chapter, except as otherwise provided herein, and may prescribe, adopt, and enforce rules and regulations relating to the administration and enforcement of this chapter. Such rules and regulations shall include, but are not limited to:

1. Clarify the inclusion or exclusion of particular products.

2. The calculation of tax for concentrates based on manufacturer’s instructions or industry practice and the designation of caloric sweeteners

3. The reexamination and correction of returns and payments, and for reporting.

4. Prescribing the methods, frequency, and schedules for the calculation, collection and payment of the tax.

28.26 8.54
RESOLUTION NO. NS-_____________________
Exhibit A

5. The manner and form in which a Distributor must register with the City, and shall report and remit the tax.

6. How a Distributor or a Retailer who receives, in the City, Sugar-Sweetened Beverage Product(s) from a Distributor must report to the City the name of that Distributor and the volume of Sugar-Sweetened Beverage Product(s).

7. The documentation to be created or maintained by a Distributor or a Retailer.

8. The administrative process and procedures for any Person against whom a determination is made by the Tax Administrator under this chapter or any Person directly interested in such determination, shall follow to dispute or otherwise challenge a determination, and the form, manner and time within which a determination may be disputed or challenged.

Adoption and implementation by the Tax Administrator of rules and regulations authorized by this Section shall not constitute new or increased tax requiring approval by the voters of the City.

The Tax Administrator shall annually verify that the taxes owed under this chapter have been properly applied, exempted, collected and remitted.

3.38.050 - COLLECTION OF TAX AND REGISTRATION OF DISTRIBUTORS.

Every Person engaged in or about to engage in business as a Distributor in the City shall immediately register with the City in the manner and form determined by the Tax Administrator. Persons engaged in such business must be registered no later than thirty (30) days after the date the tax imposed by this chapter becomes effective on May 1, 2019, but such privilege of such registration after the date of imposition of such tax shall not relieve any Person from the obligation or payment or collection of tax on and after the date of imposition thereof, regardless of registration.

In order to aid in the collection of taxes due to the City under this chapter, any Distributor or Retailer that distributes, receives or sells Sugar-Sweetened Beverage Product(s) shall provide information to the City regarding the Distribution of these products in accordance with rules and regulations adopted by the Tax Administrator.

The City Council is authorized to have the taxes imposed by this chapter collected by the County of Santa Cruz or the California Board of Equalization in conjunction with the collection of other taxes for the City. If the City Council exercises this authorization, the duties and responsibilities of the Tax Administrator shall be given, as appropriate, to the County of Santa Cruz or the California Board of Equalization, which may delegate such duties and responsibilities as necessary and as authorized by law.

3.38.055 - PENALTIES AND INTEREST
Any Distributor who fails to file a tax return and pay any amount of tax required to be collected and paid to the City within the time required by the rules and regulations established

28.27 8.55
RESOLUTION NO. NS-_____________________
Exhibit A
by the Tax Administrator shall pay a penalty of ten (10) percent of the tax, in addition to the tax, plus interest, computed on the amount of delinquent tax, inclusive of penalties, at the rate of one and one-half (1.5) percent per month, or fraction thereof, from the date on which the tax or the amount of tax required to be collected became due and payable to the City and until the date of payment.

If the Tax Administrator determines that any tax found to be due under this chapter or the delinquent filing of a tax return is due to fraud, intentional disregard or an intent to evade this part or authorized rules and regulations, a penalty of fifteen (15) percent shall be added thereto in addition to any other penalties which may be imposed.

3.38.060 - TAX DEEMED DEBT TO CITY
The amount of any tax, penalties and interest imposed by the provisions of this chapter shall be deemed a debt to the city and any Person carrying on any business taxable under this chapter without first having paid such tax shall be liable in an action in the name of the City in any court of competent jurisdiction for the amount of the tax, and penalties and interest imposed on such Person and for any and all cost recovery, including attorneys’ fees in the enforcement of this chapter.

3.38.070 - CREDITS AND REFUNDS.

Any tax under this chapter that has been paid more than once or has been erroneously or illegally collected or received by the City shall be refunded as determined by the Tax Administrator.

Any tax under this chapter that has been returned to the Distributor within six (6) months of the initial Distribution and for which the entire purchase price has been refunded in cash or credit shall be refunded as determined by the Tax Administrator.

Claims must be filed with the Tax Administrator and determined in accordance with the rules and regulations to be established by the Tax Administrator, within one year from the date of payment of the tax to the City. No refund shall be paid under this section unless claimant establishes entitlement thereto by written documentation.

3.38.080 EXAMINATION OF BOOKS, RECORDS, WITNESSES - CONFIDENTIALITY OF INFORMATION - PENALTY.

It shall be the duty of a Distributor liable for the payment to the City of the tax imposed by this chapter to keep and preserve, for a period of four years, all records, complete and accurate, as may be necessary to determine the amount of such tax, interest, penalties and enforcement charges as the Distributor may be liable for payment to the City.

The Tax Administrator shall have the power to audit and examine all books and records of every Person liable for the payment to the City of the tax imposed by this chapter, including both state and federal income tax returns, California sales tax returns, or other evidence documenting the gross receipts of Persons engaged in Distribution in the City for the purpose

28.28 8.56
RESOLUTION NO. NS-_____________________
Exhibit A
of ascertaining the amount of tax, if any, required to be paid by the provisions hereof, and for the purpose of verifying any statements or any item thereof when filed by any Person pursuant to the provisions of this chapter. If such Person, after written demand by the Tax administrator, refuses to make available for audit, examination or verification such books, records or other evidence as the Tax Administrator requests, the Tax Administrator may, after full consideration of all information within his or her knowledge concerning the business and activities of the Person, make an assessment in the manner provided in this chapter of any taxes estimated to be due.

Every Person subject to the provisions of this chapter is directed and required to furnish to the Tax Administrator or duly authorized agent or employee, the means, facilities and opportunity for making such examination and investigations. The Tax Administrator is authorized to examine a Person under oath, for the purpose of verifying the accuracy of any declaration made, or if no declaration was made, to ascertain the tax or, if applicable, registration fees, due under this chapter. In order to ascertain the tax due under this chapter, the Tax Administrator may compel, by administrative subpoena, the production of relevant books, papers and records and the attendance of all Persons as parties or witnesses.

Except for disclosures to agents, attorneys, or employees of the City necessary to the purpose of administering or enforcing the tax, or in compliance with a court order, or in connection with an appeal, hearing or court action, City employees shall maintain the confidentiality of all business and personal information and documents furnished to or obtained by the Tax Administrator in connection with the collection or administrative proceedings relating to the determination and assessment of taxes.

The refusal to submit to such examination or production by any employer or Person subject to the provisions of this chapter shall be deemed a violation of this chapter, and administrative subpoenas shall be enforced pursuant to applicable state law.

3.38.085 FAILURE TO COLLECT AND REPORT TAX – DETERMINATION OF TAX BY DIRECTOR OF FINANCE.

If any Person shall fail or refuse to provide records for audit, or to collect the tax and to make, within the time provided any report and remittance of said tax or any portion thereof required by this chapter, the Tax Administrator shall have the discretion to make an estimate of the tax due based on the facts and information available.

As soon as Tax Administrator shall procure such facts and information upon which to base the assessment of any tax imposed by this chapter and payable by the Distributor who has failed or refused to provide any requested records, the Tax Administrator shall proceed to determine and assess against such Distributor the tax, interest and penalties provided for by this chapter.

In case such determination is made, the Tax Administrator shall give a notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the Distributor so assessed at the last known place of address.

28.29 8.57
RESOLUTION NO. NS-_____________________
Exhibit A
Such Distributor may within ten (10) days after the serving or mailing of such notice make application in writing to the Tax Administrator for a hearing on the amount assessed. If application by the Person for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the Tax Administrator shall become final and conclusive and immediately due and payable. If such application is made, the Tax Administrator shall give not less than five (5) days’ written notice in the manner prescribed herein to the Person to show cause at a time and place fixed in the notice why the amount specified therein should not be fixed for such tax, interest and penalties. At such hearing the Distributor may appear and offer evidence why such specified tax, interest and penalties should not be so fixed.

After such hearing the Tax Administrator shall determine the proper tax to be remitted and shall thereafter give written notice to the Distributor in the manner prescribed herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable after fifteen days unless an appeal is taken as provided in Section

3.38.090.

3.38.090 APPEAL.

Any Distributor aggrieved by any decision of the Tax Administrator with respect to the amount of such tax, interest and penalties, if any, owed under this chapter, may appeal to the city council in accordance with the provisions of Chapter 1.16 of the Santa Cruz Municipal Code.

3.38.100 PENALTY FOR VIOLATIONS.

Any Distributor violating any of the provisions of this chapter shall be guilty of a misdemeanor and shall be punishable by a fine of not more than one thousand dollars or by imprisonment in the county jail for a period of not more than six months or by both fine and imprisonment, as provided in Title 4 of this code, in addition to the penalties provided for in this chapter or elsewhere in this code.

Any Distributor who fails or refuses to register as required in this chapter, or to furnish any return required to be made or who fails or refuses to furnish a supplemental return or other data required by the Tax Administrator, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor, and is punishable as stated above in subsection (a), in addition to being subject to the other penalties provided for in this chapter or code, or elsewhere. Any Person required to make, render, sign or verify any report or claim who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by this chapter to be made is guilty of a misdemeanor and is punishable as stated above in subsection (a), in addition to the penalties provided for in this chapter or code, or elsewhere.

All remedies prescribed by this chapter or code, or any other provisions of law, and the use of one or more remedies by the City are cumulative, and shall not bar the use of any other remedy for the purpose of enforcing the provisions of this chapter.

28.30 8.58
RESOLUTION NO. NS-_____________________
Exhibit A

3.38.110 - COLLECTION DATE.

Collection of the tax shall begin on May 1, 2019.

3.38.120 UNRESTRICTED GENERAL REVENUE PURPOSES.

Notwithstanding the provisions of section 3.38.010, all tax revenue collected and remitted to the City pursuant to this chapter shall be deposited in the City of Santa Cruz unrestricted general fund and can be spent for unrestricted general revenue purposes.

3.38.130 NOT A SALES AND USE TAX.

The tax imposed by this measure is a general excise tax on conducting business within the City of Santa Cruz. It is not a sales tax or use tax or other excise tax on the sale, consumption, or use of Sugar-Sweetened Beverage Product(s).

3.38.140 SEVERABILITY.

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

28.31 8.59
RESOLUTION NO. NS-_____________________
Exhibit A
Section 2. EFFECTIVE DATE. This ordinance relates to the levying and collecting a general tax and shall take effect immediately if the tax imposed is approved by a simple majority of voters voting on the question at the November 6, 2018 election, and shall become operative on the date specified in Section 3.38.140.

PASSED AND ADOPTED by a majority vote of the electorate of the City of Santa Cruz on November 6, 2018. Pursuant to Section 2, above, the ordinance became effective immediately upon such adoption.

Attest:
(Signature)

(Title)

28.32 8.60
RESOLUTION NO. NS _________

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ REQUESTING THAT THE CONSOLIDATED NOVEMBER 2018 GENERAL ELECTION INCLUDE A

BALLOT MEASURE FOR THE CITY OF SANTA CRUZ TO IMPOSE AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE DISTRIBUTION OF SUGARSWEETENED BEVERAGE PRODUCTS IN THE CITY OF SANTA CRUZ WHEREAS, the City Council Ad Hoc Revenue Committee was established on or about February 13, 2018, to evaluate revenue considerations, including ballot measure(s) for the November, 2018 general election;
WHEREAS, the City Council Ad Hoc Revenue Committee became aware of significant harmful health risks of sugar-sweetened beverages to the public and has evaluated health reports relating thereto;
WHEREAS, the City Council Ad Hoc Revenue Committee has considered and reviewed the experience of other local jurisdictions in seeking to combat the negative health impacts of sugar sweetened beverages;
WHEREAS, the City Council accepts the Ad Hoc Revenue Committee’s recommendation for placement of a tax measure on the November 6, 2018 General Municipal Election to levy a tax of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products in the city for unrestricted general revenue purposes, in order to promote community health & wellness, and sustain vital city services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families; and facilities for community activities - and establish a community oversight panel, with all funds to be used locally.

WHEREAS, pursuant to Elections Code Section 10002, the governing body of any city may by resolution request the Board of Supervisors of the county to permit the county elections official to render specified services to the city relating to the conduct of an election; and WHEREAS, the resolution of the governing body of the city shall specify the services requested; and
WHEREAS, pursuant to Elections Code Section 10002, the city shall reimburse the county in full for the services performed upon presentation of a bill to the city; and WHEREAS, pursuant to Elections Code Section 10400, whenever two or more elections, including bond elections, of any legislative or congressional district, public district, city county, or other political subdivision are called to be held on the same day, in the same territory, or in territory that is in part the same, they may be consolidated upon the order of the governing body or bodies or officer or officers calling the elections; and WHEREAS, pursuant to Elections Code Section 10400, such election for cities and special districts may be either completely or partially consolidated; and

28.33 8.61
RESOLUTION NO.

WHEREAS, pursuant to Elections Code Section 10403, whenever an election called by a district, city or other political subdivision for the submission of any question, proposition, or office to be filled is to be consolidated with a statewide election, and the question, proposition, or office to be filled is to appear upon the same ballot as that provided for that statewide election, the district, city or other political subdivision shall, at least 88 days prior to the date of the election, file with the board of supervisors, and a copy with the elections official, a resolution of its governing board requesting the consolidation, and setting forth the exact form of any question, proposition, or office to be voted upon at the election, as it is to appear on the ballot.

Upon such request, the Board of Supervisors may order the consolidation; and WHEREAS, the resolution requesting the consolidation shall be adopted and filed at the same time as the adoption of the ordinance, resolution, or order calling the election; and WHEREAS, various district, county state and other political subdivision elections may be or have been called to be held on November 6, 2018.

NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the City Council of the City of Santa Cruz that it hereby orders an election be called and consolidated with any and all elections also called to be held on November 6, 2018 insofar as said elections are to be held in the same territory that is in part the same as the territory of the City of Santa Cruz, and hereby requests the Board of Supervisors of the County of Santa Cruz to order such consolidation under Elections Code Section 10401 and 10403.

BE IT FURTHER RESOLVED AND ORDERED that the City Council of the City of Santa Cruz hereby requests the Board of Supervisors to permit the Santa Cruz County Elections Department to provide any and all services necessary for conducting the election and agrees to pay for said services, and
BE IT FURTHER RESOLVED AND ORDERED that the Santa Cruz County Elections Department shall conduct the election for the following measure to be voted on as the November 6, 2018 election:

Measure to be voted on:

Ballot Question:
“In order to promote community health & wellness, and sustain vital City services - such as support for parks, beaches, and open spaces; programs for youth, seniors, and working families; and facilities for community activities - shall the City levy a tax for unrestricted general revenue purposes of one cent ($0.01) per fluid ounce on the distribution of sugar sweetened beverage products, and establish a community oversight panel, with all funds to be used locally?” Yes__________ No____________

28.34 8.62
RESOLUTION NO.

PASSED AND ADOPTED this 26th day of June, 2018, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED:

David Terrazas, Mayor
ATTEST:

Bonnie Bush, City Clerk Administrator

28.35 8.63
RESOLUTION NO.

BE IT ORDAINED by the electorate of the City of Santa Cruz that Section 3.38 of the Santa Cruz Municipal Code is hereby added as follows:

ORDINANCE NO._________

AN ORDINANCE OF THE CITY OF SANTA CRUZ
IMPOSING AN EXCISE TAX OF ONE CENT ($0.01) PER FLUID OUNCE ON THE

DISTRIBUTION OF SUGAR-SWEETENED BEVERAGE PRODUCTS IN THE CITY OF

SANTA CRUZ
Section 1. Chapter 3.38 – SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX is hereby added to Title 3 – REVENUE AND FINANCE of the City of Santa Cruz Municipal Code, to read as follows:
“Chapter 3.38 - SUGAR-SWEETENED BEVERAGE DISTRIBUTION TAX

3.38.005 - SHORT TITLE.

This chapter shall be known as the "Sugar-Sweetened Beverage Distribution Tax Ordinance."

3.38.010 – PURPOSE OF THIS CHAPTER
This chapter imposes a general tax on the Distribution of Sugar-Sweetened Beverage Products for unrestricted general revenue purposes, including, but not limited to, promoting community health & wellness, and sustaining vital City services. This chapter is enacted solely to raise revenue for general municipal purposes, and not for purposes of regulation.

3.38.015 - COMMUNITY OVERSIGHT PANEL.

There is hereby established a Community Oversight Panel:
1) A Community Oversight Panel shall report on the impact of the tax, review expenditures, and include recommendations on the use of future revenues to promote community health & wellness and general revenue purposes, as consistent with this chapter. 2) The Community Oversight Panel shall be comprised of a minimum of 9 members with a term of 4 years as follows:
a) A representative designated by the City’s Parks and Recreation Commission, b) A representative designated by the Santa Cruz City School District c) City Council appointed representatives from a youth organization, three health or wellness-related organizations or practitioners, and three at-large community members. 3) The Community Oversight Panel will transmit its annual report and recommendations to the City Council.

28.36 8.64
RESOLUTION NO.

3.38.020 - DEFINITIONS.

Except where the context otherwise requires, the following definitions govern the construction of this chapter:
"Alcoholic Beverage" means any beverage that is subject to taxation as an Alcoholic beverage under California Revenue and Taxation Code, Sections 32001 et seq., as may be amended from time to time.
"Beverage for Medical Use" means a beverage suitable for human consumption and manufactured for use as an oral nutritional therapy for persons who cannot absorb or metabolize dietary nutrients from food or beverages, or for use as an oral rehydration electrolyte solution formulated to prevent or treat dehydration due to illness. "Beverage for Medical Use" also means a "medical food" as defined in Section 109971 of the California Health and Safety Code. "Beverage for Medical Use" shall not include beverages commonly referred to as "sports drinks" or any other common names that are derivations thereof. "Business Entity" means any Person except for a natural person. "Caloric Sweetener" means any substance or combination of substances that meets all of the following criteria:

1. Is suitable for human consumption,

2. Adds calories to the diet when consumed,

3. Is perceived as sweet when consumed, and

4. Is added for making, mixing, or compounding Sugar-Sweetened Beverages by combining the substance or substances with one or more ingredients including, but not limited to, water, ice, powder, coffee, tea, fruit juice, vegetable juice, or carbonation or other gas. “Caloric Sweetener” may take any form, including but not limited to a concentrate, liquid, syrup, gel, and powder, whether or not frozen. "Caloric Sweetener" includes, without limitation, sucrose, fructose, glucose, other sugars, and high fructose corn syrup, honey; but does not include a substance that exclusively contains natural, concentrated, or reconstituted fruit or vegetable juice or any combination thereof.
"City" means the City of Santa Cruz, California.
"Community Oversight Panel" means the Sugar-Sweetened Beverage Distribution Tax Community Oversight Panel described in this chapter.
“Concentrate” means a syrup, powder, frozen or gel mixture, or other product containing one or more sweeteners as an ingredient, intended to be used in making, mixing, or compounding a sweetened beverage by combining the concentrate with one or more other ingredients. "Consumer" or "Consumers" means a natural person or persons who purchase a SugarSweetened Beverage Product(s) in the City for a purpose other than resale in the ordinary course of business.
"Distribution", "Distribute" or "Distributing" means the transfer of title, ownership, or possession other than by a common carrier: (a) from one Business Entity to another for consideration; or (b)

28.37 8.65
RESOLUTION NO.
within a single Business Entity, such as by a wholesale or warehousing unit to a retail outlet or between two or more employees or contractors of said Business Entity. "Distribution" or "Distribute" shall not mean the retail sale to a Consumer. "Distributor" means any Person who engages in the business of Distribution of Sugar-Sweetened Beverage Product(s) within the City.
"General Tax" means any tax imposed for unrestricted general governmental purposes. "Milk Product" means: (a) any beverage in which natural milk secreted by an animal is the primary and first ingredient in the product ingredient list; and (b) any plant-based substance or combination of substances in which (i) water and (ii) grains, nuts, legumes, or seeds, constitute the first two ingredients in the product ingredient list. For purposes of this definition, "Milk Product" includes concentrate and dehydrated forms, whether or not reconstituted. For purposes of this definition, "Milk Product" includes, but is not limited to, soy milk, almond milk, rice milk, coconut milk, hemp milk, oat milk, hazelnut milk, flax milk. “Natural Fruit Juice” means the original liquid resulting from the pressing of fruit, and includes natural fruit juice concentrate, and dehydrated natural fruit juice. “Natural Vegetable Juice” means the original liquid resulting from the pressing of vegetables, and includes natural vegetable juice concentrate, and dehydrated natural vegetable juice. "Natural or Common Sweetener" means: a sweetening agent on its own and independent of any Sugar-Sweetened Beverage Product, including but not limited to, granulated white sugar, brown sugar, honey, molasses, xylem sap of maple trees, agave nectar, corn syrup, or stevia. “Nonalcoholic Beverage” means any beverage that is not subject to tax under California Revenue and Taxation Code sections 32001 et seq.”
"Person" means any natural person, partnership, cooperative, association, limited liability company, corporation, personal representative, receiver, trustee, assignee, or any other legal entity.
"Powder" means any solid mixture containing one or more Caloric Sweeteners as an ingredient intended to be used in making, mixing or compounding a Sugar-Sweetened Beverage by combining the Powder with one or more other ingredients. "Retailer" means any Person who serves a Sugar-Sweetened Beverage Product(s) to Consumer(s) for payment.
"Small Business" means any Person with less than $500,000 in annual gross receipts in the most recent calendar year that distributes, sells, serves or provides Sugar-Sweetened Beverage Product(s) directly to final Consumers.
"Sugar-Sweetened Beverage" means any nonalcoholic beverage prepared in any form intended for human consumption to which one or more Caloric Sweeteners has been added and that contains 40 or more calories per 12 fluid ounces of beverage including, but not limited to, drinks and beverages commonly referred to as "soda," "pop," "cola," "soft drinks," "sports drinks,"

28.38 8.66
RESOLUTION NO.
"energy drinks," "slushies," "sweetened ice teas," or any other common names that are derivations thereof.
"Sugar-Sweetened Beverage Distribution Tax" or "Tax" is the general excise tax imposed under Section 3.38.030.
"Sugar-Sweetened Beverage Product(s)" means a Sugar-Sweetened Beverage or Caloric Sweetener.
"Syrup" means any liquid or frozen mixture, containing one or more Caloric Sweeteners as an ingredient, intended to be used, or actually used, in making, mixing, or compounding a SugarSweetened Beverage by combining the Syrup with one or more other ingredients. "Tax Administrator" means the Director of Finance for the City of Santa Cruz or his or her designee.

3.38.025 - EXEMPTIONS.
"Sugar-Sweetened Beverage" and “Sugar-Sweetened Beverage Product” shall not include:
1) any beverage that contains less than 40 calories per 12 fluid ounces of beverage; 2) any beverage sold for consumption by infants, which is commonly referred to as "infant formula" or "baby formula," or oral rehydration fluids for children; 3) any beverage for medical use;
4) any beverage designed as supplemental, meal replacement, or sole-source nutrition that includes proteins, carbohydrates, and multiple vitamins and minerals; 5) Milk Products;
6) 100 percent natural fruit or vegetable juice or combination thereof with no added caloric sweetener;
7) Any Caloric Sweetener that the Consumer combines with other ingredients to create a Sugar Sweetened Beverage;
8) Sweetened medication such as cough syrup, liquid pain relievers, fever reducers, and similar products; or
9) Any alcoholic beverage.

The Tax shall not apply to:

1. To any Distributor that is not subject to taxation by the City under the laws of the United States or the State of California.

2. The Distribution of any Sugar-Sweetened Beverage Product by a Small Business as defined in this chapter.

3. To any Distributor of Natural or Common Sweeteners.

3.38.030 - EXCISE TAX.

In addition to any other taxes imposed by the City, the City hereby levies a General Tax of one cent ($0.01) per fluid ounce on the Distribution of Sugar-Sweetened Beverage Products in the City.

28.39 8.67
RESOLUTION NO.

For the purposes of this chapter, the volume, in ounces, of a Sugar-Sweetened Beverage Product shall be calculated as follows:

1. For a Sugar-Sweetened Beverage, the volume, in fluid ounces, of Sugar-Sweetened Beverages distributed to any Person in the course of business in the City.

2. For added Caloric Sweeteners, the largest volume, in fluid ounces, of Sugar-Sweetened Beverages that could be produced from the added Caloric Sweeteners. In accordance with rules and regulations promulgated by the City pursuant to Section 3.38.040, the largest volume, in fluid ounces, that would typically be produced from the added Caloric Sweeteners shall be determined based on the manufacturer's instructions or, if the Distributor uses that added Caloric Sweeteners to produce a Sugar-Sweetened Beverage, the regular practice of the Distributor.

3. The Tax shall be paid upon the first nonexempt Distribution of a Sugar-Sweetened Beverage Product in the City. To the extent that there is a chain of Distribution within Santa Cruz involving more than one Distributor, the tax shall be levied on the first Distributor subject to the jurisdiction of the City. To the extent the Tax is not paid as set forth above for any reason, it shall be payable on subsequent Distributions and by subsequent Distributors; provided, that the Distribution of Sugar-Sweetened Beverage Products may not be taxed more than once in the chain of commerce.

3.38.040 - ADMINISTRATION OF TAX.

It shall be the duty of the Tax Administrator to collect and receive all taxes imposed by this chapter, and to keep an accurate record thereof.

The Tax Administrator is hereby charged with the enforcement of this chapter, except as otherwise provided herein, and may prescribe, adopt, and enforce rules and regulations relating to the administration and enforcement of this chapter. Such rules and regulations shall include, but are not limited to:

1. Clarify the inclusion or exclusion of particular products.

2. The calculation of tax for concentrates based on manufacturer’s instructions or industry practice and the designation of caloric sweeteners

3. The reexamination and correction of returns and payments, and for reporting.

4. Prescribing the methods, frequency, and schedules for the calculation, collection and payment of the tax.

5. The manner and form in which a Distributor must register with the City, and shall report and remit the tax.

6. How a Distributor or a Retailer who receives, in the City, Sugar-Sweetened Beverage Product(s) from a Distributor must report to the City the name of that Distributor and the volume of Sugar-Sweetened Beverage Product(s).

7. The documentation to be created or maintained by a Distributor or a Retailer.

8. The administrative process and procedures for any Person against whom a determination is made by the Tax Administrator under this chapter or any Person directly interested in such determination, shall follow to dispute or otherwise challenge a determination, and the form, manner and time within which a determination may be disputed or challenged.

28.40 8.68
RESOLUTION NO.

Adoption and implementation by the Tax Administrator of rules and regulations authorized by this Section shall not constitute new or increased tax requiring approval by the voters of the City.

The Tax Administrator shall annually verify that the taxes owed under this chapter have been properly applied, exempted, collected and remitted.

3.38.050 - COLLECTION OF TAX AND REGISTRATION OF DISTRIBUTORS.

Every Person engaged in or about to engage in business as a Distributor in the City shall immediately register with the City in the manner and form determined by the Tax Administrator.

Persons engaged in such business must be registered no later than thirty (30) days after the date the tax imposed by this chapter becomes effective on May 1, 2019, but such privilege of such registration after the date of imposition of such tax shall not relieve any Person from the obligation or payment or collection of tax on and after the date of imposition thereof, regardless of registration.

In order to aid in the collection of taxes due to the City under this chapter, any Distributor or Retailer that distributes, receives or sells Sugar-Sweetened Beverage Product(s) shall provide information to the City regarding the Distribution of these products in accordance with rules and regulations adopted by the Tax Administrator.

The City Council is authorized to have the taxes imposed by this chapter collected by the County of Santa Cruz or the California Board of Equalization in conjunction with the collection of other taxes for the City. If the City Council exercises this authorization, the duties and responsibilities of the Tax Administrator shall be given, as appropriate, to the County of Santa Cruz or the California Board of Equalization, which may delegate such duties and responsibilities as necessary and as authorized by law.

3.38.055 - PENALTIES AND INTEREST
Any Distributor who fails to file a tax return and pay any amount of tax required to be collected and paid to the City within the time required by the rules and regulations established by the Tax Administrator shall pay a penalty of ten (10) percent of the tax, in addition to the tax, plus interest, computed on the amount of delinquent tax, inclusive of penalties, at the rate of one and one-half (1.5) percent per month, or fraction thereof, from the date on which the tax or the amount of tax required to be collected became due and payable to the City and until the date of payment.

If the Tax Administrator determines that any tax found to be due under this chapter or the delinquent filing of a tax return is due to fraud, intentional disregard or an intent to evade this part or authorized rules and regulations, a penalty of fifteen (15) percent shall be added thereto in addition to any other penalties which may be imposed.

3.38.060 - TAX DEEMED DEBT TO CITY
The amount of any tax, penalties and interest imposed by the provisions of this chapter shall be deemed a debt to the city and any Person carrying on any business taxable under this chapter without first having paid such tax shall be liable in an action in the name of the City in any court

28.41 8.69
RESOLUTION NO.
of competent jurisdiction for the amount of the tax, and penalties and interest imposed on such Person and for any and all cost recovery, including attorneys’ fees in the enforcement of this chapter.

3.38.070 - CREDITS AND REFUNDS.

Any tax under this chapter that has been paid more than once or has been erroneously or illegally collected or received by the City shall be refunded as determined by the Tax Administrator.

Any tax under this chapter that has been returned to the Distributor within six (6) months of the initial Distribution and for which the entire purchase price has been refunded in cash or credit shall be refunded as determined by the Tax Administrator.

Claims must be filed with the Tax Administrator and determined in accordance with the rules and regulations to be established by the Tax Administrator, within one year from the date of payment of the tax to the City. No refund shall be paid under this section unless claimant establishes entitlement thereto by written documentation.

3.38.080 EXAMINATION OF BOOKS, RECORDS, WITNESSES - CONFIDENTIALITY OF INFORMATION - PENALTY.

It shall be the duty of a Distributor liable for the payment to the City of the tax imposed by this chapter to keep and preserve, for a period of four years, all records, complete and accurate, as may be necessary to determine the amount of such tax, interest, penalties and enforcement charges as the Distributor may be liable for payment to the City.

The Tax Administrator shall have the power to audit and examine all books and records of every Person liable for the payment to the City of the tax imposed by this chapter, including both state and federal income tax returns, California sales tax returns, or other evidence documenting the gross receipts of Persons engaged in Distribution in the City for the purpose of ascertaining the amount of tax, if any, required to be paid by the provisions hereof, and for the purpose of verifying any statements or any item thereof when filed by any Person pursuant to the provisions of this chapter. If such Person, after written demand by the Tax administrator, refuses to make available for audit, examination or verification such books, records or other evidence as the Tax Administrator requests, the Tax Administrator may, after full consideration of all information within his or her knowledge concerning the business and activities of the Person, make an assessment in the manner provided in this chapter of any taxes estimated to be due.

Every Person subject to the provisions of this chapter is directed and required to furnish to the Tax Administrator or duly authorized agent or employee, the means, facilities and opportunity for making such examination and investigations. The Tax Administrator is authorized to examine a Person under oath, for the purpose of verifying the accuracy of any declaration made, or if no declaration was made, to ascertain the tax or, if applicable, registration fees, due under this chapter. In order to ascertain the tax due under this chapter, the Tax Administrator may compel,

28.42 8.70
RESOLUTION NO.
by administrative subpoena, the production of relevant books, papers and records and the attendance of all Persons as parties or witnesses.

Except for disclosures to agents, attorneys, or employees of the City necessary to the purpose of administering or enforcing the tax, or in compliance with a court order, or in connection with an appeal, hearing or court action, City employees shall maintain the confidentiality of all business and personal information and documents furnished to or obtained by the Tax Administrator in connection with the collection or administrative proceedings relating to the determination and assessment of taxes.

The refusal to submit to such examination or production by any employer or Person subject to the provisions of this chapter shall be deemed a violation of this chapter, and administrative subpoenas shall be enforced pursuant to applicable state law.

3.38.085 FAILURE TO COLLECT AND REPORT TAX – DETERMINATION OF TAX BY DIRECTOR OF FINANCE.

If any Person shall fail or refuse to provide records for audit, or to collect the tax and to make, within the time provided any report and remittance of said tax or any portion thereof required by this chapter, the Tax Administrator shall have the discretion to make an estimate of the tax due based on the facts and information available.

As soon as Tax Administrator shall procure such facts and information upon which to base the assessment of any tax imposed by this chapter and payable by the Distributor who has failed or refused to provide any requested records, the Tax Administrator shall proceed to determine and assess against such Distributor the tax, interest and penalties provided for by this chapter.

In case such determination is made, the Tax Administrator shall give a notice of the amount so assessed by serving it personally or by depositing it in the United States mail, postage prepaid, addressed to the Distributor so assessed at the last known place of address.

Such Distributor may within ten (10) days after the serving or mailing of such notice make application in writing to the Tax Administrator for a hearing on the amount assessed. If application by the Person for a hearing is not made within the time prescribed, the tax, interest and penalties, if any, determined by the Tax Administrator shall become final and conclusive and immediately due and payable. If such application is made, the Tax Administrator shall give not less than five (5) days’ written notice in the manner prescribed herein to the Person to show cause at a time and place fixed in the notice why the amount specified therein should not be fixed for such tax, interest and penalties. At such hearing the Distributor may appear and offer evidence why such specified tax, interest and penalties should not be so fixed.

After such hearing the Tax Administrator shall determine the proper tax to be remitted and shall thereafter give written notice to the Distributor in the manner prescribed herein of such determination and the amount of such tax, interest and penalties. The amount determined to be due shall be payable after fifteen days unless an appeal is taken as provided in Section 3.38.090.

3.38.090 APPEAL.

28.43 8.71
RESOLUTION NO.

Any Distributor aggrieved by any decision of the Tax Administrator with respect to the amount of such tax, interest and penalties, if any, owed under this chapter, may appeal to the city council in accordance with the provisions of Chapter 1.16 of the Santa Cruz Municipal Code.

3.38.100 PENALTY FOR VIOLATIONS.

Any Distributor violating any of the provisions of this chapter shall be guilty of a misdemeanor and shall be punishable by a fine of not more than one thousand dollars or by imprisonment in the county jail for a period of not more than six months or by both fine and imprisonment, as provided in Title 4 of this code, in addition to the penalties provided for in this chapter or elsewhere in this code.

Any Distributor who fails or refuses to register as required in this chapter, or to furnish any return required to be made or who fails or refuses to furnish a supplemental return or other data required by the Tax Administrator, or who renders a false or fraudulent return or claim, is guilty of a misdemeanor, and is punishable as stated above in subsection (a), in addition to being subject to the other penalties provided for in this chapter or code, or elsewhere. Any Person required to make, render, sign or verify any report or claim who makes any false or fraudulent report or claim with intent to defeat or evade the determination of any amount due required by this chapter to be made is guilty of a misdemeanor and is punishable as stated above in subsection (a), in addition to the penalties provided for in this chapter or code, or elsewhere.

All remedies prescribed by this chapter or code, or any other provisions of law, and the use of one or more remedies by the City are cumulative, and shall not bar the use of any other remedy for the purpose of enforcing the provisions of this chapter.

3.38.110 - COLLECTION DATE.

Collection of the tax shall begin on May 1, 2019.

3.38.120 UNRESTRICTED GENERAL REVENUE PURPOSES.

Notwithstanding the provisions of section 3.38.010, all tax revenue collected and remitted to the City pursuant to this chapter shall be deposited in the City of Santa Cruz unrestricted general fund and can be spent for unrestricted general revenue purposes.

3.38.130 NOT A SALES AND USE TAX.

The tax imposed by this measure is a general excise tax on conducting business within the City of Santa Cruz. It is not a sales tax or use tax or other excise tax on the sale, consumption, or use of Sugar-Sweetened Beverage Product(s).

3.38.140 SEVERABILITY.

28.44 8.72
RESOLUTION NO.

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

Section 2. EFFECTIVE DATE. This ordinance relates to the levying and collecting a general tax and shall take effect immediately if the tax imposed is approved by a simple majority of voters voting on the question at the November 6, 2018 election, and shall become operative on the date specified in Section 3.38.140.

PASSED AND ADOPTED by a majority vote of the electorate of the City of Santa Cruz on November 6, 2018. Pursuant to Section 2, above, the ordinance became effective immediately upon such adoption.

Attest:
(Signature)

(Title)

28.45 8.73
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM] Supporters
Measure D - Berkeley's soda tax - was supported by prominent, respected organizations and individuals in and beyond Berkeley. The list below contains a number of them.

HEALTH ORGANIZATIONS

COMMUNITY & EDUCATION ORGANIZATIONS

POLITICAL ORGANIZATIONS

GROCERS & RESTAURANTS
BERKELEY CITY COUNCIL AND SCHOOL BOARD (Unanimous endorsement)

INDIVIDUALS

HEALTH ORGANIZATIONS
African American Tobacco Control Leadership Council
American Academy of Pediatrics - California


28.46 8.74
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM] American Heart Association
Alameda-Contra Costa Medical Association
Alameda County Public Health Commission
Berkeley Dental Society
Berkeley Pediatric Medical Group
California Dental Hygienists' Association
California Nurses Association
California Center for Public Health Advocacy
California Public Health Association - North
Center for Science in the Public Interest
Healthy & Active Before 5
Healthy Black Families
Healthy & Active Before 5
Latino Coalition for a Healthy California
Lifelong Medical Care, Inc.

Kiwi Pediatrics Medical Group
Public Health Institute
Parents of Children of African Descent
Physicians for Social Responsibility, S.F. Bay Area
Prevention Institute

COMMUNITY & EDUCATION ORGANIZATIONS
Berkeley NAACP
Latinos Unidos de Berkeley
Berkeley Federation of Teachers
California Federation of Teachers
YMCA of the Central Bay Area
The Ecology Center
ACLU Berkeley/North East Bay Chapter
Associated Students of the University of California Berkeley Berkeley Community Gardening Collaborative
Berkeley Council of Classified Employees
Berkeley Firefighters Association
Berkeley Local Public Employees Union One

28.47 8.75
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM] Berkeley Media Studies Group
Berkeley Organizing Congregations for Action
Berkeley Youth Alternatives
The Daily Californian (UC Berkeley's Student-Run Newspaper) East Bay Express Newspaper
LeConte Elementary School PTA
Longfellow Middle School PTA
Malcolm X Elementary School PTA
Oakland Tribune Newspaper
Options Recovery Services
Project Open Hand
Roots of Change
SF Bay Guardian News
Thousand Oaks Elementary School PTA
Urban Adamah Jewish Community Farm
Youth Spirit Artworks
18 Reasons

POLITICAL ORGANIZATIONS
Alameda County Democratic Party Central Committee
Berkeley Citizen Action
Berkeley Democratic Club
Berkeley Organizing Congregations for Action
East Bay Stonewall Democratic Club
East Bay Young Democrats
Gray Panthers Berkeley/East Bay
League of Women Voters Berkeley, Albany, Emeryville
John George Democratic Club
National Women's Political Caucus - Alameda North
Wellstone Democratic Renewal Club

28.48 8.76
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM]

GROCERS & RESTAURANTS
Monterey Market
The Natural Grocery Company
Bette's Oceanview Diner
Cafe Leila, Berkeley
Guerilla Cafe
Smoke BBQ, Berkeley
Westbrae Biergarten

BERKELEY CITY COUNCIL AND SCHOOL
BOARD (Unanimous endorsement)
Mayor Tom Bates
District 1 Councilmember, Linda Maio,
District 2 Councilmember, Darryl Moore
District 3 Councilmember Max Anderson
District 4 Councilmember, Jesse Arreguin
District 5 Councilmember, Laurie Capitelli
District 6 Councilmember, Susan Wengraf
District 7 Councilmember, Kriss Worthington
District 8 Councilmember, Gordon Wozniak
Berkeley School Board President, Joshua Daniels
Berkeley School Board Member, Beatriz Leyva-Cutler
Berkeley School Board Member, Karen Hemphill
Berkeley School Board Member, Judy Appel
Berkeley School Board Member, Julie Sinai
Candidates:

District 1 City Council candidate, Alejandro Soto-Vigil District 7 City Council candidate, Sean Barry

28.49 8.77
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM] District 8 City Council candidate, George Beier
District 8 City Council candidate, Lori Droste
District 8 City Council candidate, Jacquelyn McCormick
District 8 City Council candidate, Mike Alvarez Cohen
Berkeley School Board candidate, Ty Alper

INDIVIDUALS
Robert Reich, Chancellor’s Professor of Public Policy, UC Berkeley* Loni Hancock, California State Senator*
Nancy Skinner, California State Assembly member*
Keith Carson, Alameda County Board of Supervisors*
Elizabeth Echols, Candidate for California State Assembly Tony Thurmond, Candidate for California State Assembly
Michael Pollan, Knight Professor of Journalism, UC Berkeley* Alice Waters, Founder, Edible Schoolyard Project; Executive Chef, Founder, and Owner of Chez Panisse
Anna Blythe Lappe, Small Planet Institute
Alice Walker, Author
Martin Bourque, Executive Director, Ecology Center
Xavier Morales, Executive Director, Latino Coalition for a Healthy California Dr. Lynn Silver, Senior Advisor, Public Health Institute Rev. Dr. Marvin Peoples, Pastor, Liberty Hill Missionary Baptist Church* Rev. Kieran Healy, St. Mary Magdalen Parish-Berkeley*
Dr. Paul M. Martin, President, American Baptist Seminary of the West* Rev. Michael Smith, McGee Ave. Baptist Church*
Cornell C. S. Wheeler, Pastor, Missionary Church of God in Christ* Dr. Vicki Alexander, Berkeley City Health Director, Retired Ann-Marie Hogan, Auditor, City of Berkeley*
Shirley Issel, Former Berkeley School Board President
John Tango Iverson, Singer/Activist, ACT UP East Bay & Occupy AIDS Hon. Carole Davis Kennerly, former Berkeley Vice Mayor
Marty Lynch, CEO of LifeLong Medical Care
Marian Mabel, Co-President, Malcolm X PTA
Joshua Room, Co-President, Malcolm X PTA

28.50 8.78
Supporters - Berkeley vs. Big Soda
http://www.berkeleyvsbigsoda.com/supporters[6/22/2018 12:52:30 PM] Tweet
Joy Moore, Garden educator and community food activist
Chris Peeples, Director at Large, Board of Directors, Alameda-Contra Costa Transit District* Dr. Jeff Ritterman, cardiologist and former Richmond City Council member Holly Scheider, parent and public health activist
Clancey Bateman, Consultant, John Snow, Inc.*
William Haar, Program Coordinator, Prevention Institute Emily Warming, Healthy & Active Before 5
Lisa Nguyen, Healthy & Active Before 5
Rhea Elina Laughlin, Healthy & Active Before 5
Cally Martin, Healthy & Active Before 5
Tonya D. Lowe, Healthy & Active Before 5
Sarah Nelson, 18 Reasons
Lauren Brightwell, Contra Costa Child Care Council*
Viola Lujan, La Clinica de La Raza*
John F. Jonas, Contra Costa Child Care Council*
Valentina Loreto-Ashleu, Contra Costa Health Services*
Michell Nadoo, Contra Costa College Early Learning Center* Yasmin Ahmed, Building Blocks for Kids Richmond*
Sarah Rios-Hacegaba, Building Blocks for Kids Richmond* Mary Helen Rocha, Brighter Beginnings*
Sandra Scherer, Monument Crisis Center*
Ana Villalobos, Monument Impact*
Lisa Stephens, Chair, Berkeley Rent Stabilization Board; Former Chair, Parks & Recreation Commission*
Marianne Balini
Sophia Koessel Talbot
Katharine Mason
Diana Camacho
*affiliation is for identification purposes only
Do you like this page?

28.51 8.79
Source Information
(1) “40% of Americans Will Develop Diabetes: CDC.” WebMD. 2005-2018. www.webmd.com/diabetes/news/20140812/40-percent-of-americans-will-developdiabetes-cdc-projects#1/. Accessed 20 Jun. 2018. (2) “Added Sugars and Cardiovascular Disease Risk in Children” American Heart Association. 2016.
http://circ.ahajournals.org/content/early/2016/08/22/CIR.0000000000000439. Accessed 20 Jun. 2018
(3) “Around $3.4M spent in Berkeley soda tax campaign.” Berkeleyside. 2015. www.berkeleyside.com/2015/02/05/around-3-4m-spent-on-berkeley-soda-taxcampaign/. Accessed 20 Jun. 2018. (4) “Berkeley sees a big drop in soda consumption after penny-per-ounce ‘soda tax’.” Los Angeles Times. 2016. http://www.latimes.com/science/sciencenow/la-sci-sn-soda-taxworks-20160823-snap-story.html/. Accessed 20 Jun. 2018. (5) Berkeley vs. Big Soda. 2015. www.berkeleyvsbigsoda.com/. Accessed 20 Jun. 2018. (6) “Campaign Finance Dashboards – June 7, 2016 and November 8, 2016 Elections.” City & County of San Francisco Ethics Commission. 2018.
https://sfethics.org/ethics/2016/06/campaign-finance-dashboards-june-7-2016-andnovember-8-2016-elections.html/. Accessed 20 Jun. 2018. (7) “Marketing Food To Children and Adolescents: A Review of Industry Expenditures, Activities, and Self-Regulation: A Federal Trade Commission Report To Congress.” Federal Trade Commission Protecting America’s Consumers. 2008. www.ftc.gov/reports/marketing-food-children-adolescents-review-industryexpenditures-activities-self-regulation/. 20 Jun. 2018. (8) “Press Release: City of Stockton Passes Second in Nation ‘Healthy-by-Default’ Kids’ Beverage Ordinance.” Public Health Advocates.
www.publichealthadvocacy.org/2016/06/press-release-city-stockton-passes-secondnation-healthy-default-kids-beverage-ordinance/. Accessed 20 Jun. 2018. (9) “Large study on Berkeley’s soda tax finds significant drop in sugary beverage sales.” Berkeley News. 2017. http://www.berkeleyside.com/2017/04/24/large-study-berkeleyssoda-tax-finds-significant-drop-sugary-beverage-sales%20. Accessed 20 Jun. 2018. (10) “Soda taxes win in Oakland, San Francisco and Albany. The Mercury News. 2016. www.mercurynews.com/2016/11/08/voters-to-decide-on-oakland-albany-soda-taxmeasures/amp/. Accessed 20 Jun. 2018.

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http://www.berkeleyside.com/2017/04/24/large-study-berkeleys-soda-tax-finds-significant-dropsugary-beverage-sales (11) “Sugar & Tooth Decay.” Healthy Food America Moving Science to Action. 2018. www.healthyfoodamerica.org/sugar_tooth_decay/. Accessed 20 Jun. 2018. (12) “Sugar & Type II Diabetes.” Healthy Food America Moving Science to Action. 2018. http://www.healthyfoodamerica.org/sugar_type_ii_diabetes/. Accessed 20 Jun. 2018. (13) “Sugary Drinks in America: Who’s Drinking What and How Much?” Healthy Food America Moving Science to Action. 2018. www.healthyfoodamerica.org/publications/.

Accessed 20 Jun. 2018.
(14) “Why Liquid Sugar Is the Worst.” Healthline. 2016. www.healthline.com/nutrition/liquid-sugar-calories#section3/. Accessed 20 Jun. 2018.

28.53 8.81
City Council Ad-Hoc
Revenue Committee
Recommendation
6/26/18, Item #28
Actions:
1) Place a one-cent Sugary-Sweetened Distribution Beverage Tax and Community Oversight Panel measure on November 6, 2018 2) Motion to support the measure, identify authors and prepare legal and as needed, fiscal analysis

28.63 8.82
Pro-active actions to create a healthier 2
Santa Cruz
 Creation of a Community Oversight Panel of experts
 Will report on the impact of the tax, monitor annual tax receipts, and recommend use of future revenues
 Will include members from City Parks & Recreation Commission, Santa Cruz schools, youth organizations, wellness organizations, doctors, pediatricians, dentists and other community wellness stakeholders
 Sugar-Sweetened beverage health impacts
 One 12oz can is 1.5 times a child's entire daily sugar intake  Liquid sugar increases the risk of diabetes more than sugar in food  Latino children have a high risk of Type 2 diabetes
 Berkeley- 9.6% decrease in soda & 15.6% increase in water consumption
2 28.64

8.83 3
 Established by Council on February 13, 2018
 Martine Watkins (Chair), Chris Krohn, Cynthia Mathews  Investigate current and long-term resource options for 2018 ballot considerations
 Focused on the November 2018 election
 Continued research and considerations of the prior Ad-Hoc Revenue Committee
 Special emphasis on Community Wellness and coordination of community stakeholders
 Critical to fund the ability to sustain Parks and Recreation and CORE and related programs that collectively support access to all to offset Social Determinants of Health
3 Ad-Hoc Revenue Committee for
November 2018 Ballot

28.65 8.84
Committee Work
Plan

28.66 8.85
5 Committee Work Plan
Confirm Committee’s
purpose and adopt
Committee Charter
Review prior
Committee’s analysis
Research, evaluate and
prioritize potential
revenue options
Recommended
structure of measures
Prioritize top revenue
options
Direct as to timing of
revenue ballot
measures
Outreach to local
stakeholders
City Council
recommendationplacement of ballot
measures
Consider poll &
continue outreach
5 28.67

8.86 Review of revenue considerations
Resource Options
Evaluated
Admission
Tax
Business
License
Tax
Cannabis
Excise Tax
Franchise
Taxes
Parcel
taxes
Other
Property
taxes
Parking Tax
Property
Transfer
Tax
Sales Tax
SugarSweetened
Tax
Transient
Occupancy
Tax
Utility
Users Tax
Examples of committee
considerations
 Community health and wellness
 Competition with a possible November
county-wide housing measure
 Success rate of a ballot measure
balance with cost of election
 Voter support patterns of current and
prior elections
 Community support
6 28.68

8.87 Community supports sugary distribution tax
 January 2018 poll results very strong
 Early outreach confirms support
 Will require community leadership to
be the 5th in the State and 8th in the
Country with this tax
 Groups like American Beverage
Association and Big Soda will mount
an aggressive fight
7 28.69

8.88 Questions &
Action
Recommended Actions
1) Resolution to place a one-cent sugar-sweetened distribution tax measure on November 6, 2018
2) Motion to support the measure, identify authors, and prepare legal and if necessary fiscal analysis

28.70 8.89
City already implemented fiscal 9
recommendations
Santa Cruz has AA+ S&P rating! 9

28.71 8.90

28.72 8.91

CITY COUNCIL

AGENDA REPORT
DATE: April 20, 2020
AGENDA OF: April 28, 2020
DEPARTMENT: City Council
SUBJECT: Resolution Urging the California State Legislature and the Governor to Immediately Overturn SB 872 (2018), Banning Local Government Taxation of Sugary Beverages (CN)
RECOMMENDATION: Resolution urging the California State Legislature and the Governor to immediately overturn SB 872 (2018) and return to California cities the right to improve public health and raise revenue by disincentivizing consumption of soda and other sugary beverages.

BACKGROUND: According to a Sacramento Bee editorial board article (‘Big Soda’s sweet deal to ban soda taxes is a California shakedown’, June 25, 2018) and general consensus of experienced political observers, the California Governor and Legislature were the victims of a type of “extortion” and “shakedown” by the American Beverage Association in the summer of 2018. The Governor and Legislature were essentially forced to enact a law temporarily prohibiting and preempting the ability of California cities to enact popular sugary drink taxes despite the fact these are proven tools for cities to both improve public health and raise revenue.

California voters who passed soda taxes in their cities before the successful 2018 campaign by the American Beverage Association have improved the health of their residents and given their cities millions of dollars in revenue available to stave off budget cuts due to the COVID-19 induced economic downturn.

A majority vote of the California Legislature and a signature by the Governor now would give California cities one more tool to fight COVID-19 and improve community health in the long term. California cities need every single tool available to give their residents the possibility of a healthier future.

It is noteworthy that among the highest risk categories for complications and death due to COVID-19 are individuals with underlying health conditions. Some of the most significant underlying health conditions, including diabetes and heart disease, have been directly linked to high consumption of sugary beverages. Policies to reduce consumption of sugary beverages will directly influence public health far beyond the immediate COVID-19 crisis.

8.92 6.1
DISCUSSION: A resolution is being requested urging the California State Legislature and the Governor to recognize that due to the COVID-19 crisis, they need to immediately overturn SB 872 that was passed in 2018 and give California cities back their right to improve public health and raise revenue by disincentivizing consumption of soda and other sugary beverages and allow residents to choose whether they want a sugary drink tax in their city.

FISCAL IMPACT: None.

Submitted by:

Justin Cummings
Mayor
Submitted by:

Martine Watkins
Councilmember
Submitted by:

Cynthia Mathews
Councilmember

ATTACHMENTS
Draft Resolution
Letter from Californians for Less Soda
Sample Resolution from Californians for Less Soda
SB 872

8.93 6.2
RESOLUTION NO. NSRESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ URGING THE

CALIFORNIA STATE LEGISLATURE AND THE GOVERNOR TO RECOGNIZE THAT DUE TO THE COVID-19 CRISIS THEY NEED TO IMMEDIATELY OVERTURN SB 872 THAT WAS PASSED IN 2018 AND GIVE CALIFORNIA CITIES BACK THEIR RIGHT TO

IMPROVE PUBLIC HEALTH AND RAISE REVENUE BY DISINCENTIVIZING

CONSUMPTION OF SODA AND OTHER SUGARY BEVERAGES
WHEREAS, According to the Sacramento Bee, the California Governor and Legislature were the victims of a type of “extortion” and “shakedown” by the American Beverage Association in the summer of 2018; and
WHEREAS, the Governor and Legislature were essentially forced to enact a law temporarily prohibiting and preempting the ability of California cities of their right to enact popular sugary drink taxes despite the fact that they are proven tools for cities to improve public health and raise revenue; and
WHEREAS, the City of Seattle enacted a soda tax in 2018 and has been able to use that revenue this year to give $800 in grocery vouchers to thousands of Seattle families hard hit by COVID-19; and
WHEREAS, California voters who passed soda taxes in their cities before the successful 2018 “extortion” by the American Beverage Association have improved the health of their residents and given their cities millions of dollars in revenue available to stave off budget cuts due to the COVID-19 induced economic downturn; and
WHEREAS, a majority vote of the California Legislature and a signature by the Governor now would give California cities one more tool to fight COVID-19; and WHEREAS, California cities need every single tool available in the war against COVID-19 to give their residents the possibility of a healthier future; and WHEREAS, the world has changed since COVID-19, and California can no longer afford to handcuff cities and prevent voters from using proven tools to improve health equity and public health and provide for safe, accessible, and affordable drinking water.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz that it hereby urges the California Legislature and the Governor of California to overturn SB 872 and allow residents to choose whether they want a sugary drink tax in their city.

BE IT FURTHER RESOLVED that the Mayor is directed to transmit a copy of this resolution to all State Legislators and the Governor with a request to take all action necessary to achieve the objectives of this resolution.

8.94 6.3
RESOLUTION NO. NS-29,
2 PASSED AND ADOPTED this 28th day of April, 2020, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: __________________________
Justin Cummings, Mayor
ATTEST: ____________________________
Bonnie Bush, City Clerk Administrator

8.95 6.4

Monday, April 13, 2020
City of Santa Cruz
809 Center Street
Santa Cruz, CA 95060
Re: Urgent Action Needed
Dear City Leaders,
As the World reels from the health and economic consequences of COVID-19, we wanted to alert you that cities can use a sugary drink tax to make your residents and your city finances healthier in the short and long run. In fact, Seattle, one of America’s two earliest and most impacted cities, is using a sugary drink tax right now to give $800 to over 6,000 of their residents to help infuse much needed resources into some of the most vulnerable communities in the City. (see article link).

In addition, sugary drink taxes have proven extremely effective at fighting the root causes of diabetes and heart disease. In fact, studies show a 2-cent sugary drink tax across California would reduce health care costs by more than $3 billion over ten years.

We are writing from Californians for Less Soda, a coalition of California and national health equity and public health advocates and health professionals, If you are interested in seeing how much revenue could be generated for your City, the Rudd Center at the University of Connecticut has a revenue calculator for Sugary Drink Taxes. If you do not see your city in the pull down menu, please reach out to our campaign and we will get projected revenue data for you.

You can find this calculator at: http://uconnruddcenter.org/revenue-calculator-forsugary-drink-taxes

8.96 6.5
- 2 -
However, in order for California cities to be able to use this effective weapon for public health, we need your help.

In 2018, due to a successful form of political extortion, corporate soda interests won a temporary prohibition on cities being able to enact soda taxes in their own cities.

We can end this prohibition and let cities choose to use a soda tax in your fight for public health with a simple majority vote of the California Legislature and a signature by the Governor.

Please, we urge you to pass a resolution by May 8 we urge you to pass a resolution by May 8th calling on the Governor and Legislature to lift the prohibition on soda taxes as soon as possible. If Sacramento If Sacramento takes action in this year’s state budget, your city may be able to have a soda tax before voters by this November – before voters by this November –offering them immediate ac offering them immediate ac offering them immediate action in response to this tion in response to this crisis. crisis.

A sample resolution is attached. If you would like more information, please contact us at [email protected] or (916) 806-1691.

Thank you,
Californians for Less Soda

8.97 6.6

Resolution urging the California State Legislature and the Governor to recognize that due to the COVID- that due to the COVID-19 crisis, they need to immediately overturn SB 872 that 19 crisis, they need to immediately overturn SB 872 that was passed in 2018 and give California cities back their right to improve public health and raise revenue by disincentivizing consumption of soda and other sugary health and raise revenue by disincentivizing consumption of soda and other sugary beverages.beverages. beverages.

WHEREAS, According to the Sacramento Bee, the California Governor and Legislature were the victims of a type of “extortion” and “shakedown” by the American Beverage Association in the summer of 2018; and WHEREAS, the Governor and Legislature were essentially forced to enact a law temporarily prohibiting and preempting the ability of California cities of their right to enact popular sugary drink taxes despite the fact they are proven tools for cities to improve public health and raise revenue; and
WHEREAS, the City of Seattle enacted a soda tax in 2018 and has been able to use that revenue this year to give $800 in grocery vouchers to thousands of Seattle families hard hit by COVID-19; and
WHEREAS, California voters who passed soda taxes in their cities before the successful 2018 “extortion” by the American Beverage Association have improved the health of their residents and given their cities millions of dollars in revenue available to stave off budget cuts due to the COVID-19 induced economic downturn; and
WHEREAS, a majority vote of the California Legislature and a signature by the Governor now would give California Cities one more tool to fight COVID-19 and; WHEREAS, California cities need every single tool available in the war against COVID-19 and to give their residents the possibility of a healthier future; and WHEREAS, the world has changed since COVID-19 and California can no longer afford to handcuff cities and prevent voters from using proven tools to improve health equity and public health and provide for safe, accessible and affordable drinking water; now, therefore, be it

8.98 6.7
RESOLVED, That the City Council of Santa Cruz urges the California legislature and the Governor of California to overturn SB 872 and allow residents to choose whether they want a sugary drink tax in their city; and, be it FURTHER RESOLVED, That the City Council of Santa Cruz directs the __________ to transmit copies of this Resolution to all State Legislators and the Governor with a request to take all action necessary to achieve the objectives of this resolution.

8.99 6.8
Senate Bill No. 872
CHAPTER 88
An act to add Section 7284.10 to Chapter 1.8 (commencing with Section 7284.8) of Part 1.7 of Division 2 of the Revenue and Taxation Code, as proposed by Assembly Bill 1838 of the 2017–18 Regular Session, relating to taxation, and making an appropriation therefor, to take effect immediately, bill related to the budget.
[Approved by Governor July 9, 2018. Filed with Secretary of State July 9, 2018.]
legislative counsel’s digest
SB 872, Committee on Budget and Fiscal Review. Local government:
taxation: prohibition: groceries.

Existing law authorizes counties, cities, and other local agencies to impose various taxes and fees in connection with activity or property within those jurisdictions. The California Constitution also authorizes a charter city to levy local taxes to raise revenues for local purposes, subject to restrictions imposed by that city’s charter or preemption in matters of statewide concern.

The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes counties and cities to impose a local sales and use tax in accordance with that law for tangible personal property sold at retail in the county or city, or purchased for storage, use, or other consumption in the county or city.

That law requires the county or city to contract with the California Department of Tax and Fee Administration for the administration of the taxes and requires the department to transmit those taxes to the city or county.

AB 1838 of the 2017–18 Regular Session, if enacted, on and after the effective date of that measure and until January 1, 2031, would prohibit the imposition, increase, levy and collection, or enforcement by a local agency of any tax, fee, or other assessment on groceries, except as provided. That bill would allow a local agency to continue to levy and collect, enforce, or reauthorize any tax, fee, or other assessment on groceries imposed, extended, or increased on or before January 1, 2018. That bill would make inoperative on the effective date of that measure any tax, fee, or other assessment on groceries imposed by a local agency after January 1, 2018.

This bill would exclude cannabis from the definition of groceries, as defined for purposes of AB 1838 of the 2017–18 Regular Session, if that bill is enacted and becomes effective.

This bill would appropriate from the General Fund $12,000 to the California Department of Tax and Fee Administration to notify affected governmental entities of the requirements of AB 1838 of the 2017–18 Regular Session on its Internet Web site.
95 8.100 6.9
This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

Appropriation: yes.

The people of the State of California do enact as follows:

SECTION 1. Section 7284.10 is added to Chapter 1.8 (commencing with Section 7284.8) of Part 1.7 of Division 2 of the Revenue and Taxation Code, as proposed by Assembly Bill 1838 of the 2017–18 Regular Session, to read:
7284.10. For the purposes of this chapter, all of the following definitions shall apply:
(a)  “Alcoholic beverages” has the same meaning as that term is defined in Section 23004 of the Business and Professions Code.
(b)  “Cannabis” has the same meaning as that term is defined in Section 26001 of the Business and Professions Code.
(c)  “Cannabis products” has the same meaning as that term is defined in Section 26001 of the Business and Professions Code.
(d)  “Cigarettes” has the same meaning as that term is defined in Section 30121.
(e)  “Electronic cigarettes” has the same meaning as that term is defined in Section 30121.
(f)  (1)  “Groceries” means any raw or processed food or beverage including its packaging, wrapper, or container, or any ingredient thereof, intended for human consumption, including, but is not limited to, meat, poultry, fish, fruits, vegetables, grains, bread, milk, cheese and other dairy products, carbonated and noncarbonated nonalcoholic beverages, kombucha with less than 0.5 percent alcohol by volume, condiments, spices, cereals, seasonings, leavening agents, eggs, cocoa, teas, and coffees whether raw or processed, including its packaging, wrapper, or container. (2)  “Groceries” does not include alcoholic beverages, cannabis, cannabis products, cigarettes, tobacco products, and electronic cigarettes. (g)  “Local agency” has the same meaning as provided in Section 6252 of the Government Code, and includes the electorate of a local agency in exercising the initiative power.
(h)  “Tax, fee, or other assessment on groceries” includes, but is not limited to, sales and use taxes, a gross receipts tax, business and occupation tax, business license tax, excise tax, privilege tax, surcharge, or any other similar levy, charge, or exaction of any kind on groceries or the manufacture, supply, distribution, sale, acquisition, possession, ownership, transfer, transportation, delivery, use, or consumption thereof.
(i)  “Tobacco products” has the same meaning as that term is defined in Section 30121.

SEC. 2. The sum of twelve thousand dollars ($12,000) is hereby appropriated from the General Fund to the California Department of Tax and Fee Administration to notify affected governmental entities of the 95 Ch. 88 — 2 —

8.101 6.10
requirements of Chapter 1.8 (commencing with Section 7284.8) of Part 1.7 of Division 2 of the Revenue and Taxation Code, as added by Assembly Bill 1838 of the 2017–18 Regular Session, on its Internet Web site.

SEC. 3. This act shall become operative only if Assembly Bill 1838 of the 2017–18 Regular Session is enacted and becomes effective.

SEC. 4. This act is a bill providing for appropriations related to the Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution, has been identified as related to the budget in the Budget Bill, and shall take effect immediately.

O
95 — 3 — Ch. 88

8.102 6.11
City Council

AGENDA REPORT
DATE: 02/10/2021
AGENDA OF: 02/23/2021
DEPARTMENT: City Council
SUBJECT: Resolution Regarding the Penalty Provision of AB 1838 (CN) RECOMMENDATION: Resolution to consider submitting a proposed tax on the distribution of soda and other sugary beverages to Santa Cruz voters and let the voters decide whether they want to tax the distribution of these products in the Santa Cruz community if AB 1838 did not contain the penalty provision, or if AB 1838, including the penalty provision, was repealed.

BACKGROUND: In 2014 and 2016, the voters of the cities of Berkeley, San Francisco, Oakland, and Albany approved local taxes on the distribution of soda and other sugary beverages, despite well-funded opposition by the beverage industry.

On June 26, 2018, the Santa Cruz City Council passed Resolution No. NS-29,419, which put on the ballot for the November 2018 election a measure to impose a tax on the distribution of soda and other sugary beverages.

However, in response to the passage of these local taxes on the distribution of soda and other sugary beverages and to prevent the electorates of other cities from imposing similar taxes, the beverage industry forced the Legislature and the Governor to enact AB 1838 (2018) which imposed a statewide ban on new local taxes on “groceries,” including taxes on sugary beverages and soda, even though most groceries are already exempt from sales tax.

AB 1838 includes a penalty provision (Rev. & Tax Code § 7284.12(f)) that is specifically designed to discourage charter cities from trying to exercise their constitutional power over municipal affairs, and which provides that if a city enacts a tax on “groceries” that conflicts with AB 1838, and if a court determines that the imposition of the tax is a valid exercise of the city’s charter authority under Article XI, section 5 of the California Constitution, then the California Department of Tax and Fee Administration is directed to stop collecting that city’s sales and use taxes.

Sales and use taxes generate 20% of the annual revenue for the City of Cruz’s general fund and the loss of this revenue would be financially devastating to the City.

On August 7, 2018, fearing the fiscal devastation that the City could suffer under the penalty provision of AB 1838, this City Council rescinded Resolution No. NS-29,419 and the proposed measure to impose a tax on the distribution of soda and other sugary beverages within the City of Santa Cruz did not appear on the November 2018 ballot.

8.103 12.1
DISCUSSION: On November 26, 2019, the City Council formally adopted a Health in All Policies (HiAP) policy framework and implementation plan to shift the culture of how we do things and institutionalize the consideration of health, equity, and sustainability in all functional areas of City operations. HiAP engages governmental partners and stakeholders to work together to improve wellbeing outcomes through local government decisions related to food access, housing, transportation, public safety, education, sustainability, climate change, parks, air and water quality, criminal justice, and economic development, among others.

Excessive sugar consumption has been linked with several metabolic abnormalities and adverse health conditions, as well as a lack of essential nutrients. The American Heart Association (AHA) recommends that Americans drastically cut back on added sugar to help slow the obesity and heart disease epidemics. The AHA suggests an added-sugar limit of no more than 100 calories per day (about 6 teaspoons or 24 grams of sugar) for most women and no more than 150 calories per day (about 9 teaspoons or 36 grams of sugar) for most men. Foods high in sugars, salt, and fat, and total calories and low in nutrients are highly advertised and marketed through media targeted to children and adolescents, while advertising for healthier foods is almost nonexistent in comparison (Centers for Disease Control and Prevention).

The AHA will be introducing legislation repealing AB 1838 this legislative cycle. This resolution states that if AB 1838 did not contain the penalty provision or if AB 1838, including the penalty provision, was repealed, then the City Council would again consider submitting a proposed tax on the distribution of soda and other sugary beverages to its voters to let the voters decide whether they want to tax the distribution of these products in the Santa Cruz community.

FISCAL IMPACT: Approving this resolution would initiate a discussion for Council should AB 1838 be repealed and it does not have a direct fiscal impact.

Submitted By:

Donna Meyers, Mayor
Shebreh Kalantari-Johnson,
Councilmember
ATTACHMENTS:

1. RESOLUTION AB 1838 PENALTY.DOCX

8.104 12.2
RESOLUTION NO. NSRESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ TO CONSIDER

SUBMITTING A PROPOSED TAX ON THE DISTRIBUTION OF SODA AND OTHER

SUGARY BEVERAGES TO SANTA CRUZ VOTERS RELATED TO THE PENALTY PROVISION OF AB 1838
WHEREAS, the City of Santa Cruz is a charter city.

WHEREAS, Article XI, section 5 of the California Constitution grants charter cities the power to make and enforce laws on matters that are municipal affairs without interference from the State.

WHEREAS, local taxation has long been held to be a core area of municipal affairs.

WHEREAS, Article XIII C of the California Constitution reserves to the local electorate the power to enact local taxes by petition and ballot measure.

WHEREAS, in 2014 and 2016, the voters of the cities of Berkeley, San Francisco, Oakland, and Albany approved local taxes on the distribution of soda and other sugary beverages, despite well-funded opposition by the beverage industry.

WHEREAS, on June 26, 2018, this City Council passed Resolution No. NS-29,419, which put on the ballot for the November 2018 election a measure to impose a tax on the distribution of soda and other sugary beverages.

WHEREAS, in 2018 in response to the passage of these local taxes on the distribution of soda and other sugary beverages and to prevent the electorates of other cities from imposing similar taxes, the beverage industry forced the Legislature and the Governor to enact AB 1838 (2018) (Rev. & Tax Code §§ 7284.8-7284.16), which imposes a statewide ban on new local taxes on “groceries,” including taxes on sugary beverages and soda, even though most groceries are already exempt from sales tax.

WHEREAS, the beverage industry forced the Legislature and Governor to enact AB 1838 by threatening to move forward with a statewide ballot measure, for which it gathered enough signatures to qualify it for the November 2018 general election, titled the “Tax Fairness, Transparency and Accountability Act of 2018” that would have gutted local finances.

WHEREAS, on June 28, 2018 Governor Brown signed AB 1838 into law, referring to the threatened statewide ballot measure in his signing letter as “an abomination.” WHEREAS, Governor Brown also stated in his signing letter for AB 1838 that “a total of 4 cities are considering passing a soda tax to combat the dangerous and ill effects of too much sugar in the diets of children.”

8.105 12.3
WHEREAS, recognizing that AB 1838’s ban on local taxes on soda and other sugary beverages is probably inapplicable to charter cities because local taxation is a municipal affair, the drafters of AB 1838 added a draconian penalty provision (Rev. & Tax Code § 7284.12(f)) that is specifically designed to discourage charter cities from trying to exercise their constitutional power over municipal affairs, and which provides that if a city enacts a tax on “groceries” that conflicts with AB 1838, and if a court determines that the imposition of the tax is a valid exercise of the city’s charter authority under Article XI, section 5 of the California Constitution, then the California Department of Tax and Fee Administration is directed to stop collecting that city’s sales and use taxes.

WHEREAS, sales and use taxes generate 20% of the annual revenue for the City of Cruz’s general fund and the loss of this revenue would be financially devastating to the City.

WHEREAS, on August 7, 2018, fearing the fiscal devastation that the City could suffer under the penalty provision of AB 1838, this City Council rescinded Resolution No. NS-29,419 and the proposed measure to impose a tax on the distribution of soda and other sugary beverages within the City of Santa Cruz did not appear on the November 2018 ballot.

NOW THEREFORE, BE IT RESOLVED that even though the penalty provision in AB 1838 is probably unconstitutional, the City of Santa Cruz cannot risk submitting a tax on soda or other sugary beverages to its voters to test the constitutionality of the penalty because the potential financial risk is too great for the City.

BE IT FURTHER RESOLVED that if AB 1838 did not contain this penalty provision, or if AB1838, including the penalty provision, was repealed, then this City Council would consider submitting a proposed tax on the distribution of soda and other sugary beverages to its voters and let the voters decide whether they want to tax the distribution of these products in this community.

PASSED AND ADOPTED this 23rd day of February, 2021, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: _____________________________
Donna Meyers, Mayor
ATTEST: ____________________________
Bonnie Bush, City Clerk Administrator

8.106 12.4
City Council

AGENDA REPORT
DATE: 05/08/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Economic Development and Housing
SUBJECT: Downtown Association: Parking and Business Improvement Area Assessments for FY 2024 (ED)
RECOMMENDATION: Motion to:
1) Approve, or to modify and approve, the plan prepared by the Downtown Association for FY 2024; and
2) Adopt a Resolution of Intention to levy a Downtown Association Parking and Business Improvement Assessment for FY 2024 and schedule a public hearing for June 13, 2023 on the levy of the assessments for FY 2024.

BACKGROUND: In accordance with State law, the Downtown Association (DTA) is required to submit an annual plan for each year in which assessments are to be levied in the Downtown Parking and Business Improvement Area. The attached plan, prepared by the DTA, fulfills the requirement for FY 2024 and is being submitted for Council approval. The plan may also be modified by Council and then approved. The City acts as a fiscal agent on behalf of the DTA, but is not a member of the DTA, nor is the City involved in the preparation of the plan.

DISCUSSION: The DTA’s budget and annual workplan was approved by the DTA Board on May 16, 2023 and proposes no change in the assessment area for FY 2024.

The business improvement assessment formula allows for an annual Consumer Price Index (CPI) adjustment in the rate. The annual CPI adjustment as of February 2023 is 5.3%; therefore, the rate per square foot will increase from $0.45 to $.47. The plan also outlines the DTA’s FY 2023 planned activities, budgeted expenses and revenues, and contributions from sources other than the assessments levied. The DTA will continue to provide clean, safe, and wlecoming services through the Ambassador and Information Kiosk programs. The DTA will also continue to support business owner’s in the economic recovery, through marketing, advocacy, and membership services.

Following Council approval of the plan, a resolution declaring the intention of the City to levy and collect the assessments within the Parking and Business Improvement Area must be adopted.

The resolution shall also set a public hearing to be held on June 13, 2023. Notice of the public hearing will be given by publishing the Resolution of Intention in a newspaper of general circulation in the City once at least seven days prior to the public hearing. At the public hearing,

9.1 written and oral protests, if any, may be made in accordance with State Street and Highways Code Sections 36524 and 36525. Prior to the public hearing, protests may be submitted to the City Clerk’s Office.

FISCAL IMPACT: There is no fiscal impact to the City. Revenues collected from the assessment are turned over to the DTA to be spent for promotional activities in the Parking and Business Improvement Area.

Prepared By:

Rebecca Unitt
Economic Development
Manager
Submitted By:

Bonnie Lipscomb
Director of Economic
Development and Housing
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

2. 23-2024 DTA WORK PLAN.PDF

3. 23-2024 DTA BUDGET - FINAL.PDF

9.2 RESOLUTION NO. NSRESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ TO LEVY

DOWNTOWN ASSOCIATION PARKING AND BUSINESS IMPROVEMENT
ASSESSMENTS FOR FISCAL YEAR 2024
WHEREAS, in accordance with California Streets & Highways Code §36533, the Downtown Association of Santa Cruz has prepared a report to the City of Santa Cruz for Fiscal Year 2024 pertaining to the Parking and Business Improvement Area assessments for the Parking and Business Improvement Area; and
WHEREAS, pursuant to California Streets & Highways Code §36533, the City Council has heretofore considered that annual report and by motion approved the report; and WHEREAS, Santa Cruz Municipal Code §5.05.030 requires semi-annual assessments to be imposed within the Business Improvement Area pursuant to a formula set forth in Municipal Code §5.05.040.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA CRUZ AS FOLLOWS:

1. The City Council hereby declares its intention to levy and collect, on a semiannual basis, assessments within the Parking & Business Improvement Area for the Fiscal Year 2024.

2. The proposed activities authorized by Santa Cruz Municipal Code Chapter 5.05 are described in the Downtown Association of Santa Cruz report.

3. The annual report of the Downtown Association of Santa Cruz is on file with the City Clerk.

4. The proposed assessments will be calculated under the formula for assessment found in Santa Cruz Municipal Code §5.05.040. This formula is based on the square footage of benefitted businesses, the type of business, and the zone in which it is found. The annual Consumer Price Index adjustment is 5.3% (February 2021 to February 2022), resulting in an increase of the per square foot rate from $0.45 to $0.47.

5. The Parking and Business Improvement Area is generally bounded on the East by the San Lorenzo River, on the West by Cedar Street, on the South by Laurel Street and on the North by River, North Pacific, and Water Streets. The precise boundaries of Zones 1 and 2 are shown on diagrams contained in Santa Cruz Municipal Code Chapter 5.05.

6. The Santa Cruz City Council will hold a public hearing in the City Council Chambers on Tuesday, June 13, 2023, to receive any oral or written protests or endorsements to the regularity or sufficiency of the Business Improvement Assessment. If protests complying with Streets and Highways Code §36524 and §36525 are received from the owners of businesses which will pay fifty percent or more of the total assessment, the procedure will be terminated and will

9.3 RESOLUTION NO. NS2
not be reconsidered until one full year has elapsed. Protests may be made at the public hearing or any time prior to the City Clerk’s Office.

7. The City Clerk is directed to give notice of the public hearing to consider the levy of business improvement assessments for Fiscal Year 2024 by publishing this Resolution of Intention in a newspaper of general circulation in the City once, at least seven days prior to the public hearing.

PASSED AND ADOPTED this 23rd day of May 2023, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ____________________________
Fred Keeley, Mayor
ATTEST: ____________________________
Bonnie Bush, City Clerk Administrator

9.4 Downtown Association of Santa Cruz
FY 2023-2024 Work Plan
Approved on May 16, 2023
Introduction
The Downtown Association of Santa Cruz is a 501c(6) member benefit organization established to promote the Downtown business district. The organization’s mission is to provide effective leadership to create, promote and sustain downtown as a unique and economically viable business, entertainment, social and cultural center.

The Downtown Association operates a merchant-based Business Improvement District (B.I.D.) funded by a special assessment on those operating businesses in the district. The organization is governed by a volunteer board of directors, elected from, and representing, the assessed members of the district.

Staff includes an Executive Director, Brand Director, and part-time Membership Champion.

Through our contractor, BlockbyBlock, the Downtown Association also has a full-time Operations Director, staffing the Downtown Ambassador Program along with the Downtown Information Kiosk. Additionally, the work of the association is augmented by volunteers, interns and contractors from time to time as projects warrant.

This work plan has been developed by the Board and staff to serve as a roadmap to guide the activities and resource allocation of the Downtown Association for fiscal year 2023-2024.

Budget Increase Needed for A Vibrant Downtown
The Downtown Association’s weak financial position was first acknowledged in 2020 with the hiring of an Interim Executive Director, alongside the firm Progressive Urban Management Associates, to facilitate a strategic plan to improve the organization’s sustainability, work that was carried out in partnership with the City of Santa Cruz Economic Development Department.

9.5 In 2023-24, the organization will be running at a significant deficit and pursuing an increase in Business Improvement Assessments to more sustainably fund the services and programs offered to downtown business members. The levy has not changed for decades, and it is time.

Year In Review
In fiscal year 2022-2023, the community enjoyed the return of a lively, activated Downtown with the opening of dozens of new businesses and year-round events - including the return of the Holiday Parade - drawing thousands of people back to spending time in Downtown Santa Cruz.

While operating on a shoestring budget, the Downtown Association supported its business members and the community at large, in its following four core areas:

1. Clean, Safe & Welcoming Programs: To ensure long-term sustainability for the Downtown Association’s core programs supported by the Downtown Management Corporation, the
Downtown Ambassador and Information Kiosk programs,
the Downtown Association contracts with BlockbyBlock,
which runs operations for over 100 downtowns across the country. In 2022-23, the Downtown Association advocated for the Downtown Management Corporation to expand the
Ambassador’s coverage area to include the entire
Downtown Association district, including Front Street,
Center Street, Cedar Street, River Street and the Clock Tower triangle (between Pacific Avenue, Water Street, and River Street). The current Ambassador coverage area is
now constrained to the area funded by the Downtown
Management Corporation, Pacific Avenue and its side
streets from Laurel Street to Water Street.

Downtown Ambassadors take charge of daily garbage, remove graffiti, report public maintenance issues to the city, and connect people in need to social services, in addition to connecting businesses to resources and assisting visitors, in the monthly Ambassador Reports. The association maintains close working relationships with the Santa Cruz Police Department and Encompass Service downtown Outreach Workers, as well as the City Manager and Office of Economic Development, who provide critical support to our Ambassadors and downtown’s safety and cleanliness.

2. Marketing: The Downtown Association of Santa Cruz actively markets Downtown Santa Cruz as the primary shopping district for Santa Cruz County through outreach to local residents and to visitors from Monterey, San Benito and Santa Clara communities. In order to reach a diverse and engaged group of visitors to the downtown district, the Downtown Association uses a multi-faceted approach to marketing by utilizing digital marketing (social media boasting over 19,800 instagram followers, ads, website and digital newsletters “e-news”) as well as in-person events to increase foot traffic to downtown streets and businesses.

With the help of an engaged Board of Directors, the Marketing Committee also churns out

9.6 new promotion ideas each year to increase visibility to Downtown Santa Cruz, this year co-launching Downtown Fridays to draw hundreds of people Downtown during the winter.

3. Member Networking & Support: The association works to keep downtown business owners, managers and employees connected and informed primarily through our weekly Business News which is distributed via email and Facebook and read by hundreds of Downtown business owners and staff each week. The Downtown Association also hosts quarterly business mixers for its members, along with city partners, county business serving organizations, and community nonprofits. The association publicizes its Board of Directors and Committee meetings to encourage members’ volunteer engagement. It leads an annual public safety meeting with SCPD, County Mental Health, Downtown Outreach and Downtown Ambassadors. The association also collaborates with the Workforce Development Board of Santa Cruz County to host a Walkabout Job Fair, in conjunction with a Downtown Day Welcoming UCSC students in the fall, that results in dozens of hires for downtown businesses.

4. Advocacy: The Downtown Association maintains collaborative working relationships with organizations across Santa Cruz county, particularly with those that also serve the association’s members, such as the Santa Cruz County Chamber of Commerce, Santa Cruz County Business Council, Visit Santa Cruz, and the Small Business Development Center of Santa Cruz. Advocacy activities this year included supporting the Downtown Library and Affordable Housing project, supporting streamlined permitting and grants for permanent outdoor dining parklets, and co-hosting periodic broker breakfasts focused on reducing vacancies Downtown, with the partnership of Economic Development.

Since 2019, the Downtown Association has also been advocating for Santa Cruz to adopt a better tax assessment structure to sustain the desired downtown management, maintenance, beautification and neighborhood services. Well-funded Property Based Improvement Districts (PBIDs) provide the clean, safe and welcoming programs of downtowns that are admired around the country. The existing PBID in Downtown Santa Cruz is the Downtown Management Corporation (DMC). The Downtown Association is fully supportive of the DMC expanding its district boundaries to better fund crucially needed Ambassador services for the entire neighborhood. 2023-2024 PROGRAMS

DOWNTOWN AMBASSADOR PROGRAM
The Mission of the Downtown Ambassadors is to
be the best part of people’s day in Downtown Santa
Cruz.

The Downtown Ambassador program is funded by
the Downtown Management Corporation. Launched
in October of 2018, the Ambassador program has
become a vital element of downtown management,
and of businesses’ and visitors’ downtown experience. Providing a welcoming presence in the

9.7 downtown is the core function of the program, but the impact and benefits reach well beyond that.

In addition to serving visitors by providing local information, recommendations and directions, the Ambassadors serve as a liaison with city agencies, contractors, service providers and others involved in Downtown management, maintenance, social services, and public safety.

Regular coordination with the Public Works downtown maintenance team, the sanitation department, Uncle Poop waste removal, and property owners adds a level of efficiency and accountability in addressing the ongoing and growing cleaning and maintenance needs of downtown’s built environment. The Ambassador team communicates both through the City of Santa Cruz’ Community Request for Service Portal (CRSP), as well as by selectively escalating issues of pressing concern via direct communications with relevant city departments.

Communication with the Santa Cruz Police Department, County Mental Health liaisons, Downtown Outreach workers, and with members of our community looking for, or in need of services, extends the valuable impact and reach of the program.

Ongoing engagement with Downtown Businesses and with district residents also does a lot to build community in the Downtown.

BRAND MANAGEMENT AND DISTRICT MARKETING
Promoting Downtown has long been a core purpose of the Downtown Association. The Downtown Association of Santa Cruz manages the Downtown Santa Cruz brand and promotes the businesses, events and elements that support its visibility and appeal, including:
● Continual alignment of social media and digital marketing ● Brand management across all promotions, events and communications ● Ongoing encouragement of brand alignment with our members and collaborators The brand is conveyed through all of the association’s marketing efforts, designed to bring people to the district and enhance the experience of everyone spending time in Downtown Santa Cruz.

SOCIAL MEDIA & DIGITAL MARKETING
All of the association's promotional efforts
direct visitors to downtown businesses and
to the Downtown Association’s website,
which remains current with Downtown
events, activities and a complete and
expanded directory of businesses. Our social
media presence has over 34,000 followers,
and continues to gain popularity on
Instagram, Facebook and Twitter. The social
platforms have provided an outstanding way
to reach Downtown Santa Cruz fans with the
many specific events, activities and business
promotions in the district.

DOWNTOWNSANTACRUZ.COM
The Downtown Santa Cruz website is a cornerstone of the association’s marketing. Utilizing a

9.8 platform designed for downtowns across the country, the site has enhanced SEO, and provides a wealth of information and resources for visitors, locals and for the Downtown Santa Cruz business community. An online events calendar lists daily activities, concerts, plays, festivals, book readings, classes and everything else happening for the public in the district. A comprehensive business directory helps direct people to the food, shops or services they’re hoping to find. The site also provides valuable information to help the association’s business members find the resources they need to be successful in Downtown Santa Cruz.

DIGITAL E-NEWS
Our e-newsletters, with a reach of over 5,000 residents and fans, include This Week Downtown which provides a great sample of what’s happening downtown, from the big ticket events, to the more obscure, plus information about new businesses, deals, and interesting happenings.

BUSINESS DIRECTORIES
Each of our member businesses is listed on our online DowntownSantaCruz.com Business Directory. We also publish and distribute 50,000 copies of a popular fold-out illustrated paper Map and Directory with listings of all the retail, restaurants and services in the district, and maintain three freestanding business directory wayfinding signs on Pacific Avenue.

DOWNTOWN PROMOTIONS
Throughout the year, the Downtown Association typically promotes special and themed activities, building on successful events and inventing new activations. Popular community events include Kids Day, Wine Walk, Monthly Sidewalk Sales and of course winter Holiday traditions.

Downtown Sidewalk Sales
On the last weekend of each month, from
March through Black Friday Weekend, the
retail shops spill out onto the sidewalk for
great month-end sales.

Where’s Waldo
In partnership with Bookshop Santa Cruz,
Where’s Waldo is a great local summer
activity that brings Waldo seekers around
Downtown and into stores on a month-long scavenger hunt. The Promotion culminates with a special event at Bookshop Santa Cruz with Prizes and Waldo himself.

Ice Cream Month
Downtown Santa Cruz would be remiss if we did not participate in National Ice Cream Month in July. Each year we host a coloring contest and invite folks to color their own exciting ice cream treat. Winners are selected in a variety of categories with a grand prize of ice cream for a year at the many favorite Downtown ice cream spots.

Back to School
Our back to school promotions celebrate students from kindergarten to postgraduates. Our targeted promotions for UCSC slugs and Cabrillo students aim to introduce our area’s newer residents to Downtown shops, restaurants, events and attractions.

9.9 Downtown Trick or Treat
One of our community’s favorite Santa Cruz traditions is Downtown Trick or Treat. Once again the Downtown Association will partner with our business members and the Santa Cruz Police Department to invite the community downtown for a fun, safe trick-or-treating good time.

Downtown Wine Walks
These Popular events are a great opportunity to showcase the local Appalachia and introduce wine lovers to new retail spots Downtown, and bring them back to visit their favorites. Presented twice a year, in November and in May, the Wine Walk is a great opportunity to bring visitors from around the Bay Area to spend a great afternoon in Downtown Santa Cruz.

Downtown Holiday Parade
The Official Kick Off to the Holiday Season happens on the first Saturday in December as the Downtown Holiday Parade marches, rolls, pedals, dances and sings up Pacific Avenue, bringing out thousands of locals, and amazing cross section of our community, and of course, the big finale of the Santa Cruz High School Cardinal Regiment Band followed by the man of the Hour atop a shiny, red, antique Santa Cruz Fire Engine.

Reindeer Roundup
The holidays provide many opportunities for Downtown
promotion. Similar to our Summer Where’s Waldo Scavenger hunt, the Reindeer Roundup brings families into stores
throughout the month of December, helping Santa find his team.

Golden Envelope
The Downtown Association serves as a neighborhood sponsor for the national Small Business Saturday event and brings holiday shoppers downtown to support local businesses during the Black Friday weekend, including on Small Business Saturday. During this Willy Wonka inspired event, shoppers are incentivized to come Downtown to win a Golden Envelope filled with surprise gift cards, when they make qualifying purchases at participating retailers on Saturday.

Santa on Pacific Avenue
Those who have visited Santa on Pacific Avenue for a photo op know that the experience is not matched anywhere. These relaxed visits with our very special ambassador to the North Pole have reached a level of legend among local kids, parents and grandparents.

Kids Day Downtown
With dozens of children’s community organizations
providing free activities during this fun street fair, Kids Day welcomes thousands of local families to Downtown for
entertainment and great specials in our Downtown shops
and restaurants.

9.10 Partner Events
In addition to producing events in-house, the Downtown Association co-sponsors and supports the production of a number of events throughout the year that promote the brand of Downtown Santa Cruz. Included in these events are Downtown Fridays, Earth Day, First Friday Santa Cruz, Dance Week Santa Cruz, the Santa Cruz Pride Parade & Festival, and more.

DOWNTOWN DOLLARS
Our Downtown Dollars program keeps tens of thousands of dollars in Downtown every year.

Accepted at 85+ businesses in the district, Downtown Dollars make great gifts and are available for purchase at Bookshop Santa Cruz, Pacific Cookie Company, the Downtown Information Kiosk, and online. Downtown Dollar gifts encourage local spending.

DOWNTOWN INFORMATION KIOSK
For over a decade, the visitor information center in the kiosk located at 1130K2 Pacific Avenue, at the intersection of Soquel Avenue in front of New Leaf Community Market, has been a Santa Cruz institution. The location provides valuable information and resources to visitors and locals, while promoting businesses and activities throughout the district. The cost of the kiosk has been offset by donated rent from the City of Santa Cruz Economic Development Department.

DOWNTOWN ADVOCACY
The Downtown Association maintains current knowledge of organizations and agencies that support doing business Downtown, and connects downtown businesses to resources. Downtown Association staff also serve as informed representatives of the downtown business community, on relevant issues, to the City Council, city management and other organizations interested in contributing to the business climate or community events in Downtown Santa Cruz. The Downtown Association’s ability to effectively represent the business interests downtown is dependent upon strong relationships, primarily with our business members, and ultimately with the many communities who use Downtown.

MEMBERSHIP EVENTS
One of the greatest assets of Downtown is our business community leaders, who bring their passions and talents downtown and open their doors to the public, defining the common experiences of Downtown Santa Cruz. The Downtown Association recognizes this asset, and fosters the connection of its members, and their ability to support each other, by hosting grand opening ribbon cuttings and networking events designed to bring members together and enhance the sense of community, as well as informational meetings that educate and engage the community on current events and issues.

WORKSHOPS
The Downtown Association hosts workshops and partners with other business service agencies to provide information, tools and knowledge that will help our members succeed.

9.11 Other Special Initiatives
Cognizant of important changes on the horizon, the Downtown Association of Santa Cruz will have an ongoing voice in defining the character of downtown as numerous large, mixed-use retail and residential developments begin construction. The Downtown Association will also continue to support permanent family-friendly attractions and privately-managed public spaces, which are widely desired by downtown’s business patrons. Constructing a Toddler Park on Pacific Avenue is one important, ongoing Board initiative.

Conclusion
The Downtown Association of Santa Cruz has been a pillar in promoting, managing, and advocating for our Downtown while supporting the community of neighborhood business leaders who make Downtown the attractive, unique, fun and lively place it is today. The Downtown Association is also an active participant in the economic vibrancy of the Santa Cruz community.

Meanwhile, the organization is financially vulnerable and not sustainable in its current Business Improvement District (BID) structure. The strength of the organization’s future lies in the ability to increase its revenues, through additional support from DMC and right-sizing Business Improvement Assessments in the coming year.

9.12 FY 2018/19 FY 2019/20 FY 2020/21 FY 2021/22 FY 2022/23 FY 2023/24 REVENUE Actual Actual Actual Actual Budget Budget
Business Improvement Assessment $244,718 $261,817 $221,963 $220,419 $220,000 $260,000 Ambassador Services (Downtown Management Corporation contract) $171,927 $167,452 $201,192 $214,121 $213,784 $337,000 DMC Sponsorships $11,000 $12,215 $12,675 $9,047 $10,000 $10,000 Events $40,047 $15,029 - $30,550 $20,000 $30,000
Sublease Rental Income $13,010 $8,900 $1,400 - - -
EIDL / PPP / CA Relief Grant Funding - $49,900 $57,480 $15,000 - - M&D Ads / Unredeemed Downtown Dollars / Other $40,343 $5,339 $28,231 $55,991 $30,000 $55,000 Only DTA Total Revenue $521,045 $520,651 $522,941 $545,129 $493,784 $692,000 $355,000

EXPENSES
Staff Chip Abra Jorian-->
Executive Director $80,800 $56,817 $85,874 $80,923 $52,500 $120,000 Brand Director (District Marketing & Events) $29,974 $37,832 $26,477 $57,583 $70,000 $90,000 Block by Block (Operations Director, Ambassador Team & Kiosk) $143,605 $139,635 $242,043 $255,232 $215,000 $361,000 Administrative/Membership/Other Wages $9,425 $11,589 $6,513 $7,100 $7,500 $8,500 Payroll Expenses $26,408 $23,827 $13,922 $13,224 $12,750 $23,125 Contract Services $24,704 $17,092 $13,841 $2,530 $7,500 $5,000 Bonuses - $1,900 $7,125 $4,085 $7,500 $9,300
Staff Development $4,510 $5,076 $3 - - $2,500
Conferences and Travel $2,763 $3,440 $856 $315 - $4,500 Medical Insurance - - - - - $12,000
Total Staff Expense $322,189 $297,209 $396,654 $420,992 $372,750 $635,925 Overhead
Rent $18,061 $18,000 $11,250 $8,250 $9,000 $9,000
Facilities Expense $736 $1,884 - $200 $1,000 $500
Insurance $4,061 $3,488 $2,201 $3,325 $2,750 $3,000
Communications $7,387 $8,047 $4,281 $2,624 $2,500 $4,500 Office Supplies $1,754 $3,551 $1,876 $958 $2,000 $1,500 Accounting / Bookkeeping $5,043 $5,973 $6,042 $6,538 $6,250 $6,750 Tax Preperations $2,000 $2,420 $2,400 $2,750 $2,500 $3,245 Dues and Memberships $1,445 $1,881 $1,087 $1,478 $1,000 $2,000 Uniforms + Equipment $5,951 $3,682 $2,265 $1,104 $1,000 $1,650 Software $9,564 $10,740 $3,917 $4,453 $4,000 $5,275
Interest Expense (EIDL) $545 - - $2,568 $2,500 $2,500
Bank Fees/Square Fees/Other $1,117 $584 $2,530 $3,120 $2,000 $3,250 Total Overhead $57,665 $60,251 $37,848 $37,367 $36,500 $43,170 Marketing
Website $5,222 $9,147 $8,843 $7,441 $8,500 $8,500
Directory / Map - - $8,733 $19,911 $20,450 $24,500
Free Standing Directories - - - $387 $1,000 $1,000
Holiday & Event Marketing / Paid Promotions $500 $3,225 $16,550 $13,257 $12,500 $10,500 Misc Marketing $5,738 $3,419 $510 $549 $500 $500
Marketing Total $11,460 $15,791 $34,636 $41,543 $42,950 $45,000 Events
Promotional Design Work + Printing $3,046 $8,631 $9,043 $4,988 $6,500 $7,800 Food / Drink $7,809 $3,239 $63 $4,819 - $3,750
Event Supplies + Contractors $30,484 $8,831 $3,775 $14,533 $5,000 $24,450 Permits $3,394 $2,431 $179 $3,574 $5,000 $6,500
Artist Fees $4,800 $3,825 $500 $20 - -
Misc $3,585 - - $920 - -
Total Events $53,118 $26,956 $13,560 $28,853 $16,500 $42,500 Strategic Planning $2,585 $3,057 $881 $2,300 $25,000 $25,000 BIA Engineer Only DTA
Total Expense $447,017 $403,264 $483,578 $531,056 $493,700 $791,594 $454,594 Net $74,028 $117,387 $39,363 $14,073 $84 -$99,594 proposed BIA increase
CASH RESERVES (End of Year)* $32,967 $100,596 $155,827 $158,196 $158,280 $58,685 *Cash balance, minus Downtown Dollars liability, minus Accounts Payable <-- COVID -->
Downtown Association of Santa Cruz
FY 2023/24 Budget

9.13 City Council

AGENDA REPORT
DATE: 05/10/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Economic Development and Housing
SUBJECT: 223 Darwin Street CFSC Loan Extension (APN: 011-122-04) (ED) RECOMMENDATION: Authorize the City Manager to execute any and all loan documents necessary, in a form approved by the City Attorney, to extend the terms of existing Red Cross funded loan in the amount of $75,000 to CFSC for the property located at 223 Darwin Street for 30 years with 3% simple interest and deferred payments.

BACKGROUND: A $74,500 Red Cross funded loan, originally granted in 1992, passed from SCAP (Santa Cruz Aids Project) to CFSC, Inc. in 2012. The loan was originally made to HIP (Housing for Independent People) alongside a $105,000 Community Development Block Grant (CDBG) grant funded in 1991, both grants having 3% interest and passing to CFSC, Inc. with assumption of the property. The grants were made by the City of Santa Cruz for acquisition and rehabilitation of the real property located at 223 Darwin Street which operates as an affordable shared housing facility with 4 bedroom-units, also known as Pearlman House (APN: 011-122- 04). Currently, the tenants all have Section 8 Vouchers, which allow the tenants to pay 30% of their incomes in rent while the remaining rent is paid by the Housing Authority of the County of Santa Cruz. The vouchers allow Fair Market Rent (FMR), rent limits established by the Housing Authority, to be charged for each bedroom in the shared housing facility.

On December 8, 1992, City Council approved deferment of the $74,500 Red Cross loan for the remaining term of the loan through 2022. Additionally, at that time, City Council also approved deferment of the $105,000 CDBG loan through June 30, 1999, and approved interest only payments from July 1, 1999, through June 30, 2015, with amortized principal and interest payments beginning July 1, 2015 until repaid in full. In April 2001, while SCAP was the successor in interest on the property, the City Council approved the conversion of the $105,000 CDBG loan to a revocable grant.

The SCAP board of directors dissolved the corporation and transferred all its assets and debt to CFSC, Inc. in 2012, which at the time was the property holding arm of The Santa Cruz Community Counseling Center (SCCCC). The City of Santa Cruz approved the assignment of the debts to CFSC, Inc. in February 2012. SCCCC assumed responsibility for SCAP’s service, contracts, and programs including those provided at the Pearlman House. Front St. Housing, a local residential services provider, now assumes property management responsibilities at the affordable housing scattered sites held by CFSC, Inc.

10.1 DISCUSSION: CFSC, Inc. requested that the City forgive, or convert to a grant, the existing Red Cross loan of $74,500. The principal and interest currently due total approximately $146,000.

Staff recommends approving an extension of the Red Cross loan and affordability requirements for a 30-year period, with the original 3% simple interest terms and continuation of deferment of payments (granted in 1992). Since the City has previously forgiven the $105,000 CDBG principal and interest on this loan and provided the low 3% interest on the Red Cross loan, the current leverage in the property is many factors below the original investment and has not kept up with inflation or rising property value, now estimated at approximately $1.3 million (see attachment: Darwin CDBG and Red Cross Loan Summaries). Leverage in the property in the form of a loan allows the City to ensure continuing affordability for another 30 years. Deferring the payments would allow the City’s interest in the property to continue and ensure affordability in the property for another 30 years while not impacting the operational costs for CFSC, Inc.

Alternately, should the City Council decide to approve the loan forgiveness, staff recommends requesting affordability in perpetuity for the property in exchange for the forgiveness.

At the April 25, 2023 City Council meeting, the CFSC, Inc. loan extension was pulled from consent; following discussion, staff was directed to bring the item back for consideration at the May 23, 2023 City Council meeting. Council further provided direction for staff and the City Attorney to meet with CFSC to determine whether it was possible to structure a forgiveness of the loan with certain findings that would not make it precedent setting and to explore unintended impacts of this direction.

Staff spoke with Mr. LaBerge on May 16, 2023, following direction from City Council to explore criteria or avenues in which forgiveness could be proposed that would not set a precedent for forgiveness of other affordable housing loans. Possible options for consideration for forgiveness that would avoid setting a precedent include affordability in perpetuity with deed restriction or providing other projects with replacements units in the City of Santa Cruz with affordability covenants. While CFSC expressed interest in the concept of the replacement units, they do not have a project at this time that would meet the criteria.

Additionally, they were not interested in the affordability covenant remaining after the loan forgiveness, which is a standard precedence that has been accepted by other parties for loan forgiveness. Therefore, staff recommends extending the loan for the terms previously recommended above which includes deferring the remaining outstanding principal and any accrued interest for an additional 30 years. If CFSC wishes to pay off the remaining loan balance at any time, they are able to do that with no penalties and the affordability provisions would terminate at that time.

Additional Discussion
• It is a HUD and HCD recommended best practice to loan funds rather than grant or forgive loans to ensure continued affordability in projects.
• Forgiveness of this loan (without requiring affordability in perpetuity) would set an unwanted precedent for forgiveness of other affordable housing loans. • Affordability in perpetuity is a common requirement of affordable housing agreements.

10.2 • Under the proposed terms, no payments would need to be made on either principal or interest for 30 years, while ensuring that the value of the investment stays in the community. • The City has been willing to subordinate its loans to facilitate additional needed financing. In FY 2023, approximately $91,000 of Community Development Block Grant (CDBG) funding was awarded as a loan to CFSC, Inc. for a project to rehabilitate the units. When the contract was ready to execute, CFSC, Inc. declined the loan and they are now renovating the property with their own funds.
• The current Fair Market Rent (FMR) currently collected for each bedroom is $1,028 per unit resulting in $49,344 of annual rent.
• The Red Cross fund from which this loan originated is an asset of the City of Santa Cruz. • The City regularly receives payments from other affordable housing loans made from the fund. • Payments on affordable housing loans, when they come back to the City, can be used to fund additional affordable housing projects, preserve affordability in projects and for programming that benefits some of the City’s most vulnerable populations. • There are two ongoing Red Cross funded programs that use this finite funding source: (1) Beach Flats area includes Nueva Vista at $25,000 annually (services include: after-school programming, tutoring, translation services, benefits, referrals, and food banks); and (2) Community Action Board at $11,000 annually (Tenant Based Rental Assistance (TBRA)) for eviction prevention). While there is only enough funding to extend these programs for a few more years, the Red Cross loan that is now due at approximately $146,000 with interest, if repaid to the City, could extend these programs for an additional 4 years.

Health in All Policies (HiAP)
The recommendation is consistent with the Health in All Policies pillars of equity, public health, and sustainability in that the proposed motion will allow CFSC, Inc. to defer the currently due loan for 30 years, helping operations to continue to provide housing for 4 low income SCAP tenants and ensuring that the value of the investment will benefit those needing affordable housing.

FISCAL IMPACT: Deferment of anticipated recapture of the Red Cross loan in the amount of $74,500 with 3% interest, when repaid, will be available for future affordable housing and/or tenant support programs, consistent with current practices.

Prepared By:

Tiffany Lake
Development Manager
Submitted By:

Bonnie Lipscomb
Director of Economic
Development and Housing
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. CFSC INC. LETTER TO CITY FOR DARWIN LOAN FORGIVENESS.PDF

2. DARWIN CDBG AND RED CROSS LOAN SUMMARIES.PDF

10.3 CFSC, Inc.
2115 7th Avenue
Santa Cruz, CA 95062
CFSC, Inc.
2115 7th Ave.,
Santa Cruz, CA 95060
To: Members of the Santa Cruz City Council
City of Santa Cruz
809 Center Street
Santa Cruz, CA 95060
March 13, 2023
Dear Members of the Santa Cruz City Council,
Thank you for the opportunity for CFSC, Inc. (“CFSC”) to address the Santa Cruz City Council concerning the forgiveness of a loan made 30 years ago to create affordable housing on Darwin Street, located in the City of Santa Cruz.

CFSC was established in 1981, originally under the name of the Community Foundation of Santa Cruz (until the name was given to the current organization with that name). CFSC operates as a valuable non-profit providing affordable housing and other housing and program opportunities to the residents of the County and City of Santa Cruz. Over the last 42 years, CFSC has acquired seventeen different buildings through various government grants and loans; many of these buildings are within the Santa Cruz City limits. Half of the buildings provide permanent affordable housing to people who have been chronically homeless and who have psychiatric disabilities. The remaining buildings are leased to Encompass Community Services at below-market rates (in some cases, at half the market rate) so that Encompass can provide needed services to its clients in Santa Cruz. As a nonprofit, CFSC has been steadfast in its commitment to responsibly provide and care for these valuable facilities.

Within the Santa Cruz city limits, CFSC owns the following affordable supported housing projects:

1. Van Ness Avenue (8 tenants)

2. Water Street (9 tenants)

3. Broadway (4 tenants)

4. Mission (5 tenants)

5. Darwin Street (4 tenants, Santa Cruz Aids Project tenants) Within the County of Santa Cruz, CFSC also owns four affordable supported housing projects with a total of 35 tenants and in conjunction with the County and another nonprofit, we are in the process of renovating a 10-bedroom, 7-bathroom house for youth at risk of homelessness.

DocuSign Envelope ID: A49A9404-E8B2-4F2A-A9BE-8E41427EE22A

10.4 CFSC, Inc.
2115 7th Avenue
Santa Cruz, CA 95062
Finally, CFSC owns properties in Santa Cruz and Watsonville, which it leases to Encompass Community Services, out of which Encompass operates a number of programs benefitting residents in Santa Cruz:

1. Santa Cruz: Santa Cruz Residential Recovery (drug rehabilitation), Sober Living Environment housing, Telos program (short-term psychiatric housing)

2. Watsonville: 2 Youth Services program sites, Escuela Quetzal School, Fuerte Program, Head Start Program,
CFSC acquired these buildings through a series of loans and grants from governmental authorities and currently carries considerable debt on the loans it has obtained. Because CFSC is a nonprofit committed to providing housing and buildings that serve the local community, it does not make a “profit” as it provides these valuable resources to Santa Cruz.

The property at Darwin St. has been providing permanent, affordable supportive housing for tenants with special needs since 1992. It provides independent living for four tenants in a group home setting with four bedrooms, a common area kitchen, a living room, etc. All tenants must be diagnosed with HIV/AIDS, qualify as very low income according to State income limits, and be homeless or at risk of homelessness. The rent for each tenant is currently $288/mo, $282/mo, $282/mo, and $0/mo. Rents for tenants fortunate enough to have a Section 8 voucher are determined by the Housing Authority (generally a maximum of 30% of their monthly income). The Housing Authority then provides subsidies for the remainder of the rent based on the income and a market rate for a four-bedroom house. Consequently, the tenants living at Darwin have secure and affordable permanent housing in a community where that would otherwise be completely unavailable to them financially.

This loan with the City of Santa Cruz, for which CFSC is seeking forgiveness, has a complicated 30-year history. The Darwin property was originally developed by Housing for Independent People (HIP). In January 1992, the City of Santa Cruz provided a loan to HIP in the amount of $74,500 from the American Red Cross Housing Reconstruction Fund as part of the earthquake recovery effort. The City Council passed a Resolution in December 1992, stating that the City Council could forgive the loan at the end of the loan term provided that the conditions set forth in the Participation Agreement have been met. These conditions include maintaining the use of the property as affordable housing for very low-, low- and moderate-income households for a period of 30 years. In April 1993, the Promissory Note for the $74,500 loan was modified to provide that the City of Santa Cruz “may decide to defer, or to forgive, payment of either the outstanding principal or accrued and unpaid interest or both.” In 2001, the Santa Cruz AIDS Project (SCAP) assumed this loan from HIP as well as a number of other loans associated with the property. Unfortunately, SCAP began experiencing financial difficulties in 2012. CFSC and Encompass stepped forward to take over the SCAP program because of the tremendous need in the community for such housing and services for the population who reside there. CFSC assumed ownership of the property and responsibility for all the loans in July 2012, which included a loan with the State HOPWA program (Housing Opportunities for People With AIDS), loans with the City of Santa Cruz, and a loan with Santa Cruz Community Credit Union (SCCCU). An examination of the CFSC Board minutes from 2012 reveals that the forgiveness provisions in the City’s $74,500 loan played a part in the Board’s decision to take over the SCAP program and property ownership responsibilities.

DocuSign Envelope ID: A49A9404-E8B2-4F2A-A9BE-8E41427EE22A

10.5 CFSC, Inc.
2115 7th Avenue
Santa Cruz, CA 95062
CFSC subsequently rolled the approximately $110,000 SCCCU loan into a commercial loan with Comerica, a loan CFSC carries to this day.

Maintaining quality, low-income housing in our region has been a challenge that can, at times, seem to be insurmountable. High real estate costs and ever-increasing operating costs are obstacles all affordable housing providers face every day. CFSC is able to provide affordable housing for our community solely due to the willingness of our funding providers to defer or forgive repayment of our capital debt. Due to regulations that limit the rental income at Darwin to just 30% of each tenant’s income, CFSC has no ability to increase operating income as our operating expenses slowly increase over time, unless tenant income or Housing Authority subsidies increase.

The forgiveness provisions included in the Modified Promissory Note required that CFSC and the previous owners adhere to the Participation Agreement for 30 years. CFSC (and HIP and SCAP) have complied with this agreement and accordingly CFSC has earned forgiveness of the loan. Moreover, it is important for the City Council to recognize that CFSC has been a reliable partner, committed to providing housing to people who are chronically homeless with disabilities. For example, in 2012, when CFSC was released from all regulatory restrictions on property it owns on Mission Street in the City of Santa Cruz, CFSC has continued to operate the property as affordable housing for those with psychiatric disabilities for the last 11 years despite having no legal responsibility to do so. Similarly, CFSC operates its property on Lincoln Street in Watsonville as affordable housing despite having no regulatory agreement requiring that it do so.

Due to the significant value this project has provided the city, CFSC requests that the City of Santa Cruz continue its collaborative work with CFSC and forgive the principal and interest on the loan for Darwin St as provided in the Modified Promissory Note. The principal and interest currently total approximately $146,000. CFSC has complied with all the conditions necessary for forgiveness that the City Council required 30 years ago. We appreciate any consideration that the City of Santa Cruz can give to work with CFSC toward a financial solution that benefits all who work to support the vulnerable residents of Santa Cruz.

Best regards,
____________________________________
Paul O’Brien
Secretary/Treasurer, CFSC, Inc.

DocuSign Envelope ID: A49A9404-E8B2-4F2A-A9BE-8E41427EE22A

10.6 P:\PLHR\Subordination, Modification, and Refinance Requests\2011\223 Darwin St. - SCAP\$105,000 CDBG Loan Summary 24Feb2011.doc
1 223 Darwin St.

SCAP House
Loan Summary
$105,000 CDBG
Document Date Notes
Loan Agreement - HIP
(copy in file)
Feb. 14, 1991 Instrument No. 9391, Vol. 4793, Page 962
Promissory Note - HIP
(copy in file)
Feb. 14, 1991 For acquisition of 223 Darwin St.
3% interest for 10 years.
1st year deferred; amortized monthly payments
of $1,143.90 for remaining 9 years.

Deed of Trust - HIP
(copy in file)
Feb. 14, 1991 Instrument No. 9394, Vol. 4794, Page 8.

Secures payment of Note.

Resolution No. NS-20,819
(signed copy in file)
Dec. 8, 1992 a. Defers repayment until 6/30/99.
b. Approves interest only payments from
7/1/99 to 6/30/15.
c. Principal and interest payments
commencing on 7/1/15 until paid.

Resolution No. NS-25,321
(copy in file)
April 10, 2001 Approves conversion of loan to a revocable 24 grant with a 24 year term.

Assignment of Loan
Agreement, Note, and Deed
of Trust
(original in file)
June 6, 2001 Instrument No. 2001-0044467
HIP to SCAP
Release of Loan Agreement
(original in file)
June 6, 2001 Instrument No. 2001-0044468
a. Rescinds Loan Agreement.
b. City releases SCAP from Loan
Agreement.
c. City agrees to reconvey HIP DT.
d. SCAP agrees to execute new agreement
with City converting $105,000 loan to
grant.

10.7 P:\PLHR\Subordination, Modification, and Refinance Requests\2011\223 Darwin St. - SCAP\$105,000 CDBG Loan Summary 24Feb2011.doc
Subrecipient Financing
Agreement - SCAP
(original in file)
June 6, 2001 Acknowledges:
a. Transfer of property from HIP to SCAP.
b. Conversion of loan to grant.
c. Establishes end of grant term as Feb. 13,
2025.

Subordination Agreement
(original in file)
June 6, 2001 Instrument No. 2001-0044466
City subordinates its $105,000 loan to the
HOPWA $100,000 loan.

Full Reconveyance
(original in file)
June 7, 2001 Instrument No. 2001-0044470
Reconveys HIP DT dated Feb. 14, 1991 as
instrument no. 9394, Vol. 4794, Page 8.

Performance Deed of Trust
(copy in file)
July 6, 2001 Instrument No. 2001-0044473
Secures performance of the Subrecipient
Financing Agreement.

10.8 P:\PLHR\Subordination, Modification, and Refinance Requests\2011\223 Darwin St. - SCAP\$74,500 ARC HRF Loan Summary 3July2012.doc
1 223 Darwin St.

SCAP House
Loan Summary
$74,500 American Red Cross Housing Reconstruction Fund
Document Date Notes
Participation Agreement Jan. 6, 1992 Establishes affordability requirements in exchange for loan.

Loan Agreement - HIP
(copy in file)
Feb. 11, 1992 $74,500 for acquisition of 223 Darwin St.

Promissory Note - HIP
(copy in file)
Feb. 11, 1992 3% interest over 30 years
Construction Deed of Trust -
HIP
(copy in file)
Feb. 11, 1992 Secures payment of the Note and
performance of the Loan Agreement.

Resolution No. NS-20,818
(signed copy in file)
Dec. 8, 1992 a. Approved deferment for the remaining
term.
b. Determination re: forgiveness to made by
City Council and end of term (conditions
of Participation Agreement must be met).

Amendment to Loan
Agreement
April 8, 1993 a. Amends description of loan documents.
b. Amends events of default.
c. Amends usury interest language.
d. Requires execution of modified security
agreement and note.

Modified Security Agreement
(copy in file)
Mar. 12, 1993
Modified Promissory Note
(copy in file)
April 8, 1993 a. Establishes Feb. 11, 2022 as date by
which loan is due and payable.
b. City may forgive payment of principal and
interest at any time prior to Feb. 11, 2022.

Assignment of Loan
Agreement, Note, and Deed
of Trust
(original in file)
June 6, 2001 Instrument No. 2001-0044472
HIP to SCAP

10.9 P:\PLHR\Subordination, Modification, and Refinance Requests\2011\223 Darwin St. - SCAP\$74,500 ARC HRF Loan Summary 3July2012.doc
2 Subordination Agreement
(original in file)
June 6, 2001 Instrument No. 2001-0044474
City subordinates its $74,500 loan to HOPWA
$100,000 loan.

Subordination Agreement
(original in file)
June 6, 2001 Instrument No. 2001-0044475
City subordinates its $74,500 loan to City
$105,000 grant.

Subordination Agreement
(original in file)
Dec. 7, 2005 Instrument No. 2005-0087244
City subordinates its $74,500 loan to SCCCU
$75,000 loan.

Subordination Agreement
(original in file)
June 11, 2009 Instrument No. 2009-0056374
City subordinates its $74,500 loan to SCCCU
$87,000 loan.

Subordination Agreement
(original in file)
June 11, 2009 Instrument No. 2009-0056375
City subordinates its $74,500 loan to SCCCU
$25,000 loan.

Assumption and Assignment
of Participation Agreement,
Loan Agreement, Promissory
Note and Deed of Trust
Recorded
July, 3, 2012
Instrument no. 2012-0031355
City approves assignment and assumption of
the Participation Agreement, Loan Agreement,
Promissory Note and Deed of Trust by CFSC,
Inc.

10.10 City Council

AGENDA REPORT
DATE: 05/09/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Economic Development and Housing
SUBJECT: Pacific Collegiate Foundation – Approval of Issuance by the California Municipal Public Financing Authority of Refunding Revenue Bonds for the Purpose of Refinancing the 2016 Variable Rate Revenue Bonds (ED) RECOMMENDATION: Resolution to approve a non-charter membership agreement (the “Non-Charter Agreement”) with the California Municipal Public Financing Authority (“CalMuni PFA”) to assist the Pacific Collegiate Foundation with the issuance of refunding revenue bonds in an amount not to exceed $6,000,000 for the purpose of refinancing their 2016 Variable Rate Revenue Bonds.

BACKGROUND: In 2016, the City assisted the Pacific Collegiate Foundation, a California nonprofit public benefit corporation (the “Foundation”), with the issuance of Series 2016 California Statewide Communities Development Authority (Pacific Collegiate Foundation) Variable Rate Demand Revenue Bonds, that were issued on August 4, 2016 (the “2016 Bonds”).

On November 24, 2015, the City adopted Resolution No. NS-29,027 (the “2015 Resolution”) which, among other things, approved the issuance of the 2016 Bonds and any refunding bonds as required by Section 147(f) of the Internal Revenue Code of 1986.

The proceeds of the Series 2016 Bonds were used to refinance a construction loan that financed the construction and improvement of an approximately 47,000 sq. ft. building used to house the Pacific Collegiate School (the “School”) located at 3004 Mission Street, Santa Cruz, California 95060 (the “Facilities”). The Facilities are located within the territorial limits of the City, and a substantial portion of the persons utilizing the services provided at the Facilities are expected to be residents of the City. Similarly, a substantial portion of the persons to be employed by the Foundation at the Facilities are expected to be residents of the City. The Facilities continue to promote significant and growing opportunities for the creation and retention of employment to the local economy and the enhancement of the quality of life for residents of the City and will promote opportunities for the creation or retention of employment within the jurisdiction of the City.

The Foundation has requested the City to join CalMuni PFA in order to allow CalMuni PFA to issue Series 2023 Refunding Revenue Bonds (Pacific Collegiate Foundation) in an aggregate principal amount of not to exceed $6,000,000 (the “Refunding Bonds”) for the purpose of providing the funds necessary to refinance and defease the 2016 Bonds. Without the City being a member of CalMuni PFA, that entity would not have the legal ability to issue bonds on behalf

11.1 of a 501(c)(3) located within the jurisdiction of the City (see Govt. Code § 6500 et seq, and specifically § 6502).

DISCUSSION: The purpose of the subject resolution is to approve the form of Non-Charter Agreement allowing the City to become non-charter members of CalMuni PFA. The adoption of this resolution is a required step in the process of the Foundation securing financing.

The 2015 Resolution established the City’s jurisdiction to assist the Foundation in the issuance of the Refunding Bonds. As such there are no requirements for a public hearing or approval of any other documentation from the City (see 26 USCS § 147(f)(2)(D).). In essence, the 2016 Bonds are merely being replaced by the Refunding Bonds.

FISCAL IMPACT: The City would not be party to any financing documents. There is no direct or indirect financial impact to the City of Santa Cruz as a result of this proposed financing.

CalMuni PFA will issue the Refunding Bonds on behalf of the Foundation. The Refunding Bonds are payable solely out of the revenues derived by the Foundation. No financial obligations are placed on the City for project financing costs or debt repayment.

Prepared and Submitted By:

Bonnie Lipscomb
Director of Economic
Development and Housing
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

2. NON-CHARTER AGREEMENT.PDF

11.2 RESOLUTION NO. NS-__,___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ

APPROVING A NON-CHARTER MEMBERSHIP AGREEMENT IN
CONNECTION WITH THE EXECUTION AND DELIVERY OF SERIES 2023

TAX-EXEMPT REFUNDING REVENUE BONDS FOR THE PACIFIC

COLLEGIATE FOUNDATION, AND OTHER MATTERS RELATING THERETO WHEREAS, the City Council (the “City Council”) of City of Santa Cruz (the “City”) is reviewing the issuance of tax-exempt refunding bonds to finance the costs associated with the refinancing of certain Series 2016 Bonds by Pacific Collegiate Foundation (the “Series 2016 Bonds”); and
WHEREAS, in 2016 the City assisted the Pacific Collegiate Foundation, a California nonprofit public benefit corporation (the “Corporation”), with the issuance of the Series 2016 Bonds (more specifically, the Series 2016 California Statewide Communities Development Authority Variable Rate Demand Revenue Bonds (Pacific Collegiate Foundation), that were issued on August 4, 2016); and
WHEREAS, the proceeds of the Series 2016 Bonds were used to refinance a construction loan that financed the construction and improvement of an approximately 47,000 sq. ft. building used to house the Pacific Collegiate School (the “School”) located at 3004 Mission Street, Santa Cruz, California 95060 (the “Facilities”); and
WHEREAS, the Corporation has applied for the financial assistance of California Municipal Public Financing Authority (the “Authority”) to (1) refinance the Series 2016 Bonds, and (2) finance costs of issuance, debt service reserve, and other related costs, (both points collectively referred to as the “Refinancing Project”); and WHEREAS, the Facilities will be used as collateral and security for the Refinancing Project; and
WHEREAS, the Facilities are located within the territorial limits of the City, and a substantial portion of the persons utilizing the services provided at the Facilities are expected to be residents of the City and a substantial portion of the persons to be employed by the Corporation at the Facilities are expected to be residents of the City; and WHEREAS, the Facilities continue to promote significant and growing opportunities for the creation and retention of employment to the local economy and the enhancement of the quality of life for residents of the City and will promote opportunities for the creation or retention of employment within the jurisdiction of the City and is within the powers conferred upon the Authority; and
WHEREAS, to provide the funds necessary to accomplish the Refinancing Project the Authority is prepared to issue its California Municipal Public Financing Authority, Series 2023 Refunding Revenue Bonds (Pacific Collegiate Foundation) in an aggregate principal amount of

11.3 2
not to exceed $6,000,000 (the “Bonds”) pursuant to an Indenture and Loan Agreement (the “Bond Documents:”); and
WHEREAS, the Bond Documents comprise a financing structure that is considered standard for California government agencies to assist non-profit organizations that provide community benefits. In using this financing structure, an Indenture must be established with a third-party nonprofit entity experienced in tax-exempt debt transactions in California that can serve as issuer of the Bonds. The Authority is serving as such independent nonprofit entity for this financing transaction; and
WHEREAS, the City desires to, pursuant to a membership agreement, become a NonCharter Member of the Authority in order to facilitate the Refinancing Project (the “Non-Charter Membership Agreement”); and
WHEREAS, without the City being a member of Authority, the Authority would not have the legal ability to issue bonds on behalf of a 501(c)(3) located within the jurisdiction of the City (see Govt. Code § 6500 et seq, and specifically § 6502); and WHEREAS, the City Council, with the aid of its staff, has reviewed the Non-Charter Membership Agreement, the form of which has been presented to the City Council and is on file with the City Clerk, and the City Council wishes at this time to approve the foregoing document in the public interests of the City; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz as follows:

Section 1. Recitals and Findings. The City Council hereby specifically finds and declares that each of the statements, findings and determinations set forth in the recitals set forth above are true and correct, and that the Bonds are expected to result in significant public benefits to the City, Corporation, and the School.

Section 2. Approval Non-Charter Membership Agreement. The City Council hereby authorizes and approves the Non-Charter Membership Agreement in substantially the form on file with the City Clerk together with any additions thereto or changes therein deemed necessary or advisable by City Manager, who is hereby authorized and directed, for and in the name and on behalf of the City, to execute the final form of the Non-Charter Membership Agreement for and in the name and on behalf of the City, and the execution thereof shall be deemed to be conclusive evidence of the City Council’s approval of any such additions and changes. The City Council hereby authorizes the delivery and performance of the Non-Charter Membership Agreement.

Section 3. Effective Date. This Resolution shall take effect from and after the date of its passage and adoption.

11.4 3
PASSED AND ADOPTED this 23rd day of May, 2023 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ________________________
Fred Keeley, Mayor
ATTEST: _________________________________
Bonnie Bush, City Clerk Administrator

11.5 NON-CHARTER MEMBERSHIP AGREEMENT
1 NON-CHARTER MEMBERSHIP AGREEMENT
by and between the

CALIFORNIA MUNICIPAL PUBLIC FINANCING AUTHORITY
and the

CITY OF SANTA CRUZ
This NON-CHARTER MEMBERSHIP AGREEMENT, dated as of May 1, 2023, by and between THE CALIFORNIA MUNICIPAL PUBLIC FINANCING AUTHORITY (“CalMuni PFA”) and the City of Santa Cruz, a duly organized municipal corporation and validly existing under the laws of the State of California (the “City”); W I T N E S S E T H:

WHEREAS, certain public agencies of the State of California (collectively, the “Charter Members”) have entered into a Joint Powers Agreement Creating the California Municipal Public Financing Authority (the “Agreement”), establishing CalMuni PFA and prescribing its purposes and powers, and providing, among other things, for qualifying public agencies to become noncharter members of CalMuni PFA (each a “Non-Charter Member”); and WHEREAS, CalMuni PFA has been formed for the purpose, among others, of exercising any powers common to the Charter and Non-Charter Members, including but not limited to acquiring, constructing, improving, operating, leasing and disposing of real property for a public purpose, all as specified in the Agreement, and to exercise the additional powers granted to it in the Act (as defined in the Agreement) and any other applicable provisions of the laws of the State of California; and
WHEREAS, CalMuni PFA has been established pursuant to the Agreement and the Act and is empowered to issue or execute non-recourse debt, which may include bonds, notes, commercial paper or any other evidences of indebtedness, leases, installment sale or other financing agreements or certificates of participation therein (herein “Obligations”), and to otherwise undertake financing programs under the Act or other applicable provisions of the laws of the State of California to accomplish its public purposes; and WHEREAS, the City desires to become an Non-Charter Member of CalMuni PFA; and WHEREAS, the Board of Directors of CalMuni PFA (the “Board”) has determined that the City should become a Non-Charter Member of CalMuni PFA; and NOW, THEREFORE, in consideration of the above premises and of the mutual promises herein contained, CalMuni PFA and the City do hereby agree as follows:

Section 1. Non-Charter Member Status. The City is hereby made a Non-Charter Member of CalMuni PFA for all purposes of the Agreement and the Bylaws of CalMuni PFA, the

11.6 NON-CHARTER MEMBERSHIP AGREEMENT
2 provisions of which are hereby incorporated herein by this reference. From and after the date of execution and delivery of this Non-Charter Membership Agreement by the City and CalMuni PFA, the City shall be and remain a Non-Charter Member of CalMuni PFA.

Section 2. Restrictions and Rights of the City. The City shall not have the right, as a Non-Charter Member of CalMuni PFA, to vote on any action taken by the Board. In addition, no officer, employee or representative of the City shall have any right to become an officer or director of CalMuni PFA by virtue of this Non-Charter Membership Agreement.

Section 3. Effect of Prior Actions. The City hereby agrees to be subject to and bound by all actions previously taken by the Board to the same extent as the Members of CalMuni PFA are subject to and bound by such actions.

Section 4. No Obligations of the City. The debts, liabilities and obligations of CalMuni PFA shall not be the debts, liabilities and obligations of the City.

Section 5. Execution of this Non-Charter Membership Agreement. Execution of this Non-Charter Membership Agreement shall satisfy the requirements of Section 12 of the Agreement and Article VI of the Bylaws of CalMuni PFA for participation by the City in all programs and other undertakings of CalMuni PFA, including, without limitation, any undertaking to finance the acquisition, construction, installation and/or equipping of public capital improvements, and any other financing program undertaken by CalMuni PFA. .
[Signature Page to Follow on Next Page]

11.7 NON-CHARTER MEMBERSHIP AGREEMENT
3 IN WITNESS WHEREOF, the parties hereto have caused this Non-Charter Membership Agreement to be executed by their proper officers thereunto duly authorized, on the day and year first set forth above.

CALIFORNIA MUNICIPAL PUBLIC

FINANCING AUTHORITY
By:_________________________________
Title:________________________________

CITY OF SANTA CRUZ
By:_________________________________
Title:________________________________

11.8 City Council

AGENDA REPORT
DATE: 05/10/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Finance
SUBJECT: Liability Claims Filed Against the City of Santa Cruz (FN) RECOMMENDATION: Motion to reject the liability claims of 1) Ezekiel C. Tidmore, 2) Judith Laing, 3) Justin Laing; and to return as late claim of 4) Deborah Marie Guadian, based on staff recommendation.

BACKGROUND: N/A
DISCUSSION: I. Claims to be rejected:

1. Claimant: Ezekiel C. Tidmore
Date of occurrence: 12/21/2022
Date of claim: 04/18/2023
Amount of claim: $7,136.30
Claimant seeks reimbursement for his vehicle, tow fees, and impound fees when his vehicle was allegedly towed without proper notice.

Self-Represented.

2. Claimant: Judith Laing
Date of occurrence: 10/20/2022
Date of claim: 04/18/2023
Amount of claim: $100,000,000.00
Claimant seeks damages related to alleged police actions.

Represented by legal counsel.

3. Claimant: Justin Laing
Date of occurrence: 10/20/2022
Date of claim: 04/18/2023
Amount of claim: $100,000,000.00
Claimant seeks damages related to alleged police actions.

12.1 Represented by legal counsel.

II. Claim to be returned as late:

4. Claimant: Deborah Marie Guadian
Date of occurrence: 05/15/2022
Date of claim: 04/20/2023
Amount of claim: Unspecified
Claimant seeks reimbursement for alleged damage to her vehicle.

Self-Represented.

FISCAL IMPACT: No fiscal impact.

Prepared By:

Ross Brandon
Risk & Safety Manager
Submitted By:

Elizabeth Cabell
Finance Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

None.

12.2 1
Brittany Inclan
From: Rhonda Reyna <[email protected]>
Sent: Saturday, May 20, 2023 11:10 PM
To: City Council
Subject: Correspondence: Agenda Item 12 May 23, 2023 Meeting Dear Mayor, Vice Mayor and City Council Members,
I am recommending that the City of Santa Cruz pay the claims of both Judith Laing and Justin Laing which are well founded.

The ruling of Johnston-Rossi vs Rossi appellate decision applies to this case and demonstrates that the actions of the Santa Cruz Police Department in facilitating the Laing children to be forced into an unscientific, unproven "reunification" therapy program that is an abuse of judicial discretion as described below, was a violation of Due Process to have the appeal adjudicated and was a violation of the family's civil rights secured by the Constitution. The world has seen the horrific videos of these children screaming for help. Worse yet, they are still missing. I am certain that Judge Rebecca Connolly will be held accountable for her gross misconduct and irreparable harm to the Laing family. "Without evidence that it is in the best interest of the children to remove them from mother’s custody for a period of at least 90 days in order to participate in the Family Bridges program, the court abused its discretion in issuing its order of December 22, 2021. (In re Marriage of Burgess, supra, 13 Cal.4th at p. 32.)"
"DISPOSITION
The order of December 22, 2021 ordering the children to participate in the Family Bridges program is reversed. Plaintiff and appellant is awarded costs on appeal." The night the Laing children were family court kidnapped, dozens of concerned citizens called both the Santa Cruz Police Department and 911 on behalf of the children, so SCPD was receiving information that the reunification camps were a scam, but SCPD willfully and wantonly ignored the advocates. Many of these advocates are available to testify. I am one of them. I spoke to Officer Infuente who told me they were not taking the children and said he would meet with me to review my information on reunification therapists. He specifically told me that it was just a civil order and that they were not going to enforce it. He lied to me. The police officers went back to the Laing home half an hour later to facilitate the kidnapping.

Peace officer's number one duty is to protect. The children stated their preference as described in Family Code 3042.

Over 40 million people heard it. As the video evidence shows, the SCPD did not protect these children. Worse yet, they stood by as the children were being physically injured. This is a crime against humanity and they should be held accountable.

Furthermore, the Santa Cruz Police Department had extensive evidence in my complaint about the nefariousness of reunification therapy and it's practitioners, that should have caused them to refuse to enforce Judge Connolly's unlawful order.

Children subjected to reunification camps are sharing their stories about the abuses they've suffered.

12.3 2
The People of Santa Cruz want accountability. Pay up.

Rhonda Reyna
https://casetext.com/case/johnston-rossi-v-rossi
Filed 1/30/23; Certified for Publication 3/1/23 (order attached)

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT

DIVISION EIGHT

KERRY ANN JOHNSTON- ROSSI,
Plaintiff and Appellant, v.

PAUL ROSSI,
Defendant and Respondent.

B318522
(Los Angeles County Super. Ct. No. BD542090)
APPEAL from an order of the Superior Court of Los Angeles County. Steven A. Ellis, Judge.

Reversed.

Summers Levine & Kretzmer, Michael J. Kretzmer; Greines, Martin, Stein & Richland, Robert A.

Olson, Cynthia Tobisman, Eleanor S. Ruth, Tina Kuang; Hall Family Law and Stefanie Hall for Plaintiff and Appellant.

Arbogast Law, David M. Arbogast; Ovando Bowen and Chumahan B. Bowen for Defendant and Respondent.
***** **** *
Plaintiff and appellant Kerry Ann Johnston-Rossi (mother) appeals from the postjudgment order modifying the parenting plan between her and her former husband, defendant and respondent Paul Rossi (father) with respect to their two minor children. Mother contends the family court

12.4 3
abused its discretion in ordering the children to participate with father in a therapy program operated by Family Bridges which mandated no contact with mother for a minimum of 90 days.

We agree the court abused its discretion and reverse the order.

FACTUAL AND PROCEDURAL BACKGROUND
Mother and father married in 2004. During their marriage, they had two children, a daughter B.R. and a son D.R. Mother and father separated after six years of marriage, and their final judgment of dissolution was entered on October 16, 2012. At the time of dissolution, both mother and father lived in Los Angeles, and the court ordered joint legal and physical custody of the children.

In April 2015, mother obtained a domestic violence restraining order against father and an order allowing her to relocate with the children to Canada. The court ordered that B.R. and D.R. “shall reside” with mother “at all times except for the custodial parenting time awarded to [father].” Father was given time with the children during breaks in their school year, and he shared alternating holidays with mother, in addition to regular weekly visitation via telephone or videochats (e.g., FaceTime). Mother subsequently was allowed to relocate with the children to New York, their current state of residence. B.R. and D.R. are now in high school. 2 The Orders by Judge Dianna Gould-Saltman
After mother relocated with the children to New York, both mother and father sought postjudgment modifications to the parenting plan and related orders. In the fall of 2020, Judge Dianna Gould-Saltman heard several days of testimony, including from mother, father, B.R., Dr.

Stan Katz, and Jayne Roberman.

Dr. Katz, who was appointed to conduct child custody evaluations, testified he felt additional monitored visitation with father in New York was warranted and that the family would also benefit from the appointment of a parenting coach. In discussing different family therapy programs that might be considered, Dr. Katz told the court he was familiar with and approved of a program run by Rebecca Bailey. Dr. Katz said her program was flexible, could be customized to fit the specific needs of the family, and allowed both parents to participate. Dr. Katz was less familiar with the Family Bridges program, but said he understood it had success in cases of severe parental alienation. He described the program as “the most extreme” because it required removal of the child from the custody of the parent with whom the child was aligned (in this case, mother). Dr. Katz said Family Bridges “doesn’t allow for the aligned parent to be involved at all.” Dr. Katz believed the Family Bridges program lasted about five to seven days which was usually followed by a period of time where the aligned parent was not allowed any contact with the child, except potentially therapeutic contact.

Dr. Katz was not in favor of restrictive programs like Family Bridges unless “nothing else ha[d] worked” to help rebuild a child’s relationship with an alienated parent. He said he did not 3 12.5
4 think such a program was necessary for B.R. and D.R. and hoped it would not become necessary.

Ms. Roberman, who was appointed to provide reunification therapy for the family, believed both children were resistant to spending time with father, and that a team approach was warranted.

She told the court “the family needs a more intensive, family-focused therapy to include relationships the children have with both parents, addressing effective means for the parents to resolve conflict and more effectively communicate.”
Mother and father each presented an expert who critiqued the recommendations made by Dr.

Katz.

After the hearing, Judge Gould-Saltman issued an order requiring additional counseling for the children. Because of the pandemic, the court allowed the sessions to be completed remotely. The court also awarded father additional visitation time with the children in New York on the first and third weekends of each month. Because the pandemic was making travel and contact between different households difficult in the winter of 2020, the court ordered that a review hearing be set to monitor whether the parties were complying with its order and to see how father’s visitation and the children’s therapy sessions were going.

The review hearing was held July 22, 2021. The court heard testimony from B.R., mother, father, and father’s girlfriend, primarily focused on how father’s visits with the children in New York had been going since the last hearing. Father had been unable to make several of the visits. The visits that had occurred had not gone well, but there had been some enjoyable time spent bike riding and visiting a museum.
4 On August 17, 2021, Judge Gould-Saltman issued a written order that addressed various matters.

As relevant here, the court ordered that father was allowed to have a week vacation time during the summer with the children in Los Angeles. Further, the court ordered that father was permitted to enroll himself and the children in “a week-long program such as Family Bridges or Turning Point” and in the event he chose to do so, father was entitled to have “the children during the week-long program” in Los Angeles in addition to his one week of summer vacation time with them in Los Angeles.

Mother filed an appeal from the August 17, 2021 order which she subsequently dismissed.

The Order by Judge Steven A. Ellis
About a month later, father filed a new motion requesting further orders modifying the parenting plan in order to allow him uninterrupted time with B.R. and D.R. to complete both the in- person portion of the Family Bridges program and the “Family Bridges required post aftercare.” According to father’s declaration, the program starts with a four-day in-person therapy component followed by a minimum of 90 days of “aftercare” which would require no contact between the children and mother. Father submitted paperwork from Family Bridges confirming the scope of the program. Father testified he was advised by Dr. Randy Rand of Family Bridges that he could not enroll in the program without a court order

12.6 5
requiring the children’s participation in the 90-day aftercare portion of the therapy. Father said he had no interest in taking custody from mother and “fully expect[ed] for custody to return to 50/50 in [New York] once the program is successfully completed.” 5 Mother opposed father’s request for an order requiring the children to participate in the Family Bridges program and requiring them to be removed from her custody for 90 days or more.

Mother filed notice, pursuant to Family Code section 217, of her intent to present live testimony at the hearing, including the testimony of B.R. and D.R. Mother contended that, as teenagers, they were entitled to testify about the prospect of being ordered out of their home and excluded from talking to their mother.

The hearing on defendant’s motion was held on
November 8, 2021 before a different judge, Judge Ellis. Judge Ellis denied mother’s request to present witnesses. The court found good cause to deny an evidentiary hearing on the basis that Judge Gould-Saltman, in her August 2021 order, had “already resolved” the substantive issues regarding the Family Bridges program. The court then heard argument from the parties on how the Family Bridges program could be completed without interfering with the children’s schooling and whether it was feasible for the program to be completed in Los Angeles.

On December 22, 2021, Judge Ellis issued a nine-page order allowing father to have custody of the children for the time necessary to complete the Family Bridges program and outlining alternative procedures depending on whether the program was completed in Los Angeles or New York. Judge Ellis ordered that participation in the Family Bridges program was not to interrupt the children’s regular schooling in New York. If the program, including the minimum 90-day aftercare portion, could not be completed in Los Angeles during the summer break, then it would have to be completed in New York with father arranging
6 for a residence in New York during the school year where he and the children would reside.

Judge Ellis found it was in the best interest of the children to have no contact with mother during the Family Bridges program unless the parties otherwise agreed or by further order of the court. “Contact” was defined to include telephone calls, text messages, letters and all forms of digital contact or correspondence. Judge Ellis ordered that once the Family Bridges program was completed, B.R. and D.R. “will be able to move back with mother and the prior custody order will be reimplemented subject to any further order of the court.” This appeal followed. We granted mother’s writ of supersedeas, staying the order pending resolution of this appeal.

DISCUSSION

1. Applicable Law

12.7 6
The overarching concern of California’s child custody and visitation law is the best interest of the child. (Montenegro v. Diaz (2001) 26 Cal.4th 249, 255 (Montenegro).) Where, as here, there is a final custody determination in place, a postjudgment request to modify custody requires the moving party to demonstrate not just the best interest of the child but changed circumstances. (Id. at p. 256.) “Under the so-called changed circumstance rule, a party seeking to modify a permanent custody order can do so only if he or she demonstrates a significant change of circumstances justifying a modification.” (Ibid., italics added.) Once a final custody determination has been made, “the paramount need for continuity and stability in custody arrangements—and the harm that may result from disruption of established patterns of care and emotional bonds with the
7 primary caretaker—weigh heavily in favor of maintaining ongoing custody arrangements.” (In re Marriage of Burgess (1996) 13 Cal.4th 25, 32–33.) The changed circumstances rule “ ‘fosters the dual goals of judicial economy and protecting stable custody arrangements.’ ” (Montenegro, supra, 26 Cal.4th at
p. 256; accord, In re Marriage of Brown & Yana (2006) 37 Cal.4th 947, 955–956 & In re Marriage of McKean (2019) 41 Cal.App.5th 1083, 1089.)
Unlike postjudgment modifications of custody orders, postjudgment modifications of visitation and the parenting plan are governed by the statutory best interest of the child test, and the changed circumstance rule does not apply. (In re Marriage of Lucio (2008) 161 Cal.App.4th 1068, 1077; accord, In re Marriage of Furie (2017) 16 Cal.App.5th 816, 827 [the appropriate standard for ordering a modification in parenting authority that does not rise to the level of a change in custody is the best interests test].) Relevant factors for the court to consider in determining the best interest of the child include the health, safety and welfare of the child, any history of physical or substance abuse by either parent, and the nature and amount of contact with each parent. (Fam. Code, § 3011, subd. (a).)
We review custody and visitation orders under the deferential abuse of discretion test. (Montenegro, supra,
26 Cal.4th at p. 255; accord, In re Marriage of Burgess, supra, 13 Cal.4th at p. 32 & Chalmers v. Hirschkop (2013)
213 Cal.App.4th 289, 299.) The “precise measure” of whether the family court abused its discretion is whether the court “could have reasonably concluded that the order in question advanced the ‘best interest’ of the child.” (In re Marriage of Burgess, at p. 32.) To the extent mother’s appeal challenges the trial court’s 8 factual findings, our review is governed by the substantial evidence test. (Chalmers, at p. 300.)

2. The Family Court Abused Its Discretion in Ordering

12.8 7
the Children to Participate in the Family Bridges Program with Father.

Mother contends Judge Ellis erred by failing to apply the changed circumstance rule. She says father did not show a significant change in circumstances that warranted B.R. and D.R. being removed from her custody to participate in the Family Bridges program, and the court abused its discretion by granting father’s modification request without requiring such a showing. She also claims the court abused its discretion in denying her request to present testimony at the hearing, and that the record does not contain substantial evidence demonstrating the modification was in the children’s best interest.

Father argues Judge Ellis, in ordering the Family Bridges program in December 2021, was merely implementing Judge Gould-Saltman’s order of August 17, 2021. He contends we should affirm Judge Ellis’s order but also says that given the passage of time, we should remand for further proceedings to allow the family court the opportunity to reconsider what type of program is in the best interests of the children at this time.

The practical effect of the December 2021 modification order was to remove B.R. and D.R. from mother’s custody for at least 90 days. The order concedes as much by concluding with the language that after completion of the Family Bridges program “the prior custody order will be reimplemented subject to any further order of the court.” Judge Ellis ordered this modification without any evidence of changed circumstances.
9 Nothing in the record supports the court’s finding that this significant disruption to the children’s established living arrangement with mother was in their best interest. The order requires the children, for a minimum period of three months, to be moved out of their home and either moved across the country to Los Angeles if the Family Bridges program can be completed during a school break, or moved into a new home in New York with father until the program can be completed there during the school year. The children would not be allowed any contact with mother during this disruptive period.

The order was based on the incorrect assumption that Judge Gould-Saltman had already ordered the children to participate in the Family Bridges program. Judge Gould- Saltman’s order did not direct the children to participate in Family Bridges, or in any other program that might last more than one week. The order granted father one week of vacation time with the children in Los Angeles during their summer break, and also permitted father to enroll himself and the children in “a week-long program such as Family Bridges or Turning Point.” In the event father chose to enroll himself and the children in a conjoint therapy program in Los Angeles, the court ordered that he was entitled to have “the children during the week-long program” in addition to his one week of summer vacation with the children. (Italics added.) The fact Judge Gould-Saltman was apparently under the mistaken impression the Family Bridges program was one of the therapy programs that could be completed in one week underscores the fact that all of the details related to Family Bridges had not been fleshed out and resolved by Judge Gould12.9
8 10
Saltman, let alone the factual issues related to removing the children from mother’s custody for a minimum of 90 days.

In denying mother’s request for an evidentiary hearing, Judge Ellis prevented mother from offering evidence relevant to the propriety of ordering the children to participate in a 90-day Family Bridges program during which they would be deprived of all contact with mother. The court’s finding that good cause supported the denial of an evidentiary hearing because Judge Gould-Saltman had already resolved the substantive issues regarding the Family Bridges program is not supported by the record as we already explained above.

Without evidence that it is in the best interest of the children to remove them from mother’s custody for a period of at least 90 days in order to participate in the Family Bridges program, the court abused its discretion in issuing its order of December 22, 2021. (In re Marriage of Burgess, supra, 13 Cal.4th at p. 32.)
We deny mother’s requests to take judicial notice of records related to father’s 2020 felony conviction for a violation of Penal Code section 245, subdivision (a)(1) as the records are not relevant to our decision.

DISPOSITION
The order of December 22, 2021 ordering the children to participate in the Family Bridges program is reversed. Plaintiff and appellant is awarded costs on appeal.

GRIMES, J.

STRATTON, P. J. VIRAMONTES, J.

WE CONCUR:
11 Filed 3/1/23

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT

DIVISION EIGHT

KERRY ANN JOHNSTON- ROSSI,
Plaintiff and Appellant, v.

PAUL ROSSI,
Defendant and Respondent.

B318522

12.10 9
(Los Angeles County Super. Ct. No. BD542090)

ORDER CERTIFYING OPINION

FOR PUBLICATION
[No change in judgment]
THE COURT:

The opinion in the above-entitled matter filed on
January 30, 2023, was not certified for publication in the Official Reports. For good cause, it now appears that the opinion should be published in the Official Reports and it is so ordered.

There is no change in the judgment.
____________________________________________________________ STRATTON, P. J. GRIMES, J. VIRAMONTES, J.

12.11 City Council

AGENDA REPORT
DATE: 05/10/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Finance
SUBJECT: Award Contract for eProcurement Solution (FN)
RECOMMENDATION: Motion to:
1) Amend the existing software services agreement, in a form to be approved by the City Attorney, with OpenGov (San Jose, California) to include the purchase of an integrated webbased electronic procurement (eProcurement) and contract management platform for a 3-year term, along with related business process, implementation and support services from June 1, 2023, through May 30, 2026; and,
2) Authorize the City Manager to execute the agreement and any amendments within the approved operating budget.

BACKGROUND: The procurement and contracting process is a highly technical one, from Requests for Proposals/Qualifications, to bid evaluation, contract negotiation, approval, and management. It is critical to the City’s ability to provide services to its citizens that these actions are done efficiently, transparently, and in line with all applicable laws. It is also important that this process is standardized, while also being able to quickly adapt to the evolving needs of the City.

Modern procurement practices leverage available technology to build these resilient systems, and require online tools that enable a broader pool of available vendors, access to up-to-date bidding and contracting terms, enhanced communications throughout the entire process, central database management of records and tracking of contracts once executed. The OpenGov, Inc. software meets these criteria and is capable of modernizing the City’s procurement process.

DISCUSSION: In a decentralized procurement environment such as the City of Santa Cruz, the OpenGov procurement software provides a number of additional features over its competitors that will assist staff with creating highly effective solicitations, which will help identify the “best value” for the particular good or service and maximize the value for the City’s expenditures. For example, the OpenGov procurement software contains logic within its programming that guides end users with best practices for appropriate solicitation methods, contains a database of solicitations and similar scopes of work that other municipalities have successfully completed, and contains a network of professionals that are available to the City for solicitation advice.

13.1 The web-based solution allows the City to continue to use an intuitive, efficient, and easy-to-use procurement process that includes online self-service and collaboration features that simplify planning, soliciting, evaluating, and awarding contracts, and enables the City to broadcast solicitations to a wider, and more relevant set of vendors.

Section 3.08.170 of the Municipal Ordinance allows the City to utilize cooperative purchasing agreements when is in the best interest of the City to do so. A cooperative purchasing agreement results from a formal procurement process, compliant with state statutes and formal procurement methods, and completed by a consortium or a single agency that is authorized for use by other municipalities and government agencies. The use of a cooperative purchasing agreement results in cost savings of time, money and finance department resources for the City. The County of Sacramento conducted a request for proposals dated December 4, 2020, and awarded the procurement system bid to OpenGov, Inc. on May 6, 2021 as the most responsive and costeffective proposal.

FISCAL IMPACT: The total amendment amount of $126,687 consists of a one-time implementation and training cost of $22,790, and total maintenance costs of $103,897 for services from July 1, 2023 through June 30, 2026. Staff is requesting approval for a 3-year commitment to realize a cost savings to the City. There are adequate funds in the Finance Department’s FY 2023 operating budget for this purchase.

Prepared By:

Elizabeth Millwee
Purchasing Manager
Submitted By:

Elizabeth Cabell
Finance Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. OPENGOV PROCUREMENT AGREEMENT.PDF

13.2 OpenGov Inc.
6525 Crown Blvd #41340
San Jose, CA 95160
United States
https://opengov.com | 1
Order Number:

Created On:

Quote Expiration Date:

Subscription Start Date:

Subscription End Date:

Q009570
April 25, 2023
0D\, 2023
June 01, 2023
May 31, 2026
Prepared By:

Email:

Contract Term:

Alex Martinez
[email protected]
36 Months
Customer Information
Customer:

Bill To/Ship To:

City of Santa Cruz, CA
809 Center St
Santa Cruz, CA US
Contact Name:

Email:

Phone:

Elizabeth Millwee
[email protected]
831-420-5084
Order Details
Billing Frequency: Annual Payment Terms: Net 30
SOFTWARE SERVICES:

Product / Service Interval Start Date Interval End Date Interval Fee OpenGov Procurement June 01, 2023 May 31, 2024 $32,957.0 OpenGov Procurement June 01, 2024 May 31, 2025 $34,605.00 OpenGov Procurement June 01, 2025 May 31, 2026 $36,335.0 Total Amount 6HH%LOOLQJ7DEOH
PROFESSIONAL SERVICES:

Product / Service Start Date Total Amount
Professional Services Deployment - Prepaid June 01, 2023 $22,790.00 Services Total Amount $22,790.00
Order Form Legal Terms
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´2SHQ*RYµ
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'DWH7KLV2UGHU)RUPLQFOXGHVDQGLQFRUSRUDWHVWKH2SHQ*RY6RIWZDUH6HUYLFHV$JUHHPHQWVLJQHGEHWZHHQWKHSDUWLHVHIIHFWLYH2FWREHU DVDPHQGHG
´66$µ
DQGWKHDSSOLFDEOH6WDWHPHQWRI:RUN
´62:µ
LQFRUSRUDWHGKHUHLQLQWKHHYHQW3URIHVVLRQDO6HUYLFHVDUHSXUFKDVHG 7KH2UGHU)RUP66$DQG62:VKDOOKHUHDIWHUEHUHIHUUHGWRDVWKH´$JUHHPHQWµ8QOHVVRWKHUZLVHVSHFLILHGDERYHIHHVIRUWKH6RIWZDUH 6HUYLFHVDQG3URIHVVLRQDO6HUYLFHVVKDOOEHGXHDQGSD\DEOHLQDGYDQFHRQWKH(IIHFWLYH'DWH%\VLJQLQJWKLV$JUHHPHQW&XVWRPHU DFNQRZOHGJHVWKDWLWKDVUHYLHZHGDQGDJUHHVWREHOHJDOO\ERXQGE\WKH2SHQ*RY6RIWZDUH6HUYLFHV$JUHHPHQW(DFKSDUW\·VDFFHSWDQFHRIWKLV $JUHHPHQWLVFRQGLWLRQDOXSRQWKHRWKHU·VDFFHSWDQFHRIWKHWHUPVLQWKH$JUHHPHQWWRWKHH[FOXVLRQRIDOORWKHUWHUPV City of Santa Cruz, CA
Signature: \s1\
OpenGov, Inc.

Signature: \s2\
Name: \n1\
Title: \t1\
Sign Date: \d1\
Name: \n2\
Title: \t2\
Countersign Date: \d2\
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 %LOOLQJ$PRXQW

 
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13.3 Statement of Work
City of Santa Cruz, CA
Creation Date: 4/20/2023
Document Number: PS-04048
Version Number: 1
Created by: Sidney Barnes
2023 Statement of Work v1.1
1 





 









13.4 Table of Contents

1. Overview and Approach 3

1.1. Agreement 3

2. Statement of Work 3

2.1. Project Scope 3

2.2. Facilities and Hours of Coverage 4

2.3. Key Assumptions 4

2.4. OpenGov Responsibilities 4

2.4.1. Activity 1 – Project Management 4

2.4.2. Activity 2 – Initialization 5

2.4.3. Activity 3 – OpenGov Use Cases 5

2.4.4. Activity 4 – Training 6

2.5. Your Responsibilities 6

2.5.1. Your Project Manager 7

2.6. Completion Criteria 7

2.7. Estimated Schedule 7

2.8. Illustrative Project Timelines 8

2.9. Charges 8

2.10. Offer Expiration Date 8
Appendix A: Engagement Charter 9
A-1: Communication and Escalation Procedure 9
A-2: Change Order Process 9
A-3: Deliverable Materials Acceptance Procedure 10
Appendix B: Implementation Activities 11
B-1: OpenGov Procurement Suite 11
Appendix C: Technical Requirements 16
C-1: OpenGov Procurement Suite 16
2023 Statement of Work v1.1
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13.5 1. Overview and Approach

1.1. Agreement
This Statement of Work (“SOW”) identifies services that OpenGov, Inc. (“OpenGov” or “we”) will perform for City of Santa Cruz, CA (“Customer” or “you”) pursuant to that order for Professional Services entered into between OpenGov and the Customer (“Order Form”) which references the Software Services Agreement or other applicable agreement entered into by the parties (the “Agreement”).
● Customer acknowledges and agrees that this Statement of Work is subject to the confidentiality obligations set forth in the Software Services Agreement between OpenGov and Customer.
● The Deliverabled listed in Appendix B are the single source of the truth of the deliverables to be provided.
● Customer’s use of the Professional Services is governed by the Agreement and not this SOW.
● Upon execution of the Order Form or other documentation referencing the SOW, this SOW shall be incorporated by reference into the Agreement.
● In the event of any inconsistency or conflict between the terms and conditions of this SOW and the Agreement, the terms and conditions of this SOW shall govern with respect to the subject matter of this SOW only. Unless otherwise defined herein, capitalized terms used in this SOW shall have the meaning defined in the Agreement. ● This SOW may not be modified or amended except in a written agreement signed by a duly authorized representative of each party.
● OpenGov will be deployed as is, Customer has access to all functionality available in the current release.

2. Statement of Work
This SOW is limited to the Implementation of the OpenGov Procurement suite as defined in the OpenGov Responsibilities section of this document (Section 2.4). Any additional services or support will be considered out of scope.

2.1. Project Scope
Under this project, OpenGov will deliver cloud based Procurement solutions to help the Customer power a more effective and accountable government. OpenGov's estimated charges and schedule are based on performance of the activities listed in the “OpenGov Responsibilities” section below. Deviations that arise during the project will be managed through the procedure described in Appendix A-2: Project Change Control Procedure, and may result in adjustments to the Project Scope, Estimated Schedule, Charges and other terms. These adjustments may include charges on a time-and-materials or fixed-fee basis using OpenGov’s standard rates in effect from time to time for any resulting additional work or waiting time.
2023 Statement of Work v1.1
3 





 









13.6 2.2. Facilities and Hours of Coverage
OpenGov will:

A. Perform the work under this SOW remotely, except for any project-related activity which OpenGov determines would be best performed at your facility in Santa Cruz, CA in order to complete its responsibilities under this SOW.

B. Provide the Services under this SOW during normal business hours, 8:30am to 6:00pm local time, Monday through Friday, except holidays.

C. Use personnel and resources located across the United States, and may also include OpenGov-trained staŨng contractors to support the delivery of services.

2.3. Key Assumptions
The SOW and OpenGov estimates are based on the following key assumptions. Deviations that arise during the proposed project will be managed through the Project Change Control Procedure (see Appendix A-2) , and may result in adjustments to the Project Scope, Estimated Schedule, Charges, and other terms.

Per
A. The OpenGov Suites are not customized beyond current capacities based on the latest release of the software.

B. Individual software modules are configured based on discussions between OpenGov and Customer.

C. Procurement Suite
i. Customer will provide complete and correct boilerplate language for solicitation and contract templates within two (2) weeks immediately following the kick-off meeting.
ii. OpenGov template configuration will include up to two (2) solicitation templates and up to three (3) contract templates (See Appendix B for list). iii. Customer will provide a complete and accurate contracts log and vendor list for import to OpenGov.

2.4. OpenGov Responsibilities

2.4.1. Activity 1 – Project Management
OpenGov will provide project management for the OpenGov responsibilities in this SOW.

The purpose of this activity is to provide direction to the OpenGov project personnel and to provide a framework for project planning, communications, reporting, procedural and contractual activity. This activity is composed of the following tasks:

Planning
OpenGov will:

A. review the SOW, contract and project plan with Customer’s Project Manager and key stakeholders to ensure alignment and agreed upon timelines; B. maintain project communications through your Project Manager; C. establish documentation and procedural standards for deliverable Materials; and 2023 Statement of Work v1.1
4 





 









13.7 D. assist your Project Manager to prepare and maintain the project plan for the performance of this SOW which will include the activities, tasks, assignments, and project milestones.

Project Tracking and Reporting
OpenGov will:

A. review project tasks, schedules, and resources and make changes or additions, as appropriate. Measure and evaluate progress against the project plan with your Project Manager;
B. work with your Project Manager to address and resolve deviations from the project plan;
C. conduct regularly scheduled project status meetings; and D. administer the Project Change Control Procedure with your Project Manager.

Completion Criteria:

This is an on-going activity which will be considered complete at the end of the Services Deliverable Materials:
● Weekly status reports
● Project plan
● Project Charter
● Risk, Action, Issues and Decisions Register (RAID)

2.4.2. Activity 2 – Initialization
OpenGov will provide the following:

A. Customer Entity configuration
B. System Administrators creation
C. Solution Blueprint creation
D. Data Validation strategy confirmation
Completion Criteria:

This activity will be considered complete when:
● Customer Entity is created
● System Administrators have access to Customer Entity
● Solution Blueprint is presented to Customer
Deliverable Materials:
● Solution Blueprint
● Sign-off of Initial Draft Solution Blueprint

2.4.3. Activity 3 – OpenGov Use Cases
OpenGov will provide the following:
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13.8 Procurement Use Cases
A. Automate Solicitation Development
B. Enhance Supplier Engagement and Collaboratively Evaluate + Award C. Make Contract Management Centralized and Proactive
Completion Criteria:

This activity will be considered complete when:

Procurement Use Cases
● Vendor Portal is configured
● Vendor List is imported
● Solicitation Templates are configured
● Intake Request Template and Workflow are configured
● Contracts Log is imported
● Contract Templates are configured
Deliverable Materials:
● Formal sign off document

2.4.4. Activity 4 – Training
Training will be provided in instructor-led virtual sessions or through OpenGov University Training courses. For any instructor-led virtual sessions, the class size is recommended to be 10, for class sizes larger than 10 it may be necessary to have more than one instructor.

Completion Criteria:
● Administrator training is provided
● Agency-wide intake training is provided
Deliverable Materials:
● Formal sign off document

2.5. Your Responsibilities
The completion of the proposed scope of work depends on the full commitment and participation of your management and personnel. The responsibilities listed in this section are in addition to those responsibilities specified in the Agreement and are to be provided at no charge to OpenGov. OpenGov's performance is predicated upon the following responsibilities being managed and fulfilled by you. Delays in performance of these responsibilities may result in delay of the completion of the project and will be handled in accordance with Appendix A-1: Project Change Control Procedure. 2023 Statement of Work v1.1
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13.9 2.5.1. Your Project Manager
Prior to the start of this project, you will designate a person called your Project Manager who will be the focal point for OpenGov communications relative to this project and will have the authority to act on behalf of you in all matters regarding this project.

Your Project Manager's responsibilities include the following:

A. manage your personnel and responsibilities for this project (for example: ensure personnel complete any self-paced training sessions, configuration, validation or user acceptance testing);
B. serve as the interface between OpenGov and all your departments participating in the project;
C. administer the Project Change Control Procedure with the Project Manager; D. participate in project status meetings;
E. obtain and provide information, data, and decisions within five (5) business days of OpenGov’s request unless you and OpenGov agree in writing to a different response time;
F. resolve deviations from the estimated schedule, which may be caused by you; G. help resolve project issues and escalate issues within your organization, as necessary; and
H. create, with OpenGov’s assistance, the project plan for the performance of this SOW which will include the activities, tasks, assignments, milestones and estimates.

2.6. Completion Criteria
OpenGov will have fulfilled its obligations under this SOW when any of the following first occurs:

A. OpenGov accomplishes the activities set forth in “OpenGov responsibilities” section and delivers the Materials listed, if any; or
B. The End date is reached

2.7. Estimated Schedule
OpenGov will schedule resources for this project upon signature of the order form. Unless specifically noted, the OpenGov assigned project manager will work with Customer Project Manager to develop the project schedule for all requested deliverables under this SOW.

OpenGov reserves the right to adjust the schedule based on the availability of OpenGov resources and/or Customer resources, and the timeliness of deliverables provided by the Customer.
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13.10 The Services are currently estimated to start within two (2) weeks but no later than four (4) weeks from signatures and have an estimated end date of September 30, 2023 (“End Date”) or on other dates mutually agreed to between you and OpenGov.

2.8. Illustrative Project Timelines
The typical project timelines are for illustrative purposes only and may not reflect your use cases.

2.9. Charges
The Services will be conducted on a Fixed Price basis. The fixed price is exclusive of any travel and living expenses and other reasonable expenses incurred in connection with the Services. All charges are exclusive of any applicable taxes.

Customer shall reimburse OpenGov for reasonable out-of-pocket expenses OpenGov incurs providing Professional Services. Reasonable expenses include, but are not limited to, travel, lodging, and meals. Expenses are billed based on actual costs incurred. OpenGov shall not exceed the estimated $5,000 expenses without written approval from the Customer.

2.10. Offer Expiration Date
This offer will expire on July 20, 2023 unless extended by OpenGov in writing. 2023 Statement of Work v1.1
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13.11 Appendix A: Engagement Charter
A-1: Communication and Escalation Procedure
Active engagement throughout the implementation process is the foundation of a successful deployment. To help assess progress, address questions, and minimize risk during the course of deployment both parties agree to the following:
● Regular communication aligned to the agreed upon project plan and timing. ○ OpenGov expects our customers to raise questions or concerns as soon as they arise. OpenGov will do the same, in order to be able to address items when known. ● Executive involvement
○ Executives may be called upon to clarify expectations and/or resolve confusion. ○ Executives may be needed to steer strategic items to maximize the value through the deployment.
● Escalation Process:
○ OpenGov and Customer agree to raise concerns and follow the escalation process, resource responsibility, and documentation in the event an escalation is needed to support issues raised
● Identification of an issue impeding deployment progress, outcome or capturing the value proposition, that is not acceptable. ● Customer or OpenGov Project Manager summarizes the problem statement and impasse.
● Customer and OpenGov Project Managers jointly will outline solution, acceptance or schedule Executive review.
● Resolution will be documented and signed off following Executive review. ● Phase Sign-Off
○ OpenGov requests sign-offs at various stages during the implementation of the project. Once the Customer has signed-off, any additional changes requested by Customer on that stage will require a paid change order for additional hours for OpenGov to complete the requested changes.

A-2: Change Order Process
This SOW and related efforts are based on the information provided and gathered by OpenGov.

Customers acknowledge that changes to the scope may require additional effort or time, resulting in additional cost. Any change to scope must be agreed to in writing or email, by both Customer and OpenGov, and documented as such via a:
● Change Order - Work that is added to or deleted from the original scope of this SOW.

Depending on the magnitude of the change, it may or may not alter the original contract amount or completion date and be paid for by Customer. Changes might include:
o Timeline for completion
o Sign off process
o Cost of change and Invoice timing
o Amending the SOW to correct an error.
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13.12 o Extension of work as the complexity identified exceeds what was expected by Customer or OpenGov.
o Change in type of OpenGov resources to support the SOW.

A-3: Deliverable Materials Acceptance Procedure
Deliverable Materials as defined herein will be reviewed and accepted in accordance with the following procedure:
● The deliverable Material will be submitted to your Project Manager. ● Your Project Manager will have decision authority to approve/reject all project Criteria, Phase Acceptance and Engagement Acceptance.
● Within five (5) business days of receipt, your Project Manager will either accept the deliverable Material or provide OpenGov’s Project Manager a written list of requested revisions. If OpenGov receives no response from your Project Manager within five (5) business days, then the deliverable Material will be deemed accepted. The process will repeat for the requested revisions until acceptance.
● All acceptance milestones and associated review periods will be tracked on the project plan.
● Both OpenGov and Customer recognize that failure to complete tasks and respond to open issues may have a negative impact on the project.
● For any tasks not yet complete, OpenGov and/or Customer will provide suŨcient resources to expedite completion of tasks to prevent negatively impacting the project. ● Any conflict arising from the deliverable Materials Acceptance Procedure will be addressed as specified in the Escalation Procedure set forth in Appendix A-1. As set forth in Section

6.1(e) of the Agreement, if there are extended delays (greater than 10 business days) in Customer’s response for requested information or deliverable; OpenGov may opt to put the project on an "On Hold" status. After the Customer has fulfilled its obligations, Professional Services can be resumed and the project will be taken off the "On-Hold" status. ● Putting a project “on Hold” may have several ramifications including, but not restricted, to the following:
○ Professional Services to the customer could be stopped; ○ Delay to any agreed timelines; or
○ Not having the same Professional Services team assigned. 2023 Statement of Work v1.1
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13.13 Appendix B: Implementation Activities
B-1: OpenGov Procurement Suite
Instance Creation
Procurement Suite
Description OpenGov Responsibilities Customer Responsibilities Website Instance
Creation
OpenGov will:
● Build customer portal and
upload Customer’s logo.

Customer will:
● Provide logo.
● Confirm access to the Portal.

Technical Project Review
Description OpenGov Responsibilities Customer Responsibilities Technical Project
Review
OpenGov will:
● Provide up to one (1) two-hour
working session at the
beginning of the project to:
o Finalize list of
templates
o Review technical
requirements
o Provide documentation
on requirements and
processes
OpenGov Assumptions:
● Boilerplate language will be
provided within two (2) weeks
immediately following the
kick-off meeting.

Customer will:
● Identify relevant participants
for attendance.
● Confirm deliverables.
● Gather and provide relevant
data for the project.

Supplier Engagement, Evaluation and Award Configuration Description OpenGov Responsibilities Customer Responsibilities Vendor Portal OpenGov will: Customer will:
● Allocate resources to create
the Vendor Portal.
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13.14 ● Provide the Customer with
iframe code and documentation
to create the Vendor Portal.
● Import the list of vendors
provided by Customer.

OpenGov Assumptions:
● Customer will provide a
complete and accurate vendor
list for import to OpenGov.

OpenGov clean up/correction of
imported files are not included
in the scope of this project.
● Provide vendor email list and
send vendor email/letter.
● Ensure that Vendor Portal
will be active before
OpenGov begins
configuration of templates
or the Solicitation
Development phase.

Generic Template OpenGov will:
● Deploy generic templates
● Provide OpenGov's “Paper to
Paperless Language Transition
Guide” to assist transition from
paper to electronic.

Customer will:
● Provide a copy of the next
solicitation document.
● Provide information to
complete the generic
solicitation upload template
including forms and an
example recent solicitation.
● Provide the category code
set used by the agency
(NIGP, NAICS, or UNSPSC).

Solicitation Development Configuration
Description OpenGov Responsibilities Customer Responsibilities Solicitation
Development
Solution
OpenGov will:
● Review and confirm the
Solicitation Templates and
forms provided by Customer.
● Work with Customer to design
and get sign off on the first
template.
● Following the sign off of the
first template, configure the
remaining templates in the
system.

OpenGov Assumptions:

Customer will:
● Provide templates with
standard boilerplate
language.
● Provide forms associated
with solicitation templates.
● Provide admin documents.
● Select the first solicitation
type (usually ITB or RFP), to
work with OpenGov for the
design
● Sign off on the first
template before beginning
the subsequent templates.
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13.15 ● OpenGov will configure up to
two (2) Solicitation
Template(s) with standard
boilerplate language:
○ RFP
○ IFB
● Validate and provide signoff
on Solicitation Templates.

Intake Configuration
Description OpenGov Responsibilities Customer Responsibilities Intake Process OpenGov will:
● Review current intake
Process.
● Perform basic intake
Training.
● Perform a gap analysis
● Configure “Review/
Approval” workflow
defaults for each
department.
● Build the Intake/Project
Request Template.

Customer will:
● Provide OpenGov with any
Intake/Project RequestForms
(templates) in current use.
● Validate and provide signoff on
Intake/ Project Request
template.

Contract Management Configuration
Description OpenGov Responsibilities Customer Responsibilities Create and Manage
Contracts
OpenGov will:
● Provide one (1) - one hour
Overview of the Contract
Management Solution to
Customer’s System
Administrator(s).
● Provide guidance and
instruction to System
Administrator on creating
and managing contracts.

Customer will:
● Attend scheduled System
Overview
● Create and manage contract
records in the system with
guidance from OpenGov.

Historical and/or
Active Contracts
OpenGov will:
● Provide a mapping
document for the metadata
of contracts to be uploaded
into the system.

Customer will
● Provide contract log per the
mapping document.
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13.16 ● Import the contract
records listed in the
contract log.

OpenGov Assumptions:
● Customer will provide a
complete and accurate
contracts log for import to
OpenGov. OpenGov clean
up/correction of imported
logs are not included in the
scope of this project.

Contract Template
Deployment
OpenGov will:
● Review & configure agreed
upon contract templates.

OpenGov Assumptions:
● OpenGov will configure up
to three (3) Contract
Template(s) with standard
boilerplate language:
○ Contract for
Services
○ Amendment for
Professional
Services
○ Professional
Services
Agreement
Customer will:
● Provide templates with
standard boilerplate language.
● Validate and provide signoff on
Contract templates.

Admin Documents and Checklist Configuration
Description OpenGov Responsibilities Customer Responsibilities Admin Documents OpenGov will:
● Review & configure up to
five (5) Admin Documents
within the four standard
types.

Customer will:
● Provide Admin Documents.

Working Sessions and Trainings
Description OpenGov Responsibilities Customer Responsibilities 2023 Statement of Work v1.1
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13.17 Procurement
Working Sessions
OpenGov will:
● Assign practice exercises
to Customer to gain
familiarization.
● Assist Customer during
first real-life solicitation
posting, and opening (if
during deployment).
● Respond to questions
regarding configured
system functionality.

Customer will:
● Complete practice exercises
to gain familiarization.
● Identify internal Admin Users
& security permissions for all
other users.

OpenGov University OpenGov will:
● Provide access to OpenGov
University online training
courses intended to teach
users on the basics of
OpenGov.

Customer will:
● Review training courses.

Procurement
Training
OpenGov will:
● Provide training on system
functionality. Topics
include:
○ Creating Bids with
Generic Templates
○ Live Bid
Management &
Vendor Experience
○ Evaluation and
Awarding
○ Writing
Solicitations using
templates
○ Contract Document
Developer Tools
○ Intake Training and
Workflow
Customer will:
● Attend training sessions as
scheduled by the Project
Manager and agreed to in the
Project Plan.
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13.18 Appendix C: Technical Requirements
C-1: OpenGov Procurement Suite
Procurement Suite
Description Technical Requirements
Logo ● .png or .jpg file
● At least 300KB but not larger than 500KB
Vendor List ● Single Flat file
● .csv or .xlsx format
Historical/Active
Contracts
● Single Flat file
● .csv or .xlsx format
Sample Documents
or Templates with
boilerplate
language
● PDF or Word format
Intake/Project
Request Templates
● PDF or Word format
Admin Documents ● PDF or Word format
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13.19 City Council

AGENDA REPORT
DATE: 05/15/2023
AGENDA OF: 05/23/2023
DEPARTMENT: Human Resources
SUBJECT: Resolution Approving the Tentative Agreement and Adopting the Memorandum of Understanding with Temporary Service Employees SEIU Local 521 (HR)
RECOMMENDATION: Resolution approving the Tentative Agreement and adopting the Memorandum of Understanding with Temporary Service Employees SEIU Local 521.

BACKGROUND: The Memorandum of Understanding (MOU) with the Temporary Service Employees SEIU Local 521(Union) expired on June 10, 2022. The Union and the City have been meeting since November of 2022, and, as a result, a tentative agreement on a successor MOU has been reached.

DISCUSSION: In accordance with the Meyers-Milias-Brown Act (MMBA) each Union’s MOU must be formally adopted by the City Council in a separate action. This is a routine action, and no changes may be made to the MOU unless otherwise agreed upon by the City and the Union.

The Temporary Service Employees SEIU Local 521 ratified the terms of the new contract, and the representatives for the bargaining group notified the City that the vote on the Tentative Agreement had passed. The terms of the Tentative Agreement between the parties have been incorporated into the successor MOU and staff is now bringing the Tentative Agreement and the MOU before the City Council for adoption.

The new MOU includes the following: three-year term, with the following cost-of-living adjustments (COLA): a 4% COLA in year one; 3% COLA in year two; and a 5% COLA in year three. In addition, the agreement includes a one-time payment of .87 cents per hour for each actual hour the temporary employee worked between and including January 1, 2022 and December 31, 2022. Other monetary agreements to be effective in the new MOU include:

Holiday Premium Pay equal to 1.5 times the employee’s base salary for actual hours worked on recognized holidays listed in the MOU; an increase of the Marine Rescue Stipend from $50 to $125 for a twenty-four (24) hour assignment; and provision of safety boots/shoes for classifications that require wearing them.

14.1 FISCAL IMPACT: The total annual estimated fiscal impact (General Fund and enterprise funds) for major MOU components are as follows:

Holiday Premium
Pay

1.5 times actual hours worked on fixed holidays ~$20,000 Safety Boots Safety boot stipend for same classifications as SEIU regular @ $250
~$11,000
Marine Rescue
Stipend
Increase on-call 24-hour status from $50 for an
assignment to $125
~$25,000
Per Year Additional Cost: ~$56,000
Prepared By:

Debbie Jones
Principal HR Analyst
Submitted By:

Sara De Leon
Chief People Officer
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

2. TENTATIVE AGREEMENT.DOCX

3. TEMPORARY SERVICE EMPLOYEES SEIU LOCAL 521 MEMORANDUM OF UNDERSTANDING.PDF

14.2 RESOLUTION NO. NS-XX,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ APPROVING

THE TENTATIVE AGREEMENT AND MEMORANDUM OF UNDERSTANDING

BETWEEN THE CITY OF SANTA CRUZ AND THE TEMPORARY SERVICE EMPLOYEES SEIU LOCAL 521
WHEREAS, the staff has prepared the Tentative Agreement within City Council approved negotiation parameters between the City and the Temporary Service Employees SEIU Local 521; and;
WHEREAS, staff has prepared the updated Memorandum of Understanding (MOU) document with the Temporary Service Employees SEIU Local 521 union; and WHEREAS, it is the obligation of the City Council to approve the MOU at a City Council meeting.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz,that the City Council hereby approves the Memorandum of Understanding with the Temporary Service Employees SEIU Local 521.

PASSED AND ADOPTED this 23rd day of May, 2023, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ______________________________
Fred Keeley, Mayor
ATTEST: _________________________________
Bonnie Bush, City Clerk Administrator

14.3 TOTAL TENTATIVE AGREEMENT
City of Santa Cruz
and
SEIU Local #521 Temporary Service Employees

FOR SUCCESSOR MOU
IN ACCORDANCE WITH GROUND RULE 8
May 23, 2023
Item Proposal MOU Section
Term The City proposes a three (3) year
Term : 04/01/23 through 12/05/2025 Section 2.00
COLA

The City proposes to provide a 4.0%
COLA effective the pay period
beginning April 15, 2023.

Effective the pay period beginning
March 2, 2024, SEIU members will
receive a 3.0% COLA.

Effective the pay period beginning
March 1, 2025, the SEIU members will
receive a 5.0% COLA.

Section 10.00
One Time Signing
Bonus
Effective May 13, 2023, or the first pay
period in which Council approves an
MOU in open session, whichever is
later, bargaining unit employees who
have worked a minimum of 300 actual
hours between and including January 1,
2022 and December 31, 2022 will
receive a one-time signing bonus of .87
cents per hour for each actual hour they
worked within that time frame.

Section 10.00
Holiday Premium Pay The City shall provide a payment of one and a half (1.5) times the base hourly
rate for actual hours worked on fixed
holidays.

Temporary employees will not be
eligible for paid time off for a holiday
unless provided for under another
section of the MOU.

The following holidays are recognized
as Fixed Holidays:

Section 10.10 (New)

14.4 New Year’s Day
Martin Luther King’s Birthday
President’s Day
Memorial Day
Juneteenth
Independence Day
Labor Day
Veteran’s Day
Thanksgiving Day
Friday after Thanksgiving
Christmas Day
Two (Four (4) Hour Holidays)
The last four (4) hours of the work shift
are Holiday hours for Christmas Eve (if
Christmas Day is on a Tuesday–
Saturday)
The last four (4) hours of the work shift
are Holiday hours for New Year’s Eve (if
New Year’s Day is on a Tuesday–
Saturday)
Except as provided for in Christmas
Eve and New Year’s Eve, when a
holiday falls on Sunday, the following
Monday shall be observed. When a
holiday falls on Saturday, the
preceding Friday shall be observed.

The City shall recognize all other days
appointed by the President of the
United States or the Governor of the
State of California as a nationwide or
statewide public holiday provided
specific prior approval is received from
the City Council.

Safety Boots The City shall provide safety
boots/shoes for employees in the
classifications that require wearing
them as shown in Exhibit D. The City
may establish administrative
procedures for the selection and
purchase of such boots/shoes. All
eligible employees will be required to
wear safety boots/shoes while on duty
unless granted a medical exemption.

Safety boots/shoes shall not be worn
Section 17.03 (NEW)

14.5 for non-work-related purposes.

Boots/shoes shall be replaced on an
as-needed basis up to the current
annual limit of $250 regardless of actual
hours worked. If feasible, the City will
offer a choice of different styles of
boots/shoes.

Marine Rescue
Stipend
Effective April 15, 2023 or the first day of
the pay period after Council approves an
MOU in open session, which ever is later:

A. Duty personnel shall receive $125 for a
twenty-four (24) hour assignment. B. All
duty hours actually worked during the
period of Duty Assignment and outside the
employee’s regularly scheduled shift shall
be compensated at their regular straighttime pay rate. A minimum of two (2) hours will be paid for callouts of less than two (2)
hours.

Section 10.08.03
Compensation
Area Meetings The City shall provide employees a
maximum of one and on-half (1 ½) hours of
release time tri-annually (three times per
year) to attend area Union general
membership meetings. The one and one
half (1 ½) hours includes travel time to and
from the meeting and cannot result in an
adverse impact on City operations. The
purpose of general membership meetings
shall be to nominate and elect shop
stewards and to provide a forum for Union
communications. In addition, there may be
a maximum of twelve (12) area meetings
annually. Union representatives shall have
access to City facilities during work hours
to conduct such area meetings with
employees. The Union shall notify the
Human Resources Director at least ten (10)
workdays in advance of the date, time, and
location of each area meeting. No more
than two (2) Union officials shall be
provided release time to conduct these
meetings.

Section 7.08
Clean-up language The City will propose non-substantive changes to update MOU.

Various
Withdrawn Proposals The Parties agree that all prior proposals not included in this total Tentative agreement
have been withdrawn.

14.6 _________________________________ ____________________________ Sara De Leon Katy Bradley
Chief People Officer SEIU Local 521 Temporary Employees Chief Negotiator
__________________________________ _____________________________ Date Date
__________________________________ _____________________________ Timothy L Davis Devon King
BSW, Chief Negotiator SEIU Local 521 Temporary Employees Chief Negotiator Association
__________________________________ _____________________________ Date Date

14.7 April 01, 2023 to December 05, 2025

MEMORANDUM OF UNDERSTANDING

CITY OF SANTA CRUZ
AND

CITY OF SANTA CRUZ TEMPORARY SERVICE EMPLOYEES
S.E.I.U. LOCAL 521

14.8 April 01, 2023 to December 05, 2025

MEMORANDUM OF UNDERSTANDING

CITY OF SANTA CRUZ AND CITY OF SANTA CRUZ TEMPORARY

SERVICE EMPLOYEES
S.E.I.U. LOCAL 521
SECTION 1.00 PREAMBLE ................................................................................................... 1 SECTION 2.00 TERM ............................................................................................................. 1 SECTION 3.00 NO ABROGATION OF RIGHTS .................................................................. 1 SECTION 4.00 PAST PRACTICES ........................................................................................ 2 SECTION 5.00 RECOGNITION ............................................................................................. 2 SECTION 6.00 NO DISCRIMINATION ................................................................................ 2 SECTION 7.00 UNION SECURITY AND UNION RIGHTS ................................................ 3

7.01 Payroll Deductions ....................................................................................................... 3

7.02 Memorandum of Understanding - Printing and Distribution ....................................... 4

7.03 Union Notification ........................................................................................................ 4

7.04 Bulletin Boards and Department Mail .......................................................................... 4

7.05 Time Off for Union Officials ........................................................................................ 4

7.05.01 Meet and Confer or Consult Sessions ................................................................... 4

7.05.02 Union Stewards ..................................................................................................... 5

7.05.03 Chief Stewards ...................................................................................................... 5

7.05.04 Union Leave .......................................................................................................... 5

7.06 Access to City Facilities ............................................................................................... 5

7.07 Bargaining Unit Employee Information....................................................................... 6

7.08 Area Meetings............................................................................................................... 6

7.09 C.O.P.E. Deduction ...................................................................................................... 6

7.10 New Employee Orientation……………………………………………………………7
SECTION 8.00 SALARY STEPS, PERSONNEL FILES AND PERFORMANCE EVALUATIONS………………………………………………………………………………….7

8.01 Personnel Files .............................................................................................................. 7

8.01.01 Performance Evaluations....................................................................................... 8

8.01.02 Late Evaluations .................................................................................................... 8

8.02 Salary Step Placement and Advancement within the Range ........................................ 9

8.02.01 Salary Rates Upon Appointment ........................................................................... 9

8.02.02 Advancement within the Salary Range ................................................................. 9 SECTION 9.00 WORK ASSIGNMENTS ............................................................................. 10

9.01 Work Shifts ................................................................................................................. 10

9.02 Lunch Period............................................................................................................... 10

9.03 Rest Periods ................................................................................................................ 10 SECTION 10.00 SALARY....................................................................................................... 10

10.01 Salary upon Return to Temporary Employment ......................................................... 11

10.02 Salary Step When Hired Into a Regular Position ....................................................... 11

10.02.01 Credit Towards One (1) Year Probation When Hired Into a Regular Position .. 11

10.03 EMT Differential ........................................................................................................ 11

14.9 10.04 Bilingual Differential .................................................................................................. 11

10.05 Beach Lifeguard II Duty Officer Stipend…………………………………………...11

10.06 Overpayments and Repayments…………………………………………………….11

10.07 Callback……………………………………………………………………………..12

10.07.01 Callback by Phone or Computer…………………………………………13

10.07.02 Callback to Worksite……………………………………………………..13

10.08 Duty Assignment - Marine Rescue Unit Members…………………………………13

10.08.01 Definition………………………………………………………………...13

10.08.02 Assignment………………………………………………………………13

10.08.03 Compensation……………………………………………………………14

10.09 Duty Assignment - All Other Temporary Service Employees………………………14

10.09.01 Definition………………………………………………………………...14

10.09.02 Assignment………………………………………………………………14

10.09.03 Compensation……………………………………………………………14

10.10 Holiday Premium Pay………………………………………………………………15
SECTION 11.00 SENIORITY ................................................................................................. 16 SECTION 12.00 OVERTIME .................................................................................................. 16 SECTION 13.00 BEREAVEMENT LEAVE ........................................................................... 17

13.01 Jury Duty .................................................................................................................... 17

13.02 Blood Donation........................................................................................................... 17

13.03 Workers’ Compensation ............................................................................................. 17 SECTION 14.00 IN-LIEU PAID TIME ................................................................................... 18 SECTION 15.00 SICK LEAVE ............................................................................................... 18 SECTION 16.00 CAREER ADVANCEMENT ....................................................................... 20

16.01 Job Opening Announcements ..................................................................................... 20

16.02 Training and Cross Training ....................................................................................... 20

16.03 Reimbursement for Licenses and Certificates ............................................................ 20

16.04 Absence for Examination ........................................................................................... 20 SECTION 17.00 SAFETY ....................................................................................................... 21

17.01 Safety Committee ....................................................................................................... 21

17.02 Safety Equipment/Uniforms ....................................................................................... 21

17.03 Safety Boots ................................................................................................................ 21 SECTION 18.00 BENEFITS .................................................................................................... 22

18.01 Health Care Reimbursement ....................................................................................... 22

18.02 Bus Passes................................................................................................................... 22

18.03 CalPERS Long Term Care ......................................................................................... 22

18.04 Medicare ..................................................................................................................... 22

18.05 Alternative Transportation Incentive Program ........................................................... 22 SECTION 19.00 GRIEVANCE PROCEDURE ....................................................................... 22

19.01 Purpose ....................................................................................................................... 22

19.02 Definition .................................................................................................................... 23

19.03 Limitations .................................................................................................................. 23

19.04 Procedures .................................................................................................................. 23

19.04.01 Step I ................................................................................................................ 23

14.10 19.04.02 Step II .............................................................................................................. 23

19.04.03 Step III ............................................................................................................. 24 SECTION 20.00 DISCIPLINE ................................................................................................. 24 SECTION 21.00 WRITTEN REPRIMANDS .......................................................................... 24 SECTION 22.00 LABOR/MANAGEMENT COMMITTEE .................................................. 25 SECTION 23.00 AUTHORIZED AGENTS ............................................................................ 25 SECTION 24.00 RENEGOTIATIONS .................................................................................... 25

24.01 Successor Negotiations ……………………………………………………………...26 SECTION 25.00 SEVERABILITY .......................................................................................... 26

EXHIBIT A
List of Classifications in Temporary Service Employees Bargaining Unit .............................. 27

EXHIBIT B
Santa Cruz City Council Policy 25.2 Discrimination, Harassment, Retaliation, and Respectful Workplace Conduct
policy...…………………………………………………………………………………………. 29

EXHIBIT C
Discrimination/Harassment/Retaliation Policy Implementation and Complaint Procedure …33

EXHIBIT D
Safety Boots …………………………………………………………………………...……37

14.11 1
April 01, 2023 to December 05, 2025

MEMORANDUM OF UNDERSTANDING

CITY OF SANTA CRUZ AND CITY OF
SANTA CRUZ TEMPORARY SERVICE EMPLOYEES, S.E.I.U., LOCAL 521 SECTION 1.00 PREAMBLE
This Memorandum of Understanding between the City of Santa Cruz (hereinafter referred to as the City) and the City of Santa Cruz Temporary Service Employees, Service Employees' International Union, SEIU Local 521, (hereinafter referred to as the Union), represents the agreement between the parties related to temporary employees, and is binding under Section 3505.1 of the Government Code.

The City and the Union have met and conferred in good faith and have arrived at an understanding concerning wages, hours, working conditions, and other terms of employment.

The City and the Union recognize their obligation to provide services of the highest quality and efficiency to the community.

The City and the Union affirm the principal that harmonious labor-management relations are to be promoted and furthered.

SECTION 2.00 TERM
The term of this agreement shall begin on April 01, 2023 and shall fully terminate on December 05, 2025.

SECTION 3.00 NO ABROGATION OF RIGHTS
The parties acknowledge that City responsibilities and rights as indicated in current Article 1, Section 1, (Appendix A) of the City's Personnel Rules and Regulations and all applicable State or Municipal laws are neither abrogated nor made subject to the meet and confer process by adoption of this Memorandum of Understanding.

Pursuant to Article 1, Section 1, (Appendix A), the City's rights include, but are not limited to the exclusive right to determine the mission of its constituent departments, commissions, and boards; to determine the procedures and standards of selection for employment and promotion; to direct its employees; to assign work to employees in accordance with the requirements determined by the City; to establish and change work schedules and assignments; to determine the content of job classifications; to hire, transfer and promote or to lay-off employees for lack of work; to suspend, discipline and discharge employees for proper cause if required; to expand or to diminish services; to subcontract any work or operations; and to determine the methods, means and personnel by which government operations are to be conducted, except as specifically modified by the terms of the Memorandum of Understanding.

The parties further acknowledge that the rights of employees are neither abrogated nor diminished by the adoption of this Memorandum of Understanding.

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SECTION 4.00 PAST PRACTICES
The parties agree that they shall adhere to established labor relations principles in handling past practices. The parties agree that a past practice may be established if the practice meets all of the following:

1. The practice is unequivocal and consistently performed; and

2. The practice is clearly communicated by the City and acted upon by the Union or clearly communicated by the Union and acted upon by the City; and

3. The practice is readily identifiable over a reasonable period of time as a fixed and established practice accepted by both parties.

The parties agree in handling past practice issues within the scope of representation:

1. Past practices superseded by revised M.O.U. language are null and void;

2. Past practices which contradict existing M.O.U. language or written City rules shall be null and void upon reasonable notice from the City that the language will be followed;

3. Past practices within the scope of representation that are not covered by M.O.U. language or City rules shall remain in effect through the term of the M.O.U. unless changed through mutual agreement.

SECTION 5.00 RECOGNITION
Pursuant to the Meyers-Milias-Brown act and the City's Personnel Rules and Regulations, S.E.I.U., Local 521, is certified as the recognized employee organization for temporary employees in classifications listed in Exhibit A attached hereto and all workers in the Temporary Service Classifications assigned to fill regular positions which are vacant for recruitment, or to fill the position during the incumbent’s leave. This unit shall be titled Temporary Service Employees.

For the purposes of this M.O.U., the term “employees” shall mean those represented temporary employees listed in Exhibit A.

SECTION 6.00 NO DISCRIMINATION
A. The Union and the City agree to adhere to the City Council policies pertaining to equal opportunity employment and harassment prevention as listed in Exhibits B and C, as well as applicable Federal and State discrimination law.

B. Neither the City, nor the Union, shall interfere with, intimidate, coerce or discriminate against City employees because of their exercising their right to form, join, and participate in the activities of the Union, or exercising their right to refuse to join or participate in the activities of the Union.

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SECTION 7.00 UNION SECURITY AND UNION RIGHTS

7.01 Payroll Deductions
A. The City shall honor the terms of the employee’s authorization for Union deductions, for example, any terms of a membership and deduction authorization card the Union has supplied the employee. The employee may only revoke the authorization pursuant to the terms of the authorization the employee signed.

B. Deductions shall start the pay period after the City receives notification of the authorization.

The City shall transmit such payments to the Union through electronic funds no later than thirty (30) days after the deduction from the employee’s earnings occur.

C. Requests to authorize payroll deductions for Union purposes or COPE deductions shall be directed by the employees to the Union rather than the City. Requests to revoke or change the authorization shall also be directed to the Union rather than the City. The City shall rely on the Union’s explanation in a certified list, submitted by a representative of the Union who has the authority to bind the Union, regarding whether authorization/ revocations/changes in deductions have been requested by the represented employees.

D. The Union shall not provide the City a copy of the employee’s authorization unless a dispute arises about the existence or terms of the authorization.

E. The City shall on a bi-weekly basis, provide the Union with an electronic file containing payroll information for SEIU 521 employees including the following information: name; job classification; department; work location; work phone; work email (if available); personal email (if available); home address; mailing address; cell phone (if available); home telephone number; date of birth; hourly rate; status (part-time or full-time); union deductions; annual salary; and employee identification number.

F. The Union shall indemnify, defend, protect and hold harmless the City and its elected and appointed officials, officers, employees, and agents (collectively hereafter the “Indemnitees”) from and against any and all claims, liabilities, losses, damages, fines, penalties, claims, demands, suits, actions, causes of action, judgments, costs and expenses (including, but not limited to, reasonable attorneys’ fees and court costs) arising from the application of any provisions under Sections 7.01-7.10, including, but not limited to, any claims made by any represented employees for the dues deductions the City made in reliance on the Union’s certification, and any claims made by any represented employees for any deduction cancellation or modification the City made in reliance on the information provided by the Union. In the event any such action or proceeding is brought against the City by reason of any such claim, the Union, upon notice from the City, covenants to defend such action or proceeding by counsel reasonably satisfactory to the City. Further, the Union agrees to indemnify and hold harmless the Indemnitees for any loss or damage arising from the Union’s actions or inactions under Sections 7.01-7.10.

G. Violations of this section of the MOU are grievable.

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7.01.02 Confidential Employees
Employees filling positions designated as confidential are represented and may hold membership in the Union, but are excluded from active participation as negotiators, committee chairpersons, or any other role in which they represent the Union in matters within the scope of representation pursuant to Section 3507.5 of the Meyers-Milias-Brown Act.

7.02 Memorandum of Understanding - Printing and Distribution The City and the Union will share the cost of printing copies of this Memorandum of Understanding in a mutually agreeable format and make it available to all members. Such distribution shall only occur during an employee's rest period, meal break or non-work time.

When a person is hired in any classification covered by this Memorandum of Understanding, the City shall notify the person that the Union is the recognized employee organization and of the agency shop provision. The City will provide that person with a copy of the current Memorandum of Understanding.

7.03 Union Notification
Except in cases of bona fide emergencies, the Union shall be given seven (7) workday's advance written notification of any ordinance, rule, resolution or regulation directly relating to matters within the scope of representation proposed to be adopted by the Santa Cruz City Council, or management, and shall be given the opportunity to meet with the City representative prior to its adoption.

7.04 Bulletin Boards and Department Mail
The Union shall have reasonable access to bulletin boards and departmental mail for the purpose of Union communications. A copy of non-privileged material shall be provided to the Human Resources Department.

7.05 Time Off for Union Officials

7.05.01 Meet and Confer or Consult Sessions
During the term of this agreement, a reasonable number of Union members (from two to five), shall be allowed a reasonable amount of paid release time off for meet and confer or meet and consult sessions scheduled with the City Council's designated representative, providing there is no disruption of work in the employee’s division. The exact number to be released shall be determined by mutual agreement prior to the session; and shall vary by the type of issue being discussed (i.e., single department affected, multiple departments affected, etc.) The Union shall notify the Director of Human Resources in advance of the meeting of the names of members who will be in attendance. Such Union members shall obtain permission through supervisory channels before leaving their work or work locations.

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Ground rules for negotiating successor agreements shall specify the number of Union members allowed for the meet and confer sessions scheduled with the City Council's representatives.

7.05.02 Union Stewards
The Union shall be authorized to designate employees within the unit as stewards, not to exceed five (5) in number and must furnish a list of these stewards to the Human Resource Department on a biannual basis (twice per year). If a designated steward is not available, temporary workers may utilize stewards from the regular bargaining unit. Stewards shall be allowed a reasonable amount of paid release time for the purpose of representing a unit employee within the steward's area of representation as shown below in the filing or processing of identified grievances as long as there is no disruption of work in the employee's division. The Union may designate an alternative representative when it deems appropriate. Stewards must first obtain permission through appropriate management channels before leaving their work or work location for such purposes, and release shall not be unreasonably denied. This provision shall be limited to periods of regular working hours.

It is agreed the City shall not pay stewards for time spent in handling grievances when they are not regularly scheduled to work.

The five (5) Union Stewards will each represent one of the following designated areas:

1. Beach

2. Library

3. Parks and Recreation

4. At Large

5. At Large

7.05.03 Chief Stewards
In addition to the Union Stewards identified in Section 7.05.02 (Union Stewards), the Union may designate up to two (2) Chief Stewards. Chief Stewards shall be entitled to release time to replace stewards when the designated area Steward is not available.

7.05.04 Union Leave
Upon request of the Union’s Santa Cruz Area Director, workers who are Union members may request unpaid release time not to exceed twelve (12) months for Union business.

7.06 Access to City Facilities
With the approval of the site administrator, the Union's representative may meet with members on City facilities during the non-working hours of the employees involved. The non-working hour’s restriction does not apply to the handling of grievances. A reasonable effort will be made to accommodate the Union representative.

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7.07 Bargaining Unit Employee Information
A. Bargaining Unit Employee List
On a bi-weekly basis, the City shall supply the Union with a comprehensive list of all employees covered by this MOU with the following information: full name, employee number, job classification, date of hire, termination date (if employment has ended), hourly rate, annual salary, date of birth, department, work location, work phone, work email (if available), personal email (if available), home address, mailing address, home phone, cellular phone (if available), and employment status (to include date of separation, etc.), to the extent permitted by law. On a monthly basis, a list of Union members whose City employment has ended shall be sent to the Union. These lists will be sent in an electronic format that both the Union and the City agree upon.

B. Protection of Contact/Biographical Information of Bargaining Unit Employees The City shall immediately notify the Union of any third party requests for contact and/or biographical information about the bargaining unit employees. The City shall promptly provide the Union a copy of the request and any material submitted with the request.

The City shall provide the Union at least ten (10) days to review the request and challenge the scope of the request prior to the City responding to the request. The City agrees to consider the Union’s response prior to disclosing to a third party any contact and/or biographical information about the bargaining unit employees.

7.08 Area Meetings
The City shall provide employees a maximum of one and on-half (1 ½) hours of release time triannually (three times per year) to attend area Union general membership meetings. The one and one-half (1 ½) hours includes travel time to and from the meeting and cannot result in an adverse impact on City operations. The purpose of general membership meetings shall be to nominate and elect shop stewards and to provide a forum for Union communications. In addition, there may be a maximum of twelve (12) area meetings annually. Union representatives shall have access to City facilities during work hours to conduct such area meetings with employees. The Union shall notify the Human Resources Director at least ten (10) workdays in advance of the date, time, and location of each area meeting. No more than two (2) Union officials shall be provided release time to conduct these meetings.

7.09 C.O.P.E. Deduction
The City agrees to the establishment of a payroll deduction program for voluntary employee contributions to the Committee on Political Education, (C.O.P.E.) subject to the following conditions:

A. Voluntary deductions for C.O.P.E. shall be withheld only if the employee so authorizes in writing on a form provided by the Union and approved by the City.

B. Payroll deductions shall commence on the second pay period after the authorization is

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received by the City.

C. Employees may sign up, change the amount of their contributions or discontinue their contributions at any time.

D. The Union shall indemnify, defend and hold the City, its officers and employees harmless against any and all claims, demands, suits and from liabilities of any nature which may arise out of or by reason of any action taken or not taken by the City under the provisions of this section.

7.10 New Employee Orientation
A. The City agrees that each newly hired bargaining unit employee shall participate in a scheduled new employee orientation that includes a half-hour (30 minute) Union informational in-person meeting within the first thirty (30) days from the date of hire during regular working hours and onsite without the loss of compensation. The City shall notify the Union no less than ten (10) days of a scheduled new employee orientation.

B. The Union agrees that it shall designate a reasonable number of Union designee(s) mutually agreed upon by the City and the Union (no more than three) to attend each orientation, session, or meeting, provided that there is no disruption of work in each designated Union employee’s division due to these employees’ attendance. The Union agrees that it shall provide the names of the Union designee(s) to the City’s Human Resources Director in writing, at least five (5) calendar days prior to the scheduled attendance at the orientation meetings, sessions, or trainings. Union designee(s) who are included in the written notice of attendance by the Union submitted to the Human Resources Director, at least five (5) calendar days in advance, shall be given release time to conduct such orientation sessions, meetings, or trainings under this Section. For purpose of this subsection, Union designee(s) may include, but not be limited to, Union representatives, officers, stewards and members.

C. City representatives shall be absent from the room during any sessions, meetings or trainings conducted by the Union with newly hired employees. The City shall not discourage an employee’s participation in the Union portion of the onboarding process.

SECTION 8.00 SALARY STEPS, PERSONNEL FILES AND PERFORMANCE

EVALUATIONS

8.01 Personnel Files
There shall be only one official personnel file which shall be maintained in the City’s Human Resources Department. Employees shall have the right to review their personnel files and/or authorize, in writing, review by their representatives. No adverse material will be placed in an employee’s personnel file without prior notice and a copy given to the employee. Employees may prepare written responses to adverse material placed in their personnel files. Upon presentation to the Human Resources Department, the Human Resources Department will place these written responses in employees’ personnel files.

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8.01.01 Performance Evaluations
All temporary employees will receive a written performance evaluation from their supervisors upon eligibility for the next step in the salary schedule.

Evaluations are intended to be a summary of the employee’s performance over the course of the evaluation period. Evaluations are also to be used as a tool to motivate the employee to work at their highest capacity and to communicate and document the employee’s level of performance. To this end, if the employee is still actively working at the time the evaluation is completed, the supervisor and the employee will meet and discuss work responsibilities, job standards and objectives, review progress and plan for the employee’s future development prior to the evaluation being placed in the employee’s personnel file.

Employees who are not actively working at the time the evaluation is completed will be mailed their evaluation to the last address provided to the City. Supervisors will make every attempt to address performance issues in a timely manner throughout the evaluation period and provide appropriate feedback to employees on an ongoing basis.

Any additions, corrections, deletions or changes on the original evaluation form, require initialing by both the maker of the amendment and the employee to indicate that the changes have been discussed and understood. No evaluation shall be made on hearsay statements.

Employees may also choose to appeal a performance evaluation to the department head and, if not satisfied, formally enter a response to the evaluation in their personnel file. Any unsatisfactory areas in an employee’s evaluation shall have attached reasons stated by the rater in the commentary section and shall include specific recommendations for improvement. Disputes regarding performance reviews shall not be subject to the grievance process.

If a step increase is denied as part of the evaluation process, the worker may appeal the denial within fifteen (15) days of receipt to the Department head. The Department Head, or designee, shall meet with the worker and their representative, if any, and render a decision within ten (10) business days of the meeting. The decision of the Department Head shall be final.

8.01.02 Late Evaluations
Failure of the supervisor to present the employee with the evaluation within ninety (90) calendar days of the due date, unless extension is mutually agreed upon in writing, shall result in a recommendation of step advancement in conjunction with Section 8.02 (Salary Step Placement and Advancement Within the Range). However, as soon as possible thereafter, the supervisor shall conduct a performance evaluation in accordance with this section.

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8.02 Salary Step Placement and Advancement within the Range

8.02.01 Salary Rates Upon Appointment
Temporary workers may be hired at any step in the appropriate salary range depending on the difficulty of recruitment, unusual qualifications, or upon prevailing rates being paid upon the recommendation of the department head and approval of the Director of Human Resources.

Bargaining Unit employees temporarily filling classifications included in the Service Employees’ Bargaining Unit shall be placed in the same salary range as provided to employees in the Service employees’ bargaining unit.

8.02.02 Advancement within the Salary Range
Advancement within a temporary employee salary range shall be granted solely on meritorious job performance as documented by a satisfactory performance evaluation.

Hours worked in different Temporary Employee positions (different Grade Codes) accumulate separately for the purpose of the calculations described below, including multiple assignments within the Professional & Technical Assistant position (Grade Code 917).

Step increases for temporaries filling classified positions are as follows:

Starting Step Placement upon initial hire.

Next Step Eligible upon completion of 1040 hours worked.

Subsequent Steps Eligible upon completion of each 2080 hours worked.

Step increases for temporary employees filling unclassified* positions are as follows:

Starting Step Placement upon initial hire.

Subsequent Step Eligible upon completion of 600 hours worked.

Subsequent Step Eligible upon completion of an additional 600 hours worked. (Total 1,200 hours)
Subsequent Step Eligible upon completion of an additional 600 hours worked. (Total 1,800 hours)
Subsequent Step Eligible upon completion of an additional 600 hours worked. (Total 2,400 hours)
* Professional and Technical Assistants (Grade Code 917) will receive a 5% increase (in lieu of a step increase) in accordance with this schedule, not to exceed the top of their salary range.

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SECTION 9.00 WORK ASSIGNMENTS

9.01 Work Shifts
Where practical, employees shall be assigned regularly scheduled starting and quitting times. The Union recognizes that the nature of some temporary employment is on-call and/or irregularly scheduled. Employees in these types of positions will not be assigned regularly scheduled starting and quitting times. Regularly scheduled employees and the Union will be notified as much in advance as possible, but at least five (5) working days in advance of changes in shift schedules and work weeks.

The scheduling of temporary employees is at the sole discretion of the employing department. If requested, the department head will meet with the Union regarding scheduling assignments. Any disputes regarding work assignments will be resolved by the department head.

9.02 Lunch Period
Employees shall be entitled to and expected to take an uninterrupted, unpaid lunch period of a minimum of thirty (30) minutes at or about the mid-point of their workday if the workday is a minimum of eight (8) hours.

9.03 Rest Periods
Employees shall be allowed a fifteen (15) minute rest period during each four hours of regular work. Departments may make reasonable rules concerning the scheduling of same. Rest periods not taken shall be waived. Rest periods cannot be taken at the beginning or end of a shift or combined with a meal period unless approved. This is not effective in periods of a bona fide emergency nature. Rest periods shall be considered work time.

SECTION 10.00 SALARY

1. Cost of Living Adjustments:
a. Effective April 15, 2023 the salaries for all represented classifications will be increased by four percent (4.0%).
b. Effective the pay period beginning March 2, 2024, salaries for all represented classifications will be increased by three percent (3.0%) c. Effective the pay period beginning March 1, 2025, salaries for all represented classifications will be increased by five percent (5.0%)

2. Effective May 13, 2023 or the first pay period in which Council approves an MOU in open session, whichever is later, bargaining unit employees who have worked a minimum of 300 actual hours between and including January 1, 2022 and December 31, 2022 will receive a

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one-time signing bonus of .87 cents per hour for each actual hour they worked within that time frame.

10.01 Salary upon Return to Temporary Employment
A worker, who returns to temporary employment in the same position within two calendar years, or longer at management’s discretion, shall be placed at their most recent salary step.

10.02 Salary Step When Hired Into a Regular Position
When a temporary worker is hired into a higher-level regular position, their pay step in the regular position shall be at least 5% higher than their most recent temporary pay rate, but shall not exceed the top step for the new position.

10.02.01 Credit Towards One (1) Year Probation When Hired Into a Regular Position
Employees hired into positions that require a one-year probation shall receive credit toward completion of the probationary period for any time spent in the same position on a temporary assignment immediately prior to the regular appointment. Such credit shall be given on a monthly basis up to a maximum of six (6) months of credit (per Service MOU Section 8.02.01 – Probationary Period).

10.03 EMT Differential
Lifeguard I’s who obtain and maintain an EMT certificate shall receive a five percent (5%) differential for all hours worked. The employee shall present proof of certification to the Department.

10.04 Bilingual Differential
The City shall provide payment of an additional $0.55 per hour on the hourly rate for hours worked when the City certifies an employee as qualified and the position requires the use of bilingual language skills.

10.05 Beach Lifeguard II Duty Officer Stipend
Beach Lifeguard II will receive a four percent (4%) stipend when scheduled to work as the Duty Officer.

10.06 Overpayments and Repayments
The City will not attempt to recover overpayments made to employees as a result of an error made by the City which are over 12 months old.

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A. Overpayments
If an overpayment or unauthorized payment has been made to a City employee, the City shall notify the employee in writing and supply the employee with the documentation used to determine the overpayment.

If the employee contends that any portion or the entire amount is not owed, they may request a meeting with the City to attempt to resolve the disagreement. The employee may have a representative attend such meeting(s) with them.

B. Repayment of Funds
An employee will pay no penalties, fees or interest as a result of the overpayment when the City and employee mutually agree upon how the repayment will be made. The employee shall have the right to select one of the following options for repayment:

1. Lump sum payment with the date mutually established by the employee and the City (lump sum payments must be made if the total amount due is 5 percent or less than the employee’s biweekly gross salary).

2. Biweekly installment payments through payroll deduction (installment payments must be a minimum of $10 and repayment must be completed within twenty-six pay periods).

3. Any other repayment arrangement mutually agreed upon between the City and the employee.

The final agreement on the repayment will be committed to writing (including the lump sum payment date, or the biweekly amount and the beginning and ending date of the installment plan identified).

C. Referral to Collections
The City may refer an employee to a collection agency or seek payment only when the employee, after being duly notified of the overpayment and having had the opportunity to review the relevant documentation, refuses to agree to a repayment of the amount owed. The employee will be notified of the referral and the City reserves all its rights to seek repayment and pursue all remedies under law including interest as it would for any other debtor.

10.07 Callback
Callback work is defined as work required by management of an employee who, following completion of the employee’s work day or work week and departure from the employee’s

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work site, is unexpectedly ordered to report back to duty or by phone or computer to perform necessary work.

10.07.01 Callback by Phone or Computer
If the employee is able to respond by phone or computer and is not required to report to the worksite, then:

A. For the first response of the day, a minimum of thirty minutes (0.5 hours) of overtime will be paid for actual overtime worked of less than thirty minutes. Thereafter, a minimum of fifteen minutes (0.25 hours) of overtime will be paid for actual overtime worked of less than fifteen minutes.

B. An additional minimum will not be paid if an employee is required to respond to additional call(s) and the time and duration of the response is within the previous minimum.

10.07.02 Callback to Worksite
A. All callback hours shall be paid at the overtime rate. A minimum of two (2) hours of overtime compensation shall be paid for all callback periods of less than two (2) hours.

B. Hours worked shall include reasonable travel time to work. Return travel time shall not be included within time worked.

C. If an employee, who was called back to work and has completed their assignment and left work, is again called back to work, they will not receive another minimum if the time of return is within the previous callback minimum.

D. Employees who are required to respond to the worksite will be provided mileage compensation, at the federal rate, for the use of their personal vehicles.

10.08 Duty Assignment – Marine Rescue Unit Members ONLY (see Section 10.09 for all Other Temporary Service Employees)

10.08.01 Definition
Duty assignment is defined as an assignment to an on-call status for a twenty-four (24) hour period of time. While on duty assignment, an employee must remain available to be contacted by phone or pager and be able to report to work within ten (10) minutes. The employee must remain within a ten (10) minute response area to the Santa Cruz Municipal Wharf throughout the duty assignment. Duty assignment shall not be considered “hours worked” pursuant to the Fair Labor Standards Act.

10.08.02 Assignment

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Duty personnel shall be assigned on a monthly rotational basis from an established list consisting of, but not limited to, qualified volunteers. A voluntary rotation process will be the preferred method of duty assignment selection; however, the City may require duty assignment if there are insufficient qualified volunteers. Prior to making mandatory assignments, the City will notify the Union. Only “qualified” employees may be appointed to duty assignment lists, as determined by the appropriate department head(s). Such qualifications will be based on the nature and requirements of the tasks performed while on duty assignment. With the concurrence of the duty supervisor, duty assignments may be substituted by other personnel on an approved list, provided employees have at least one week between duty assignments.

10.08.03 Compensation
A. Duty personnel shall receive $125 for a twenty-four (24) hour assignment.

B. All duty hours actually worked during the period of Duty Assignment and outside the employee’s regularly scheduled shift shall be compensated at their regular straight-time pay rate. A minimum of two (2) hours will be paid for callouts of less than two (2) hours.

10.09 Duty Assignment – All Other Temporary Service Employees (see Section 10.08 for Marine Rescue Unit Members ONLY)

10.09.01 Definition
Duty assignment is defined as an assignment to an on-call status for a specified period of time. While on duty assignment, an employee must remain available to be contacted by phone or pager and be able to report to work within a thirty (30) minute period. Duty assignment shall not be considered “hours worked” pursuant to the Fair Labor Standards Act.

10.09.02 Assignment
Duty personnel shall be assigned on a weekly rotational basis from an established list consisting of, but not limited to, qualified volunteers. A voluntary rotation process will be the preferred method of duty assignment selection; however, the City may require duty assignment if there are insufficient qualified volunteers. Prior to making mandatory assignments, the City will notify the Union. Only “qualified” employees may be appointed to duty assignment lists, as determined by the appropriate department head(s). Such qualifications will be based on the nature and requirements of the tasks performed while on duty assignment. With the concurrence of the duty supervisor, duty assignments may be substituted by other personnel on an approved list, provided employees have at least one week between duty assignments.

10.09.03 Compensation
A. Weekdays

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Duty personnel shall receive one and one half (1.5) hours of their base hourly salary for a sixteen hour assignment
B. Weekends
Duty personnel shall receive two (2) hours of their base hourly salary for a twenty-four hour assignment.

C. Holidays (City Designated Eight (8) Hour Holidays)
Duty personnel shall receive eight (8) hours of their base hourly salary for a twenty-four hour assignment.

D. Holidays (City Designated four (4) Hour Holidays)
Duty personnel shall receive four (4) hours of their base hourly salary for a twenty hour assignment.

E. All duty hours actually worked outside the employee’s regularly scheduled shift shall be compensated at the overtime rate. A minimum of two (2) hours of overtime will be paid for callouts of less than two (2) hours. An additional minimum will not be paid if an employee is required to perform an additional duty call and the time of return is within the previous duty call minimum.

If the assigned duty person or crew member assisting the duty person is required to respond to a call that requires them to work more than twelve (12) hours within a twenty-four hour period, and any portion of those twelve (12) hours is after midnight, the employee shall be entitled to an eight (8) hour rest period prior to returning to work. If any portion of the rest period occurs during the employee’s regular schedule, the employee shall receive regular paid compensation for that time.

F. An employee shall have the option of receiving compensatory time off for the duty assignment compensation and hours worked.

10.10 Holiday Premium Pay
The City shall provide a payment of one and a half (1.5) times the base hourly rate for actual hours worked on fixed holidays.

Temporary employees will not be eligible for paid time off for a holiday unless provided for under another section of the MOU.

The following holidays are recognized as Fixed Holidays:

New Year’s Day
Martin Luther King’s Birthday
President’s Day
Memorial Day
Juneteenth
Independence Day
Labor Day

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Veteran’s Day
Thanksgiving Day
Friday after Thanksgiving
Christmas Day
Two (Four (4) Hour Holidays)
The last four (4) hours of the work shift are Holiday hours for Christmas Eve (if Christmas Day is on a Tuesday–Saturday)
The last four (4) hours of the work shift are Holiday hours for New Year’s Eve (if New Year’s Day is on a Tuesday–Saturday)
Except as provided for in Christmas Eve and New Year’s Eve, when a holiday falls on Sunday, the following Monday shall be observed. When a holiday falls on Saturday, the preceding Friday shall be observed.

The City shall recognize all other days appointed by the President of the United States or the Governor of the State of California as a nationwide or statewide public holiday provided specific prior approval is received from the City Council.

SECTION 11.00 SENIORITY
Seniority for temporary workers shall be defined as hours worked within a given classification from the date of initial hire as a temporary worker.

SECTION 12.00 OVERTIME
The Union understands that from time to time the City will direct employees to work overtime hours. When overtime work is necessary, the City will make an effort to distribute overtime equally among qualified employees. To the extent possible, employees will be given advance notification.

An employee may be excused from overtime work for legitimate reasons.

Overtime is defined as all management authorized hours in a paid status in excess of forty (40) hours per week, which are contiguous with the employee’s regular work schedule, excluding voluntary training. Overtime shall be computed at the rate of one and one-half times the base hourly rate or may be converted to compensatory time off at the rate of one and one-half times the hours worked.

Employees covered by the Fair Labor Standards Act (FLSA) shall be entitled to FLSA overtime which is defined as all hours required by management and actually worked by the employee in excess of forty (40) hours in a work period as defined by the City. FLSA overtime is compensated in pay or compensatory time off at one and one-half (1-1/2) times the employee’s regular rate of pay. The regular rate shall be as defined in the FLSA.

Compensatory time off shall not be allowed to accumulate beyond eighty (80) hours at any given time.

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Based on IRS tax law under constructive receipt rules an employee may use the following methods to meet the IRS rule.
• An employee with accrued compensatory time off shall be permitted to use such time within a reasonable period in the same calendar year as it was earned after making the request, unless such time off will unduly disrupt the operations of the department. • Cash out all or part of the accrued and unused compensatory time anytime during the calendar year
• Any remaining balance will be paid out on the last payday in December.

Unused compensatory time hours earned prior to January 1, 2021 may be carried over into calendar year 2021 and are subject to the same provisions above as new hours earned in calendar year 2021 and after.

SECTION 13.00 BEREAVEMENT LEAVE
The purpose of this section is to provide paid leave for employees when they are bereaved at the death of a family member and this loss has had a temporary negative effect on their ability to continue their work performance.

When a temporary worker is scheduled to work and a death occurs in the employee’s immediate family, a leave of absence with pay of up to twenty (20) hours per incident, in a seven (7) consecutive day period, may be granted an employee by the department head. For the purpose of this section, “immediate family” is defined as: spouse, parent, son, daughter, grandparent, sibling, mother or father-in-law, brother or sister-in-law, grandchild of the employee or spouse, son-in-law, daughter-in-law, grandparent-in-law, registered Principal Domestic partner, or other close relation residing in the employee’s household. In rare cases when the individual has no other legal relationship with the deceased other than foster or step-parent, the HR Director or City Manager has the discretion to approve that leave upon application.

13.01 Jury Duty
Employees shall receive equivalent unpaid time off when performing jury duty on their scheduled work day on the day the jury duty is performed. An employee must notify their supervisor of the expected duration of the absence and must present to the department head official documents supporting such duty. This section shall not apply to grand jury service.

13.02 Blood Donation
An employee may be granted paid release time of up to a maximum of one (1) hour for donating blood during regularly scheduled hours of work at a City sponsored blood drive. The length of such leave must be approved by the supervisor and is dependent upon the nature and scheduling of the work performed and the travel distance required.

13.03 Workers’ Compensation

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An employee who is entitled to workers’ compensation payments may use accumulated in-lieu paid time and/or compensatory time off to supplement such payments to an amount equal to their net salary. After depletion of any accrued paid leaves, the employee shall be eligible for benefits only in the amounts prescribed by the workers’ compensation laws.

The Union and the City recognize that work-related injuries/illnesses can often be prevented.

Therefore, work-related injuries/illnesses shall be an ongoing agenda item for the Citywide Safety Committee. Proactive, preventive measures may be recommended by the Committee. The Committee will also make recommendations on appropriate way(s) of reviewing workers’ compensation claims.

SECTION 14.00 IN-LIEU PAID TIME
During the term of the MOU, upon completion of 600 or more hours of work, temporary employees shall receive nineteen (19) hours of in-lieu paid time. Subsequently, workers accrue nine (9) hours of paid time for every 200 additional hours of work thereafter. Such in-lieu paid time is provided instead of any other type of paid leave or holiday time off (except paid Bereavement Leave).

Employees will be allowed to receive payment for accrued in-lieu paid time upon request. Any unused in-lieu paid time will be payable to the employee upon termination of employment.

SECTION 15.00 SICK LEAVE
In accordance with the Healthy Workplaces, Healthy Families Act of 2014:

I. Applicability and Eligibility to Earn and Use Paid Sick Leave A. Employees shall receive paid sick leave as described in this section after 30 days of City employment within a 12-month period.

B. An employee is eligible to use accrued paid sick leave after 90 days of City employment within a 12-month period. The 12-month period shall be measured initially by the employee’s hire date and by the employee’s anniversary date.

II. Annual Grant of Paid Sick Leave
A. Beginning on July 1, 2015, and on July 1st of each calendar year thereafter, the City shall grant employees 24 hours of paid sick leave to use for permitted purposes as described in this section. Employees who are hired after July 1st of any given calendar year shall also be issued 24 hours of paid sick leave.

B. Any unused paid sick leave hours remaining as of June 30th of any calendar year shall expire and shall not be carried over to the next 12-month period.

III. Use of Paid Sick Leave
A. An eligible employee may use only up to a maximum of three (3) days or 24 hours of paid sick leave in a 12-month period. An employee must be allowed to take up to a

14.29 19
total of 24 hours of accrued time during any 12-month period for reasons allowed under Section III.B. (For example, if an eligible seasonal or temporary employee who works six (6) hours per day and has accrued 24 hours of paid sick leave, takes three (3) paid sick days during the year, the employee has used 18 hours and still has six (6) hours of paid leave remaining in the same year.) B. An eligible employee may use paid sick leave under this section for the following reasons:
i. Diagnosis, care, or treatment of the employee’s existing health condition or preventive care for an employee; or
ii. Diagnosis, care, or treatment of an existing health condition of, or preventive care for an employee’s family member. For the purposes of using sick leave under this section only, “family member” shall mean an employee’s parent, child, spouse, registered domestic partner, parent-in-law, sibling, grandchild, or grandparent.
iii. In addition, with appropriate certification an employee who is a victim of domestic violence, sexual assault, or stalking may use accrued paid sick leave under this section for the following reasons:
a) To obtain or attempt to obtain any relief, including, but not limited to, a temporary restraining order, restraining order, or other injunctive relief, to help ensure the health, safety, or welfare of the victim or the victim’s child;
b) To seek medical attention for injuries caused by domestic violence, sexual assault, or stalking;
c) To obtain services from a domestic violence shelter, program, or rape crisis center;
d) To obtain psychological counseling related to an experience of domestic violence, sexual assault, or stalking; or
e) To participate in safety planning and take other actions to increase safety from future domestic violence, sexual assault, or stalking, including temporary or permanent relocation.

IV. Notification to City of Use of Paid Sick Leave
When accrued sick leave must be used, an employee will notify their immediate supervisor of the need to use leave and its probable duration, if known, within one hour after the regular scheduled starting time. If the employee’s need to use sick leave is unforeseeable, the employee must provide notice to the employee’s supervisor as soon as practicable. When the employee’s need to use sick leave is foreseeable, the employee must provide reasonable advance notice.

V. Other Terms of Paid Sick Leave
A. Employees may determine how much paid sick leave they wish to use, however, the minimum amount of paid sick leave an employee may use is one hour per work day.

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B. Employees shall be compensated for each hour of sick leave used under this policy at the employee’s base hourly rate of pay. Employees shall be compensated for using sick leave, on the payday for the next regular payroll period after the sick leave was taken.

C. Except as provided in this section, upon termination, resignation, retirement or other separation from employment, no cash out or compensation of any kind will be provided to an employee for accrued and unused paid sick leave.

If an employee separates from the City and is rehired within one (1) year from the date of separation, any previously accrued and unused paid sick leave shall be restored to the employee to the extent required by law. If at the time of separation from City employment, the rehired employee had not yet worked the required 90 days to be able to use paid sick leave, the employee must still satisfy the 90 day requirement, counting all days previously worked for the City, before the employee may use the employee’s accrued paid sick leave.

SECTION 16.00 CAREER ADVANCEMENT

16.01 Job Opening Announcements
The City encourages employees to apply for other positions and, to that end, all job announcements will normally be posted on department bulletin boards and other appropriate locations as determined by the Director of Human Resources. Employees are also advised to access the listings via the City’s website and/or the Human Resources Department.

16.02 Training and Cross Training
The City shall maintain, consistent with budgetary allocations and availability, a training program which will enable employees to upgrade their skills and improve their levels of performance.

The City and Union acknowledge that there is a benefit to cross-training of employees. When feasible, the City will cross-train employees to enhance skill development. Employees may request consideration for cross-training opportunities. Such requests will be considered and a timely response provided.

16.03 Reimbursement for Licenses and Certificates
Employees shall be reimbursed for the cost of licenses and certificates which are required to perform their job duties. No reimbursement shall be made for fees of less than $5.

Employees whose job description requires a class A or B driver’s license shall receive $100 per month provided they possess and maintain said required license in the performance of their job duties.

16.04 Absence for Examination

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An employee shall be granted release time to participate in any part of an examination process for promotion or transfer within the City workforce that is scheduled during the employee’s hours of work. The employee shall notify their immediate supervisor five (5) calendar days in advance of such an absence.

SECTION 17.00 SAFETY
The City intends to meet its obligation under the California Occupational Safety and Health Act and shall adopt and use reasonable safeguards, devices and practices for safe employment.

Responsibility for promoting safety practices is shared equally by the City and its employees. The City will provide appropriate safety training courses and may place reasonable requirements of prior training and/or certification before employees engage in certain activities.

In order to ensure that health and safety hazards are dealt with on a timely basis, the following procedure shall be used to deal with potential hazards.

A. Employees shall report health and safety hazards to their immediate supervisor upon discovery and in accordance with appropriate City Administrative Procedures. If the immediate supervisor is unable to abate the hazard, they shall refer the matter to the department/division manager, or
B. Employees may use the Safety Communication System as provided in the City’s Administrative Procedure Order.

17.01 Safety Committee
The union may appoint one temporary worker to serve on the Citywide Safety Committee. This Committee shall meet at least quarterly to consider potential or actual health, safety, and training matters. Union members shall serve on the Safety Committee without loss of compensation if scheduled to work during meeting times provided supervisory approval is received.

The Safety Committee shall be apprised of all reported hazards, their status, and resolution of the issue(s).

17.02 Safety Equipment/Uniforms
The City shall provide employees with any necessary and required uniforms or safety equipment required for the performance of their job.

17.03 Safety Boots
The City shall provide safety boots/shoes for employees in the classifications that require wearing them as shown in Exhibit D. The City may establish administrative procedures for the selection and purchase of such boots/shoes. All eligible employees will be required to wear safety boots/shoes while on duty unless granted a medical exemption. Safety boots/shoes shall not be worn for non-work-related purposes. Boots/shoes shall be

14.32 22
replaced on an as-needed basis up to the current annual limit of $250 regardless of actual hours worked. If feasible, the City will offer a choice of different styles of boots/shoes.

SECTION 18.00 BENEFITS

18.01 Health Care Reimbursement
Employees who work more than 220 hours in the following quarters will be reimbursed 50% the cost of their single coverage medical plan, not to exceed $100 per quarter.

Quarter Payable
July/August/September October
October/November/December January
January/February, March April
April/May/June July
Employees must provide a receipt showing their payment for coverage within ten (10) days after the end of each quarter to be eligible for payment. Reimbursement will only be for single medical coverage paid for directly by the employee.

18.02 Bus Passes
Temporary service employees are eligible to participate in the City’s bus pass program. Additional information regarding this program is available from the Human Resources Department.

18.03 CalPERS Long Term Care
Temporary service employees are eligible to participate in the CalPERS Long Term Care insurance benefit. Additional information regarding this program is available from the Human Resources Department.

18.04 Medicare
Temporary service employees and the City (on employees’ behalf) participate in and contribute to the Medicare program.

18.05 Alternative Transportation Incentive Program
The City will provide up to $10 per month per employee for reimbursement of eligible transportation related expenses, subject to a cap, as defined in the City’s APO II-53 - Alternative Transportation Incentive Program.

SECTION 19.00 GRIEVANCE PROCEDURE

19.01 Purpose
To assure prompt and fair treatment of grievances related to employment.

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Any employee or group of employees covered by this Memorandum of Understanding, or the Union acting on their behalf, may file a grievance.

19.02 Definition
A grievance is defined as an alleged violation, misinterpretation or misapplication of the provisions of this Memorandum of Understanding or the City’s Personnel Rules and Regulations.

19.03 Limitations
A. A grievant may be represented by an individual of their choosing in preparing and presenting a grievance.

B. No reprisal shall result against any employee, group of employees, or the Union, who presents a bona fide grievance under this procedure.

C. Time limits may be extended by mutual agreement of the parties. Absent such agreement, grievances may be advanced to the next step if time limits are not met.

D. Only upon mutual written agreement between the parties may Step I of the grievance procedure be waived.

E. Grievances may, by mutual agreement in writing, be referred back for further consideration or discussion to a prior Step, or advanced to a higher Step of the grievance procedure. If a grievance is moved either forward or backward to another step, the time limits at that step shall be controlling and shall begin on the date the parties agree to the move.

19.04 Procedures

19.04.01 Step I
The grievant will first attempt to resolve the grievance through informal discussions with their immediate supervisor or other appropriate departmental personnel. These discussions must be initiated within ten (10) working days of the incident upon which the grievance is based. Meetings shall be scheduled in advance and the nature of the grievance stated when the appointment is made. Every attempt will be made by the parties to settle the issue at this level.

19.04.02 Step II
If the grievance is not resolved through the informal discussions, the grievant or their representative may within ten (10) working after the informal meeting, submit a written grievance to the department head. The written grievance must contain in clear, factual and concise language.

1. Name of the grievant.

2. A brief statement as to the date, time and place of the occurrence on which the

14.34 24
grievance is based and the facts as the grievant see them.

3. The specific provision of the M.O.U. which the grievant alleges has been misinterpreted, misapplied, or violated.

4. Steps taken toward informal resolution.

5. The action the grievant believes will resolve the grievance.

6. The name of any representative chosen by the grievant.

7. A copy of the written grievance, signed by the grievant or Union Representative, shall be presented at the time of the department head conference. However, the grievance will not be processed by the City until the Grievant or employee representative of a group grievance has signed the written grievance document.

The department head shall hold a conference with the grievant within ten (10) workdays following receipt of the formal grievance. They shall prepare a written response within five (5) working days after the conference. Copies shall go to the parties involved including the employee's representative and the Human Resources Department.

19.04.03 Step III
If the grievance is not resolved, the grievant may, within five (5) workdays following receipt of the department head's response, appeal to the City Manager or their representative, stating in writing the basis for the appeal. The grievance may also be appealed if the department head fails to respond within fifteen (15) workdays after submission of the formal grievance.

The City Manager or their representative shall set a meeting within ten (10) workdays of receiving the appeal. The grievant and/or their representative shall state their position on the grievance to the City Manager and present any other materials that they deem relevant to the grievance. The City Manager or their representative shall render a written decision to all parties directly involved within fifteen (15) workdays following the meeting. The decision of the City Manager on the grievance shall be final.

SECTION 20.00 DISCIPLINE
The City and Union acknowledge that temporary employees have at will employment status and that either the employee or the City is entitled to end the employment relationship at any time, for any reason.

Should the City decide to terminate, suspend or demote a temporary employee due to performance and/or attendance issues, it will so notify the employee in writing with concurrent notice to the Union. Upon request, by the employee or the Union, a meeting will be scheduled with the department head to allow the employee and/or their representative to provide explanatory or mitigating information, which the City will consider in determining if any change in its position is appropriate. The department head shall have the final decision in all temporary employee decisions.

There is no appeal.

SECTION 21.00 WRITTEN REPRIMANDS
A written reprimand may be issued by an employee’s supervisor if an employee has violated a City

14.35 25
rule, provision of the MOU, or if their performance is in need of improvement. Written reprimands shall be placed in the employee’s personnel file. An employee shall have the right to prepare a written response to the reprimand and have said response placed in their personnel file. An employee may appeal the supervisor’s decision to issue a written reprimand to the department head by filing an appeal to the department head within ten (10) working days of receipt of the reprimand.

The department head’s decision regarding the written reprimand shall be final.

SECTION 22.00 LABOR/MANAGEMENT COMMITTEE
The City and the Union agree to establish a committee for the purpose of discussing the use and management of temporary employees and positions. Each party (City and Union) may appoint up to four (4) representatives to the committee. The committee will meet at least twice per each contract year at a date, time, and location that is mutually convenient.

The committee will review data pertaining to temporary employees including: names, hours worked, position classification, assigned department, original start date, and position status (temporary or regular). The purpose of reviewing this data is to identify if and when it is appropriate to transition temporary workers &/or positions to regular employment status. As a result of working with this data, the committee shall also recommend improved tracking and accounting practices for managing temporary employees and positions.

Additionally, in an effort to maintain transparency and accountability in the recruitment and selection of temporary employees, the committee shall discuss and recommend improvement to those processes.

SECTION 23.00 AUTHORIZED AGENTS
For the purposes of administering the terms and provisions of this Memorandum of Understanding:

A. The City's principal authorized agent shall be the Director of Human Resources, or their duly authorized agent (address 809 Center Street, Room 6, Santa Cruz, CA 95060); except where a particular Management representative is specifically designated in connection with the performance of a specified function or obligation set forth herein.

B. The Union's principal authorized agent shall be the Field Representative of Local 521, or their duly authorized representative (address 517 Mission Street, #B, Santa Cruz, CA 95060.)
SECTION 24.00 RENEGOTIATIONS
If the Union desires to negotiate a successor M.O.U., then the Union shall serve upon the City, no later than ninety (90) days prior to the expiration date of the M.O.U., its written request to begin negotiations as well as its written proposals modifying the M.O.U.

Negotiations shall begin within thirty (30) days from the date of receipt by the City of such notice and proposals, or any other mutually agreed upon dates.

24.01 Successor Negotiations

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The parties will meet and consult no later than October 1, 2017 about whether or not the Temporary Service Employees bargaining unit will bargain over a successor Memorandum of Understanding with the Regular Service Employees bargaining unit.

SECTION 25.00 SEVERABILITY
Should any of the provisions herein contained be rendered or declared invalid by reason of any State or Federal legislation or court action, such invalidations shall not invalidate the remaining portions of this Memorandum of Understanding, which shall remain in full force and effect, insofar as such remaining portions are severable.

CITY OF SANTA CRUZ CITY OF SANTA CRUZ

TEMPORARY SERVICE EMPLOYEES,
S.E.I.U., LOCAL 521
Date: May 15, 2023 Date: May 15, 2023

Sara De Leon Katy Bradley

Tim Davis Devon King

Ken Bare

Emilio Galvan

Noah Nagel

14.37 City of Santa Cruz Page 1 of 2
California 12/19/2022
Human Resources
Salary Compensation Plans Deliver To: cruser
Effective Date: 12/24/2022
Sorted by: Grade Description
Grade
Code Description
Step
A
Step
B
Step
C
Step
D
Step
E
Step
F
Step
G
Step
I
Step
H
Step
J
Temporary
901 AQUATIC INSTRUCTOR/COACH 15.5000 16.2750 17.0888 17.9432 18.8403 902 BEACH CAPTAIN 24.0862 25.2905 26.5550 27.8828 29.2769 903 BEACH LIEUTENANT 23.6973 24.8822 26.1263 27.4326 28.8042 904 BEACH LIFEGUARD I 19.6860 20.6703 21.7038 22.7890 23.9285 905 BEACH LIFEGUARD II 21.6610 22.7441 23.8812 25.0753 26.3291 907 COMMUNITY SERVICE AIDE I 16.3318 17.1489 18.0063 18.9066 908 COMMUNITY SERVICE AIDE II 18.2225 19.1367 20.0922 21.0971 22.1520 925 LIBRARY AIDE 15.5000 16.2750 17.0888 17.9432 18.8403 911 MAINTENANCE WORKER AIDE I 15.5000 16.2750 17.0888 17.9432 18.8403 913 MAINTENANCE WORKER AIDE II 17.8250 18.7163 19.6521 20.6347 21.6664 914 OFFICE ASSISTANT 15.5000 16.2750 17.0888 17.9432 18.8403 915 POOL LIFEGUARD 15.5000 16.2750 17.0888 17.9432 18.8403 916 POOL MANAGER 15.4176 16.1862 16.9965 17.8464 18.7387 \\Edenrpt\Eden_5.5Reports\CustomReports\Py\SalaryCompPlansWithStepJ.rpt Page 1 of 2

EXHIBIT A

14.38 City of Santa Cruz Page 2 of 2
California 12/19/2022
Human Resources
Salary Compensation Plans Deliver To: cruser
Effective Date: 12/24/2022
Sorted by: Grade Description
Grade
Code Description
Step
A
Step
B
Step
C
Step
D
Step
E
Step
F
Step
G
Step
I
Step
H
Step
J
Temporary
917 PROFESSIONAL & TECH ASSIST 15.5000 41.7306
918 RANGER TRAINEE 17.2875 18.1534 19.0607 20.0136 21.0142 919 RECREATION AREA AIDE 15.5000 16.2750 17.0888 17.9432 18.8403 920 RECREATION I 15.5000 16.2750 17.0888 17.9432
921 RECREATION II 17.0500 17.9025 18.7976 19.7375 20.7244 922 RECREATION III 18.7550 19.6928 20.6774 21.7112 22.7968 923 RECREATION IV 20.6305 21.6620 22.7451 23.8824 25.0765 924 RECREATION V 22.6935 23.8282 25.0196 26.2706 27.5841 \\Edenrpt\Eden_5.5Reports\CustomReports\Py\SalaryCompPlansWithStepJ.rpt Page 2 of 2

14.39 COUNCIL POLICY 25.2

POLICY TITLE DISCRIMINATION, HARASSMENT, RETALIATION, AND

RESPECTFUL WORKPLACE CONDUCT POLICY

POLICY STATEMENT
It is the policy of the City of Santa Cruz to maintain and promote a working environment free from abusive conduct, discrimination, harassment, and retaliation; and to provide all current and prospective employees, Councilmembers, contractors, unpaid interns, and volunteers with equal opportunity in employment regardless of race, religious creed (including religious dress and grooming practices), color, national origin (including language use restrictions), ancestry, disability (mental and physical), medical condition, sex, gender (including gender identity and gender expression), physical characteristics, marital status, age, sexual orientation, genetic information (including family health history and genetic test results), organizational affiliation, and military and veteran status (all of which are later referred to as “Protected Categories”), or any other consideration made unlawful by local, State or Federal law.

This policy pertains to all aspects of employment with the City or the application for employment with the City including, but not limited to, recruitment, selection, placement, assignment, compensation, benefits, training, transfer, promotion, evaluation, discipline, and termination.

This policy prohibits unlawful harassment, discrimination, and retaliation by supervisors, managers, co-workers, and third parties such as vendors or customers.

Definitions:

Discrimination as used in this policy is defined as the treatment or consideration of, or making a distinction in favor of or against, an employee on the basis of any of the above-listed protected categories including, but not limited to, any of the following forms:
a) basing an employment decision on a job applicant’s or an employee’s protected status; b) treating an applicant or employee differently with regard to any aspect of employment because of their protected status;
c) offering an employment benefit in exchange for sexual favors; d) threatening negative consequences if an employee declines a sexual advance; e) engaging in harassment, as more specifically defined below; and f) taking adverse employment action (i.e., demotion, transfer, discipline, or termination) against an employee based on the employee opposing discrimination in the workplace; assisting, supporting, or associating with a member of a protected category who complains about discrimination, or assisting in an investigation of discrimination.

Harassment as used in this policy is defined as the persistent disturbance or irritation of an employee on the basis of any of the above-listed protected categories including, but not limited to, any of the following forms:
a) verbal harassment such as epithets, derogatory comments, or slurs, including on social media; b) physical acts such as assault or impeding or blocking movement; c) visual insults such as derogatory posters, drawings, or photographs;

14.40 d) unwanted sexual advances, requests for sexual favors, and other acts of a sexual nature; and e) sending sexually-related emails or text messages.

Abusive Conduct as used in this policy is defined as conduct in the workplace or on social media, undertaken with malice, that a reasonable person would find hostile, offensive, and unrelated to an employer’s legitimate business interests; it may include repeated infliction of verbal abuse, such as the use of derogatory remarks, insults, and epithets, verbal or physical conduct that a reasonable person would find threatening, intimidating or humiliating, or the sabotage or undermining of a person’s work performance. A single act shall not constitute abusive conduct, unless especially severe and egregious.

Employee as used in this policy is defined as an individual performing business activities under direct supervision of another City employee and includes full-time, part-time, and temporary employees, contractors, unpaid interns, and volunteers.

Equal Employment Opportunity Committee (EEOC) as used in this policy is an advisory body to the City Council consisting of nine (9) members, including representatives from the community appointed by the City Council, employees appointed by the City Manager, and employees appointed by various labor groups.

Responsibilities:

1. The City of Santa Cruz shall take reasonable steps to prevent abusive conduct, discrimination, harassment, and retaliation from occurring in the workplace environment, including the following:
a) affirmatively raising the subjects of abusive conduct, discrimination, harassment and retaliation; b) expressing strong disapproval;
c) maintaining and developing appropriate sanctions;
d) informing employees of their right to raise and how to raise the issues of abusive conduct, discrimination, harassment, and retaliation under City policy and/or the law; and e) maintaining and developing methods to sensitize all concerned.

Such behavior shall not be tolerated, condoned, or trivialized. The City is committed to take action against any person violating this policy which will end the prohibited conduct. City employees who violate this policy shall be subjected to appropriate discipline, including possible dismissal, upon consideration of the findings and recommendations of the City Manager or their representative.

2. The City Manager shall fully accept and support the City’s commitment to prevent abusive conduct, discrimination, harassment, and retaliation as a means to assure full equal employment opportunity for all prospective and current employees, contractors, unpaid interns, and volunteers including the following:
a) defining and assigning specific responsibilities throughout the organization for the development, implementation, and monitoring of this policy; b) appointing one (1) department head and three (3) employee representatives to the EEOC; c) ensuring all department heads support this policy;
d) reviewing the recommendations of the Human Resources Director on the resolution of complaints appealed under the Administrative Procedure Order (APO) Discrimination/Harassment/Retaliation Policy Implementation and Complaint Procedure, and making final decisions in each such complaint; and
e) ensuring that an EEO Report is completed and submitted annually to the City Council.

14.41 3. The Human Resources Department (HR) Director shall be responsible for:
a) ensuring that this policy, including its definition of abusive conduct, discrimination, harassment, and retaliation and the complaint procedures are disseminated to all employees; b) providing guidance, training sessions, and assistance to department heads, managers, supervisors, and employees within their areas of responsibility; c) investigating, resolving, and making findings and recommendations on complaints that are reported according to established informal and formal grievance procedures as set forth in in the Discrimination/Harassment/Retaliation Policy Implementation and Complaint Procedure APO and the Respectful Workplace Conduct APO;
d) coordinating the annual EEO report, to include data on the make-up of the City workforce and the representation of protected classes, and distributing the report to the City Council, City staff, the public, and Federal and state agencies as requested or required; e) regularly reviewing and revising personnel policies, procedures, and practices to eliminate nonjob-related criteria, minimize the opportunity for discrimination and harassment, and ensure compliance with all legal requirements for equal employment opportunity; f) designing, implementing, and monitoring a recruitment program to draw all qualified applicants; and
g) designating an EEO Coordinator, who will assist the HR Director with EEO-related activities and staff the EEOC.

4. Department Heads, Managers, and Supervisors shall all be responsible for:
a) giving their full support to this policy through active cooperation, leadership, and personal example;
b) informing employees in their respective departments or areas of responsibility of their rights and responsibilities regarding abusive conduct, discrimination, harassment, and retaliation under this policy;
c) ensuring that their employees have equal access to training and promotional opportunities; d) acting to prevent abusive conduct, discrimination, harassment and retaliation from occurring; and e) cooperating with the HR Director in resolving complaints involving employees in their respective departments.

5. Employees of the City shall be responsible for lending their personal support and cooperation in maintaining equal employment opportunities in the City. Employees shall cooperate fully with all investigations of abusive conduct, discrimination, harassment, and retaliation and implementation of remedial measures and shall not retaliate against complainants or witnesses.

6. The EEOC shall act in an advisory capacity to the City Council in all matters pertaining to EEO and be responsible for serving as a communication channel between City employees, the community, the City Manager, and the EEO Coordinator on any EEO activities and concerns.

Additional Applications and Considerations:
• Complaints may be filed by any individual (or a representative of their choice, on their behalf) who feels a violation of this policy has occurred. The procedures for resolving complaints alleging violation of this policy are set forth in APO Discrimination/Harassment/Retaliation Policy Implementation and Complaint Procedure and APO Respectful Workplace Conduct.

14.42 • Contracts with the City of Santa Cruz which contain an equal employment opportunity/nondiscrimination clause shall also include language which requires those contractors to be responsible for ensuring that effective policies and procedures concerning the prevention of abusive conduct, discrimination, harassment, and retaliation exist in their companies. • Councilmembers, contractors, unpaid interns, volunteers, customers and visitors shall not be subjected to, or cause, a violation of this policy.
• All Memoranda of Understanding entered into by the City and any employee organization shall contain an appropriate non-discrimination/harassment clause. • In applying this policy, the rights of free speech and association shall be accommodated consistently with the intent of this policy. Nothing in these regulations may be construed as limiting the City’s right to take reasonable disciplinary measures which do not discriminate on a basis identified in this policy.
• Discrimination/harassment/retaliation prevention (including prevention of abusive conduct), and cultural diversity awareness training, is mandatory for all City employees and City Councilmembers.
• All City employment announcements, brochures, procedures, advertisements, and application forms will state that the City is an Equal Opportunity Employer. The Human Resources Department will also inform all outreach recruitment and referral sources of the City’s Discrimination and Harassment Policy and request that sources actively recruit and refer qualified applicants from all sectors of the community.
• In support of recruitment and retention efforts, City management shall consider the viability of participating in or developing supportive programs in such areas as: job-related skill training and education, job development, career counseling, transportation, day care, and health care. • Where groups of employees are featured in the City’s publications and communications (i.e., text and photographs), insofar as possible, the materials should illustrate that the City’s workforce is as diverse as the populace it serves.

AUTHORIZATION: Council Policy Manual Update of November 17, 1998 HISTORY:

Revision by Resolution No. NS-28,533 July 24, 2012
Revision by Resolution No. NS-28,823 September 9, 2014
Revision by Resolution No. NS-29,220 April 4, 2017

14.43 City of Santa Cruz II-1A
Administrative Procedure Order
Section II, #1A (Revised April 2017)
TO: Department Heads
SUBJECT: DISCRIMINATION/HARASSMENT/RETALIATION POLICY

IMPLEMENTATION AND COMPLAINT PROCEDURE

PURPOSE
The purpose of this document is to confirm the City’s commitment to prohibit and prevent unlawful discrimination, harassment, and retaliation in employment, and provide a City complainant an investigation procedure to resolve complaints of alleged discrimination, harassment, or retaliation in violation of the law or City Council Policy 25.2 (Discrimination, Harassment, and Respectful Workplace Conduct Policy).

POLICY
It is the policy of the City of Santa Cruz to maintain and promote a working environment free from discrimination, harassment, and retaliation, and to provide all current and prospective employees, contractors, interns, and volunteers with equal opportunity in employment regardless of race, religious creed (including religious dress and grooming practices), color, national origin (including language use restrictions), ancestry, disability (mental and physical), medical condition, sex, gender (including gender identity and gender expression), physical characteristics, marital status, age, sexual orientation, genetic information (including family health history and genetic test results), organizational affiliation, and military and veteran status (later referred to collectively as “Protected Categories”) or any other consideration made unlawful by local, State, or Federal law.

This policy is promulgated in recognition of the fact that conduct of the type prohibited by this policy, if allowed to exist, not only violates Federal, State, and municipal law, but also serves to undermine employee integrity, create low employee morale, reduce employee productivity, and cause skilled and valuable workers to leave their City employment. All of this, in turn, is detrimental to the general health and welfare of the community, which depends upon a highly motivated and skilled body of City employees to deliver essential municipal services.

The City Council acknowledges and understands that in order to implement a policy of this type, it is essential that all persons who witness or experience discrimination, harassment, or retaliation report it immediately in order to facilitate early, effective, efficient, and impartial investigation and intervention by the City. Accordingly, any retaliation against a person for filing a complaint, reporting discrimination, harassment, or retaliation which he or she has witnessed, or assisting in an investigation is strictly prohibited. Employees found to have participated in retaliatory action in contravention of this policy shall be subject to disciplinary action up to and including termination.

14.44 Administrative Procedure Order II-1A
Section II, #1A (Revised April 2017)