Agenda packet — Santa Cruz City Council, June 25, 2024 (part 1 of 5)

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

CITY COUNCIL AGENDA
Regular Meeting - June 25, 2024
Updated June 24, 2025 – Item #10
11:30 A.M. CLOSED SESSION, ZOOM/COURTYARD CONFERENCE ROOM 12:30 P.M. ORAL COMMUNICATIONS, CONSENT, GENERAL BUSINESS AND PUBLIC

HEARINGS, 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, June 24th
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, June 23rd by emailing the Mayor and the City Clerk.

Approval will be confirmed via email.
[email protected] [email protected]
June 25, 2024 City Council 2
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 8, 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. 11:30 AM
Statements of Disqualification
Closed Session

1. Conference with Legal Counsel – Liability Claims (Government Code §54956.95)
1) Claimant: John J. Morley
2) Claimant: Luis Ramirez
3) Claimant: Mirfak Elize Fuentes Hernandez
4) Claimant: Barbara Jana Hostetter
5) Claimant: David Turner
6) Claimant: Jeffrey David Dunworth
7) Claimant: Progressive West Insurance Company
Claims against the City of Santa Cruz
June 25, 2024 City Council 3
Closed Session (continued)

2. Conference with Legal Counsel - Existing Litigation (Government Code §54956.9(d)(1))
1) County of Santa Cruz, et al. v. Purdue Pharma L.P., et al. (United States District Court, Northern District of California, Case No. 5:18-cv-02803 and United States District Court, Northern District of Ohio, MDL No. 2804, Case No. 17-MD-2804)
2) City of Santa Cruz, et al. v. The Regents of the University of California, et. al.,
(Santa Cruz County Superior Court Case No. 21CV02683, consolidated with 22CV00373 and 22CV00838)

3. Real Property Negotiations (Government Code §54956.8) 1) Property: Colligan Theater
APN: 008-661-13
Owner: City of Santa Cruz
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Theatre 831 dba All About Theatre
Under Negotiation: Price, terms of payment, or both
2) Property: 1070 River Street, referred to as the Kron House APN: 008-661-18
Owner: City of Santa Cruz
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Arts Council Under Negotiation: Price, terms of payment, or both
June 25, 2024 City Council 4
City Council
12:30 PM
Call to Order
Roll Call
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
Presentation

4. Mayoral Proclamation Declaring July 2024 as Parks and Recreation Month
Presiding Officer's Announcements
Statements of Disqualification
Additions and Deletions
City Attorney Report on Closed Session
Council Meeting Calendar

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

June 25, 2024 City Council 5
Consent Agenda

6. Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA/CM) Resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 winter storms.

7. Minutes of the June 11, 2024 City Council Meeting (CC) Motion to approve as submitted.

8. Minutes of the June 18, 2025 Joint City Council and Planning Commission Study Session (CC)
Motion to approve as submitted.

9. Arts Commission Appointment (CC)
Motion to approve Mayor Keeley’s nomination of Chanel Enriquez to the Arts Commission.

The contract for the item below was modified.

10. City Overlook Emergency Shelter Operations and Management Award Contract (CM)
Motion to award a contract to People First of Santa Cruz County for the City Overlook emergency shelter operations and management in the amount of $4,292,879 and reject all other proposals, and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Homelessness Response Manager is authorized to execute change orders within the approved budget.

11. Emergency Shelter Transportation Program Operations and Management Award Contract (CM)
Motion to award a contract to Community Bridges/Lift Line, Santa Cruz, CA for transportation operations for the emergency shelter program in the amount of $417,271 and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Homelessness Response Manager is authorized to execute change orders within the approved budget.

June 25, 2024 City Council 6
Consent Agenda (continued)

12. Long-Term Safe Parking Operations and Management Award Contract (CM)
Motion to award a contract to People First of Santa Cruz County for the long-term safe parking program operations and management in the amount of $489,732 and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Homelessness Response Manager is authorized to execute change orders within the approved budget.

13. Governor's Office of Planning and Research Adaptation Planning Grant Program - Authorization to Submit a Grant Application to Complete a Microgrid Feasibility and Community Resilience Plan (CM) Resolution authorizing the City Manager to apply for, accept, and appropriate funds from the Governor’s Office of Planning and Research Local Government’s Adaptation Planning Grant Program.

14. Designation of Voting Delegate and Alternate to Attend the League of California Cities (LOCC) Annual Conference Being Held in Long Beach October 16 – 18, 2024 (CN)
Motion to designate Vice Mayor Golder as the voting delegate, and Councilmember Brunner as the alternate in the event that Vice Mayor Golder is unavailable, to attend the League of California Cities Annual Conference in Long Beach.

15. Letter of Support of California Senate Bill 1053 and Assembly Bill 2236 (CN)
Motion to direct the Mayor to provide a letter of support of California Senate Bill 1053 and Assembly Bill 2236, both related to plastic pollution.

June 25, 2024 City Council 7
Consent Agenda (continued)

16. City Council Ad Hoc Climate and Resilience Committee (CN) Motion to:
1) Accept an update regarding the recent work of the City Council Ad Hoc Climate and Resilience Committee (Ad Hoc); and
2) Approve Ad Hoc recommendations for West Cliff Implementation Committee membership and next steps, and the approach for a pilot of a broader climate and resiliency advisory committee.

17. Economic Development Strategy Update: Downtown and
Eastside/Midtown District Activation Recommendations (EDH) Accept the Economic Development Strategy Update regarding business district activations and direct staff to move forward on the following recommended actions:
1) Continue placemaking and activation of Lot 32, the “Midtown Parking Lot;”
2) Complete evaluation of storefront activation strategies and return to Council for consideration and approval of modifications to existing programs and approval of new initiatives that will assist in the activation and maintenance of empty storefronts;
3) Continue work related to the establishment of a Midtown Business District and pre-feasibility analysis of a Westside Business District; and 4) Complete outreach for the alleyway activation program and return to Council as needed with recommendations for approval.

18. River Street Shelter Site License Agreement, 115-C Coral Street (EDH) Motion to approve and authorize the City Manager to execute the License Agreement with Housing Matters in a form approved by the City Attorney for the River Street Shelter site at 115-C Coral Street.

June 25, 2024 City Council 8
Consent Agenda (continued)

19. Proposition 4 Appropriations Limit Adjustment Factors (FN) Motion to adopt a resolution approving the selection of the annual adjustment factors to be utilized in the calculation of the City’s Proposition 4 Appropriations Limit (GANN Limit) based on the adopted budget for FY 2025, with amendments thereto, if any.

20. Award Contracts for Tree Services (FN)
Motion to award two contracts for the citywide on-call tree services to Lewis Tree Service Incorporated (Lewis Tree), Kent, Ohio and Community Tree Services, LLC (Community Tree), Royal Oaks, California, for three years, and to authorize the City Manager to execute a contract in a form approved by the City Attorney with both Lewis Tree and Community Tree. The Purchasing Manager is authorized to execute change orders within the approved budget.

21. Pass-Through Agreement with Community Bridges/CTSA of Santa Cruz County - TDA Claimant (FN)
Motion to authorize and direct the City Manager to execute an agreement with Community Bridges/Consolidated Transportation Services Agency/State Transit Assistance (STA), allowing the City to act as claimant for funds obtained from the Santa Cruz County Regional Transportation Commission (SCCRTC) for FY 2025.

22. Pass-Through Agreement with Volunteer Center of Santa Cruz County - TDA Claimant (FN)
Motion to authorize and direct the City Manager to execute an agreement with Volunteer Center of Santa Cruz County, allowing the City to act as claimant for funds obtained from the Santa Cruz County Regional Transportation Commission (SCCRTC) for FY 2025.

23. General Obligation Refunding Bonds - Tax Rate Authorization (FN) Motion to adopt a resolution setting the tax rate for FY 2025 with respect to the City’s General Obligation Refunding Bonds.

June 25, 2024 City Council 9
Consent Agenda (continued)

24. Liability Claims Filed Against the City of Santa Cruz (FN) Motion to reject the claims of 1) John J. Morley, 2) Luis Ramirez, 3) Mirfak Elize Fuentes Hernandez, 4) Barbara Jana Hostetter, 5) David Turner, 6) Jeffrey David Dunworth, and 7) to return as late, the claim of Progressive West Insurance Company, based on staff
recommendation.

25. Resolution Amending the City of Santa Cruz Personnel Complement and Classification and Compensation Plans for the Parks and Recreation, Information Technology, and Water Departments (HR)
Motion to adopt a resolution amending the Classification and Compensation Plans for the FY 2025 budget personnel complement by approving classification and position changes in three departments and correcting compensation ranges for four classifications.

26. 2024 Wharf Repair Project - Approval of Plans and Specifications and Authorization to Advertise for Bids and Award Contract - Environmental Clearance: Exempt - Section 15301, Existing Facilities; Section 15302, Replacement or Reconstruction; Section 15303, New Construction or Conversion of New Structures; and Section 15304, Minor Alterations of Land (PR)
Motion to:
1) Award a contract to Dickman-Hines Lumber Co. in the amount of $464,151.84 and ratify them as the lowest, responsive, and responsible bid for Invitation for Bid (IFB) PK-0133 - Santa Cruz Wharf Pilings; 2) Approve plans and specifications for the 2024 Wharf Repair Project and authorize Parks and Recreation staff to advertise the project for bid and award the contract in a form to be approved by the City Attorney. Per Resolution No. NS-27,563 the City Manager is hereby authorized and directed to execute the contract in a form approved by the City Attorney. The Parks and Recreation Director is authorized to execute change orders within the approved budget; and
3) Motion to find that the project is exempt under the California Environmental Quality Act (CEQA) (Categorical Exemption Sections 15301, 15302, 15303, and 15304).

June 25, 2024 City Council 10
Consent Agenda (continued)

27. 2024 Citywide Sewer/Storm Drain Lining Project - Authorization to Advertise and Award (PW)
Motion to approve the plans and specifications for the 2024 Citywide Sewer/Storm Drain Lining Project (c401511), authorize an exemption from local hire requirements, 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 approved by the City Attorney. The Director of Public Works is authorized to execute changes orders within the approved project budget.

28. 2024 Laurel Street Surface Seal and Striping Project – Authorization to Advertise and Award (PW)
Motion to:
1) Approve the plans and specifications for the 2024 Laurel Street Surface Seal and Striping Project and authorize staff to advertise for bids and award the contract. The City Manager is hereby authorized and directed to execute an agreement in a form approved by the City Attorney. The Director of Public Works is authorized to execute change orders within the approved project budget;
2) Adopt a resolution to approve the plans and specifications for the project pursuant to Government Code Section 830.6; and
3) Approve the Laurel Street Surface Seal and Striping Project and find the project exempt under the California Environmental Quality Act.

June 25, 2024 City Council 11
Consent Agenda (continued)

29. 2024 Pavement Rehabilitation Project – Authorization to Advertise and Award (PW)
Motion to:
1) Approve the plans and specifications for the 2024 Pavement Rehabilitation Project (c400809), authorize staff to advertise for bids and award the contract. The City Manager is hereby authorized and directed to execute an agreement in a form approved by the City Attorney. The Director of Public Works is authorized to execute change orders within the approved project budget;
2) Adopt a resolution to approve the plans and specifications for the project pursuant to Government Code Section 830.6; and
3) Approve the 2024 Pavement Rehabilitation Project and find the project exempt under the California Environmental Quality Act.

30. Memorandum of Understanding with County of Santa Cruz for Edible Food Recovery Support Services (PW)
Motion authorizing the City Manager to execute a Memorandum of Understanding (MOU) in a form approved by the City Attorney with County of Santa Cruz for Edible Food Recovery Support Services.

31. Santa Cruz Resource Recovery Facility Appliance Recycler Services Contract - Authorization to Advertise and Award (PW)
Motion to approve the specifications for the Santa Cruz Resource Recovery Facility Appliance Recycler Services and authorizing staff to advertise for bids and award the contract. The City Manager is hereby authorized and directed to execute the contract in a form approved by the City Attorney. The Public Works Director is authorized to execute change orders within the approved project budget.

June 25, 2024 City Council 12
Consent Agenda (continued)

32. West Cliff Dr. 60-inch Reinforced Concrete Pipe Headwall Repair (c402409) - Authorization to Advertise and Award and Budget Adjustment (PW)
Motion to:
1) Approve the plans and specifications for West Cliff 60-inch West Cliff Dr. 60-inch reinforced concrete pipe (RCP) headwall repair 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 approved by the City Attorney. The Public Works Director is authorized to execute change orders within the approved project budget;
2) Approve the West Cliff Dr. 60-inch RCP headwall repair project and find the project exempt under CEQA; and
3) Adopt a resolution to amend the FY 2024 budget and appropriate funds in the amount of $700,000 for the West Cliff 60-inch RCP Headwall Repair Project.

33. West Cliff Multi-Use Path Rehabilitation Project (m400819) – Authorization to Advertise and Award (PW)
Motion to:
1) Approve the project plans and specifications for the West Cliff MultiUse Path Rehabilitation Project (m400819), authorize staff to advertise for bids, and award the contract. The City Manager is hereby authorized and directed to execute an agreement in a form approved by the City Attorney. The Director of Public Works is authorized to execute change orders within the approved project budget; 2) Adopt a resolution to approve the plans and specifications for the project pursuant to Government Code Section 830.6; and
3) Approve the West Cliff Multi-Use Path Rehabilitation Project and find the project exempt under the California Environmental Quality Act.

June 25, 2024 City Council 13
Consent Agenda (continued)

34. Contract Amendment with Fehr & Peers Transportation Consultants for West Cliff Transportation Consulting (PW)
Motion to approve Amendment 1 with Fehr & Peers Transportation Consultants (Walnut Creek, CA) in the amount of $8,150. The City Manager is hereby authorized and directed to execute an agreement in a form approved by the City Attorney. The Director of Public Works is authorized to execute contract amendments within the approved project budget.

35. 2024 Branciforte Creek Streambank Restoration Project – Approval of Plans and Specifications, California Environmental Quality Act Exemption, and Authorization to Advertise for Bids and Award of Contract (WT)
Motion to:
1) Approve the plans and specifications for the 2024 Branciforte Streambank Restoration Project (c702304) and authorize staff to advertise for bids. The City Manager, or designee, is hereby authorized and directed to execute the contract as authorized by Resolution No.

NS-27,563;
2) Find the 2024 Branciforte Streambank Restoration Project (c702304) exempt under the California Environmental Quality Act (CEQA), and allow staff to file a Notice of Exemption; and
3) Authorize the Water Director to execute change orders for the 2024 Branciforte Streambank Restoration Project within the approved project budget.

36. Aquifer Storage and Recovery Beltz 9 Pilot Test Site Preparation and Monitoring Well – Notice of Completion (WT)
Motion to accept the work of Eaton Drilling, Inc. as complete per the plans and specifications, authorizing the filing of a Notice of Completion for the Aquifer Storage and Recovery Beltz 9 Pilot Test Site Preparation and Monitoring Well Project and authorizing the Water Director to sign the Notice of Completion as the Owner’s Authorized Agent.

June 25, 2024 City Council 14
Consent Agenda (continued)

37. Purchase of Easement for the Electrical Power for Carbonera Tank Operations: Assessor’s Parcel Number 068-201-01, Owned by Richard J.

Giovannoni and Judy K. Giovannoni (WT)
Motion to adopt a resolution authorizing and directing the City Manager to execute a Purchase Sale Agreement in the amount of $10,000 and Grant of Easement Deed in a form approved by the City Attorney, on a property (designated as APN 068-201-01) located in Santa Cruz, CA on Mill Road near the intersection of Glen Canyon Road and Branciforte Drive and owned by Richard J. Giovannoni and Judy K. Giovannoni for the purpose of providing electrical power to the Carbonera Tank, and to find the project exempt under California Environmental Quality Act and allow staff to file a Notice of Exemption.

38. Contract Amendment 2025-01 with HDR, Inc. for Capital Program Management Services (WT)
Motion authorizing the City Manager to execute Contract Amendment No. 2025-01 with HDR, Inc. for Service Order No. 10 in the amount of $9,303,596 in a form to be approved by the City Attorney.

End Consent Agenda
Consent Public Hearing

39. 2nd Reading and Final Adoption of Ordinance No. 2024-10 to Add Chapter 6.110 – 6.110.070 to Title 6, Health and Sanitation, of the Santa Cruz Municipal Code to Prohibit the Use of Gas-Powered Leaf Blowers Citywide (CM)
Motion to adopt Ordinance No. 2024-10 entitled “Prohibition of GasPowered Leaf Blowers” to add Chapter 6.110 – 6.110.070 to Title 6, Health and Sanitation, of the Santa Cruz Municipal Code (SCMC) to prohibit the use of gas-powered leaf blowers citywide. The California Environmental Quality Act (CEQA) determination: This ordinance is consistent with the Negative Declaration approved for the City of Santa Cruz Climate Action Plan 2030 adopted by City Council on September 13, 2022. The ordinance is also exempt from CEQA under the “common sense” exemption, 15061(b)(3) and per CEQA Guidelines Section 15308, Class 8, Actions by Regulatory Agencies for Protection of the Environment.

June 25, 2024 City Council 15
Public Hearing

40. 302, 310, 314, 322, 324, 326, 328 Front Street: CP24-0097 (APN 005- 151-29, -34, -35, -43, -48, -51) Major Modification to Previously Approved Application File Number CP21-0051 to Amend the Conditions of Approval to Add Voluntary Public Benefits to the PreviouslyApproved Six-Story, 232-Room Hotel Project with Restaurant, Bar, Banquet, and Other Related Facilities located in the CBD (Central Business District) Zone District. (Environmental Determination:

Categorical Exemption, Section 15332 & Statutory Exemption 15061(b)(3)) Applicant: SCFS Venture LLC (PL)
Motion to adopt a resolution approving application CP24-0097 based on the attached Findings and Conditions of Approval.

General Business

41. City Council Sugar-Sweetened Beverage Ad Hoc Committee Recommendations Related to the Placement of a General Purpose Tax Measure of Two-Cents Per Ounce on Distributors of Sugar-Sweetened Beverages on the November 5, 2024 Ballot (CN)
Motion to:
1) Accept recommendations from the recent work of the City Council Sugar-Sweetened Beverage Ad Hoc Committee;
2) Adopt a resolution requesting that the November 5, 2024 General Election ballot include a general tax of two-cents per fluid ounce on distributors of sugar sweetened beverages that includes a Community Oversight Panel to transmit an annual report and make
recommendations to the City Council; and
3) Support 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.

June 25, 2024 City Council 16
General Business (continued)

42. City of Santa Cruz Homelessness Response Strategic Plan July 2024 – June 2027 (CM)
Motion to approve the City of Santa Cruz's Homelessness Response Strategic Plan, covering July 2024 – June 2027.

43. Monterey Bay Area Regional Climate Project Working Group (CM) Motion to:
1) Accept the presentation on the activities of the Monterey Bay Area Regional Climate Project Working Group (RCPWG); and
2) Adopt a resolution affirming the City Council’s intention to commit to funding the City of Santa Cruz’s contribution for the RCPWG for three (3) additional years (through FY 2027), if feasible given the status of the General Fund.

Adjournment
June 25, 2024 City Council 17

INFORMATION ITEMS PREVIOUSLY DISTRIBUTED TO CITY COUNCILMEMBERS ADDENDUM TO CITY COUNCIL AGENDA – JUNE 25, 2024

44. Parks and Recreation Department: Status Change for Sister City Puerto La Cruz, Venezuela - 6/25/24 (PKFYI 80)

MAYOR'S PROCLAMATIONS
ADDENDUM TO CITY COUNCIL AGENDA – JUNE 25, 2024

45. Proclaiming June 22, 2024 as “Santa Cruz Woodies and Woodies on the Wharf Day” and encouraging all citizens to join in celebrating Woodies on the Wharf as a locally beloved Santa Cruz event.

46. Proclaiming June 15, 2024 as “World Elder Abuse Awareness Day” and the month of June 2024 as “Elder Abuse Awareness Month” and encouraging all citizens to join in this observance and in helping prevent elder abuse and supporting the well-being of all older adults in the City.

47. Proclaiming Saturday, June 15, 2024 as “Janet Webb Day” and encouraging all citizens to join in congratulating her on being named the “2024 Farmer of the Year” by the Santa Cruz County Farm Bureau.

48. Proclaiming June 17, 2024 as “Santa Cruz Shakespeare Day” and encouraging all citizens to join in welcoming the 2024 Shakespeare Company of actors and artisans to our town, congratulating Santa Cruz Shakespeare for consistent excellent as an independent arts organization for twelve years and counting, honoring it as an outstanding member of the community, and expressing heartfelt gratitude for the leadership that it shows in fostering a thriving performing arts culture in our town—Shakespeare, play on! June 25, 2024 City Council 18
Advisory Body Appointments
The following positions are either currently vacant or the terms are due to expire.

Council will make the appointments at a future meeting.

County Latino Affairs
Commission
One opening – at-large nomination
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.

July is...

PARKS AND RECREATION MONTH

4.1 W HAT IS...

PARKS AND RECREATION MONTH?
Since 1985, people in the United States
have celebrated Park and Recreation
Month in July to promote building strong,
vibrant and resilient communities
through the power of parks and
recreation and to recognize park and
recreation professionals that maintain our
country’s local, state and community
parks.
28 1,0 0 0
P&R

PROFESSIONALS
7,78 0 +

PARKS IN CA
Lo n d o n Ne lso n Co m m un it y Ce n t e r Te am 4.2

NATIONAL

RECREATION AND

P ARK ASSOCIATION
This year's theme —“Whe re You Be long” —celeb rates the many ways p ark and re cre at ion p rofe ssionals across t he count ry fost e r a se nse of b e longing in t he ir com m unit y b y p rovid ing we lcom ing and inclusive p rogram s, e sse nt ial se rvice s for all age s and ab ilit ie s, and safe , acce ssib le sp ace s t o b uild m e aningful conne ct ions.

This Park and Re cre at ion Mont h le t ’s unit e and up lift t he m any re asons why local p arks and re cre at ion t ruly e m b od ie s t he e sse nce of b e longing.

Toge t he r, we can d e m onst rat e why t he se sp ace s are Whe re You Be long.

4.3 • P ro m o t e s p h ys ic a l, e m o t io n a l, a n d m e n t a l h e a lt h & w e lln e s s • Su p p o rt s t h e e c o n o m ic vit a lit y o f c o m m u n it ie s • Fo st e rs so cia l co h e sive n e ss
• Su st a in s a n d st e w a rd s o u r n a t u ra l re so u rc e s • Su p p o rt s h u m a n & c o m m u n it y d e ve lo p m e n t

TOP BENEFITS
Ara n a Gulch
Harve y We st Pum p J un e t e e n t h at Lo n d o n Ne lso n Co m m un it y Ce n t e r Track
Delaveaga Park 4.4

LET'S TALK ABOUT

OUR ORGANIZATION

ESSENTIAL TO COMMUNITY HEALTH AND WELLBEING
To that end, we c o m m it to :
• Tra n s p a re n t an d honest co m m u n ica t io n as the fo u n d a t io n of great re la t io n sh ip s.
• A s p irit of e q u it y, openness and in n o va t io n , w e lco m in g d iffe re n ce s and d ive rsit y.
• Se rvice to the co m m u n it y in a manner that is su st a in a b le , safe , re sp o n sive and a cce ssib le to a ll.
• Co lla b o ra t io n to a ch ie ve re su lt s that re fle ct our departm ent visio n , le ve ra g in g the strengths of the c o m m u n it y.

4.5 FREE ACTIVITES ALL MONTH LONG
7/5

J UNIOR GUARDS

BIG SW IM
7/9

TUESDAY NIGHT LIVE
CONCERT # 3
7/20

FREE TREE W ALK
Cheer on the Little and Junior
Guards at the Santa Cruz
Wharf at 1:30 P M - 3 PM
FREE Concert featuring The
Joint Chiefs at the Santa Cruz
Wharf.
6 PM - 8 PM
Join the City's Arborist, Leslie
Keedy. Meet at fountain in
City Hall Courtyard 9 AM
Must Register to participate!
Sa n Lo re n zo Rive r Wa lk
Urb an Fo re st e r, Le slie Ke e d y

4.6 Cit yOfSan t aCruz.co m / J ulyIs

ALL J ULY EVENTS
7/16 &
W ALKING ADVENTURE GROUP 7/18
7/22-
7/26

CIVIC BACKSTAGE TOUR
7/19

LONDON NELSON COMMUNITY CENTER

OPEN HOUSE WEEK
Join Coastal Watershed Council for the guided San Lorenzo River walk Meet at the Chinatown Gate Pedestrian Bridge on River Street (Behind Trader Joe's) For more information contact the Walking Adventure Group at (831) 420 -6180
Join us for a Backstage tour at the Civic Auditorium. We will explore an inside look at the stage, back rooms, provide staff stories, secrets of the Civic and more! Time 6PM!
More information at SantaCruzCivic.com
Be our guest! Tours, Q&A's, Refreshments, and more!
Singles Ping -Pong Tournament 7/23
Doubles Ping -Pong Tournament 7/25
For more information visit London Nelson Community Center Cit yOfSan t aCruz.co m / J ulyIs

4.7 JUNE EVENT HIGHLIGHTS
• J u n e 11t h : Tu e s d a y Nig h t Live Co n c e rt # 2 a t t he Santa Cruz W harf
• J u n e 15t h : J u n e t e e n t h a t t h e Lo n d o n Ne ls o n Co m m u n it y Ce n t e r
• J u n e 22n d : W o o d ie s o n t h e W h a rf, Kid ’s Da y Do w n t o w n , a n d Lib e ra t io n P a d d le O u t • J u n e 29 t h : Fa m ily Fu n Da y a t De la ve a g a P a rk

4.8 QUESTIONS?
Visit : Cit yOfSan t aCruz.co m / J ulyIs

4.9 Meeting Type
Holiday
Jewish Holiday
Regular Meeting
Special Meeting (will be added as scheduled)
Study Session (will be added as scheduled)
Budget Hearing
DATE Location Meeting Type
July 4
August Council Chambers Study Session ‐ 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 September 2
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 October 2/3
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public October 11/12
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public November 11
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 28
November 29
Courtyard Conf. Room Closed Session ‐ Closed to the Public Council Chambers Council Regular Meeting ‐ Open to the Public December 25/26
December 25
City Council Meeting Calendar for 2024
November 26
December 10
City Hall Closure ‐ Thanksgiving Day
City Hall Closure ‐ Day After Thanksgiving Day
September 10
September 24
Please note: Meeting times are not final and are likely to change August 13
City Hall Closure ‐ Labor Day
August 27
July 9 and 23 Meetings Cancelled ‐ CITY COUNCIL DARK
City Hall Closure ‐ Independence Day
December 24 Meeting Cancelled ‐ CITY COUNCIL DARK
City Hall Closure ‐ Christmas Day
Rosh Hashanah (City observed ‐  sundown to sundown)
November 12
October 8
October 22
City Hall Closure ‐ Veteran's Day (observed)
Hanukkah (City observed ‐  sundown to sundown)
Yom Kippur (City observed ‐  sundown to sundown)

5.1 City Council

AGENDA REPORT
DATE: 06/04/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Attorney
SUBJECT: Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA/CM) RECOMMENDATION: Resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 winter storms.

BACKGROUND: On January 4, 2023, the City Manager declared the existence of a local emergency following storms in December 2022 and January 2023 (“2022/2023 Winter Storms”) that caused significant flooding, infrastructure damage, and other storm impacts, including downed trees and impacts to persons experiencing homelessness.

A year later, and while responses to the 2022/2023 Winter Storms remained ongoing, the City of Santa Cruz experienced another significant storm event that resulted in flooding and significant damage to City infrastructure (“2023/2024 Winter Storms”). The City Manager again declared the existence of a local emergency as a result of the 2023/2024 Winter Storms on February 6, 2024.

DISCUSSION: Government Code section 8630 authorizes a governing body of a city or an official designated by ordinance to proclaim the existence of a local emergency. Santa Cruz Municipal Code section 2.20.030 empowers the Director of Emergency Services to proclaim the existence or threatened existence of a local emergency when the City is affected or likely to be affected by a public calamity or disaster, subject to confirmation by the City Council at the “earliest practicable time.” During the existence of such emergency, the Director of Emergency Services is also authorized, pursuant to Section 2.20.040(1), to “[m]ake and issue rules and regulations on matters reasonably related to the protection of life and property as affected by such emergency,” also subject to confirmation by the City Council “at the earliest practicable time.”
In view of the facts and circumstances described above and damage caused by the 2022/2023 and 2023/2024 winter storms, the City Council ratified the City Manager’s January 4, 2023, emergency declaration by Resolution No. NS-30,085 at its January 10, 2023 regular meeting, and ratified the City Manager’s February 6, 2024 emergency declaration by Resolution No. NS30,286 at its February 13, 2024 regular meeting.

6.1 The attached resolution, if adopted by the City Council, would extend the 2022/2023 Winter Storms emergency declaration and 2023/2024 Winter Storms emergency declaration by an additional 60 days, to August 24, 2024.

FISCAL IMPACT: Actions taken by the City during a declared emergency are potentially recoverable from Cal OES (California Governor’s Office of Emergency Services) and FEMA (Federal Emergency Management Agency).

Prepared By:

Stephanie Duck
Deputy City Attorney
Submitted By:

Tony Condotti
City Attorney
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

6.2 RESOLUTION NO. NS-30,XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ EXTENDING THE LOCAL EMERGENCY DECLARATIONS IN CONNECTION WITH THE 2022/2023 WINTER STORMS AND 2023/2024 WINTER STORMS
WHEREAS, Government Code section 8630 authorizes the City Council or an official designated by ordinance to proclaim the existence of a local emergency; and WHEREAS, Santa Cruz Municipal Code section 2.20.030 empowers the City Manager, as the director of emergency services, to proclaim the existence or threatened existence of a local emergency when the City is affected or likely to be affected by a public calamity, subject to confirmation by the City Council at the earliest practicable time; and WHEREAS, on December 30 and 31st, 2022, the City of Santa Cruz experienced an atmospheric river storm rain event, followed by another powerful storm event on January 4 and 5th, 2023 (the “2022/2023 Winter Storms”). As a result of the 2022/2023 Winter Storms, flooding, debris from trees, and mud impacted the San Lorenzo River and adjacent areas, including the Tannery area, San Lorenzo Park, and the beach. The San Lorenzo River reached

22.1 feet. Rainfall amounts exceeded 7 inches in the mountains over a 24-hour period. The 2022/2023 Winter Storms resulted in flooding, downed trees, major infrastructure damage, and impacts to persons experiencing homelessness; and
WHEREAS, the County of Santa Cruz proclaimed the existence of a local emergency in the County on January 3, 2023 in response to the 2022/2023 Winter Storms; and WHEREAS, in light of the 2022/2023 Winter Storms and pursuant to his authority as Emergency Services Director, on January 4, 2023, the City Manager declared the existence of a local emergency (the “2022/2023 Emergency Proclamation”). At its January 10, 2023 meeting, the City Council adopted Resolution No. NS-30,085 declaring the existence of a State of Emergency in connection with the 2022/2023 Winter, confirming the 2022/2023 Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2022/2023 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,315 at its April 30, 2024 regular meeting, further extending the declaration of emergency by 60 days; and
WHEREAS, a year after the 2022/2023 Winter Storms, on December 28 and 30th, 2023, the City of Santa Cruz experienced a large winter swell event involving significant rain and hazardous ocean conditions, causing an estimate of $2.5 million in damage along West Cliff Drive and the Santa Cruz Wharf, followed by atmospheric river storms throughout January and February 2024 (the “2023/2024 Winter Storms”). The 2023/2024 Winter Storms included significant rainfall on January 22, 2024 that contributed to flooding within the City of Santa Cruz and specifically to Cypress Point Apartments; and

6.3 RESOLUTION NO. NS-30,XXX
WHEREAS, on January 30, 2024, the County of Santa Cruz Board of Supervisors ratified Local Emergency for the December 2023 Coastal Storms, as proclaimed by the County Administrative Officer as the Director of Emergency Services on January 3, 2024; and WHEREAS, in light of the 2023/2024 Winter Storms and pursuant to his authority as Emergency Services Director, on February 6, 2024, the City Manager declared the existence of a local emergency (the “2023/2024 Emergency Proclamation”). At its February 13, 2024 meeting, the City Council adopted Resolution No. NS-30,286 declaring the existence of a State of Emergency in connection with the 2023/2024 Winter Storms, confirming the 2023/2024 Winter Storms Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2023/2024 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,315 at its April 30, 2024 regular meeting, further extending the declaration of emergency by 60 days; and
WHEREAS, damage to City infrastructure from the 2022/2023 Winter Storms and 2023/2024 Winter Storms is extensive and as a result, the City’s emergency response remains ongoing.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz (City Council) as follows:

A. That the City Council hereby declares that the local emergency declaration adopted at its January 10, 2023 regular meeting by Resolution No. NS-30,085, and extended on January 24, 2023 by Resolution NS-30,095, on March 14, 2023 by Resolution NS-30,116, on May 9, 2023 by Resolution NS-30,145,on June 27, 2023 by Resolution NS-30,166, on August 22, 2023 by Resolution NS-30,187, on October 10, 2023 by Resolution NS-30,208, on November 28, 2023 by Resolution NS-30,239, on January 23, 2024 by Resolution NS30,274, on March 12, 2024 by Resolution NS-30,296, and on April 30, 2024 by Resolution NS-30,315, shall be extended an additional sixty (60) days from its adoption pursuant to California Government Code Section 8630, et seq., by this Resolution; and B. That the City Council hereby declares that the local emergency declaration adopted at its February 13, 2024 regular meeting by Resolution NS-30,286, and extended on April 9, 2024 by Resolution NS-30,311, and on April 30, 2024 by Resolution NS-30,315, shall be extended an additional sixty (60) days from its adoption pursuant to California Government Code Section 8630, et seq., by this Resolution; and
C. This Resolution shall remain in full force and effect and shall thereafter terminate on the sixtieth (60th) day after its adoption, unless earlier terminated or further extended by subsequent City Council action.

6.4 RESOLUTION NO. NS-30,XXX
PASSED AND ADOPTED this 25th day of June 2024 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

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

MINUTES OF A CITY COUNCIL MEETING
June 11, 2024
1:00 PM
Mayor Keeley opened the City Council Closed Session at 1:02 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, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

Statements of Disqualification – None.

Public Comment
Mayor Keeley opened the public comment period at 1:03 p.m. There were no speakers. Mayor Keeley closed the public comment period at 1:04 p.m., at which time the meeting was closed to the public and Council adjourned to the Courtyard Conference Room.

Closed Session

1. Conference With Legal Counsel – Liability Claims (Government Code §54956.95) Claimant: Jose Ruelas
Claim against the City of Santa Cruz
Council received a status report, took up under agenda item 11, and no reportable action was taken.

7.1 June 11, 2024 CITY COUNCIL MINUTES 6863
Closed Session (continued)

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.

7.2 June 11, 2024 CITY COUNCIL MINUTES 6864
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
June 11, 2024
1:30 PM
Call to Order – Mayor Keeley called the meeting to order at 1:32 p.m. in Council Chambers.

Roll Call

Present: Councilmembers Newsome, Brown, Watkins (arrived at 1:33 p.m. after roll call), Brunner, Kalantari-Johnson; Vice Mayor Golder; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Assistant City Manager L. Schmidt, Chief of Fire R. Oatey, Director of Economic Development and Housing B. Lipscomb, Director of Finance E. Cabell (via Zoom), Director of Water H. Luckenbach, Director of Information Technology K. Morgan, Director of Planning and Community Development L. Butler, Chief People Officer S. De Leon, Director of Parks and Recreation T. Elliot, Sustainability and Climate Resiliency Officer T. Wise-West, Deputy City Attorney S. Humy, Finance Manager T. Cole, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

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

Oral Communications
At 1:33 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.

James Ewing-Whitman spoke regarding military frequency weapons in civilian territory, and meeting new Park Rangers.

Garrett spoke regarding the budget hearing at the previous meeting.

At 1:36 p.m. Mayor Keeley closed Oral Communications.

7.3 June 11, 2024 CITY COUNCIL MINUTES 6865
Presentations

3. Central Coast Community Energy Annual Update
Catherine Stedman, Chief Communications Officer with Central Coast Community Energy, provided the membership annual update and responded to Council questions.

4. Mayoral Proclamation Declaring June 2024 as National Elder Abuse Awareness Month and June 15, 2024 as World Elder Abuse Awareness Day Mayor Keeley presented a proclamation declaring June 2024 as National Elder Abuse Awareness Month and June 15, 2024 as World Elder Abuse Awareness Day to Gabriel Barraza, Senior Adult Protective Services Social Worker.

Presiding Officer's Announcements
Statements of Disqualification – Councilmember Brunner announced she is recusing herself from items 18 and 19 as it relates to her employer.

Additions and Deletions – None.

City Attorney Report on Closed Session – See page 6863 for the report.

Council Meeting Calendar

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

City Clerk Administrator B. Bush reminded Council about the joint Study Session with the Planning Commission on June 18, 2024.

7.4 June 11, 2024 CITY COUNCIL MINUTES 6866
Consent Agenda
Councilmember Brown made a comment on items 7, 8, and 17.

Councilmember Watkins made a comment on items 7 and 8, requesting to amend the motion language for item 8 to include the following:
 Following the adoption of the State budget, direct staff to return with options for continuing the City’s support of the Market Match Program in partnership with the Santa Cruz Farmers’ Market.

Councilmember Kalantari-Johnson made a comment on items 7 and 8.

Councilmember Brunner made a comment on items 8 and 10.

Mayor Keeley made a comment on item 7.

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

Rachel Dann spoke regarding item 7.

Mayor Keeley closed the public comment period.

MOTION: Vice Mayor Golder moved, seconded by Councilmember Watkins, to approve the amended 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.

6. Minutes of the May 28, 2024 City Council Meeting (CC) Motion carried to approve as submitted.

7. Support for the Santa Cruz County Water and Wildfire Protection Act (CN) Resolution No. NS-30,342 was adopted expressing the Santa Cruz City Council’s support for the Santa Cruz County Water and Wildfire Protection Act (WWPA).

7.5 June 11, 2024 CITY COUNCIL MINUTES 6867
Consent Agenda (continued)

8. Resolution Opposing the Governor’s Proposal to Cut Funds from the Market Match Program (EDH/CN)
Motion carried to:
 Adopt Resolution No. NS-30,343 opposing the Governor’s proposal to cut $33.2 million of the $35 million budget for the Market Match Program and urging the Governor to maintain all safety net programs, including the California Nutrition Incentive Program (CNIP) in the state budget; and  Direct staff to return with options for continuing the City’s support of the Market Match Program in partnership with the Santa Cruz Farmers’ Market following the adoption of the State’s budget.

9. Exempt Surplus Land Declaration for Property owned by the City of Santa Cruz, located at the Northwest Corner of Mount Hermon Road and Kings Village Road in the City of Scotts Valley, aka Skypark, APNs 022-721-07, 022-721-08, and 022-721-09 (EDH)
Resolution No. NS-30,344 was adopted declaring the City-owned property located at the Northwest Corner of Mount Hermon Road and Kings Village Road in the City of Scotts Valley, aka Skypark, APNs 022-721-07, 022-721-08, and 022-721-09 as exempt surplus land under the Surplus Lands Act and may be sold to the City of Scotts Valley for its agency use.

10. Second Amendment to Graffiti Abatement Services Agreement with Graffiti Protective Coatings, Inc. (EDH)
Motion carried to authorize the City Manager to execute the Second Amendment to Professional Services Agreement with Graffiti Protective Coatings, Inc., extending services through FY 2025 in an amount of $147,688.

11. Liability Claim Filed Against the City of Santa Cruz (FN) Motion carried to reject the liability claim of Jose Ruelas, based on staff recommendation.

7.6 June 11, 2024 CITY COUNCIL MINUTES 6868
Consent Agenda (continued)

12. Lewis Tree Service Contract Change Order (41-24062) (PR) Motion carried to approve the Lewis Tree Service contract change order for emergency tree service work related to the FY 2024 winter storms (Contract number: 41-24062).

13. Award Contract for Groundsmaster 5900 Large Area Mower (PR) Motion carried to award a contract for the purchase of a Toro Groundsmaster 5900 Large Area Mower to Turf Star Western in the amount of $146,559.00.

14. 2024 Pavement Rehabilitation Project (c400809) – Authorization to Advertise and Award (PW)
This item was continued to June 25, 2024 and was not discussed.

15. Wastewater Treatment Facility Gravity Thickener No. 2 Upgrade (c401706) – Notice of Completion (PW)
Motion carried to accept the work of Fluid Resource Management (Arroyo Grande, CA) as completed per plans and specifications and authorize the filing of the Notice of Completion for the Wastewater Treatment Facility Gravity Thickener No. 2 Upgrade (c401706).

16. Centrifuge Control Panel Improvement Project (m409659) – Notice of Completion (PW)
Motion carried to accept the work of Separator Technology Solutions (San Leandro, CA) and authorize the filling of the Notice of Completion for the Centrifuge Control Panel Improvement Project (m409659).

7.7 June 11, 2024 CITY COUNCIL MINUTES 6869
Consent Agenda (continued)

17. Emergency Temporary Flare Installation Project at the Resource Recovery Facility (c401909) – Authorization to Ratify Purchase Orders Related to Emergency Project (PW)
Motion carried to ratify purchase orders related to the emergency temporary flare installation project with:
 LFG Specialties, LLC (Boston Rouge, LA) to deliver, install, and lease a temporary flare to the City of Santa Cruz at the Resource Recovery Facility in the amount of $160,685.00;
 Cupertino Electric Inc (San Jose, CA) to perform electrical work necessary to supply power to a temporary flare at the Resource Recovery Facility in the amount of $130,658.00; and
 Tetra Tech BAS (Diamond Bar, CA) to construct the flare skid pad and pipe connection in the amount of $252,371.00 in a form approved by the City Attorney. The Public Works Director is authorized to execute change orders within the approved project budget.

End Consent Agenda
At this time, Councilmember Brunner recused herself and left the dais.

Consent Public Hearings
Mayor Keeley opened the public comment period. There were no speakers. Mayor Keeley closed the public comment period.

MOTION: Councilmember Newsome moved, seconded by Councilmember Kalantari-Johnson, to approve the Consent Public Hearing Agenda.

ACTION: The motion carried with the following vote.

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

NOES: None.

ABSENT: None.

DISQUALIFIED: Councilmember Brunner.

7.8 June 11, 2024 CITY COUNCIL MINUTES 6870
Consent Public Hearings (continued)

18. Downtown Association: Parking and Business Improvement Area Assessments for FY 2025 (EDH)
Resolution No. NS-30,345 was adopted confirming the Parking and Business Improvement Area FY 2025 Plan prepared by the Downtown Association and levying the Parking and Business Improvement Area Assessments for FY 2025.

19. Cooperative Retail Management Business Real Property Improvement District Assessments for FY 2025 (EDH)
Resolution No. NS-30,346 was adopted confirming the Cooperative Retail Management Business Real Property Improvement District Annual Plan FY 2025 and levying Cooperative Retail Management Business Real Property Improvement District Assessments for FY 2025.

At this time, Councilmember Brunner returned to the dais.

General Business

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

Unidentified person
Garrett
Ken Foster
Carol Wilhelmy
Ron Goodman
Brett Garrett
Susan Kauffman
Mayor Keeley closed the public comment period.

Deputy City Attorney S. Humy responded to Council questions.

7.9 June 11, 2024 CITY COUNCIL MINUTES 6871
General Business (continued)

20. First Reading of An Ordinance to Add Chapter 6.110 – 6.110.070 to Title 6, Health and Sanitation, of the Santa Cruz Municipal Code to Prohibit the Use of Gas-Powered Leaf Blowers Citywide (CM) (continued)
MOTION: Councilmember Kalantari-Johnson moved, seconded by Councilmember Watkins, to:
 Introduce for publication Ordinance No. 2024-10 entitled “Prohibition of Gas-Powered Leaf Blowers” to add Chapter 6.110 – 6.110.070 to Title 6, Health and Sanitation, of the Santa Cruz Municipal Code (SCMC) to prohibit the use of gas-powered leaf blowers Citywide. The California Environmental Quality Act (CEQA) determination: This ordinance is consistent with the Negative Declaration approved for the City of Santa Cruz Climate Action Plan 2030 adopted by City Council on September 13, 2022. The ordinance is also exempt from CEQA under the “common sense” exemption, 15061(b)(3) and per CEQA Guidelines Section 15308, Class 8, Actions by Regulatory Agencies for Protection of the Environment, with the following amendments to Section 6.110.050 Exemptions:

FROM:
“1.This section shall not apply to the maintenance of parcels of ten (10) acres or more.

2. This section shall not apply to the maintenance of the designated parks and open spaces listed here: Arana Gulch, Arroyo Seco, DeLaveaga Park, Depot Park, Harvey West Park, Main Beach, Moore Creek Preserve, Neary Lagoon, Pogonip, San Lorenzo Park, Rail Trail, University Terrace Park, Riverwalk, and West Cliff.

7.10 June 11, 2024 CITY COUNCIL MINUTES 6872
General Business (continued)

TO:
“This chapter shall not apply to:

1. The maintenance of parcels of ten (10) acres or more. Parcels owned or maintained by homeowners’ associations that, in the aggregate, are ten (10) acres or more shall not be exempt from this chapter.

2. The maintenance of the designated parks, greenways, and open spaces listed here: DeLaveaga Park, Depot Park, Harvey West Park, Neary Lagoon, San Lorenzo Park, Rail Trail, University Terrace Park, Riverwalk, and West Cliff.

3. Use of gas-powered leaf blowers is exempt from this section when utilized by or at the direction of emergency responders for the purposes of responding to an emergency, or necessary to restore, preserve, protect, or save lives or property from imminent danger of loss or harm.”
 Direct staff to pursue funding opportunities to provide financial assistance to City residents and small businesses to transition to electric-powered leaf blowers; and
 Phase out the acreage exemption within 2—3 years of implementation of the ordinance.

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.

Staff Assignment:

Councilmember Brown requested to track where the complaints are coming from, if it’s landscaping companies, or homeowners themselves.

7.11 June 11, 2024 CITY COUNCIL MINUTES 6873
General Business (continued)

21. Budget Adoption

21.1 Fiscal Year 2025 Proposed Budget Adoption (FN)

21.2 Resolution Amending the City of Santa Cruz Personnel Complement and Classification and Compensation Plans for the Public Works, City Manager’s Office, Finance, Parks and Recreation, Water, Economic Development and Housing, Information Technology, Police, Human Resources, and the Library (HR)
Finance Manager T. Cole gave a presentation and responded to Council questions.

Director of Planning and Community Development L. Butler, City Manager M.

Huffaker, and Chief of Fire R. Oatey responded to Council questions.

Mayor Keeley opened the public comment period. There were no speakers.

Mayor Keeley closed the public comment period.

MOTION: Councilmember Brown moved, seconded by Councilmember Brunner, to:
 Adopt Resolution No. NS-30,347 adopting the Fiscal Year (FY) 2025 Budget including the Capital Investment Program (CIP), effective July 1, 2024; authorize the City Manager to allocate within the applicable funds the FY 2025 Schedule of Administrative Budget Changes to the appropriate accounting classifications and to approve related and applicable transfer in/out between funds; and authorize the Finance Director to create additional appropriations to provide for commitments carried over from the prior fiscal year, including contract and purchase order encumbrances and unexpended project balances, so long as there is a sufficient fund balance to finance these commitments; and
 Accept the Water Commission’s recommendations regarding the Water Department’s FY 2025 Operating and Capital Investment Program (CIP); and  Adopt Resolution No. NS-30,348 amending the Classification and Compensation Plans for the FY 2025 budget personnel complement by implementing the approved FY 2025 budget/position changes in several departments.

7.12 June 11, 2024 CITY COUNCIL MINUTES 6874
General Business (continued)

21. Budget Adoption

21.1 Fiscal Year 2025 Proposed Budget Adoption (FN) (continued)

21.2 Resolution Amending the City of Santa Cruz Personnel Complement and Classification and Compensation Plans for the Public Works, City Manager’s Office, Finance, Parks and Recreation, Water, Economic Development and Housing, Information Technology, Police, Human Resources, and the Library (HR) (continued)
FRIENDLY AMENDMENT: Councilmember Brunner requested to include direction to bring back an option to move forward with ordering a fire apparatus within 3—6 months. Councilmember Brown 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.

Adjournment – Vice Mayor Golder moved, seconded by Councilmember Brown, to adjourn. By consensus City Council adjourned at 3:38 p.m.

Respectfully Submitted:

Julia Wood, Deputy City Clerk Administrator
Attest:

Bonnie Bush, City Clerk Administrator
Approved:

Fred Keeley, Mayor

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

MINUTES OF A JOINT CITY COUNCIL/PLANNING COMMISSION STUDY SESSION June 18, 2024
5:30 PM
Call to Order – Mayor Keeley called the study session to order at 5:34 p.m. in Council Chambers.

Roll Call

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

Planning Commissioners Dann, Gordon, Kennedy, McKelvey, Thompson.

Absent: Planning Commission Vice Chair Polhamus; Chair Conway.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Director of Planning and Community Development L. Butler, Director of Economic Development and Housing B. Lipscomb, Director of Finance E. Cabell, Chief of Fire R. Oatey, Principal Planner M. VanHua, Transportation Planner C. Gallogly, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

General Business

1. Joint City Council and Planning Commission Study Session on the Downtown Plan Expansion Public Review Draft (PL)
Director of Planning and Community Development L. Butler introduced the item and responded to questions.

Principal Planner M. VanHua, and Bill Wiseman, Planning Practice Leader with Kimley Horn, gave a presentation and responded to questions.

Transportation Planner C. Gallogly and Director of Economic Development and Housing B. Lipscomb responded to questions.

8.1 June 18, 2024 CITY COUNCIL MINUTES 4917
General Business (continued)

1. Joint City Council and Planning Commission Study Session on the Downtown Plan Expansion Public Review Draft (PL) (continued)
Mayor Keeley opened the public comment period. The following people spoke.

Joh Hall
Unidentified person
Joe Quigg
Bryan Shields
Rick Longinotti
Andy Schiffrin
Kyle Kelley
Brett Garrett
Frank Barron
Gillian Greensite
Chris Murphy
Jim Sandoval
Rafa Sonnenfeld
Jack Lee
Lucy Yin
Keith Christman
Unidentified person
Unidentified person
Alberto Lustre
Unidentified person
Mayor Keeley closed the public comment period.

By consensus, Council and Planning Commissioners directed staff to:

Return at the earliest possible date with an analysis of the following recommendations for inclusion in the Downtown Expansion Plan:
 Leave the existing General Plan densities in place, except that blocks B, D, and H will be studied at 3.5 FAR;
 Support an Affordable Housing Overlay Zone for blocks A, B, C, and D; and  Provide incentives in the Affordable Housing Overlay Zone to allow increases in FAR to a point that sufficiently increases the use of the City’s Density Bonus Law (thus increasing the total number of affordable units), and the maximum height to 12 stories for development, working towards the goal of providing at least 20% of the units as affordable.

8.2 June 18, 2024 CITY COUNCIL MINUTES 4918
General Business (continued)

1. Joint City Council and Planning Commission Study Session on the Downtown Plan Expansion Public Review Draft (PL) (continued)
Additional comments provided by the Council and Planning Commission included, but were not limited to, the following:
 Further study and include options for financing public infrastructure and public parking improvements in the plan, including, but not limited to additional impact fees and infrastructure financing districts.  Seek to maintain local control of development, rather than state control of development, with the policies.
 Look at development holistically, including discussing the context of affordable housing being included in the new development plans and considering who will occupy the market rate units and how that relates to the availability of other housing.
 Explore ways to minimize existing resident displacement, through approaches such as adding or strengthening policies like preference for locals in affordable housing, use of SB 649 local preference policies, and relocation assistance.
 Desire for parking to serve the future uses.
 Support for community amenities such as parks and gathering spaces, including those that can serve children and families.
 Desire for diverse unit types and sizes, including for families and singles, considering existing and future housing stock in the plan area and throughout the city.
 Support for broad community engagement, including but not limited to business owners and residential renters.
 Include graphics and diagrams in the presentations and plan that capture the future development.
 Support for adding new residents who will, in turn, support businesses.  Review policies that support long-term durability of building materials.  Provide more information on arena events.
 Explore allowing creative options for new businesses in the plan area, both in terms of uses and sizes.
 Use the environmental impact report to inform plan policies.  Consider dark sky policies that limit light pollution and focus light towards the interior of plan area and not towards the river.
 Expand the data available as it relates to various items discussed.

Adjournment – Vice Mayor Golder moved, seconded by Councilmember Watkins, to adjourn. By consensus City Council adjourned at 9:28 p.m.

8.3 June 18, 2024 CITY COUNCIL MINUTES 4919
Respectfully Submitted:

Julia Wood, Deputy City Clerk Administrator
Attest:

Bonnie Bush, City Clerk Administrator
Approved:

Fred Keeley, Mayor

8.4 City Council

AGENDA REPORT
DATE: 06/07/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Clerk
SUBJECT: Arts Commission Appointment (CC)
RECOMMENDATION: Motion to approve Mayor Keeley’s nomination of Chanel Enriquez to the Arts Commission.

BACKGROUND: Due to a resignation, the Arts Commission has a vacancy.

DISCUSSION: Mayor Keeley has a nomination to the Arts Commission, which Council must vote to approve. Mayor Keeley would like to nominate Chanel Enriquez to a term ending January 31, 2027, eligible for reappointment.

FISCAL IMPACT: None.

Prepared By:

Bonnie Bush
City Clerk
Submitted By:

Laura Schmidt
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. APPLICATION.PDF

9.1 9.2

9.3 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Manager
SUBJECT: City Overlook Emergency Shelter Operations and Management Award Contract (CM)
RECOMMENDATION: Motion to award a contract to People First of Santa Cruz County for the City Overlook emergency shelter operations and management in the amount of $4,292,879 and reject all other proposals, and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Homelessness Response Manager is authorized to execute change orders within the approved budget.

BACKGROUND: In June of 2021, the City Council approved the Camping Standards and Service Ordinance (CSSO), which directed staff to ensure at least 150 safe sleeping spots were created and maintained. Shortly thereafter, the City issued a Request for Qualifications (RFQ) to solicit competitive proposals for a variety of homelessness services, including operation of an emergency shelter. At that time, the City received two competitive bids for operating large shelter programs, and The Salvation Army (TSA) scored the highest due to their experience both locally and nationally in shelter operations.

The initial contract with TSA for the City Overlook program operation was approved by City Council in December 2021 for a 75-space emergency shelter program located on the south lawn of the National Guard Armory building in upper DeLaveaga Park. In June of 2022, the contract was amended to include operating inside the Armory building after the County program ceased operations. This allowed for an additional 60 spaces, for a total capacity of 135 spaces. The City Overlook shelter has operated continuously at this capacity for the past two years.

DISCUSSION: On February 23, 2024, the City issued a Request for Proposals (RFP) specifically for the Operation and Management of the City Overlook Emergency Shelter for FY 2025. The scope of services called for prospective vendors to provide 24-hour emergency shelter services, 7 days per week, 365 days a year, with a capacity for up to 135 spaces at the shelter.

The onsite services are to include healthy, safe, and secure sleeping quarters, nutritious meals, access to bathroom and shower amenities, and permanent housing exit-focused linkages and referral services. A separate vendor, Community Bridges/Lift Line, provides shuttle services on and off site to program participants daily from 6:00 a.m. to 9:00 p.m.

The City received responsive proposals from two organizations: The Salvation Army, and People First of Santa Cruz County (formerly The Free Guide). Based upon the evaluation criteria

10.1 provided in the RFP, People First of Santa Cruz County was determined to be the highest scoring proposal.

The budget for People First’s proposed contract for FY 2025 is $4,292,879. This includes personnel costs of $3,017,391 for approximately 34 full-time equivalent positions, $885,910 in operating costs (including $542,000 for food service, and $390,000 in indirect costs (10%)). The proposed cost for FY 2025 represents a 4% increase compared to the contract for FY 2024 with the current operator.

FISCAL IMPACT: FY 2025 funding to support the operations and management of the City Overlook will come from the General Fund, Safe Sleeping and Shelter – Armory (p102202), in the amount of $4,292,879. The funding request to support this contract was included in the FY 2025 decision package for the City budget. The City has made a request to the State of California to provide some level of financial support for the City Overlook shelter operations for FY 2025.

While the City continues to be in dialogue with the state, there has not yet been a final decision by the state to provide financial support in the upcoming fiscal year. The City has had similar conversations with the County of Santa Cruz, but no formal commitment has been made for FY 2025.

Prepared By:

Larry Imwalle
Homelessness Response
Manager
Submitted By:

Lisa Murphy
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. CONTRACT WITH PEOPLE FIRST OF SANTA CRUZ COUNTY FOR OPERATION

AND MANAGEMENT OF THE CITY OVERLOOK EMERGENCY SHELTER
PROGRAM.PDF

10.2 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 1
Professional Services Agreement With

PEOPLE FIRST OF SANTA CRUZ COUNTY
For OPERATIONS AND MANAGEMENT OF THE CITY OVERLOOK EMERGENCY SHELTER (JULY 1, 2024 – JUNE 30, 2025)
THIS AGREEMENT for professional services is made by and between the City of Santa Cruz (“City”) and People First of Santa Cruz County, a nonprofit corporation (“Consultant”) (each is referred to individually as a “Party” and collectively, as the “Parties”) as of July 1, 2024 (the “Effective Date”).

NOW, THEREFORE, in consideration of each other’s mutual promises, the Parties hereto agree as follows:

SECTION 1: SCOPE OF WORK
Consultant will furnish services as defined and described in the Scope of Work, attached hereto as Exhibit A and incorporated herein.

SECTION 2: RESPONSIBILITIES OF CONSULTANT
All work performed by Consultant, or under Consultant’s direction, shall be rendered in accordance with the generally accepted practices, and to the standards of, Consultant's profession. Consultant represents and agrees that Consultant: (i) is fully experienced and properly qualified to perform the work and services provided for herein, (ii) has the financial capability required for the performance of the work and services, and (iii) is properly equipped and organized to perform the work and services in a competent, timely, and workmanlike/professional manner, in accordance with the requirements of this Agreement.

Consultant shall not undertake any work beyond the Scope of Work set forth in Exhibit A unless such additional work is approved in advance and in writing by City. The cost of such additional work shall be reimbursed to Consultant by City on the same basis as provided for in Section 4.

If, in performing the work, it is necessary to conduct field operations, security and safety of the job site will be the Consultant's responsibility excluding, the security and safety of any facility of City within the job site which is not under the Consultant's control.

Consultant shall meet with Larry Imwalle, Homelessness Response Manager, hereinafter called "Director", or other designated and authorized City personnel, or third parties as necessary, on all matters connected with carrying out of Consultant’s services described in Exhibit A. Such meetings shall be held at the request of either Party. Review and City approval of completed work shall be obtained monthly, or at other intervals as may be mutually agreed upon during the course of this Agreement. Review, approval, or acceptance of Consultant’s work by City or others shall not relieve Consultant from responsibility for errors and omissions in Consultant’s work.

SECTION 3: RESPONSIBILITIES OF THE CITY
City shall make available to Consultant all necessary data and information in the City's possession and shall actively assist Consultant in obtaining such information from other agencies and individuals as needed. Consultant is entitled to reasonably rely upon the accuracy and completeness of such data and information, and Consultant shall provide City prompt written notice of any known defects in such data and information.

10.3 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 2
acceptable work, provided that such approval will not be unreasonably withheld or delayed. If the work is not acceptable, City will inform Consultant of the changes or revisions necessary to secure approval.

SECTION 4: FEES AND PAYMENT
For services actually performed, the City will compensate Consultant at the rates set forth in the Fee Schedule detailed in Exhibit B and in accordance with the terms set forth therein. Payment for Consultant's services in carrying out the entire Scope of Work shall be made within the budget limit, or limits shown, upon Exhibit B.

Consultant agrees that the payments to Consultant specified in this Section 4 will constitute full and complete compensation for all obligations assumed by Consultant under this Agreement. Such payments shall be considered the full compensation for all personnel, materials, supplies, and equipment used by Consultant in the Scope of Work Where conflicts regarding compensation may occur, the provisions of this section apply.

Variations from the budget for each task which are justified by statements indicating personnel time expended and submittal of a revised budget are only allowed with prior City approval; however, in no event shall the total fee charged for the Scope of Work set forth in Exhibit A exceed the budget of $4,292,879.54 (“the Maximum Fee Amount”) without advance written City authorization in the form of an amendment or change order. This Maximum Fee Amount will be reduced by $11,761.31 per day for each day, from July 1, 2024, onward, that, in the City’s sole discretion, the Consultant is not running the shelter as specified in the Scope of Work at the outset of Agreement. The period between July 1, 2024, and the day that the Consultant begins running the shelter as specified in the Scope of Work is called the Startup Period. The Maximum Fee Amount will be increased by the actual Startup Costs, as defined below, incurred during the Startup Period, so long as the Startup Costs do not exceed $26,000.00. “Startup Costs” are those costs actually incurred during the Startup Period for hiring of employees, training, and development of the policies and procedures required in Section 3 of the Scope of Work.

Upon execution of this Agreement, Consultant shall invoice City for and City shall pay up to Consultant $26,000.00 as a deposit for Startup Costs. If, anytime on or after September 1, 2024, in the City’s sole determination, no insurer has agreed to provide the Insurance required in Exhibit D, the City may terminate this Agreement effective immediately.

At the end of the Startup Period, Consultant must provide a “true-up,” as specified below, of the Startup Costs and within 15 days return any of the unused portion of the deposit for the Startup Costs. If City terminates this Agreement due to Consultant’s failure to obtain the Insurance required in Exhibit D, then Consultant shall, within 30 days of the City’s Notice of Termination, return any Startup Costs received by Consultant to the City.

After the Startup Period, City shall make a onetime payment of $11,761.31 per day for each day left in the month that the Consultant begins running the shelter as specified in the Scope of Work. Thereafter, Consultant shall invoice the City on the 1st and 15th of every month ending June 15, 2025. The City shall pay Consultant equal payments of $178,869.95 bi-monthly against each invoice. Consultant shall provide quarterly “true-up” of costs to the City for each three-months services that are provided, by October 15, 2024, January 15, 2025, April 15, 2025, and July 15, 2025, for expenses incurred by Consultant for the prior quarter. The “true-up” must include labor costs (by category and employee) detailing the time worked by each class of employee with separate totals for overtime and benefit costs, food total costs, miscellaneous total supply costs, other permitted costs (per Exhibit B) and the percentage of the agency fee.

In City’s sole discretion, if City is not satisfied with the form of the “true-up” City shall direct the Consultant who will resubmitted in the format required by the City with the information City requests.

All “true-ups” shall contain the following affidavit signed by Consultant (if individual) or by an authorized representative of Consultant (if Consultant is an entity):

10.4 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 3
"I hereby certify [or as an authorized representative of Consultant] that the total expenses of (insert expenses amount) as summarized above and shown in detail on the attachments is in accordance with the terms of Agreement dated (Insert Agreement Date)." If this contract is terminated the Consultant shall provide, within 15 days of termination, a “true-up” covering any portion of this Agreement for which a “true-up” had not previously been provided.

If the “true-up” shows that the City has overpaid for the period covered by the “true-up”, then the City shall deduct the amount of overpayment from the next monthly payment. If the City has overpaid for the final quarter of this Agreement, or for the last “true-up” after termination, then the Consultant will return the overpayment within one-month of receiving notice of the overpayment. The requirement to give a “true-up” and to repay overpayments survives the termination of this Agreement.

This Agreement is contingent upon the appropriation of sufficient funding by the City for the services covered by this Agreement. If funding is reduced or deleted by the City for the services covered by this Agreement, the City has the option without penalty or liability to either terminate this Agreement or to offer an amendment to this Agreement indicating the reduced amount.

SECTION 5: TRAVEL REIMBURSEMENT POLICY
The City shall not be responsible for any travel, meal, or lodging reimbursements to Consultant and/or Consultant’s employees.

SECTION 6: CHANGES IN WORK
City may negotiate changes in the Scope of Work. No changes in the Scope of Work shall be made without the written approval of City and Consultant. Any change requiring compensation in excess of the sum specified in Exhibit B shall be approved in advance in writing by the City. Only City’s authorized representative(s) is authorized to approve changes to this Agreement on behalf of City.

SECTION 7: TERM AND SCHEDULE
The term of this Agreement shall be effective July 1, 2024, and terminating on June 30, 2025. At the option of the City, this Agreement may be renewed annually under the same contractual terms and conditions by letter agreement.

Consultant shall begin work as specified in a written authorization (e.g., Notice to Proceed) to perform services. The written authorization to perform work shall not be issued until after this Agreement has been approved and authorized by the City.

Neither party will be held responsible for delay or default caused by declared emergencies, natural disasters, or any Force Majeure event which is beyond the party's reasonable control. Consultant will, however, make all reasonable efforts to remove or eliminate such a cause of delay or default and will, upon the cessation of the cause, diligently pursue performance of its obligations in this Agreement.

The City reserves the right to obtain the item(s) and/or services covered by this Agreement from another source during any on-going suspension of service due to the circumstances outlined above.

SECTION 8: TERMINATION

10.5 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 4
The City may terminate the Agreement for any reason by providing written notice to Consultant not less than 30 calendar days prior to an effective termination date.

The City may, at its option, allow Consultant to cure its failure to perform within 10 business days (or longer period authorized in writing by the City) from the date of the City’s termination notice. The termination shall become effective if Consultant has not cured within the specified time period to the City’s satisfaction.

Consultant may terminate this Agreement for cause if the City fails to cure a material default in performance within a period of 30 calendar days (or such longer period agreed to by the Consultant), from the date of the Consultant’s written termination notice specifying the default in performance. Consultant must provide a written notice of termination to the City not less than 30 calendar days of the effective termination date.

Upon notice of termination by either the City or Consultant, the Consultant will immediately act to not incur any additional obligations, costs or expenses, except as may be reasonably necessary to terminate its activities. The City’s only obligation to the Consultant will be just and equitable payment for services authorized by, and received to the satisfaction of, the City up to and including the effective date of termination less any amounts withheld. All finished or unfinished work or documents procured or produced under the Agreement will become property of the City upon the termination date. In the event of Consultant’s failure to perform pursuant to the Agreement, the City reserves the right to obtain services elsewhere and Consultant will be liable for the difference between the prices set forth in the terminated Agreement and the actual cost to the City. Termination of the Agreement pursuant to this paragraph shall not relieve the Consultant of any liability to City for additional costs, expenses, or damages sustained by City due to failure of the Consultant to perform pursuant to the Agreement. City may withhold any payments to Consultant for the purpose of set-off until such time as the exact amount of damages due City from Consultant is determined. After the effective date of termination, Consultant will have no further claims against the City under the Agreement. No other compensation will be payable for anticipated profit on unperformed services.

SECTION 9: INSURANCE
Prior to the beginning of and throughout the duration of the Agreement, Consultant will maintain and comply with the Insurance Requirements as set forth in Exhibit D. Consultant will insure the City against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder. The insurance coverages required shall not in any way limit the liability of the Consultant.

SECTION 10: INDEMNIFICATION
Consultant agrees, to the fullest extent permitted by law, to indemnify, defend, and hold harmless the City, its officials, officers, employees, agents, and volunteers (collectively, “Indemnitees”) from and against any and all liability, claim, action, loss, injury, damage, judgment, or expense, including attorneys’ fees and costs (“Losses”) caused by or resulting from the negligence, recklessness, or willful misconduct of Consultant, Consultant’s officers, employees, agents, or subcontractors in any way related to this Agreement. Consultant’s duty to indemnify and hold harmless Indemnitees shall not apply to the extent such Losses are caused by the sole or active negligence or willful misconduct of Indemnitees. Consultant’s obligation to defend shall arise regardless of any claim or assertion that Indemnitees caused or contributed to the Losses.

In the event this Agreement involves the performance of design professional services by Consultant, Consultant’s officers, employees, agents, or subcontractors, Consultant’s costs to defend Indemnitees shall not exceed the Consultant’s proportionate percentage of fault per Civil Code §2782.8. This section shall survive the termination or expiration of this Agreement.

SECTION 11: EQUAL EMPLOYMENT OPPORTUNITY/NON-DISCRIMINATION POLICIES

10.6 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 5
City’s policies promote a working environment free from abusive conduct, discrimination, harassment, and retaliation; and require equal opportunity in employment for all regardless of race, religious creed (including religious dress and grooming practices), color, national origin (including language use restrictions), ancestry, religion, 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 or veteran status, or any other consideration made unlawful by local, State or Federal law. City requires Consultant to comply with all applicable Federal and State and local equal employment opportunity laws and regulations, and Consultant is responsible for ensuring that effective policies and procedures concerning the prevention of abusive conduct, discrimination, harassment, and retaliation exist in Consultant’s business organization. The City’s current Equal Employment Opportunity and Non-Discrimination policies to which this Section applies may be viewed at http://www.codepublishing.com/CA/SantaCruz/?SantaCruz09/SantaCruz0983.html and http://www.cityofsantacruz.com/home/showdocument?id=59192.

SECTION 12: LEGAL ACTION/ATTORNEYS’ FEES
If any action at law or in equity is brought to enforce or interpret the provisions of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees in addition to any other relief. The laws of the State of California, with jurisdiction in the Santa Cruz County Superior Court, shall govern all matters relating to the validity, interpretation, and effect of this Agreement and any authorized or alleged changes, the performance of any of its terms, as well as the rights and obligations of Consultant and the City.

SECTION 13: AMENDMENTS
This Agreement may not be amended in any respect except by way of a written instrument which expressly references and identifies this particular Agreement, which expressly states that its purpose is to amend this particular Agreement, and which is duly executed by the City and Consultant. Consultant acknowledges that no such amendment shall be effective until approved and authorized by the City’s authorized representative. No representative of the City is authorized to obligate the City to pay the cost or value of services beyond the scope of services set forth in Exhibit A.

Such authority is retained solely by the City Manager, Director, or their designee. Unless expressly authorized by the City Manager or Director, Consultant’s compensation shall be limited to that set forth in Exhibit B, Fee Schedule.

SECTION 14: MISCELLANEOUS PROVISIONS

Otherwise, no change in assignment by the Consultant may occur without prior written approval of the City.

2. Consultant Services Only. Consultant is employed to render professional services only and any payments made to Consultant are compensation solely for such professional services.

3. Independent Contractor. In the performance of this Agreement, it is expressly understood that Consultant, including each of Consultant’s employees, agents, subcontractors or others under Consultant’s supervision or control, is an independent contractor solely responsible for its own acts and omissions, and shall not be considered an employee of the City for any purpose. Consultant agrees to indemnify, defend and hold harmless the City, its officials, officers, employees, and agents against any claim or liability, including attorneys’ fees and costs, arising in any manner

10.7 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 6
related to this Agreement that an employee, agent or others under Consultant’s supervision or control was misclassified.

In the event that Consultant or any employee, agent, or subcontractor of Consultant providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of City, Consultant shall indemnify, defend, and hold harmless City for the payment of any employee and/or employer contributions for PERS benefits on behalf of Consultant or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.

4. Consultant Not an Agent. Except as City may specify in writing, Consultant shall have no authority, express or implied, to act on behalf of City in any capacity whatsoever as an agent. Consultant shall have no authority, express or implied, pursuant to this Agreement to bind City to any obligation whatsoever.

5. Subcontractors. Consultant shall obtain prior approval of the City prior to subcontracting of any work pursuant to this Agreement. If at any time, the City determines any subcontractor is incompetent or unqualified, Consultant will be notified and will be expected to immediately cancel the subcontract. Consultant shall require and verify that all subcontractors maintain insurance meeting all of the requirements stated herein, including naming the City of Santa Cruz, its officers, officials, employees, agents, and volunteers as additional insureds. Any modification to the insurance requirements for subcontractors must be agreed to by the City in writing.

Consultant shall be as fully responsible to the City for the negligent acts and omissions of its contractors and subcontractors or subconsultants, and of persons either directly or indirectly employed by them, or acting on Consultant’s behalf pursuant to this Agreement, as it is for the acts and omissions of persons directly employed by Consultant. Consultant’s obligation to pay its subconsultants is an independent obligation from the City’s obligation to make payments to the Consultant.

6. Assignment. This Agreement shall not be assigned without first obtaining the express written consent of the Director or after approval of the City Council. Neither party may assign this Agreement unless this Agreement is amended in accordance with its terms.

7. Conflicts of Interest. Consultant agrees to comply with conflict of interest lawsin performing the work and services under this Agreement. Consultant covenants (on behalf of Consultant and Consultant’s employees, agents, representatives, and subcontractors) that there is no direct or indirect interest, financial or otherwise, which would conflict in any manner or degree with the performance of services required under this Agreement. Consultant acknowledges and agrees to comply with applicable provisions of conflict of interest law and regulations, including the CA Political Reform Act, Sections 1090 and 87100 of the Government Code, and the City’s conflict of interest code. Consultant will immediately advise City if Consultant learns of a conflicting financial interest of Consultant during the term of this Agreement.

8. City Property. The work, or any portion, of Consultant in performing this Agreement shall become the property of City. The Consultant may be permitted to retain copies of such work for information and reference in connection only with the provision of services for the City. All materials and work product, whether finished or unfinished, shall be delivered to City upon completion of contract services or termination of this Agreement for any reason.

Consultant acknowledges and agrees that the work product shall be considered a work made for hire within the meaning of the patent and copyright laws of the United States; and Consultant agrees that all copyrights which arise from creation of project-related documents and materials pursuant to this Agreement shall be vested in the City and Consultant waives and relinquishes all claims to copyright or other intellectual property rights in favor of City. Any work product related to this Agreement shall be confidential, not to be used by the Consultant on other projects or

10.8 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 7
disclosed to any third party, except by agreement in writing by the City, or except as otherwise provided herein.

Consultant’s final deliverables shall comply with Section 508 (29 U.S.C. Section 794d) accessibility requirements, as applicable.

9. Intellectual Property and Indemnity. Consultant represents to City that, to the best of Consultant’s knowledge, any Intellectual Property (including but not limited to: patent, patent application, trade secret, copyright and any applications or right to apply for registration, computersoftware programs or applications, tangible or intangible proprietary information, or any other intellectual property right) in connection with any services and/or products related to this Agreement does not violate or infringe upon any Intellectual Property rights of any other person or entity.

To the fullest extent permitted by law, Consultant agrees to indemnify, defend, and hold harmless City, its officials, officers, employees, and agents, from any and all claims, demands, actions, liabilities, damages, or expenses (including reasonable attorneys’ fees and costs) arising out of a claim of infringement, actual or alleged, direct or contributory, of any Intellectual Property rights in any way related to Consultant’s performance under this Agreement or to the City’s authorized intended or actual use of Consultant’s product or service under this Agreement. This provision shall survive termination or expiration of this Agreement.

If any product or service becomes, or in the Consultant’s opinion is likely to become, the subject of a claim of infringement, the Consultant shall, at its sole expense: (i) provide the City the right to continue using the product or service; or (ii) replace or modify the product or service so that it becomes non-infringing; or (iii) if none of the foregoing alternatives are possible even after Consultant’s commercially reasonable efforts, in addition to other available legal remedies, City will have the right to return the product or service and receive a full or partial refund of an amount equal to the value of the returned product or service, less the unpaid portion of the purchase price and any other amounts, which may be due to the Consultant. City shall have the right to retrieve its data and proprietary information at no charge prior to any return of the product or termination of service.

10. Confidentiality.
a. Consultant shall not acquire any ownership interest in data and information (“City Data”) received by Consultant from City, which shall remain the property of the City. Certain information may be considered confidential (“Confidential Information”). Confidential Information shall mean all information or proprietary materials (in every form and media) not generally known to the public and which has been or is hereafter disclosed or made available directly or indirectly to Consultant through any means of communication, either verbally or in writing even if it has not been designated in writing as “Confidential” to Consultant in connection with this Agreement. Unless otherwise required by law, Consultant shall not, without City’s written permission, use or disclose City Data and/or Confidential Information other than in the performance of the obligations under this Agreement. As between Consultant and City, all City Confidential Information shall remain the property of the City. Consultant shall not acquire ownership interest in the City’s Confidential Information.
b. Consultant shall be responsible for ensuring and maintaining the security and confidentiality of City Data and Confidential Information, protect against any anticipated threats or hazards to the security or integrity of City Data and Confidential Information, protect against unauthorized access to or use of City Data and Confidential Information that could result in substantial harm or inconvenience to City or any end users; and ensure the proper return and/or disposal of City Data and Confidential Information upon termination of this Agreement with notice to the City.

10.9 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 8
c. Consultant shall take appropriate action to address any incident of unauthorized access to City Data and Confidential Information, including addressing and/or remedying the issue that resulted in such unauthorized access, notifying City as soon as possible of any incident of unauthorized access to City Data and Confidential Information, or any other breach in Consultant’s security that materially affects City or end users; and be responsible for ensuring compliance by its officers, employees, agents, and subcontractors with the confidentiality provisions hereof. Should confidential and/or legally protected City Data be divulged to unauthorized third parties, Consultant shall comply with all applicable federal and state laws and regulations, including but not limited to California Civil Code sections 1798.29 and 1798.82 at Consultant’s sole expense. Consultant shall not charge City for any expenses associated with Consultant’s compliance with these obligations.

d. Consultant shall defend, indemnify and hold harmless City, its officials, officers, employees and agents against any claim, liability, loss, injury or damage (including attorneys’ fee and costs) arising out of, or in connection with, the unauthorized use, access, and/or disclosure of City Data and/or Confidential Information by Consultant and/or its agents, employees or subcontractors, excepting only loss, injury or damage caused by the sole negligence or willful misconduct of the City. This provision shall survive the termination or expiration of this Agreement.

11. Consultant's Records/Audits. Consultant shall maintain accurate accounting records and other written documentation pertaining to the costs incurred relating to this Agreement for examination and audit by the City, State, or federal government, as applicable, in compliance with Gov. Code §8546.7 for a contract in excess of $10,000, or in compliance with other applicable federal laws (e.g. 48 CFR 31) or regulations for a period of three (3) years from: the date of the final City payment for Consultant's services, or from the date of final disposition of real property or equipment acquired with federal funds, or date of the termination of this Agreement, whichever is later. If Consultant engages a subcontractor to perform work related to this Agreement with a cost of $10,000 or more over a 12-month period, such subcontract shall contain these same requirements. This provision shall survive the termination of this Agreement.

12. California Public Records Act. City is a public agency subject to the disclosure requirements of the California Public Records Act (“CPRA”). If Consultant’s proprietary information is contained in documents or information submitted to City, and Consultant claims that such information falls within one or more CPRA exemptions, Consultant must clearly mark such information “Confidential and Proprietary,” and identify the specific lines containing the information. In the event of a request for such information, City will make best efforts to provide notice to Consultant prior to such disclosure. If Consultant contends that any documents are exempt from the CPRA and wishes to prevent disclosure, it is required to obtain a protective order, injunctive relief, or other appropriate remedy from a court of law in Santa Cruz County before the City is required to respond to the CPRA request. If Consultant fails to obtain such remedy within the time the City is required to respond to the CPRA request, City may disclose the requested information without any liability. Consultant further agrees that it shall defend, indemnify and hold City harmless against any claim, action or litigation (including but not limited to all judgments, costs, and attorney’s fees) that may result from denial by City of a CPRA request for information arising from any representation, or any action (or inaction), by the Consultant.

13. Compliance with Laws. All activities of Consultant, its employees, subcontractors and/or agents will be carried out in compliance with all applicable federal, state, and local laws and regulations. Consultant further agrees to comply with the covenant of good faith and fair dealing and other provisions of Santa Cruz Municipal Ordinance chapter 3.09, or otherwise Consultant may be subject to penalties including being declared an irresponsible contractor.

10.10 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 9

14. Licensure. Consultant agrees that Consultant, its subcontractors and/or agents (if any) has/have complied with all applicable federal, state, and local licensing requirements and agrees to provide proof of a current City of Santa Cruz Business Tax Certificate if:
• Consultant, its subcontractor(s) and agent(s) or its business is/are located in the City of Santa Cruz; • Will perform actual work in the City of Santa Cruz for 6 or more days annually; or • Will use company vehicles to deliver within the City of Santa Cruz for 6 or more days annually.

For additional information and licensing requirements, view the City’s Business Licenses and Permits webpage or call the Revenue and Taxation division at 831/420-5070.

15. Living Wage. Every contract for services to the City for $10,000 or more, is subject to City of Santa Cruz Living Wage Ordinance number 2000-25. If applicable, Consultant agrees to comply with the requirements of the Living Wage ordinance as provided in Santa Cruz Municipal Code Chapter 5.10.

16. Prevailing Wages for Public Work. To the extent that the work or services to be performed under this Agreement may be considered a “public work” (construction, alteration, demolition, or repair work) pursuant and subject to Labor Code section 1720 et seq., Consultant (and any subconsultant performing the work or services) shall conform to any and all prevailing wage requirements applicable to such work/and or services under this Agreement. Consultant (and any subconsultant) shall adhere to the prevailing wage determinations made by the Director of Industrial Relations (DIR) pursuant to California Labor Code Part 7, Chapter 1, Article 2, applicable to the work, if any. All workers employed in the execution of a public works contract (as such term is defined California Labor Code section 1720 et seq. and section 1782(d)(1)) must be paid not less than the specified prevailing wage rates for the type of work performed. (CA Labor Code sections 1720, 1774 and 1782.) To the extent applicable to the scope of work and services under this Agreement, Consultant agrees to be bound by the state prevailing wage requirements, including, but not limited to, the following:
a. If a worker is paid less than the applicable prevailing wage rate owed for a calendar day (or any portion thereof), Consultant shall pay the worker the difference between the prevailing wage rate and the amount actually paid for each calendar day (or portion thereof) for which the worker(s) was paid less than the prevailing wage rate, as specified in Labor Code section 1775; b. Consultant shall maintain and make available payroll and worker records in accordance with Labor Code sections 1776 and 1812;
c. If Consultant employs (and/or is legally required to employ) apprentices in performing the work and/or services under this Agreement, Consultant shall ensure compliance with Labor Code section 1777.5; d. Consultant is aware of the limitations imposed on overtime work by Labor Code sections 1810 et seq. and shall be responsible for any penalties levied in accordance with Labor Code section 1813 for failing to pay required overtime wages;
e. Consultant shall post a copy of the applicable wage rates at each jobsite at a location readily available to its workers.
f. Any failure of Consultant and/or its subconsultant to comply with the above requirements relating to a public work project shall constitute a breach of this Agreement that excuses the City’s performance of this Agreement at the City’s sole and absolute option and shall be at the sole risk of Consultant. Consultant on behalf of itself and any subconsultant, agree to indemnify, defend and hold harmless the City and its officials, officers, employees, and agents from and against any and all claims, liabilities, losses, costs, expenses, attorney’s fees, damages, expenses, fines, financial consequences, interest, and penalties, of any

10.11 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 10
kind or nature, arising from or relating to any failure (or alleged failure) of the Consultant and any subconsultant to pay prevailing wages or to otherwise comply with the requirements of prevailing wage law relating to a public work.
g. Consultant acknowledges that it and/or any subconsultant may not engage in the performance of any contract for public work unless currently registered with the DIR and qualified to perform public work pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a)].

17. Storm Water Requirements. To the extent applicable to the Scope of Work under this Agreement, Consultant, Consultant’s employees, subcontractors, and agents are required to abide by the applicable City of Santa Cruz Storm Water Best Management Practices (BMPs) for the duration of the work. The City’s mandatory Storm Water BMPs, which are listed according to the type of work, operations, or business, are located on the City website at: https://www.cityofsantacruz.com/government/city-departments/public-works/stormwater/bestmanagement-practices

Promptly upon such notification, the Parties shall meet at a mutually agreeable time and place in order to exchange relevant information and perspective, and to attempt to resolve the dispute. In the event that no resolution is achieved, and if, but only if, the parties mutually agree, then prior to pursuing formal legal action, the parties shall make a good faith effort to resolve the dispute by non-binding mediation or negotiations between representatives with decision-making power, who, to the extent possible, shall not have had substantive involvement in the matters of the dispute. To the extent that the dispute involves or relates to a public works project, the Parties agree to attempt to resolve the dispute by complying with the claims process as set forth in Public Contract Code sections 9204(e), 20104-20104.6, but without waiving the requirements of the California Tort Claims Act, Gov’t Code section 800 et seq. unless otherwise agreed to by the Parties.

19. Force Majeure. Neither party hereto shall be considered in default in the performance of its obligation hereunder to the extent that the performance of any such obligation is prevented or delayed by an act of God, natural disaster, pandemic, acts of terrorism, war, a strike, lockout or other labor difficulty, or other peril, which is beyond the reasonable control of the affected party and without the negligence of the respective Parties. Each party hereto shall give notice promptly to the other of the nature and extent of any Force Majeure claimed to delay, hinder or prevent performance of the services under this Agreement. Each Party will, however, make all reasonable efforts to remove or eliminate such a cause of delay or default and will, upon the cessation of the cause, diligently pursue performance of its obligations in this Agreement. In the event either party is prevented or delayed in the performance of its respective obligation by reason of such Force Majeure, the only remedy is that there may be an equitable adjustment of the schedule based on City’s sole discretion.

20. Complete Agreement. This Agreement, along with any attachments, is the full and complete integration of the Parties’ agreement with respect to the matters addressed herein, and that this Agreement supersedes any previous written or oral agreements between the Parties with respect to the matters addressed herein. Unless otherwise stated, to the extent there is any conflict between this Agreement and any other agreement (written or oral), the terms of this Agreement shall control.

21. Severability. The unenforceability, invalidity or illegality of any provision(s) of this Agreement shall not render the other provisions unenforceable, invalid or illegal.

10.12 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 11

22. Waiver. Waiver by any party of any portion of this Agreement shall not constitute a waiver of the same or any other portion hereof.

23. Governing Law. This Agreement shall be governed by and interpreted in accordance with California law.

24. Contract Interpretation. Each party acknowledges that it has reviewed this Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.

25. MacBride Principles/Peace Charter. City of Santa Cruz Resolution NS-19,378 (7/24/90) encourages all companies doing business in Northern Ireland to abide by the MacBride Principles and Peace Charter.

26. Notices. If either party shall desire or is required to give notice to the other such notice shall be given in writing, via email, and concurrently delivered by: (a) personal delivery, in which case notice is effective upon delivery; (b) overnight courier (i.e., Federal Express) with charges prepaid or charged to the sender’s account, in which case notice is effective when delivered; (c) priority U.S. Mail, in which case notice shall be deemed delivered on the second business day after the deposit thereof with the U.S. Postal Service. Notices shall be addressed to recipient as follows:

To CITY:

City Manager’s Office
Larry Imwalle
809 Center St. Rm 10
Santa Cruz, Ca 95060
[email protected]
831 420-5405
To CONSULTANT:

People First of Santa Cruz County
Evan Morrison
P.O. Box 7120
Santa Cruz, Ca 95061
831 325-2699
Changes to the above information shall be given to the other party in writing ten (10) business days before the change is effective.

27. Counterparts. The Parties may execute this Agreement in two or more counterparts, which shall, in the aggregate, be deemed an original but all of which, together, shall constitute one and the same instrument. A scanned, electronic, facsimile or other copy of a party’s signature shall be accepted and valid as an original.

28. Warranty of Authority. The signatories to this Agreement warrant and represent that each is authorized to execute this Agreement and that their respective signatures serve to legally obligate their respective representatives, agents, successors and assigns to comply with the provisions of this Agreement. [SIGNATURES ON FOLLOWING PAGE]

10.13 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 12
Approved As To Form:

By: _____________________________ Date: __________________ Office of the City Attorney, Ashley Wheelock

CITY OF SANTA CRUZ
By: _____________________________ Date: _________________ Matt Huffaker
City Manager

CONSULTANT
By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ Signature Requirements for a Corporation – 2 officer signatures required (one from each group, unless person signing holds officer positions in both Group 1 and 2):

Group 1: Chief Executive Officer, Chairman of the Board, President, or Vice President Group 2: Secretary, Assistant Secretary, Chief Financial Officer, Treasurer, Assistant Treasurer

10.14 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 13
EXHIBIT A: SCOPE OF WORK
The Consultant will provide 24-hour emergency shelter services, 7 days per week. The shelter site is located at 301 Armory Road in Santa Cruz and has the capacity for up to 135 shelter spaces. (Double occupancy is permitted with consent of participants.) Shelter services will include healthy, safe, and secure sleeping quarters; three daily nutritious meals; access to bathroom and shower amenities; and permanent housing exit-focused linkages and referral services.

Consultant’s approach to delivering quality and impactful shelter and case management services at the City Overlook Shelter is to focus on creating a comprehensive system that allows staff to meet people where they are, cultivate trust, and connect them with the resources and services that will help them to thrive and end their homelessness and secure stable housing.

1. Shelter Oversight:
a. Ensure the shelter site operates on a 24 hours/day, 7 days/week basis; b. Hire and oversee appropriate levels of staffing to ensure safe and effective 24/7 shelter operations, per Exhibit B;
c. HMIS will be used systems for data collection and reporting, as well as participant and program assessment and evaluation;
d. Provide all shelter participants with at least three meals per day, showers and charging stations.
e. Procure all camping supplies for participants;
f. Ensure participants adhere to program policies; and
g. Provide each shelter participant a space of at least 6 feet between guests and to minimize personal belongings to allow for ingress and egress of guests and staff.

2. Services for Shelter Participant:
a. Coordinating with service providers from the County, non-profits, and other organizations to facilitate connections to services provided by those entities; b. Ensure that all participants with physical limitations receive the personal assistance needed to support accessibility to services;
c. Ensure that all shelter participants are able to safely access and use all amenities at or brought to the site, such as portable toilets, hand washing stations and showers; d. Ensure secure storage is available to all participants so that they may store valuables or specific items that are not allowed in community spaces within shelter sites; and e. Ensure that each participant is provided the following amenities:
i.Tent;
ii.Cot or mattress;
iii.Personal storage tote; and
iv.Sanitary blankets and/or sleeping bags free of infestations

3. Maintain and update Policies and Procedures:
a. Shelter layout that meets all applicable government zoning and building requirements; b. Participant behavioral expectations policy;
c. Safety procedures;
d. Parking policies;
e. Pet policy;
f. Public visitation policy;
g. Neighborhood interface procedures;

10.15 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 14
h. Shower policies;
i. Written plan for responding to first aid and health emergencies including basic first aid supplies accessible on site;
j. Written evacuation plan for emergencies, i.e. Fire, Earthquake and evacuation plan; k. Shelter staff position descriptions, responsibilities and expectations; and l. Information on connections to mainstream services, referral and priority eligibility

4. Staff Training:
a. Ensure staff is trained on Housing First, Trauma Informed Care, and Harm Reduction principles: and
b. Ensure staff can readily access Shelter Program Policies and Procedures for consistency and clarity in conducting contracted services.

5. Maintain Facilities and ensure a healthy environment for staff and participants:
a. Refer any participant with a suspected or known infectious disease to the Homeless Persons Health Project (866-731-HPHP);
b. Immediately notify City of any incidents that resulted in a call to 911, including the nature of the call and the outcome of the incident;
c. Communicate with City staff if facility maintenance issues arise; and d. Ensure staff and participants adhere to policies and procedures and respect the facilities and neighboring areas.

Consultant’s Work Plan
Objective: To provide safe shelter services for 135 participants at the City Overlook Shelter. To provide participants with support and access to basic needs, as well as referrals to other needed community services.

People First of Santa Cruz County also provides case management and housing navigation services to all shelter participants.

1. Continue existing services- Continue operating the shelter with 4 staff onsite (including a caregiver) during every shift. Two of the staff stations will be combined to require only 4 staff at any given time.

Case management will also be provided to all participants at the shelter. The current meal plan will be continued, and the team will be comprised of experienced shelter staff and case workers.

2. Finalize staff selection- Reach out to all prospective staff and finalize staff selections. There is currently a pool of about 50 staff to pull from who were all involved in the Extreme Weather Shelters.

People First of Santa Cruz County will also notify staff in their other programs of these opportunities and will post the jobs publicly so other service providers in the community can apply as well.

3. Staff training- Staff will undergo a training program that includes Housing First, Trauma-Informed Care, Harm Reduction, Ethical Decision-Making, Motivational Interviewing, and De-escalation.

4. Scheduling- The team has established scheduling software and will create schedules based on the needs of the shelter.

5. Outreach plan- Work in conjunction with other City staff to create an outreach plan.

6. Develop a housing-needs assessment- Create a housing-needs assessment for case managers to utilize when creating housing plans for participants.

10.16 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 15

7. Communication protocols- Create communication protocols for policies and procedures regarding communication needs between staff and participants.

8. Develop policies and procedures- People First of Santa Cruz County has developed policies and procedures for other similar programs and will modify them to fit the needs of this shelter.

9. Monitor service- Develop overall metrics for gauging the effectiveness of the program and for getting feedback from staff and participants to improve quality.

10. Evaluate effectiveness- Evaluate whether the program meets the basic requirements of the scope of services. Furthermore, evaluate whether participants are finding stable housing and are reducing their barriers to permanent housing.

11. Maintenance- Staff will regularly assess the state items are in. A janitor will assess and maintain the facility. Create a system for tracking and responding to maintenance requests.

12. Sustainability- Develop and implement strategies for long-term sustainability, develop and implement policies for quality assurance.

Consultant’s Employee Conduct
Consultant will agree to remove any employee whose conduct is improper, inappropriate, or offensive as determined by the City. A removed employee(s) is not to work on City premises without the written consent of the City. The Consultant will remove any employee from working in, or delivering to, City facilities who is convicted of a felony during their employment.

10.17 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 16
EXHIBIT B: FEE SCHEDULE

10.18 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 17
EXHIBIT C: WORK SCHEDULE
Consultant shall run the Overlook Shelter from July 1, 2024 through June 30, 2025.

10.19 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 18
EXHIBIT D: INSURANCE REQUIREMENTS
Consultant shall procure and maintain insurance against claims for injuries to persons or damages to property and otherwise which may arise from or in connection with the performance of the work under this Agreement and the results of that work by Consultant, its agents, representatives, employees, or subcontractors.

A. CERTIFICATE REQUIREMENTS
The City will be issued a Certificate of Insurance (a Memorandum of Understanding will not be accepted) with the following minimum requirements:
• Certificate(s) will show current policy number(s) and effective dates, • Coverage and policy limits will meet, or exceed, requirements below, • The Certificate Holder will be City of Santa Cruz, Risk Management, 1200 Pacific Ave., Suite 290, Santa Cruz, CA 95060,
• Certificate will be signed by an authorized representative, • An endorsement, if required below, will be provided to show the City, its officers, officials, employees, and volunteers as additional insureds, and
• Coverages must be maintained during the term of the Agreement with the City, unless a longer duration is required as specified below.

B. MINIMUM SCOPE AND LIMITS OF INSURANCE
Consultant acknowledges that the insurance coverage and policy limits set forth in this section constitute the minimum amount of coverage required. If Consultant maintains broader insurance coverage and/or higher limits than the minimums shown below, the City of Santa Cruz requires and shall be entitled to the broader insurance coverage and/or higher limits maintained by Consultant. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Santa Cruz.

Coverage will be at least as broad as:
• COMMERCIAL GENERAL LIABILITY (CGL): $5,000,000 PER OCCURRENCE; $5,000,000 AGGREGATE Proof of coverage for $5 Million per occurrence and $5 Million in the aggregate including products and completed operations, property damage, bodily injury, personal and advertising injury will be provided on Insurance Services Office (ISO) Form CG 00 01 covering CGL. • SEXUAL ABUSE OR MOLESTATION (SAM) LIABILITY: If the work will include contact with minors, and the CGL policy referenced above is not endorsed to include affirmative coverage for sexual abuse or molestation, Contractor shall obtain and maintain a policy covering Sexual Abuse and Molestation with a limit no less than $1,000,000 per occurrence or claim. • PROFESSIONAL LIABILITY (ERRORS AND OMISSIONS): $1,000,000 PER OCCURRENCE OR CLAIM, $2,000,000 AGGREGATE.

Consultant will maintain insurance appropriate to Consultant’s profession; with limit no less than $1,000,000 per occurrence or claim, $2,000,000 aggregate. Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after date of completion of the services under this Agreement. If coverage is canceled or non-renewed and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date or start of work date, Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of the contract of work.

10.20 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 19
• AUTOMOBILE LIABILITY:

Proof of coverage for $1,000,000 provided on ISO Form Number CA 00 01 covering any auto (Code 1), or if Consultant has no owned autos, hired, (Code 8) and non-owned autos (Code 9), per accident for bodily injury and property damage.
• WORKERS’ COMPENSATION AS REQUIRED BY THE STATE OF CALIFORNIA, WITH STATUTORY LIMITS, AND EMPLOYER’S LIABILITY INSURANCE: $1,000,000 per accident for bodily injury or disease.

The Worker’s Compensation policy must be endorsed with a waiver of subrogation in favor of the City for all work performed by the Consultant and its employees. (Not required if Consultant provides written verification it has no employees) - If Consultant has no employees, Consultant shall complete and sign a Workers’ Compensation Exemption Declaration and Release of Liability.

C. OTHER INSURANCE PROVISIONS
The insurance policies are to comply with the following provisions:
• ADDITIONAL INSURED STATUS
The City, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of Consultant including materials, parts, or equipment furnished in connection with such work or operations, products and completed operations. General liability coverage will be provided in the form of an endorsement to Consultant’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used).
o PRIMARY COVERAGE
For any claims related to this Agreement, Consultant’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of Consultant’s and all subcontractor’s insurance and will not contribute with it.
• NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
• WAIVER OF SUBROGATION
Consultant hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Consultant may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. Consultant agrees to obtain any endorsement that may be necessary to effectuate this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer. • EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
Consultant may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and

10.21 City of Santa Cruz Professional Services Agreement for Operations and Management of the City Overlook Emergency Shelter
July 2024 (Form Rev.01/24 ) Page 20
which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Consultant’s primary and excess liability policies are exhausted. • SELF-INSURED RETENTIONS (SIR)
Self-insured retentions must be declared to and approved by the City. City may require Consultant to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses.

The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City.
• ACCEPTABILITY OF INSURERS
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A: VII, unless otherwise acceptable to the City.
• CLAIMS MADE POLICIES
If any of the required policies provide coverage on a claims-made basis:

1. The Retroactive Date must be shown and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained, and evidence of insurance must be provided, for at least five (5) years after completion of the contract of work.

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of contract work. • VERIFICATION OF COVERAGE
Consultant will furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy (and CPL, automobile and any Excess Liability/Umbrella policies, as applicable) listing all policy endorsements to be approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the Consultant’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

D. SUBCONTRACTORS
Consultant shall include their subcontractor(s) as additional insured(s) under the policies or shall furnish separate certificates and endorsements for each contractor and subcontractor. Consultant shall require and verify that all contractors and subcontractors maintain insurance meeting all the requirements stated herein, and Consultant shall ensure that City, its officers, officials, employees, agents, and volunteers are named as additional insureds on insurance required from its contractor(s) and subcontractor(s).

E. SPECIAL RISKS/CIRCUMSTANCES
City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances and provide notice to Consultant.

10.22 1
Lindsay Nelson
From: Garrett <[email protected]>
Sent: Monday, June 24, 2024 9:49 AM
To: City Council
Subject: 6.25.24 Agenda Item #10 (Consent) Homeless services contract

6.25.24 Agenda Item #10 (Consent) Homeless services contract I would comment on the costs of this plan of yours. This item doesn't include transportation, or any other cost associated with the venue (if any), but just looking at this item, what I see is:
for FY 2025 is $4,292,879 for partial cost of housing/feeding/not to sure vaguely something else for a maximum of 135 people served (could be less, then the cost per goes potential much higher up). 35 full time positions which cost $3,017,391 or $86,211/yr average EACH, for what FOOD SERVERS, SECURITY, CLEAN UP JANITORS, ???? You don't say. That's a fine, fine salary.

Although you claim this is 24 hour service, is it really? I doubt food is served 24/7 (why would it be, is this ROOM SERVICE?), and people have to sleep and don't need a whole lot then do they? Assuming the people work 8 hr/day , for 50 weeks, 5 days a week (they won't work every single week, will they?, This is then $236 a day, which even if you think all hours cost the same which they don't, that's $215/hr.

Read that again, that is $43/hour (not exactly food service worker wages) .

Since this is only a partial cost of total services of the shelter, the real cost is more.

I will admit relative to government pay, probably a bargain, but not by private sector standards.

Put another way, the minimum cost per homeless person served is , for just this contract if operated at capacity 135 people,
amounts to $31,799 / year or about minimum wage benefit when minimum wage was $15/hr.

So, being homeless pays at least about minimum
wage.

Not much incentive to not be homeless.

Glad I could help put this into perspective for you.

Garrett Philipp - Westside tax payer paying for this.

10.23 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Manager
SUBJECT: Emergency Shelter Transportation Program Operations and Management Award Contract (CM)
RECOMMENDATION: Motion to award a contract to Community Bridges/Lift Line, Santa Cruz, CA for transportation operations for the emergency shelter program in the amount of $417,271 and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Homelessness Response Manager is authorized to execute change orders within the approved budget.

BACKGROUND: On June 27, 2023, the City Council approved a contract with The Salvation Army (TSA) to operate the City Overlook emergency shelter located at the Santa Cruz Armory from July 1, 2023, through June 30, 2024. In the report to Council, staff indicated that the shuttle program, which provides transportation to and from the Armory for shelter program participants, had been removed from TSA contract, and that the City would initiate a Request for Proposal (RFP) process to identify a new vendor to provide the transportation service.

The RFP was released on May 26, 2023, and three organizations submitted proposals that met the minimum qualifications. In accordance with the City’s procurement protocols, and the evaluation criteria outlined in the RFP, the City reviewed the submissions, and Community Bridges/Lift Line received the highest score. In addition, Community Bridges/Lift Line submitted the lowest cost proposal. Community Bridges/Lift Line is able to leverage their existing fleet of vehicles and drivers to operate the Armory transportation program, keeping costs down. They have extensive experience, and a proven history working with vulnerable populations throughout Santa Cruz County. On September 12, 2023, Council approved a contract with Community Bridges to provide the transportation services at the City Overlook Emergency Shelter.

DISCUSSION: Community Bridges/Lift Line began providing the shuttle services for the City Overlook Emergency Shelter and the Long-Term Safe Parking program at the Santa Cruz Armory site on September 15, 2023. They provide hourly service to approximately 150 program participants, shuttling them from the Armory in DeLaveaga Park to stops in central Santa Cruz, Coral St, and County Health and Humans Services at Emeline. The transportation program operates 14 hours a day (6:00 a.m. to 9:00 p.m.) 365 days a year. Community Bridges/Lift Line has developed productive working relationships with the Emergency Shelter and Long-Term Parking Program staff and program participants and has demonstrated quality service and performance in its 9 months of operating this program. Staff recommends renewing the contact

11.1 with Community Bridges/Lift Line to operate the Emergency Shelter Transportation Program for FY 2025. The proposed contract amount for the 12-month period is $417,271, which represents a 5% increase compared to the annual cost in the current fiscal year.

FISCAL IMPACT: For FY 2025, the funding to support the operations and management of the Emergency Shelter Transportation program will come from the General Fund, Safe Sleeping and Shelter – Armory (p102202), in the amount of $417,271. The funding request to support this contract was included in the FY 2025 decision package for the City budget.

Prepared By:

Larry Imwalle
Homelessness Response
Manager
Submitted By:

Lisa Murphy
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. CONTRACT TO OPERATE AND MANAGE THE EMERGENCY SHELTER TRANSPORTATION.DOCX

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Professional Services Agreement With

COMMUNITY BRIDGES
For

OPERATION OF EMERGENCY SHELTER TRANSPORTATION SERVICES
(JULY 1, 2024—JUNE 30, 2025)
THIS AGREEMENT for professional services is made by and between the City of Santa Cruz (“City”) and Community Bridges (“Consultant”) (each is referred to individually as a “Party” and collectively, as the “Parties”) as of July 1, 2024 (the “Effective Date”).

NOW, THEREFORE, in consideration of each other’s mutual promises, the Parties hereto agree as follows:

SECTION 1: SCOPE OF WORK
Consultant will furnish services as defined and described in the Scope of Work, attached hereto as Exhibit A and incorporated herein.

SECTION 2: RESPONSIBILITIES OF CONSULTANT
All work performed by Consultant, or under Consultant’s direction, shall be rendered in accordance with the generally accepted practices, and to the standards of, Consultant's profession. Consultant represents and agrees that Consultant: (i) is fully experienced and properly qualified to perform the work and services provided for herein, (ii) has the financial capability required for the performance of the work and services, and (iii) is properly equipped and organized to perform the work and services in a competent, timely, and proper manner, in accordance with the requirements of this Agreement.

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acceptable work, provided that such approval will not be unreasonably withheld or delayed. If the work is not acceptable, City will inform Consultant of the changes or revisions necessary to secure approval.

SECTION 4: FEES AND PAYMENT
For services actually performed, the City will compensate Consultant at the rates set forth in the Fee Schedule / Budget detailed in Exhibit B and in accordance with the terms set forth therein. Payment for Consultant's services in carrying out the entire Scope of Work shall be made within the budget limit, or limits shown, upon Exhibit B. Such payment shall be considered the full compensation for all personnel, materials, supplies, and equipment used by Consultant in the Scope of Work. Markups shall not be charged for any approved sub-consultants or subcontractors.

Invoices shall detail the time worked by each class of employee on each task and the expenses incurred for which billing is made. Invoices shall indicate the percentage completion of each work task as identified in the Scope of Work in Exhibit A and the overall percentage of completion of the total required services. Unless otherwise specified in the fee schedule, payments shall be made monthly by the City within 30 days based on itemized invoices from the Consultant which list the actual costs and expenses.

All invoices shall contain the following affidavit signed by Consultant (if individual) or by a principal of Consultant’s firm (if Consultant is an entity):
"I hereby certify [or as principal of Consultant] that the charge of (Insert invoice amount) as summarized above and shown in detail on the attachments is a fair and reasonable use of public funds, is in accordance with the terms of Agreement dated (Insert Agreement Date), and has not been previously paid."
This Agreement is contingent upon the appropriation of sufficient funding by the City for the services covered by this Agreement. If funding is reduced or deleted by the City for the services covered by this Agreement, the City has the option without penalty or liability to either terminate this Agreement or to offer an amendment to this Agreement indicating the reduced amount.

SECTION 5: TRAVEL REIMBURSEMENT POLICY
The City shall not be responsible for any travel, meal, or lodging reimbursements to Consultant and/or Consultant’s employees.

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SECTION 7: TERM AND SCHEDULE
The term of this Agreement shall be on the effective date of this Agreement and terminating on June 30, 2025. At the option of the City, this Agreement may be renewed annually under the same contractual terms and conditions by letter agreement. It is expressly understood by the Parties hereto that this Agreement and its commencement is dependent and conditioned upon the execution and grant of a License Agreement (“License”) to the City from the California Military Department (the “State”) for use of the Santa Cruz Armory located at 301 Armory Rd., Santa Cruz, CA 95065-2101; and in the event that said License is not executed, this Agreement will not go into effect and the City incurs no responsibilities or liabilities under this Agreement.

The City reserves the right to obtain the item(s) and/or services covered by this Agreement from another source during any on-going suspension of service due to the circumstances outlined above.

SECTION 8: TERMINATION
The City may terminate the Agreement for any reason by providing written notice to Consultant not less than 30 calendar days prior to an effective termination date. However, this Agreement shall terminate immediately upon any termination of the License for any reason whatsoever, without any liability upon the City, its officials, officers, and employees.

The Consultant may terminate the Agreement for cause by providing written notice to the City` not less than 30 calendar days prior to an effective termination date.

The City may, at its option, allow Consultant to cure its failure to perform within 10 business days (or longer period authorized in writing by the City) from the date of the City’s termination notice. The termination shall be become effective if Consultant has not cured within the specified time period to the City’s satisfaction.

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determined. After the effective date of termination, Consultant will have no further claims against the City under the Agreement. No other compensation will be payable for anticipated profit on unperformed services.

SECTION 9: INSURANCE
Prior to the beginning of and throughout the duration of the Agreement, Consultant will maintain and comply with the Insurance Requirements as set forth in Exhibit C. Consultant will insure the City against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder. The insurance coverages required shall not in any way limit the liability of the Consultant.

SECTION 11: EQUAL EMPLOYMENT OPPORTUNITY/NON-DISCRIMINATION POLICIES City’s policies promote a working environment free from abusive conduct, discrimination, harassment, and retaliation; and require equal opportunity in employment for all regardless of race, religious creed (including religious dress and grooming practices), color, national origin (including language use restrictions), ancestry, religion, 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 or veteran status, or any other consideration made unlawful by local, State or Federal law. City requires Consultant to comply with all applicable Federal and State and local equal employment opportunity laws and regulations, and Consultant is responsible for ensuring that effective policies and procedures concerning the prevention of abusive conduct, discrimination, harassment, and retaliation exist in Consultant’s business organization. The City’s current Equal Employment Opportunity and Non-Discrimination policies to which this Section applies may be viewed at http://www.codepublishing.com/CA/SantaCruz/?SantaCruz09/SantaCruz0983.html and http://www.cityofsantacruz.com/home/showdocument?id=59192.

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authorized to obligate the City to pay the cost or value of services beyond the scope of services set forth in Exhibit A.

SECTION 14: MISCELLANEOUS PROVISIONS

Consultant shall replace the project manager or key staff upon Director’s request due to Director’s concern about their performance, or City shall have the right to terminate this Agreement. Otherwise, no change in assignment by the Consultant may occur without prior written approval of the City.

2. Consultant Services Only. Consultant is employed to render professional services only and any payments made to Consultant are compensation solely for such professional services.

3. Independent Contractor. In the performance of this Agreement, it is expressly understood that Consultant, including each of Consultant’s employees, agents, subcontractors or others under Consultant’s supervision or control, is an independent contractor solely responsible for its own acts and omissions, and shall not be considered an employee of the City for any purpose. Consultant agrees to comply with AB5, codified at Labor Code section 2750.3, and shall indemnify, defend and hold harmless the City, its officials, officers, employees, and agents against any claim or liability, including reasonable attorneys’ fees and costs, arising in any manner related to this Agreement that an employee, agent or others under Consultant’s supervision or control was misclassified.

Any modification to the insurance requirements for subcontractors must be agreed to by the City in writing.

Consultant acknowledges and agrees to comply with applicable provisions of conflict of interest law and regulations, including the CA Political Reform Act, Sections 1090 and 87100 of the Government Code, and the City’s conflict of interest code. Consultant will immediately advise City if Consultant learns of a conflicting financial interest of Consultant during the term of this Agreement.

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or unfinished, shall be delivered to City upon completion of contract services or termination of this Agreement for any reason. Consultant acknowledges and agrees that the work product shall be considered a work made for hire within the meaning of the patent and copyright laws of the United States; and Consultant agrees that all copyrights which arise from creation of project-related documents and materials pursuant to this Agreement shall be vested in the City and Consultant waives and relinquishes all claims to copyright or other intellectual property rights in favor of City. Any work product related to this Agreement shall be confidential, not to be used by the Consultant on other projects or disclosed to any third party, except by agreement in writing by the City, or except as otherwise provided herein. Consultant’s final deliverables shall comply with Section 508 (29 U.S.C. Section 794d) accessibility requirements, as applicable.

9. Intellectual Property and Indemnity. Consultant represents to City that, to the best of Consultant’s knowledge, any Intellectual Property (including but not limited to: patent, patent application, trade secret, copyright and any applications or right to apply for registration, computer software programs or applications, tangible or intangible proprietary information, or any other intellectual property right) in connection with any services and/or products related to this Agreement does not violate or infringe upon any Intellectual Property rights of any other person or entity.

10. Confidentiality.
a. Consultant shall not acquire any ownership interest in data and information (“City Data”) received by Consultant from City, which shall remain the property of the City. Certain information may be considered confidential (“Confidential Information”). Confidential Information shall mean all information or proprietary materials (in every form and media) not generally known to the public and which has been or is hereafter disclosed or made available directly or indirectly to Consultant through any means of communication, either verbally or in writing even if it has not been designated in writing as “Confidential” to Consultant in connection with this Agreement. Unless otherwise required by law, Consultant shall not, without City’s written permission, use or disclose City Data and/or Confidential Information other than in the performance of the obligations under this Agreement. As between Consultant and City, all City Confidential Information shall remain the property of the City. Consultant shall not acquire ownership interest in the City’s Confidential Information. b. Consultant shall be responsible for ensuring and maintaining the security and confidentiality of City Data and Confidential Information, protect against any anticipated threats or hazards to the security or integrity of City Data and Confidential Information, protect against unauthorized access to or use of City Data and Confidential Information that could result in substantial harm or inconvenience to City

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or any end users; and ensure the proper return and/or disposal of City Data and Confidential Information upon termination of this Agreement with notice to the City. c. Consultant shall take appropriate action to address any incident of unauthorized access to City Data and Confidential Information, including addressing and/or remedying the issue that resulted in such unauthorized access, notifying City as soon as possible of any incident of unauthorized access to City Data and Confidential Information, or any other breach in Consultant’s security that materially affects City or end users; and be responsible for ensuring compliance by its officers, employees, agents, and subcontractors with the confidentiality provisions hereof. Should confidential and/or legally protected City Data be divulged to unauthorized third parties, Consultant shall comply with all applicable federal and state laws and regulations, including but not limited to California Civil Code sections 1798.29 and 1798.82 at Consultant’s sole expense. Consultant shall not charge City for any expenses associated with Consultant’s compliance with these obligations.
d. Consultant shall defend, indemnify and hold harmless City, its officials, officers, employees and agents against any claim, liability, loss, injury or damage (including reasonable attorneys’ fee and costs) arising out of, or in connection with, the unauthorized use, access, and/or disclosure of City Data and/or Confidential Information by Consultant and/or its agents, employees or subcontractors, excepting only loss, injury or damage caused by the sole negligence or willful misconduct of the City. This provision shall survive the termination or expiration of this Agreement.

11. Consultant's Records. Consultant shall maintain accurate accounting records and other written documentation pertaining to the costs incurred relating to this Agreement for examination and audit by the City, State, or federal government, as applicable, during the period of this Agreement, and for a period of at least five (5) years from the date of the final City payment for Consultant's services, or date of the termination of this Agreement, whichever is later. If Consultant engages a subcontractor to perform work related to this Agreement with a cost of $10,000 or more over a 12-month period, such subcontract shall contain these same requirements.

This provision shall survive the termination of this Agreement.

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14. Licensure. Consultant agrees that Consultant, its subcontractors and/or agents (if any) has/have complied with all applicable federal, state, and local licensing requirements and agrees to provide proof of a current City of Santa Cruz Business Tax Certificate if:
 Consultant, its subcontractor(s) and agent(s) or its business is/are located in the City of Santa Cruz;  Will perform actual work in the City of Santa Cruz for 6 or more days annually; or  Will use company vehicles to deliver within the City of Santa Cruz for 6 or more days annually.

For additional information and licensing requirements, view the City’s Business Licenses and Permits webpage or call the Revenue and Taxation division at 831/420-5070

16. Prevailing Wages for Public Work. To the extent that the work or services to be performed under this Agreement may be considered a “public work” (construction, alteration, demolition, or repair work) pursuant and subject to Labor Code section 1720 et seq., Consultant (and any subconsultant performing the work or services) shall conform to any and all prevailing wage requirements applicable to such work/and or services under this Agreement. Consultant (and any subconsultant) shall adhere to the prevailing wage determinations made by the Director of Industrial Relations (DIR) pursuant to California Labor Code Part 7, Chapter 1, Article 2, applicable to the work, if any. All workers employed in the execution of a public works contract (as such term is defined California Labor Code section 1720 et seq. and section 1782(d)(1)) must be paid not less than the specified prevailing wage rates for the type of work performed. (CA Labor Code sections 1720, 1774 and 1782.)
To the extent applicable to the scope of work and services under this Agreement, Consultant agrees to be bound by the state prevailing wage requirements, including, but not limited to, the following:
a. If a worker is paid less than the applicable prevailing wage rate owed for a calendar day (or any portion thereof), Consultant shall pay the worker the difference between the prevailing wage rate and the amount actually paid for each calendar day (or portion thereof) for which the worker(s) was paid less than the prevailing wage rate, as specified in Labor Code section 1775; b. Consultant shall maintain and make available payroll and worker records in accordance with Labor Code sections 1776 and 1812;
c. If Consultant employs (and/or is legally required to employ) apprentices in performing the work and/or services under this Agreement, Consultant shall ensure compliance with Labor Code section 1777.5; d. Consultant is aware of the limitations imposed on overtime work by Labor Code sections 1810 et seq. and shall be responsible for any penalties levied in accordance with Labor Code section 1813 for failing to pay required overtime wages;
e. Consultant shall post a copy of the applicable wage rates at each jobsite at a location readily available to its workers.
f. Any failure of Consultant and/or its subconsultant to comply with the above requirements relating to a public work project shall constitute a breach of this Agreement that excuses the City’s performance of this Agreement at the City’s sole and absolute option and shall be at the sole risk of Consultant. Consultant on behalf of itself and any subconsultant, agree to indemnify, defend and hold harmless the City and its officials, officers, employees, and agents from and against any and all claims, liabilities, losses, costs, expenses, attorney’s fees, damages, expenses, fines, financial consequences, interest, and penalties, of any kind or nature, arising from or relating to any failure (or alleged failure) of the Consultant and any

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subconsultant to pay prevailing wages or to otherwise comply with the requirements of prevailing wage law relating to a public work.
g. Consultant acknowledges that it and/or any subconsultant may not engage in the performance of any contract for public work unless currently registered with the DIR and qualified to perform public work pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a)].

18. Dispute Resolution. The Parties agree to attempt in good faith to resolve through negotiation any dispute, claim or controversy arising out of or relating to this Agreement. Either party may initiate negotiations by providing written notice in letter form to the other party, setting forth the subject of the dispute and the relief requested. Promptly upon such notification, the Parties shall meet at a mutually agreeable time and place in order to exchange relevant information and perspective, and to attempt to resolve the dispute. In the event that no resolution is achieved, and if, but only if, the parties mutually agree, then prior to pursuing formal legal action, the parties shall make a good faith effort to resolve the dispute by non-binding mediation or negotiations between representatives with decision-making power, who, to the extent possible, shall not have had substantive involvement in the matters of the dispute. To the extent that the dispute involves or relates to a public works project, the Parties agree to attempt to resolve the dispute by complying with the claims process as set forth in Public Contract Code sections 9204(e), 20104-20104.6, but without waiving the requirements of the California Tort Claims Act, Gov’t Code section 800 et seq. unless otherwise agreed to by the Parties. The Parties shall share equally in the fees and costs of mediation if mediation is necessary.

21. Severability. The unenforceability, invalidity or illegality of any provision(s) of this Agreement shall not render the other provisions unenforceable, invalid or illegal.

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22. Waiver. Waiver by any party of any portion of this Agreement shall not constitute a waiver of the same or any other portion hereof.

23. Governing Law. This Agreement shall be governed by and interpreted in accordance with California law.

Notices shall be addressed to recipient as follows:

To CITY:

City Manager’s Office
Larry Imwalle
809 Center Street
Santa Cruz, CA 95062
[email protected]
831-420-5405
To CONSULTANT:

Community Bridges
Raymon Cancino
Chief Executive Officer
519 Main St., Watsonville, CA 95076
[email protected]
831.688.8840 x201
Changes to the above information shall be given to the other party in writing ten (10) business days before the change is effective.

A scanned, electronic, facsimile or other copy of a party’s signature shall be accepted and valid as an original.

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Approved As To Form:

By: ______________________________ Date: __________________ Office of the City Attorney

CITY OF SANTA CRUZ
By: ______________________________ Date: __________________ Matt Huffaker
City Manager

CONSULTANT
By: ______________________________ Date: __________________ Printed: ___________________________ Title: __________________

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EXHIBIT A: SCOPE OF WORK
Introduction
The City is contracting with the Consultant to operate the Emergency Shelter Transportation Program, which includes providing 17- passenger vehicle(s), drivers, and oversight. The Emergency Shelter Transportation Program provides essential transportation for guests of the City Overlook shelter and the RV Safe Parking program. Half hour to hourly services is necessary, 7 days a week, 365 days a year, to allow shelter guests offsite access, which shall be accomplished with a single vehicle and driver and subsequent backups.

The City Overlook and the RV Safe Parking emergency shelter programs are located at the National Guard Armory building in upper DeLaveaga Park. The shelters serve up to 150 individuals at any given time. Due to a variety of factors, including a lack of sidewalk leading up to the facility, shelter guests are not allowed to walk or bike on and off site. The transportation program is therefore a necessary and integral service that supports these shelter operations.

Since the City Overlook Emergency Shelter Program opened in May 2022, the City has been running the transportation program in conjunction with The Salvation Army, which also operates the City Overlook shelter. The shuttle program has consisted of two vans and 3 drivers per van (3 FTEs). The shuttles have a set route, with designated stops, taking guests to the County of Santa Cruz Emeline campus, the Housing Matter’s Coral St. campus, and to downtown Santa Cruz. In addition, two days a week the shuttles add two more stops at a laundry mat and Safeway located off Water St. in Santa Cruz. Each van runs on the half hour, shuttling guests to and from the Armory from 6am to 10pm daily.

The Emergency Shelter Transportation Program must work in harmony with the emergency shelter programs cosited at the Armory location. Shuttle staff will be in close contact with the staff of the two shelter programs on site:

The Salvation Army operated City Overlook emergency shelter and The Free Guide operated RV Safe Parking program.

Task 1 – Oversee and Operate the Armory Shuttle Program The Consultant shall be responsible for ensuring the transportation program operates 356 days a year, providing shelter guests transportation on and off site.

Task 1 Deliverables: Comprehensive oversite of the transportation program, including the development of a service plan, and ensuring the program is fully equipped, staffed and operational year-round. The Consultant shall be responsible for establishing and implementing policies and procedures including, but not limited to, driver training, incident reporting, vehicle maintenance, and tracking fuel and vehicle supplies.

Task 1 Timing: The transportation program must operate throughout the contract period (July 2024 through June 2025).

Task 2 – Provide and Maintain Transportation Vehicle(s) The Consultant shall be responsible for acquiring and maintaining the transportation vehicle(s) and ensuring the vehicle(s) are in operation 7 days a week, 365 days a year, from 6am to 10pm.

Task 2 Deliverables: The vehicle(s) capacity must be able to accommodate at least 15 guests per hour. Due to the usual volume of guests per hour, the vehicles must be able to accommodate at least 8 guests plus the driver. The Consultant can opt to operate with passenger vans or with a larger shuttle bus, as long as the vehicle can accommodate up to 15 guests per hour. The Consultant will be responsible for ensuring the vehicle(s) have sufficient fuel and regular maintenance for operation. The shuttle vehicle(s) must also have a bike rack or some means to transport guests bicycles. The transportation vehicle(s) may remain at the Armory site overnight and when not in use.

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Task 1 Timing: Vehicles must be acquired and operational by the contract start date. The vehicles must maintain in operation throughout the contract period.

Task 3 – Hire, Train, and Supervise Transportation Drivers The Consultant shall be responsible for hiring, training, and supervising drivers for the vehicles and ensure that drivers are available to operate the transportation program 7 days a week, 365 days a year, from 6am to 10pm.

Task 3 Deliverables: The transportation program must maintain sufficient drivers in order to make sure the shuttles run consistently from 6am to 10 pm, 7 days a week, 365 days a year. The Consultant shall be responsible for researching the CA DMV requirements for passenger vehicles and ensuring the drivers adhere to those requirements. CA DMV requirements vary depending on the vehicle size.

Emergency Shelter Transportation Program drivers must be insurable, provide great customer service and communication skills, be trained in conflict resolution, and, ideally, have experience working with vulnerable populations. The drivers are in constant interaction with the shelter guests. Helping them on and off the vehicles, assisting those with mobility challenges, ensuring that guests adhere to the shuttle rules, and helping mount and dismount guest bicycles from the vehicle. The drivers must also work well with the City Overlook staff (currently Salvation Army staff), who check in and out the guests as they leave and return to the shelter.

Task 3 Timing: Drivers must be hired and trained by the contract start date. The vehicles must maintain in operation throughout the contract period.

Task 4 – Provide and Maintain Transportation Supplies
The Consultant shall be responsible for purchasing and maintaining the supplies needed to safely operate the shuttle program.

Task 4 Deliverables: The transportation program supplies are primarily safety related, such as first aid kit and fire extinguisher per vehicle as well as stool to assist guest disembarking from the vehicle. A bike rack or some form of bicycle transportation mechanism is also a supply requirement. In addition, the Contractor can opt for driver support supplies such as gloves, vests, etc.

Task 4 Timing: Supplies must be purchased and available by the contract start date. The vehicles must maintain in operation throughout the contract period.

Task 5 – Collaborate with Emergency Shelter Staff
The Consultant shall be responsible for working in collaboration with the staff of the two shelter programs co-sited at the Armory. The transportation program is serving the clients of these shelter programs and it is therefore essential that the Consultant and the drivers have open communications and good rapport with the shelter staff.

Task 5 Deliverables: The Consultant and/or drivers will need to attend collaboration meetings, coordinate with on the ground shelter staff, and trouble shoot transportation program related items with staff of The Salvation Army and The Free Guide. At minimum, the drivers will communicate with The Salvation Armory monitors as the transportation vehicles are arriving and departing the site and will keep track of the number of guests per route.

Task 5 Timing: Collaboration with shelter staff will maintain in operation throughout the contract period.

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EXHIBIT B: FEE SCHEDULE / BUDGET
The approved Program budget provides annual costs. This contract is for the term of July 1, 2024 through June 30, 2025. The total amount payable under this agreement shall not exceed $417,271. CONTRACTOR shall provide monthly invoices, using a template provided by the CITY, to document services costs based on the budget detailed in this scope of work and the attached Exhibit B – Fee Schedule/Budget document Contractor will invoice the City on or before the 15th of each month for actual expenses incurred based upon the agreed upon budget included in this contract. Monthly invoices should include the following information and costs:
 Personnel costs with staff levels/hours for the invoicing month  Operational and supply costs with list of supplies purchased to support the Program during the invoicing month

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EXHIBIT C: INSURANCE REQUIREMENTS
Consultant shall procure and maintain insurance against claims for injuries to persons or damages to property and otherwise which may arise from or in connection with the performance of the work under this Agreement and the results of that work by Consultant, its agents, representatives, employees, or subcontractors.

A. CERTIFICATE REQUIREMENTS
The City will be issued a Certificate of Insurance (a Memorandum of Understanding will not be accepted) with the following minimum requirements:
 Certificate(s) will show current policy number(s) and effective dates,  Coverage and policy limits will meet, or exceed, requirements below,  The Certificate Holder will be City of Santa Cruz, Risk Management, 1200 Pacific Ave., Suite 290, Santa Cruz, CA 95060,
 Certificate will be signed by an authorized representative,  An endorsement, if required below, will be provided to show the City, its officers, officials, employees, and volunteers as additional insureds, and
 Coverages must be maintained during the term of the Agreement with the City, unless a longer duration is required as specified below.

Coverage will be at least as broad as:
 COMMERCIAL GENERAL LIABILITY (CGL): $1,000,000 PER OCCURRENCE; $2,000,000 AGGREGATE Proof of coverage for $1 Million per occurrence and $2 Million in the aggregate including products and completed operations, property damage, bodily injury, personal and advertising injury will be provided on Insurance Services Office (ISO) Form CG 00 01 covering CGL.  AUTOMOBILE LIABILITY:

Proof of coverage for $5,000,000 provided on ISO Form Number CA 00 01 covering any auto (Code 1), or if Consultant has no owned autos, hired, (Code 8) and non-owned autos (Code 9), per accident for bodily injury and property damage.
 WORKERS’ COMPENSATION AS REQUIRED BY THE STATE OF CALIFORNIA, WITH STATUTORY LIMITS, AND EMPLOYER’S LIABILITY INSURANCE: $1,000,000 per accident for bodily injury or disease.

The Worker’s Compensation policy must be endorsed with a waiver of subrogation in favor of the City for all work performed by the Consultant and its employees.

If Consultant has no employees, Consultant shall complete and sign a Workers’ Compensation Exemption Declaration and Release of Liability.

C. OTHER INSURANCE PROVISIONS
The insurance policies are to comply with the following provisions:
 ADDITIONAL INSURED STATUS

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The City, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of Consultant including materials, parts, or equipment furnished in connection with such work or operations, products and completed operations. General liability coverage will be provided in the form of an endorsement to Consultant’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used).
o PRIMARY COVERAGE
For any claims related to this Agreement, Consultant’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of Consultant’s and all subcontractor’s insurance and will not contribute with it.
 NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
 WAIVER OF SUBROGATION
Consultant hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Consultant may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. Consultant agrees to obtain any endorsement that may be necessary to effectuate this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.  EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
Consultant may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Consultant’s primary and excess liability policies are exhausted.  DURATION OF COVERAGE
CGL & Excess Liability/Umbrella policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Such Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.  SELF-INSURED RETENTIONS (SIR)
Self-insured retentions must be declared to and approved by the City. City may require Consultant to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses.

The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City.
 ACCEPTABILITY OF INSURERS
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A: VII, unless otherwise acceptable to the City.
 CLAIMS MADE POLICIES
If any of the required policies provide coverage on a claims-made basis:

11.18 City of Santa Cruz Professional Services Agreement Operation of Emergency Shelter Transportation Services

Page 17 of 17 ends

1. The Retroactive Date must be shown and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of contract work.  VERIFICATION OF COVERAGE
Consultant will furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy (and CPL, automobile and any Excess Liability/Umbrella policies, as applicable) listing all policy endorsements to be approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the Consultant’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

11.19 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Manager
SUBJECT: Long-Term Safe Parking Operations and Management Award Contract (CM)
RECOMMENDATION: Motion to award a contract to People First of Santa Cruz County for the long-term safe parking program operations and management in the amount of $489,732 and to authorize the City Manager to execute an agreement in a form approved by the City Attorney.

The Homelessness Response Manager is authorized to execute change orders within the approved budget.

BACKGROUND: With the adoption of the Oversized Vehicle Ordinance (OVO) in October 2021, the City Council directed staff to open a three-tiered safe parking program. In August of 2022, the City opened the Long-Term (Tier 3) safe parking program in the front parking lot of the National Guard Armory building. A contract was awarded to the Association of Faith Communities (AFC), the fiscal sponsor of The Free Guide, to operate this program based upon proposals received for safe-parking programs in response to the City’s Request for Qualifications for an array of homelessness services. This 24/7 Safe Parking program for oversized vehicles provides free parking and wraparound supportive services including case management and housing navigation for participants with a capacity of up to 20 oversized vehicles. This program has continued to operate at capacity since it opened in August 2022. This program was the first and remains the only 24/7 safe parking program for oversized vehicles in Santa Cruz County.

On May 11, 2023, the Coastal Commission approved the City’s Coastal Development Permit related to the OVO for a one-year period. The conditions of the approved permit required the continuation of the safe parking program, including the Long-Term (Tier 3) 24/7 program. On May 9, 2024, a new three-year Coastal Development Permit related to the OVO was approved by the Coastal Commission. This permit also includes the provision of a long-term 24/7 safe parking program as a condition of approval.

DISCUSSION: In early 2024, AFC and The Free Guide communicated to the City a mutual desire to shift contractual responsibility for operation of the Long-Term Safe Parking program to The Free Guide as an independent entity, rather than under the fiscal sponsorship of AFC. Given timing of the contract term, the City determined that the appropriate approach was to issue a Request for Proposals (RFP), to ensure a competitive bid process consistent with procurement policies.

12.1 On March 8, 2024, the City issued an RFP for the Operation and Management of the Long-Term Safe Parking for FY 2025. The scope of services called for prospective vendors to provide safe parking services utilizing Housing First, Trauma Informed Care principles. Services are to include healthy, safe, and secure safe parking spaces for oversized vehicles, access to bathroom and shower amenities, wraparound supportive services, Homeless Management Information System (HMIS) and other data entry, and permanent housing exit-focused case management and referral services.

The City received a proposal from one organization, People First of Santa Cruz County (formerly The Free Guide), which has been operating the Long-Term Safe-Parking program under the fiscal sponsorship of AFC since the inception of this program August 2022. Based upon the evaluation criteria provided in the RFP, People First of Santa Cruz County provided a highly qualified proposal, and a program design that has demonstrated significant results in exits from programs to housing.

The budget for People First’s proposed contract for FY 2025 is $489,732. This includes personnel costs of $397,028 for approximately 5 full-time equivalent positions, $48,982 in operating costs and $44,521 in indirect costs (10%). The contract with People First for operating the Long-Term Safe Parking presented to Council for approval is $489,732 for a term of 12 months. This represents an increase of 13% over the previous year. The increased costs are attributed primarily to increased personnel costs related to the modified staffing plan under People First as an independent entity.

FISCAL IMPACT: FY 2025 funding to support the operations and management of the LongTerm Safe Parking program will come from the General Fund, Safe Parking Program – Tier 3 (p102211),) in the amount of $489,732. The funding request to support this contract was included in the FY 2025 decision package for the City budget.

Prepared By:

Larry Imwalle
Homelessness Response
Manager
Submitted By:

Lisa Murphy
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. CONTRACT WITH PEOPLE FIRST OF SANTA CRUZ COUNTY FOR OPERATIONS AND MANAGEMENT OF THE LONG-TERM SAFE PARKING PROGRAM.DOCX

12.2 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 1
Professional Services Agreement With

PEOPLE FIRST OF SANTA CRUZ COUNTY (PEOPLE FIRST)
For OPERATION AND MANAGEMENT OF THE TIER 3 SAFE PARKING PROGARM THIS AGREEMENT for professional services is made by and between the City of Santa Cruz (“City”) and People First of Santa Cruz County (People First) (“Consultant”) (each is referred to individually as a “Party” and collectively, as the “Parties”) as of July 1, 2024 (the “Effective Date”).

NOW, THEREFORE, in consideration of each other’s mutual promises, the Parties hereto agree as follows:

SECTION 1: SCOPE OF WORK
Consultant will furnish services as defined and described in the Scope of Work, attached hereto as Exhibit A, and incorporated herein.

SECTION 2: RESPONSIBILITIES OF CONSULTANT
All work performed by Consultant, or under Consultant’s direction, shall be rendered in accordance with the generally accepted practices, and to the standards of, Consultant's profession. Consultant represents and agrees that Consultant: (i) is fully experienced and properly qualified to perform the work and services provided for herein, (ii) has the financial capability required for the performance of the work and services, and (iii) is properly equipped and organized to perform the work and services in a competent, timely, and proper manner, in accordance with the requirements of this Agreement.

Consultant shall meet with Larry Imwalle, Homelessness Response Manager, hereinafter called "Director", or other designated and authorized City personnel, or third parties as necessary, on all matters connected with carrying out of Consultant’s services described in Exhibit A. Such meetings shall be held at the request of either Party. Review and City approval of completed work shall be obtained monthly, or at other intervals as may be mutually agreed upon during this Agreement. Review, approval, or acceptance of Consultant’s work by City or others shall not relieve Consultant from responsibility for errors and omissions in Consultant’s work.

The Director may authorize a staff person to serve as his or her representative. The work in progress shall be reviewed at such intervals as may be mutually agreed upon between the Parties. The City will be the sole judge of acceptable work, provided that such approval will not be unreasonably withheld or delayed. If the work is not acceptable, City will inform Consultant of the changes or revisions necessary to secure approval.

12.3 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 2
SECTION 4: FEES AND PAYMENT
For services actually performed, the City will compensate Consultant at the rates set forth in the Fee Schedule detailed in Exhibit B and in accordance with the terms set forth therein. Payment for Consultant's services in carrying out the entire Scope of Work shall be made within the budget limit, or limits shown, upon Exhibit B. Such payment shall be considered the full compensation for all personnel, materials, supplies, and equipment used by Consultant in the Scope of Work.

Invoices shall detail the time worked by each class of employee on each task and the expenses incurred for which billing is made. Unless otherwise specified in the fee schedule, payments shall be made monthly by the City within 30 days based on itemized invoices from the Consultant which list the actual costs and expenses.

All invoices shall contain the following affidavit signed by Consultant (if individual) or by a principal of Consultant’s firm (if Consultant is an entity):
"I hereby certify [or as principal of Consultant] that the charge of (Insert invoice amount) as summarized above and shown in detail on the attachments is a fair and reasonable use of public funds, is in accordance with the terms of Agreement dated (Insert Agreement Date) and has not been previously paid."
This Agreement is contingent upon the appropriation of sufficient funding by the City for the services covered by this Agreement. If funding is reduced or deleted by the City for the services covered by this Agreement, the City has the option without penalty or liability to either terminate this Agreement or to offer an amendment to this Agreement indicating the reduced amount.

SECTION 5: TRAVEL REIMBURSEMENT POLICY
The City shall not be responsible for any travel, meal, or lodging reimbursements to Consultant and/or Consultant’s employees.

SECTION 7: TERM AND SCHEDULE
The term of this Agreement shall be on the effective date of this Agreement and terminating on June 30, 2024.

12.4 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 3
Consultant shall begin work as specified in a written authorization (e.g., Notice to Proceed) to perform services. The written authorization to perform work shall not be issued until after this Agreement has been approved and authorized by the City.

The City reserves the right to obtain the item(s) and/or services covered by this Agreement from another source during any on-going suspension of service due to the circumstances outlined above.

SECTION 8: TERMINATION
The City may terminate the Agreement for any reason by providing written notice to Consultant not less than 10 calendar days prior to an effective termination date.

The Consultant may terminate the Agreement for cause by providing written notice to the City` not less than 30 calendar days prior to an effective termination date.

The City may, at its option, allow Consultant to cure its failure to perform within 10 business days (or longer period authorized in writing by the City) from the date of the City’s termination notice. The termination shall be become effective if Consultant has not cured within the specified time period to the City’s satisfaction.

SECTION 9: INSURANCE
Prior to the beginning of and throughout the duration of the Agreement, Consultant will maintain and comply with the Insurance Requirements as set forth in Exhibit C. Consultant will insure the City against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder. The insurance coverages required shall not in any way limit the liability of the Consultant.

12.5 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 4
SECTION 10: INDEMNIFICATION
Consultant agrees, to the fullest extent permitted by law, to indemnify, defend, and hold harmless the City, its officials, officers, employees, agents, and volunteers (collectively, “Indemnitees”) from and against any and all liability, claim, action, loss, injury, damage, judgment, or expense, including attorneys’ fees and costs (“Losses”) caused by or resulting from the negligence, recklessness, or willful misconduct of Consultant, Consultant’s officers, employees, agents, or subcontractors in any way related to this Agreement. Consultant’s duty to indemnify and hold harmless Indemnitees shall not apply to the extent such Losses are caused by the sole or active negligence or willful misconduct of Indemnitees. Consultant’s obligation to defend shall arise regardless of any claim or assertion that Indemnitees caused or contributed to the Losses.

12.6 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 5
SECTION 14: MISCELLANEOUS PROVISIONS

1. Project Manager/Key Staff. Director reserves the right to evaluate and confer with Consultant regarding the project manager or other key staff assigned by Consultant to perform the work under this Agreement. Consultant shall replace the project manager or key staff upon Director’s request due to Director’s concern about their performance, or City shall have the right to terminate this Agreement. Otherwise, no change in assignment by the Consultant may occur without prior written approval of the City.

2. Consultant Services Only. Consultant is employed to render professional services only and any payments made to Consultant are compensation solely for such professional services.

3. Independent Contractor. In the performance of this Agreement, it is expressly understood that Consultant, including each of Consultant’s employees, agents, subcontractors or others under Consultant’s supervision or control, is an independent contractor solely responsible for its own acts and omissions, and shall not be considered an employee of the City for any purpose. Consultant agrees to comply with AB5, codified at Labor Code section 2750.3, and shall indemnify, defend, and hold harmless the City, its officials, officers, employees, and agents against any claim or liability, including attorneys’ fees and costs, arising in any manner related to this Agreement that an employee, agent or others under Consultant’s supervision or control was misclassified.

5. Subcontractors. Consultant shall obtain prior approval of the City prior to subcontracting of any work pursuant to this Agreement. If at any time, the City determines any subcontractor is incompetent or unqualified, Consultant will be notified and will be expected to immediately cancel the subcontract. Consultant shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, including naming the City of Santa Cruz, its officers, officials, employees, agents, and volunteers as additional insureds. Any modification to the insurance requirements for subcontractors must be agreed to by the City in writing.

7. Conflicts of Interest. Consultant agrees to comply with conflict of interest laws in performing the work and services under this Agreement. Consultant covenants (on behalf of Consultant and Consultant’s employees, agents, representatives, and subcontractors) that there is no direct or indirect interest, financial or otherwise, which would conflict in any manner or degree with the performance of services required under this Agreement. Consultant acknowledges and agrees to comply with applicable provisions of conflict of interest law and regulations, including the CA Political Reform Act, Sections 1090 and 87100 of the Government Code, and the City’s conflict of interest code. Consultant will immediately advise City if Consultant learns of a conflicting financial interest of Consultant during the term of this Agreement.

12.7 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 6
from creation of project-related documents and materials pursuant to this Agreement shall be vested in the City and Consultant waives and relinquishes all claims to copyright or other intellectual property rights in favor of City. Any work product related to this Agreement shall be confidential, not to be used by the Consultant on other projects or disclosed to any third party, except by agreement in writing by the City, or except as otherwise provided herein.

Consultant’s final deliverables shall comply with Section 508 (29 U.S.C. Section 794d) accessibility requirements, as applicable.

9. Intellectual Property and Indemnity. Consultant represents to City that, to the best of Consultant’s knowledge, any Intellectual Property (including but not limited to: patent, patent application, trade secret, copyright and any applications or right to apply for registration, computer software programs or applications, tangible or intangible proprietary information, or any other intellectual property right) in connection with any services and/or products related to this Agreement does not violate or infringe upon any Intellectual Property rights of any other person or entity.

12.8 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 7
and ensure the proper return and/or disposal of City Data and Confidential Information upon termination of this Agreement with notice to the City.
c. Consultant shall take appropriate action to address any incident of unauthorized access to City Data and Confidential Information, including addressing and/or remedying the issue that resulted in such unauthorized access, notifying City as soon as possible of any incident of unauthorized access to City Data and Confidential Information, or any other breach in Consultant’s security that materially affects City or end users; and be responsible for ensuring compliance by its officers, employees, agents, and subcontractors with the confidentiality provisions hereof. Should confidential and/or legally protected City Data be divulged to unauthorized third parties, Consultant shall comply with all applicable federal and state laws and regulations, including but not limited to California Civil Code sections 1798.29 and 1798.82 at Consultant’s sole expense. Consultant shall not charge City for any expenses associated with Consultant’s compliance with these obligations.
d. Consultant shall defend, indemnify and hold harmless City, its officials, officers, employees and agents against any claim, liability, loss, injury or damage (including attorneys’ fee and costs) arising out of, or in connection with, the unauthorized use, access, and/or disclosure of City Data and/or Confidential Information by Consultant and/or its agents, employees or subcontractors, excepting only loss, injury or damage caused by the sole negligence or willful misconduct of the City. This provision shall survive the termination or expiration of this Agreement.

12. California Public Records Act. City is a public agency subject to the disclosure requirements of the California Public Records Act (“CPRA”). If Consultant’s proprietary information is contained in documents or information submitted to City, and Consultant claims that such information falls within one or more CPRA exemptions, Consultant must clearly mark such information “Confidential and Proprietary,” and identify the specific lines containing the information. In the event of a request for such information, City will make best efforts to provide notice to Consultant prior to such disclosure. If Consultant contends that any documents are exempt from the CPRA and wishes to prevent disclosure, it is required to obtain a protective order, injunctive relief, or other appropriate remedy from a court of law in Santa Cruz County before the City is required to respond to the CPRA request. If Consultant fails to obtain such remedy within the time the City is required to respond to the CPRA request, City may disclose the requested information without any liability. Consultant further agrees that it shall defend, indemnify, and hold City harmless against any claim, action, or litigation (including but not limited to all judgments, costs, and attorney’s fees) that may result from denial by City of a CPRA request for information arising from any representation, or any action (or inaction), by the Consultant.

12.9 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 8

14. Licensure. Consultant agrees that Consultant, its subcontractors and/or agents (if any) has/have complied with all applicable federal, state, and local licensing requirements and agrees to provide proof of a current City of Santa Cruz Business Tax Certificate if:
 Consultant, its subcontractor(s) and agent(s) or its business is/are located in the City of Santa Cruz; or  Will perform actual work in the City of Santa Cruz for 6 or more days annually; or  Will use company vehicles to deliver within the City of Santa Cruz for 6 or more days annually.

For additional information and licensing requirements, view the City’s Business Licenses and Permits webpage or call the Revenue and Taxation division at 831/420-5070.

12.10 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 9
kind or nature, arising from or relating to any failure (or alleged failure) of the Consultant and any subconsultant to pay prevailing wages or to otherwise comply with the requirements of prevailing wage law relating to a public work.
g. Consultant acknowledges that it and/or any subconsultant may not engage in the performance of any contract for public work unless currently registered with the DIR and qualified to perform public work pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a)].

19. Force Majeure. Neither party hereto shall be considered in default in the performance of its obligation hereunder to the extent that the performance of any such obligation is prevented or delayed by an act of God, natural disaster, pandemic, acts of terrorism, war, a strike, lockout or other labor difficulty, or other peril, which is beyond the reasonable control of the affected party and without the negligence of the respective Parties. Each party hereto shall give notice promptly to the other of the nature and extent of any Force Majeure claimed to delay, hinder, or prevent performance of the services under this Agreement. Each Party will, however, make all reasonable efforts to remove or eliminate such a cause of delay or default and will, upon the cessation of the cause, diligently pursue performance of its obligations in this Agreement. In the event either party is prevented or delayed in the performance of its respective obligation by reason of such Force Majeure, the only remedy is that there may be an equitable adjustment of the schedule based on City’s sole discretion.

21. Severability. The unenforceability, invalidity, or illegality of any provision(s) of this Agreement shall not render the other provisions unenforceable, invalid, or illegal.

12.11 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 10

22. Waiver. Waiver by any party of any portion of this Agreement shall not constitute a waiver of the same or any other portion hereof.

23. Governing Law. This Agreement shall be governed by and interpreted in accordance with California law.

To CITY:

City Manager’s Office
Larry Imwalle
809 Center St., Rm 10
Santa Cruz, CA 95062
[email protected]
831-420-5405
To CONSULTANT:

Association of Faith Communities (AFC)
Judy Hutchison
532 Center Street
Santa Cruz, CA 95060
[email protected]
831-226-4788
Changes to the above information shall be given to the other party in writing ten (10) business days before the change is effective.

27. Counterparts. The Parties may execute this Agreement in two or more counterparts, which shall, in the aggregate, be deemed an original but all of which, together, shall constitute one and the same instrument. A scanned, electronic, facsimile, or other copy of a party’s signature shall be accepted and valid as an original.

12.12 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 11
Signature Requirements for Nonprofit Corporation:
2 officer signatures required (one from each group, unless person signing holds officer positions in both Group 1 and 2):

By: ______________________________ Date: __________________ Office of the City Attorney

CITY OF SANTA CRUZ
By: ______________________________ Date: __________________ Matt Huffaker
City Manager

CONSULTANT
By: ______________________________ Date: __________________ Printed: ___________________________ Title: __________________

12.13 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 12
EXHIBIT A: SCOPE OF WORK

SCOPE OF WORK OVERVIEW
The City of Santa Cruz (CITY) is entering into a contract with Association of Faith Communities (AFC) A California Corporation (CONTRACTOR), to operate a Safe Parking Program for unsheltered individuals living in their vehicles.

CONTRACTOR shall operate a 24-hour emergency safe parking program, 7 days per week, located at 301 Armory Road in Santa Cruz. The safe parking program will be sited at the Armory north parking lot (within the fenced area) for up to 20 oversized vehicles. Services will include safe and secure parking spots; access to bathroom and shower amenities; and case management aimed at permanent housing exit-focused linkages and referral services.

PERFORMANCE MEASUREMENTS
How Many Services
Will Be Provided? How Well Will Services Be Provided? Is Anyone Better Off? A minimum of 17
unduplicated
individuals will
receive program
services per night
during the contract
period.
100% of enrolled participants will have a
completed assessment and entry into HMIS
within 14 days of program enrollment.

Data Collection Tools: Monthly client
reports & Homelessness Management
Information System (HMIS)
20% of program participants will exit
homelessness to a permanent housing
destination within 12 months.
60% of program participants will have
become housing ready within 12 months.
70% of program participants will have a
documented instance of overcoming a
housing barrier within 4 months of
entering the program.

Data Collection Tool: HMIS

SERVICE PRINCIPLES
CONTRACTOR shall ensure the program adheres to Housing First, Trauma Informed Care, and Harm Reduction principles:

HOUSING FIRST
 CONTRACTOR shall conduct all emergency sheltering activities in adherence with the Core Components of Housing First, pursuant to State Welfare and Institution Code Section 8255(b).  There are no requirements for sobriety, income, adherence to substance use treatment, mental health treatment, and/or participation in case management in order to receive shelter services. The focus is on shelter as a step towards permanent housing. CONTRACTOR shall work to ensure addiction and mental health issues do not become barriers to participation in the program, and that referrals are given to recovery providers for those that wish to seek help in confronting their behavioral health challenges.

12.14 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 13

TRAUMA INFORMED CARE (TIC)

1. TIC in a shelter is important because individuals currently experiencing homelessness are more likely to have experienced traumatic incidents in their lifetime than people in the general population.

CONTRACTOR response to behavioral incidents shall be guided by TIC principles and practice.

HARM REDUCTION
CONTRACTOR shall not mandate abstinence from drugs and alcohol or require treatment for mental health symptoms or substance use as a requirement for program eligibility. Responses to participant situations focus on behaviors related to the health and safety of the individual, other participants and staff in the shelter, and the intent is to keep someone in shelter safely while also ensuring the safety of staff and other shelter participants. Exits due to behavior are reserved for only the most severe incidents or when there are multiple incidents that continue to jeopardize the health and safety of participants and staff.

CITY RESPONSIBILITIES

1. CITY shall be responsible for the requisite infrastructure at the Armory north parking lot site for CONTRACTOR to provide the services described in this scope of work including sanitation and hygiene facilities.

2. CITY will provide maintenance of the site/structures as well as cover utility costs and responsibilities for the site, including refuse service.

CONTRACTOR RESPONSIBILITIES

1. CONTRACTOR shall:
a. Ensure the safe parking program operates on a 24 hours/day, 7 days/week basis. b. Provide all shelter participants with case management services including housing navigation and connection to County services
c. Not allow participants to congregate in a group or be outside between 10:00 pm. and 6:00 am. d. Provide each shelter participant a space of at least 6 feet between guests and minimize personal belongings to allow for ingress and egress of guests and staff.

1. CONTRACTOR shall ensure that all participants with physical limitations receive the personal assistance needed for personal care needs, such as cleaning, bathing, moving into or out of wheelchairs, or changing clothes, as well as getting into/out of transportation vehicles.

2. CONTRACTOR shall ensure that all shelter participants are able to safely access and use all amenities at or brought to the site, such as portable toilets, hand washing stations and showers.

3. CONTRACTOR shall ensure that its safe parking program has Policies and Procedures that at a minimum include:
a. Shelter layout that meets all applicable government zoning and building requirements

12.15 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 14
b. Shelter requirements
c. Safety procedures
d. Parking policies
e. Pet policy
f. Public visitation policy
g. Neighborhood interface procedures
h. Shower policies
i. Janitorial/storage expectations
j. Written plan for responding to first aid and health emergencies including basic first aid supplies accessible on site
k. Written evacuation plan for emergencies, i.e., Fire, Earthquake. l. Organizational Chart depicting CONTRACTOR reporting structure and contact information for CONTRACTOR management personnel to be called for different types of problems, i.e., facilities, client behavior, emergency, etc.
m. Shelter staff position descriptions, responsibilities, and expectations n. Information on required Service Principles as indicated in this contract o. Information on connections to mainstream services, referral, and priority eligibility

4. CONTRACTOR shall ensure its staff can readily access Shelter Program Policies and Procedures for consistency and clarity in conducting contracted services.

5. CONTRACTOR shall maintain a healthy environment.
a. CONTRACTOR shall refer any participant with a suspected or known infectious disease to the Homeless Persons Health Project (866-731-HPHP).
b. CONTRACTOR shall immediately notify City of any incidents that resulted in a call to 911, including the nature of the call and the outcome of the incident by contacting Megan Bunch – [email protected] or (831) 420-5093.

6. CONTRACTOR shall utilize identified systems for data collection and reporting, as well as participant and program assessment and evaluation. Systems shall be approved by the Director, and reports from the system shall be provided to the CITY upon request.

12.16 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 15

7. CONTRACTOR shall take necessary steps to ensure participants do not create or their conduct constitute a nuisance in the immediate vicinity of the site.

8. CONTRACTOR shall ensure that pets of participants adhere to the established shelter pet policy.

9. Upon expiration or termination of this AGREEMENT, CONTRACTOR shall remove all decorations, display, signs, or equipment from the site.

PERSONNEL & SITE SUPERVISION

1. CONTRACTOR shall recruit, hire, and maintain minimum staffing levels as specified in “Exhibit B– Budget” at a skill set sufficient to perform all the duties required to work with referred or identify potentially eligible participants and ensure the following are accomplished:
 Assessment of all safe parking applicants
 Safe parking participants’ entrance to and exit from the program happen in a coordinated manner  Appropriate oversight of safe parking operations to ensure the health and safety of participants and staff

2. CONTRACTOR shall ensure all paid and volunteer staff are instructed on CONTRACTOR’s shelter policies and procedures, and that a policy and procedures manual is available on site.

CONNECTION TO ADDITIONAL SERVICES

1. CONTRACTOR shall ensure all participants receive an intake assessment, and that information on participants is entered into HMIS.

2. CONTRACTOR shall refer and link participants with appropriate community-based resources and programs to meet needs identified during the intake and assessment process. CONTRACTOR shall work to ensure participants attain resources to which they were referred by program staff.

3. CONTRACTOR shall ensure that participants receive transportation linkage and referral assistance when necessary to obtain appropriate community resources and support.  To assist participants with disabilities to access transportation assistance, CONTRACTOR shall contact The Lift Line (https://communitybridges.org/liftline/) for disabled transportation assistance services or a similar free transportation service.

SYSTEMS FOR DATA COLLECTION
CONTRACTOR shall utilize the following approved systems for data collection and reporting, as well as participant and program assessment and evaluation.

HOMELESS MANAGEMENT INFORMATION SYSTEM (HMIS)

1. CONTRACTOR shall utilize HMIS as the agreed upon collaborative system for program and participant data collection and reporting.

12.17 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 16

2. CONTRACTOR shall complete HMIS data entry for each participant that includes information sharing authorization, new client entry if needed, program intake assessment, participant update information, participant referral information, and participant exit information.

REFERRALS, ELIGIBILITY AND PRIORITY CRITERIA

BASIC REFERRAL CRITERIA

1. CONTRACTOR shall accept referrals of participants from the City. With consent from the City, Contractor may also accept referrals from the Coordinated Entry System (CES) or from County agencies in the event there are available beds.

2. CONTRACTOR shall ensure that all participants are provided information about the Homeward Bound program and offered Homeward Bound as a diversion option at program intake.

BASIC ELIGIBILITY CRITERIA FOR SHELTER SERVICES
The basic eligibility for entry into the program, as established by City, is that participants are living in their vehicles while experiencing homelessness (literally homeless, unsheltered other than vehicle).

REPORTING AND COORDINATION REQUIREMENTS

1. CONTRACTOR shall immediately notify CITY of any significant issues with program participants; time is of the essence. Significant issues include but are not limited to disciplinary or safety issues that impact participants’ shelter stay.

2. Training: CONTRACTOR shall ensure that personnel listed under “Exhibit B – Budget” are appropriately trained in Housing First, HMIS, Coordinated Entry, Trauma Informed Care, Harm Reduction, to facilitate their ability to utilize evidence-based Housing First and other best practices.

INVOICES

1. CONTRACTOR shall provide monthly invoices, using a template provided by the CITY, to document services costs based on the budget detailed in this scope of work and the attached Exhibit B - Budget document.

2. Monthly invoices shall be submitted via email to CITY authorized staff (Larry Imwalle, [email protected]) within 10 calendar days following the end of the month in which the services were provided.

BACK UP DOCUMENTATION AND REPORTING

1. CONTRACTOR shall provide required backup documentation on monthly contracted activities along with monthly invoices when submitted.

2. CONTRACTOR shall utilize the HMIS to enter, track and measure data on each participating individual, based on the Performance Measurement outcomes stated in this scope of work.

3. CONTRACTOR shall utilize monthly reports and other reports as needed, to enter, track and measure data not already captured within HMIS, based on the Performance Measurement outcomes stated in this scope of work.

12.18 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 17

SCOPE OF WORK OR BUDGET MODIFICATION

1. Changes to the budget, including transfers between budget categories within a specific fiscal year may be made only through a budget modification, which must be requested to the CITY in writing by the CONTRACTOR in advance of the modification, providing the transfer is less than 30% (cumulative), is within a single budget suffix of the approved budget, and is within the total original fiscal year budget.

2. Budget modification requests must be received no later than May 15th of the fiscal year in which the budget modification is applicable and must have prior approval by CITY authorized staff to be approved.

ADDITIONAL TERMS AND CONDITIONS

1. Corrective Action: CONTRACTOR shall perform the agreed upon services detailed in this scope of work, submit timely invoices and reports, and work to meet agreed upon outcomes as detailed herein.

CONTRACTOR failure to provide any of these agreed upon terms may result in a Corrective Action request. Corrective Action requests will specify ongoing problems in the performance of these contract terms and a deadline by which to rectify problems and will also require the CONTRACTOR to submit a brief Corrective Action Plan detailing how ongoing problems will be resolved. Failure to adequately address steps outlined in the Corrective Action Plan may ·result in the withholding of payment on invoices and/or termination of the contract.

2. Federal Funding: CONTRACTOR certifies they are not suspended, debarred, or proposed for debarment from receiving federal funds; declared ineligible to receive federal funds; or voluntarily excluded from participation in covered transactions by any federal department or agency.

3. Uninterrupted Provision of Services: In order to maintain uninterrupted services under this agreement, the CONTRACTOR shall ensure that the budgeted staffing for the contracted services is maintained, which includes providing coverage for staff vacancies or leaves of more than two weeks. Additionally, CONTRACTOR program and direct service staff must be replaced within 90 days of the start of staffing vacancies.

4. Notification of Personnel Changes: In the event of key personnel changes or leaves of more than two weeks for positions funded by this agreement (e.g., program manager or assistant program manager), the CONTRACTOR shall report changes to the CITY within 10 business days of occurrence.

5. Instruction: The CONTRACTOR shall provide this Scope of Work to all of its employees who conduct activities under this contract, so that CONTRACTOR staff clearly understands expected activities per this agreement. The CONTRACTOR will train any new employees who work in any capacities related to the provisions of this contract, in the requirements of this contract.

6. Publicity and Outreach: The CONTRACTOR agrees to obtain CITY approval prior to use for all contracted program marketing materials, including but not limited to flyers, brochures, written success stories, social media posts, and website information. The CONTRACTOR shall ensure that the CITY logo and name are included on all contracted program marketing materials and will obtain these directly from CITY authorized staff for approved uses.

7. Media Inquiries: Should the CONTRACTOR receive press/media inquiries regarding the services provided through this contract, the CONTRACTOR shall notify the Homelessness Communication Specialist of the inquiry, at [email protected] or at 831-420-5059. Press/media must also be referred directly to the Communications Specialist for additional information.

12.19 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 18
EXHIBIT B: FEE SCHEDULE
The total amount payable under this agreement shall not exceed $430,161.60.

Program participants will vary due to a number of factors. This variation in Program participation will impact the costs associated with Program operations. The approved Program budget (below) is based on maximum participation of 20 vehicles. Should participation be lower, the Program costs, and therefore, Contractor invoices, will also be lower. It is therefore necessary tat the Contractor provide accurate monthly reports and invoice monthly based on the associated costs incurred.

Contractor will invoice the City on or before the 15th of each month. Monthly invoices should include the following information and costs:
 Average number of Program participants for the invoicing month  Payroll costs with staff levels/house for the invoicing month  Supply costs with list of supplies purchased to support the Program during the invoicing month Budget

12.20 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 19
EXHIBIT C:INSURANCE REQUIREMENTS
Consultant shall procure and maintain insurance against claims for injuries to persons or damages to property and otherwise which may arise from or in connection with the performance of the work under this Agreement and the results of that work by Consultant, its agents, representatives, employees, or subcontractors.

Coverage will be at least as broad as:
 COMMERCIAL GENERAL LIABILITY (CGL): $2,000,000 PER OCCURRENCE; $2,000,000 AGGREGATE Proof of coverage for $2 Million per occurrence and $2 Million in the aggregate including products and completed operations, property damage, bodily injury, personal and advertising injury will be provided on Insurance Services Office (ISO) Form CG 00 01 covering CGL.  AUTOMOBILE LIABILITY:

Proof of coverage for $1,000,000 provided on ISO Form Number CA 00 01 covering any auto (Code 1), or if Consultant has no owned autos, hired, (Code 8) and non-owned autos (Code 9), per accident for bodily injury and property damage.
 WORKERS’ COMPENSATION AS REQUIRED BY THE STATE OF CALIFORNIA, WITH STATUTORY LIMITS, AND EMPLOYER’S LIABILITY INSURANCE: $1,000,000 per accident for bodily injury or disease.

12.21 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 20
C. OTHER INSURANCE PROVISIONS
The insurance policies are to comply with the following provisions:
 ADDITIONAL INSURED STATUS
The City, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds on the CGL with respect to liability arising out of work or operations performed by or on behalf of Consultant including materials, parts, or equipment furnished in connection with such work or operations, products and completed operations. General liability coverage will be provided in the form of an endorsement to Consultant’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used).
 PRIMARY COVERAGE
For any claims related to this Agreement, Consultant’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of Consultant’s and all subcontractor’s insurance and will not contribute with it.
 NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
 WAIVER OF SUBROGATION
Consultant hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Consultant may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. Consultant agrees to obtain any endorsement that may be necessary to effectuate this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.  EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
Consultant may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Consultant’s primary and excess liability policies are exhausted.  DURATION OF COVERAGE
CGL & Excess Liability/Umbrella policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Such Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

12.22 City of Santa Cruz Professional Services Agreement for Operation and Management of the Tier 3 Safe Parking Program June 2024 (Form Rev.01/23) Page 21
 SELF-INSURED RETENTIONS (SIR)
Self-insured retentions must be declared to and approved by the City. City may require Consultant to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses.

1. The Retroactive Date must be shown and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained, and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of contract work.  VERIFICATION OF COVERAGE
Consultant will furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy (and CPL, automobile, and any Excess Liability/Umbrella policies, as applicable) listing all policy endorsements to be approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the Consultant’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

12.23 City Council

AGENDA REPORT
DATE: 06/05/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Manager
SUBJECT: Governor’s Office of Planning and Research Adaptation Planning Grant Program - Authorization to Submit a Grant Application to Complete a Microgrid Feasibility and Community Resilience Plan (CM) RECOMMENDATION: Resolution authorizing the City Manager to apply for, accept, and appropriate funds from the Governor’s Office of Planning and Research Local Government’s Adaptation Planning Grant Program.

BACKGROUND: The Governor’s Office of Planning and Research (OPR) announced the availability of funding for Round 2 of the Adaptation Planning Grant Program (APGP) through a Notice of Funding Availability (NOFA). OPR anticipates that $9,500,000 will be available for competitive awards in Round 2. Funding for the APGP is provided by the state’s General Fund.

OPR’s Integrated Climate Adaptation and Resiliency Program administers the APGP and received funds to implement the program through the provision of grants and staff support.

Applications can request between $100,000 and $650,000 in total state funding for planning projects spanning twenty-four months. Applications were due June 3, 2024. Projects selected for funding will begin on January 1, 2025.

DISCUSSION: The City’s Climate Action Plan 2030 adopted in 2022 contains two high impact actions that pertain to microgrids. Action M3.3 calls for identifying and implementing near term microgrid opportunities that align with resilience objectives and conducting a microgrid pilot program. BE3.3 calls for supporting commercial battery storage installations and business district scale microgrid opportunities. The City’s Climate Adaptation Plan, adopted in 2018 and currently under revision, calls for reducing energy consumption and increasing local, distributed renewable energy resources as well as stimulating similar actions in the private sector.

Microgrids and Community Resilience Center development are explicit actions drafted for the Climate Adaptation Plan and Local Hazard Mitigation Plan updates to be complete later in 2024.

The US Department of Energy defines a microgrid as a group of interconnected electricity loads and distributed energy resources within clearly defined electrical boundaries that acts as a single controllable entity with respect to the electrical grid. A microgrid can connect and disconnect from the Pacific Gas and Electric electrical grid to enable it to operate in both grid-connected or island mode. Microgrids are like smaller, independent electrical networks that can connect to the main electrical grid.

13.1 They offer several advantages:
• Help modernize the main grid and use different smart technologies; • Enhance the use of renewable energy sources, like solar or wind power, which can lower peak electricity use and cost and reduce power loss because they generate electricity closer to where it is needed;
• Ensure a steady supply of energy for important critical loads, and they can help control the quality and reliability of power in a specific area. They also involve the community in managing power usage; and
• Help the main power grid by managing delicate power needs and dealing with the ups and downs of renewable energy. They can also provide extra services to support the main grid.

Community Resilience Centers (CRCs) are existing and trusted locations, such as schools, community centers, churches, and libraries, that provide aid and resources before, during, and after disasters. CRCs are designed in collaboration with the community they serve. CRCs provide aid and services that help communities prepare and recover from these types of disasters.

CRCs should be designed in partnership with residents to offer services like:
• Providing clean air during smoke events;
• Acting as cooling locations during extreme heat;
• Distributing food;
• Serving as an emergency shelter or hub for emergency services; • Facilitating disaster preparedness training and neighborhood organizing; and • Hosting off-grid charging during power outages or shutdowns.

The City’s Economic Development Strategy adopted in 2021 includes strategies to “facilitate gathering of business input for longer-term city projects to implement the Climate Action Plan” and “creating opportunities for interdepartmental coordination and business outreach on sustainability projects”. Additionally, the City Council Strategic Plan 2023-2028 includes a focus area to “invest in sustainable, climate-adapted infrastructure and community assets in both the natural and built environment.” Microgrids and CRCs align with both strategies.

Recent engagement between the City, Beach Flats residents and Community-Based Organizations (CBOs) contributed to explicit climate planning processes but also identified a collective vision to address 5 discrete needs that can be co-benefits of climate investment:
infrastructure, housing, public safety, environment, and service programming. Many of these needs can be addressed through development of community microgrids and CRCs in the Beach Flats frontline neighborhood and at CBOs that serve other vulnerable groups. More broadly, the need has been emphasized by recent public safety power shutoffs, escalating energy costs, the need for grid reliability and new financing programs. However, there is a gap in and need for capacity and comprehensive knowledge and planning around microgrids and community resilience centers opportunities both municipally and citywide.

The City and CBO co-applicant, Ecology Action (EA) submitted an application entitled, Santa Cruz Microgrid Feasibility and Community Resilience Plan on June 3, 2024, seeking funds to work with CBO partners, consultants and the wider community to equitably identify, prioritize and develop feasible pilot and full scale microgrid and community resilience center opportunities prioritizing vulnerable groups and frontline neighborhoods like the Beach Flats and the CBOs that serve them. The project also includes municipal buildings and facilities. Because partnership

13.2 commitments were still forming and a go decision pending, staff were unable to request authorization from City Council prior to the grant application deadline.

Key project elements include: (1) community engagement building understanding around these measures, (2) issue of a request for information and interest (RFI+I) from energy professionals, property owners, researchers, neighbors, investors and funders, CBOs, service providers and others to understand needs and opportunities, (3) evaluation of community and municipal buildings/facilities for decarbonization, microgrid and community resilience center opportunities, (4) developing, prioritizing and sequencing project concepts with funding packages into a community-wide Microgrid Feasibility and Community Resilience Plan, and (5) creating enabling conditions for change management and accelerated deployment of priority concepts.

The partnerships proposed are key to successful and equitable delivery of the project but also to ongoing implementation of the Microgrid Feasibility and Community Resilience Plan. The City will administer and manage the project. EA will lead community engagement, education, and financial training elements. CBO partners (EA, Ventures, Community Bridges, Central Coast Energy Services, Santa Cruz Works, and others) will join members of existing City advisory bodies (e.g., Transportation and Public Works Commission, Downtown Commission) in advisory roles on a project steering committee.

Some partner CBOs will participate in workforce training development, community engagement outreach, and promotion while others will participate in the RFI+I process submitting information for their city located facilities. The broader set of CBOs from collaborative networks (e.g., Monterey Bay Area Climate Justice Collaborative, Chamber of Commerce)will be leveraged to reach other vulnerable community members, e.g., elderly, differently-abled, unhoused and others, as well as businesses, neighborhood groups and the general public. A core city team will participate to include municipal buildings and facilities. The project partners will ensure focus on culturally accessible resiliency education, providing vulnerable groups and CBOs with technical assistance to participate in the RFI+I and financing training to drive from plan toward implementation.

If awarded, this project will add to growing number of City-led projects coming online or in development that advance public-private-nonprofit partnerships on energy resilience.

FISCAL IMPACT: There is no fiscal impact from submitting the grant proposal. The City requested $649,790 to carry out this scope of work.

Prepared By:

Tiffany Wise-West
Sustainability and Resiliency
Manager
Submitted By:

Laura Schmidt
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

13.3 RESOLUTION NO. NS-XX,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ AUTHORIZING

THE CITY MANAGER TO APPLY FOR FUNDS FROM THE CALIFORNIA ENERGY

COMMISSION LOCAL GOVERNMENT BUILDING DECARBONIZATION CHALLENGE

TO COMPLETE MICROGRID FEASIBILITY AND COMMUNITY RESILIENCE PLAN WHEREAS, the City of Santa Cruz is subject to wildfire, flooding, sea level rise, earthquake and many other climate and natural hazards potentially impacting the reliability of energy sources and social services are critical whether needed every day, in the event of a climate hazard disruption, or in the recovery phase; and
WHEREAS, microgrids and community resilience centers are able to increase resilience to climate and natural hazards but can also result in co-benefits to infrastructure, housing, public safety, environment, and service programming which are priorities indicated by frontline neighborhoods; and
WHEREAS, on the Santa Cruz City Council adopted the City’s Climate Action Plan 2030 in 2022 and the Climate Adaptation Plan in 2018; and
WHEREAS, both the Climate Action Plan and Climate Adaptation Plan include several actions that accelerate adoption of microgrids and community resilience centers with focus on frontline and vulnerable groups; and
WHEREAS, the California Governor’s Office of Planning and Research (OPR) announced the availability of funding for Round 2 of the Adaptation Planning Grant Program (APGP) where $9,500,000 is available for competitive award; and
WHEREAS, the City of Santa Cruz collaboratively developed and submitted an application to fund the development of a Microgrid Feasibility and Community Resilience Plan; and NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Santa Cruz herby:
1) Directs City staff to submit a grant application package to the Governor’s OPR APGP to develop the Microgrid Feasibility and Community Resilience Plan and carry out associated activities for an amount of up to $650,000; and
2) Authorizes the City Manager of the City of Santa Cruz to apply for, accept, and execute in the name of the City of Santa Cruz all necessary applications, contracts and agreements and amendments thereto and appropriate funds from the OPR APGP to implement and carry out the scope of work approved through approval of the application.

13.4 RESOLUTION NO. NS-XX,XXX
2 PASSED AND ADOPTED this 25th day of June, 2024 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

13.5 City Council

AGENDA REPORT
DATE: 06/04/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Council
SUBJECT: Designation of Voting Delegate and Alternate to Attend the League of California Cities (LOCC) Annual Conference Being Held in Long Beach October 16 – 18, 2024 (CN)
RECOMMENDATION: Motion to designate Vice Mayor Golder as the voting delegate, and Councilmember Brunner as the alternate in the event that Vice Mayor Golder is unavailable, to attend the League of California Cities Annual Conference in Long Beach.

BACKGROUND: None.

DISCUSSION: This year’s League of California Cities (LOCC) Annual Conference is scheduled for Wednesday, October 16, 2024, through Friday, October 18, 2024, in Long Beach.

One very important aspect of the conference is the session to consider and take action on conference resolutions. This session is scheduled for Friday, October 18. Annual conference resolutions guide cities and the LOCC in their efforts to improve the quality, responsiveness, and vitality of local government in California. It is therefore important that all cities be represented.

Although each member city has a right to cast one vote, at this time, the LOCC has asked that each city council designate a voting delegate and up to two alternates in the event that the voting delegate is unavailable so that proper records may be established.

FISCAL IMPACT: Funds have been budgeted to pay for City Council meeting/travel expenses.

Prepared By:

Bonnie Bush
City Clerk
Submitted By:

Fred Keeley
Mayor
ATTACHMENTS:

None.

14.1 City Council

AGENDA REPORT
DATE: 06/04/2024
AGENDA OF: 06/25/2024
DEPARTMENT: City Council
SUBJECT: Letter of Support of California Senate Bill 1053 and Assembly Bill 2236 (CN)
RECOMMENDATION: Motion to direct the Mayor to provide a letter of support of California Senate Bill 1053 and Assembly Bill 2236, both related to plastic pollution.

BACKGROUND: Senate Bill (SB) 1053 from the California legislative session aims to tackle the issue of plastic pollution by regulating reusable grocery bags and prohibiting the use of single use plastic film bags at grocery stores and large retail stores. The bill proposes a statewide ban on these plastic bags, with some expectations for specific uses, and mandates that stores provide reusable bags for purchase or allow customers to bring their own. This initiative seeks to reduce plastic waste and encourage more sustainable options as plastic has become a leading pollutant across the California Coast.

Congruent with SB 1053, Assembly Bill (AB) 2236 aims to solidify California’s stance on reducing plastic pollution and promoting sustainable alternatives. It strengthens and supports existing regulations by requiring recycled paper bags to be made entirely from post-consumer recycled materials and setting specific standards for reusable grocery bags sold at stores.

Additionally, the bill streamlines regulations by eliminating outdated provisions and focusing on promoting environmentally friendly alternatives to single-use plastic bags. This legislation represents a significant step forward in California’s commitment to a cleaner and more sustainable future.
 These bills aim to close the loophole caused by SB 270 that allows for thicker plastic bags made of HDPE, setting a higher standard for reusable bags to prevent the emergence of HDPE which are stronger plastic bags and will last longer in the environment.  Stores buy these bags for about 5 cents each and sell them for about double the price, pocketing the profits and still allowing these bags in landfills, along the coast, and rivers because this plastic cannot be recycled
 SB 1053 and AB 2236 would reduce plastic pollution.
 These bills would protect natural resources by reducing reliance on natural materials for paper bags and promote reusable alternatives.
 They would promote sustainability.

DISCUSSION: Santa Cruz’s coast is not immune to plastic pollution. Local beaches like Natural Bridges and Main Beach are frequently littered with plastic debris washed ashore by the

15.1 tides. Plastic bags, straws, and other single use plastic items are the most common types of litter found along the coastline and river. These bags pose far-reaching consequences for species like the sea otter and the leather back sea turtle, disrupting the food web and entangling and choking these animals.

Santa Cruz’s commitment to environmental protection aligns with the goals of SB 1053 and AB 2236. These bills aim to strengthen existing plastic bag regulations and promote the use of sustainable alternatives, which directly supports the city’s efforts in wastewater treatment, storm water treatment, stormwater management, and environmental compliance. By reducing plastic pollution and encouraging the use of more sustainable and recycled materials, these bills contribute to a cleaner and healthier environment for Santa Cruz and the surrounding counties, in direct alignment with the Council supported Pitch In Santa Cruz initiative (https://pitchinsantacruz.org/) which aims to make Santa Cruz County litter-free.

FISCAL IMPACT: No fiscal impact associated with providing a letter of support for the bills.

Submitted By:

Fred Keeley
Mayor
ATTACHMENTS:

None.

15.2 CITY COUNCIL

AGENDA REPORT
DATE: June 6, 2024
AGENDA OF: June 25, 2024
DEPARTMENT: City Council
SUBJECT: City Council Ad Hoc Climate and Resilience Committee (CN) RECOMMENDATION: Motion to:
1) Accept an update regarding the recent work of the City Council Ad Hoc Climate and Resilience Committee (Ad Hoc); and
2) Approve Ad Hoc recommendations for West Cliff Implementation Committee membership and next steps, and the approach for a pilot of a broader climate and resiliency advisory committee.

BACKGROUND: Climate and resiliency are long-standing concerns and work areas for the City. As a leader in this space, the City has been working on many broad plans and specific implementation projects. Two specific areas of recent focus are:
 Review of the current mayoral Climate Action Task Force, and  Next steps for the City’s West Cliff 50-year Community Vision.

When the 50-year Community Vision was before Council on April 9, 2024, Council directed staff to: work with a council ad hoc committee consisting of Mayor Keeley, Vice Mayor Golder, and Councilmember Kalantari-Johnson to develop recommendations on organizational models (including potentially charters with scope, membership, terms of service) for:
 A West Cliff 50-year Implementation Committee, and
 An advisory body to the Council to provide overall climate and resilience policy advice.

With this direction, the City Council Ad Hoc Climate and Resilience Committee (Ad Hoc) was formed and the Ad Hoc has met several times to date on May 7th, May 20th, and June 10th. A summary of their work is below, along with key recommendations to the Council.

DISCUSSION: The Ad Hoc work is divided into two focus areas:

1. West Cliff 50-year Implementation Committee (WCIC)

2. Climate and Resiliency Committee (CRC)
West Cliff 50-year Implementation Committee
The Ad Hoc discussed and recommends the following:

16.1  Scope: Review and advise on implementation priorities, plans (and associated outreach), and funding capacity for the City’s West Cliff area for the next 3-5 years as guided by the 50-year Community Vision. Discussions and advice will also be informed by the City’s other climate and resilience work.
 Membership – 10 in total:
o 3 – Councilmembers:
 Mayor Keeley
 Vice Mayor Golder
 Councilmember Kalantari-Johnson
o 7 - Community Subject Matter Experts:
 Climate – Ross Clark
 Cycling – Danielle Lewis
 Diversity – Ellory Fink
 Environmental Justice and/or Student – To Be Filled by Youth Liaison  Neighborhood – Don Iglesias
 Surfing – Shaun Burns
 Resident Historian – Bob Pearson
o Staff Participation:
 Lead: Erika Smart
 Subject Matter Experts (SMEs)
 Tiffany Wise-West – Sustainability and Resiliency Officer  Nathan Nguyen – Director of Public Works
 Others as Needed
 Duration and Meeting Cadence:
o Commitment through approximately December 2025 – January 2026 o Meetings:
 Actual schedule is to-be-determined based upon work plans for two projects – the West Cliff Roadmap (Roadmap) and an Ocean Protection Council (OPC) Grant Project for 3 Subarea Shoreline Adaptation Implementation Blueprints (OPC Project). These two projects will require feedback from the WCIC and their respective plans will help determine key feedback points.
 Tentative schedule:
 2-3 meetings in quick succession for start-up, then
 Recurring meetings – possibly monthly1
 Meetings will initially be at Santa Cruz City Hall and then may transition to online as approved by the WCIC.
 1st meeting/kickoff will be in August-September 2024
Climate and Resiliency Committee
This proposed new group would replace the current mayoral Climate Action Taskforce2 (Task Force) and advise the Council on selected subsets of climate and resiliency topics for the City.

The current Climate Action Taskforce members and meeting schedule are at:
1 Selection of the successful respondent from the Roadmap request for proposal (RFP) is anticipated to be in late July with final negotiations and contracting after that. Thus, the WCIC should start-up a little prior to the anticipated consulting Roadmap team being in place.
2 Originally convened in 2008 and comprised of 10 community members.

16.2 https://www.cityofsantacruz.com/government/city-departments/city-manager/climate-actionprogram/climate-action-task-force As part of research to understand what other agencies are doing, city staff conducted research with 16 California cities and 3 California counties regarding their climate advisory bodies. The memo summarizing the research is attached as “Climate and Resiliency Committee + Commission Research Summary Memo”. From the research, three options emerged:

1. Option 1: Integrating sustainability and resiliency in every committee and commission structure

2. Option 2: Restructuring the Task Force into a more formal advisory body to address select sustainability and resiliency topics

3. Option 3: Creating a "super" committee comprised of members from various existing committees and commissions to address select sustainability and resiliency topics After discussion at Ad Hoc meetings, the group is recommending that the City pilot Option 3, a “Super Committee”.
 Pilot: The Ad Hoc recommends that the City Manager convene a “Super Committee” pilot for 1.5 years, with the remaining half-year of the 2-year term being development of final recommendations to the Council for its possible action regarding a permanent Climate and Resiliency Committee.
o The general ideas for scope and purpose are:
 Acts as advisor to the Council
 Monitors operationalization and implementation of climate and resiliency program goals
 Integrates across subject areas for climate and resiliency goals and implementation
 Communicates back and integrates back to respective Commissions  As feasible - calls outs and recommends climate and resiliency study sessions for specific topic areas
o More details regarding expectations for the Pilot, along with draft operating rules, will be presented in a subsequent Ad Hoc update to Council in the AugustSeptember 2024 timeframe.  Draft Membership: 7 in total - 3 at large and 4 more coming from existing City Commissions.
o 3 at large: Spots to be filled through regular advisory body application process:
 At Large 1 - climate advocacy, transportation, water, trees, waste, buildings, energy and resiliency
 At Large 2 - climate advocacy, transportation, water, trees, waste, buildings, energy and resiliency
 At Large 3 - Youth Representative – can be from local high schools, community college, or university
o 4 from existing Commissions: These existing Commissions would nominate and recommend one of its members to serve on the Climate and Resiliency Committee, preferably with backgrounds noted in the parentheses:
 Transportation and Public Works (transportation, waste, energy; coastal resiliency)
 Planning (sustainability/resiliency policy, building performance)  Water (water, water supply resiliency)
 Parks and Recreation (trees, carbon sequestration)

16.3 o Membership Term:
 Members from other City Commissions will serve on the Climate and Resiliency Committee according to their terms on their respective Commissions.
 At Large Member terms will begin in January and will last 4 years per term, with two term limits. At Large pilot members will not have their time applied toward these limits.

The next update to Council from the Ad Hoc will be in August-September 2024. At that meeting, the Ad Hoc plans to bring:
- Further details as to the operating rules for the pilot Climate and Resiliency Committee. - Status of the West Cliff Roadmap RFP and WCIC next steps and kickoff.

FISCAL IMPACT: None.

Prepared by:

Laura Schmidt
Assistant City Manager
Submitted by:

Fred Keeley
Mayor
Shebreh Kalantari-Johnson
Councilmember
Renee Golder
Vice Mayor
ATTACHMENTS:

1. CLIMATE AND RESILIENCY COMMITTEE + COMMISSION RESEARCH SUMMARY MEMO.PDF

16.4 CITY MANAGER’S OFFICE

MEMORANDUM
DATE: April 8, 2024 | revised May 7, 2024
TO: Matt Huffaker, City Manager

FROM: Tiffany Wise-West, Sustainability and Resiliency Officer SUBJECT: Summary of Research on Sustainability Committees and Commissions Background
In 2008, the City constituted a Climate Action Task Force (CATF), convened by the mayor, and comprised of ten community members. The community members apply using the City’s standard application and the mayor selects the members. In the past, prior to election of a 4-year mayor, the CATF members served 1 year terms. The purpose of the CATF is to assist the City in implementing its climate action plan. As climate adaptation has become a City focus, the CATF’s purpose was expanded to include assisting the City in its climate adaptation plan. The CATF is to meet 4 to 6 times per year. Typically the Sustainability and Resiliency Officer prepares a work plan for the CATF consisting of climate work occurring in the City and aligned with CATF members preferences.

A task force is a unit specially organized for a task over a limited time duration and this task force has met continuously for 16 years. Due to interest in potentially creating a more formal climate advisory body with a more appropriate, non-time bounded format, City staff conducted research to assist in the development of recommendations for an alternative advisory body.

Discussion
Staff conducted research in two ways. First, we reviewed the format, purpose, and other details of climate advisory bodies put in place by other California cities. Second, we asked existing committee and commission members their preference for different climate advisory body models.

Summary of other Climate Advisory Bodies
Through online and peer network research, staff were able to identify 16 California cities and 3 California counties with climate advisory bodies. While typically staff constrain research on peer cities to those with about the same population, doing so for this topic would yield a very low number of cities to assess. Thus, the 19 cities and counties ranged in population from about 7,200 (City of Sausalito) to about 809,000 (City of San Francisco) Format: All but one of the climate advisory bodies assessed consisted of a stand alone committee or commission and 1 could be considered a “super commission,” that is, one that is

16.5 comprised of members from other existing committees of commissions. Of those assessed, one is a “task force,” one is a “working group,” and the remainder are commissions. Some separate specific topics into their own advisory bodies, e.g., City of Sausalito’s Sea Level Rise Task Force.

Membership: For those cities/counties with climate advisory groups, the bodies consist of 5 to 10 members; 2 include a youth member. Some are appointed by district councilmembers, some appointed by mayor, others recruit to fit categories of membership (e.g., Yolo County) Membership term: 2 to 4 years (max 2 terms); youth members serve 1 year terms Frequency/Length of Meetings: Monthly, bimonthly and quarterly; ranges from 30 minutes to 3 hours in each meeting’s duration
Compensation: It was difficult to determine whether compensation was offered for all jurisdictions assessed. Some explicitly consider membership as a volunteer, unpaid positions, whereas others offer $50 per meeting attended (not to exceed a maximum in one month).

Mandate/Purpose: There are number of different purpose statements.  “promotion” of environmental initiatives to increase awareness; “plan public events”  “advise” council on issues pertaining to energy, climate science and technology, natural resources and the environment; setting environmental policy and decisions  “assist with” or “facilitate” implementation of climate plans  “monitor” implementation of climate plans
 “provide expertise and guidance” on major policy and programmatic areas  “develop” recommendations and/or policies for implementation; “review” proposed legislation at all levels
 Special powers, e.g., tree removal appeals, acting as underground utilities advisory To note, some committee/commission members in other jurisdictions receive training to become a member.

Existing City Committee/Commission Member Survey Findings Staff queried over 90 existing committee and commission members and as of the revised date of this memo, 58 had responded to the question regarding preferred climate advisory body models.

Since these members were contacted for the biannual Santa Cruz Like Me demographics survey, tracking progress towards diversity in recruitment and representation of committee and commission members, staff included the following question:
“City staff are exploring how sustainability and resiliency can be more formally integrated into the City's advisory structure. As part of this process, the current Community Climate Action Task Force format is being reevaluated, with potential changes being implemented in 2025. We're seeking early feedback on three potential approaches:
1) integrating sustainability and resiliency in every committee and commission structure 2) restructuring the Task Force into a more formal advisory body to address select sustainability and resiliency topics

16.6 3) creating a "super" committee comprised of members from various existing committees and commissions to address select sustainability and resiliency topics Do you have a preference for or insights on the advantages or disadvantages of any of these options?”
In response to this question, 41% who responded preferred option 1, 14% preferred option 2 and 45% preferred option 3. These advisory body members also articulated advantages and disadvantages of each option.

Option 1: simplicity, consistency, efficiency and most effective, in alignment with HiAP; but could risk having topics get lost; could allow of shift in perspective in policy and application to specific advisory body. Would enable every committee to integrate HiAP values into every project and will create a standard across the board.

Option 2: Unclear what items this body would take up; don’t need another committee; could be well qualified committee addressing carefully selected topics Option 3: Adds greater time and/or workload for some staff and advisory body members; most flexible, allows for true participation and accountability; ensures connectivity between advisory bodies (“de-siloing”) and that focus endures
One respondent mentioned that if option 1 was the prevailing advisory body format the City elected to proceed with, in some instances, “perhaps more focused research would be necessary, at which point a task force could be appointed by the mayor our council and could emerge from commissions.” Another respondent noted that select committees should only explicitly integrate sustainability, e.g, planning, water.

One respondent mentioned that if option 2 was the prevailing advisory body format, it “may not need to meet on a regular basis…” and “Council could play a role in directing the Task Force to focus on the areas needing attention across various committees and commissions.” Another respondent noted that option 2 “could become political due to the appointment process.” Five respondents suggested that both options 1 and 3 implemented together would provide the integration needed.

16.7 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: Economic Development and Housing
SUBJECT: Economic Development Strategy Update: Downtown and Eastside/Midtown District Activation Recommendations (EDH) RECOMMENDATION: Accept the Economic Development Strategy Update regarding business district activations and direct staff to move forward on the following recommended actions:
1) Continue placemaking and activation of Lot 32, the “Midtown Parking Lot;” 2) Complete evaluation of storefront activation strategies and return to Council for consideration and approval of modifications to existing programs and approval of new initiatives that will assist in the activation and maintenance of empty storefronts; 3) Continue work related to the establishment of a Midtown Business District and pre-feasibility analysis of a Westside Business District; and
4) Complete outreach for the alleyway activation program and return to Council as needed with recommendations for approval.

BACKGROUND: In March of 2021, during the height of the pandemic, the City Council approved the Economic Development Strategy (EDS) which included a 2-year plan for immediate pandemic relief efforts and a longer 3–5-year plan for recovery and activation of the City’s business and retail sectors. The EDS was developed through a process that included data analyses, outreach to stakeholders, surveys, and input by the City Council and City staff to identify significant opportunities and challenges to be addressed in the plan. The EDS has helped guide the City’s efforts over the last three years and the development of programs, including the Santa Cruz Microloan Program, Grow Santa Cruz Loan Program, the Outdoor Dining Program, and the Downtown Pops! Program, all of which have provided critical support to many businesses during the pandemic.

As 2024 holds promise for additional business recovery, it is time to review existing programs, review the goals and objectives in the EDS for the next 2 years, and evaluate opportunities for further business support and activation of the City’s primary retail and business districts. This comprehensive approach will not only enhance the downtown and eastside/midtown environments but also align with the City's commitment to Health in All Policies (HiAP).

17.1 The EDS (2021-2025) is comprised of goals, strategies, and implementation actions around the following topic areas: COVID-19 Impacts, Tourism and Hotels, Small Business and Commercial Districts, Retail and Shopping Districts (Downtown and Eastside/Midtown), Specialized Industry Sectors and City Services and Processes. The EDS also includes potential metrics for tracking progress in implementing a given strategy or action.

Economic Development and Housing Department (EDH) presented an update on the EDS at the January 23, 2024, Council meeting for the purposes of further direction, and in response to particular community and Council interest, on the following topic strategies: Small Business and Commercial Districts and Retail and Shopping Districts (Downtown and Eastside/Midtown).

Council approved the following recommendation and actions:

A) Accept the Economic Development Strategy Update regarding downtown and Eastside/Midtown and Westside actions and direct staff to move forward on the following additional recommended action areas to further activate the three districts during the current fiscal year:

1. Placemaking and activation;

2. Assessment of remaining empty storefronts and the development of potential incentives for property owners;

3. Planning for future use of the existing library space including a permanent home for the downtown Farmers’ Market;

4. Integration of new downtown housing projects into the downtown business, retail and shopping environment;

5. Pursue establishment of an Eastside/Midtown and Westside Business or PropertyBased Improvement Districts; and

6. Amend the Economic Development Strategy to include these additional strategies and actions.

B) Return to Council with an update on progress during the current fiscal year.

DISCUSSION: This report focuses on progress made since the January 23, 2024 Council meeting in the areas of placemaking and activation, assessment of remaining vacant storefronts, and pursuing the establishment of a Midtown and Westside Business or Property-Based Improvement Districts (BID/PBID).

Recommendation 1: Placemaking and activation: Develop a plan following community engagement and stakeholder input for activating major public spaces with an emphasis on public locations downtown and in the eastside/midtown area that have the greatest potential impact and return to Council within the current fiscal year for consideration. Specific areas to address shall include the downtown alleyways, the public area on Pacific Avenue located between the kiosks at the terminus of Lincoln Street with Pacific Avenue, and Lot 32 located at the intersection of Cayuga and Soquel in the eastside/midtown area.

Downtown Placemaking: The EDH Business Services team started analyzing opportunities and constraints for the Downtown alleyways activation and obtaining estimates for the installation of festoon lighting. Initial estimates range from approximately $40,000 to $65,000 for Frazier Lewis Lane and from $13,500 and $65,000 for Plaza Lane. Staff is working to collect additional bids to move forward with further implementation of the alleyway lighting project.

17.2 Additionally, staff in coordination with the Downtown Association (DTA) are conducting further outreach and engagement to identify the best fit in terms of type of activation and location for the alleyways and Pacific Avenue activation area.

Eastside/Midtown Placemaking: Midtown Fridays is a summer block party located at Lot 32, a parking lot in the eastside/midtown area. It runs every Friday in June, July and August and has artists, vendors, and music. This event series has been successful with the support of Event Santa Cruz. Event Santa Cruz has built a strong attendance record and businesses and neighbors welcome the annual activation. Staff has executed a contract with Event Santa Cruz for the 2024 season and work is under way to kick off the annual event series on May 31.

Staff has also begun gathering cost estimates for specific infrastructure investments needed to fully activate Lot 32 which includes sewer, water, and electrical, in addition to modifications to the accessible parking layout to support events, food trucks and community activation. Initial estimates for the electrical work range from $27,955 to $113,200. The low bid is the best option and could be funded using the existing EDH FY 2024 budget. Staff will move forward with a contract for this work to be completed this calendar year.

Further research is needed to understand the full cost of the potential permanent retail or food and beverage kiosk improvements. These infrastructure investments could also help to extend the season for viable year-round activations.

Recommendation 2: Assessment of remaining empty storefronts and the development of potential incentives for property owners: While vacancy rates are currently historically low in the downtown and re-leasing of recently vacated spaces is healthy, there remain a handful of longerterm vacancies that are problematic for the overall health and vibrancy of the downtown.

Conducting a current survey of existing vacancies, including length, special circumstances and challenges to activation will be useful information to assist the City and brokers in helping property owners re-lease long-term vacant storefronts. Exploring best practices and potential incentives including grants, low-interest loans as well as potential changes to the City ordinances to encourage re-leasing are all recommendations to be specifically explored.

EDH staff held the first Broker Breakfast of 2024 in February with over 25 commercial real estate brokers in attendance. Broker breakfasts have been a helpful tool to develop strong relationships between the brokers and the City in a shared goal to fill vacancies, attract and retain businesses in commercial districts, and identify new resources or changes to City policies to support local businesses in accessing commercial spaces. During this meeting, brokers share their current available spaces and any challenges or opportunities with these spaces.

City staff followed up with the brokers and property owners after the quarterly meeting in February for more in-depth interviews of properties that have been vacant for 3 or more years.

During these interviews, staff discussed the types of businesses that have been interested in the space, reasons why potential deals fell through, and openness to other opportunities to fill the spaces, such as participation in the Downtown Pops! Vacant storefront activation program. The main takeaways from these interviews are as follows:

1. Some spaces have been leased by the owners, but no activation or occupancy have yet been undertaken by the tenant.
a. Three of the four ground floor retail spaces that have been vacant for over 4 years have had multi-year leases that did not result in a business opening due to issues,

17.3 such as expensive tenant improvement costs, accessibility issues, or changing business conditions due to the pandemic.

2. Fewer users available for large retail spaces (3,000 sf or more) and high costs to rent large spaces.
a. There is significantly less demand for retail over 3,000 sf which is shown by more frequent filling of spaces between 1,000-2,000 sf.
b. Larger spaces are more likely to be filled by national chains but those stores are not expanding as frequently due to evolving retail trends. Additionally, these chains typically open stores throughout the state or country at one time. If they are not successful at securing a space at the same time as other locations, it is likely they will not choose to locate in Santa Cruz at all or they will have to wait several years for another potential cycle of store openings. c. Property owners have to adjust their rent formulas based on the rising costs of operating expenses. While rent rates can fluctuate based on market conditions and are subject to negotiation, the operating costs (e.g. shared utilities, common area maintenance fees, etc.) that are often passed through to a tenant in a lease continue to increase which can make a significant impact on the rate per square foot of a large space. As a result, many of these spaces are no longer financially feasible even at a very low base rent per square foot.

As a result of these conversations there have been actions taken to address two of the spaces that have been vacant for over four years. Staff has been able to work with one property owner on storefront improvements that have improved the appearance of the building and have connected them with a prospective tenant with whom they are now in lease negotiations for a new restaurant that will be relocating from Monterey. The other property owner is currently preparing plans to move forward with tenant improvements that will create two smaller spaces and move it from a shell space into a "ready to lease" space that will make it easier for a prospective tenant to move in and at a size that is more attractive in the current retail market.

Staff is also refining a best practice review of vacant storefront activation incentives. Some examples of potential tools and policies include:

1. Expand the Downtown Pops! Program to provide tenant improvements for micro-retail opportunities in larger retail spaces.

2. Develop a set of pre-approved window coverings with beautiful graphics or imagery reflecting the community and local art that can be installed by property owners when a storefront is vacant more than 30 days. Staff is researching if other cities have similar programs that are codified to become a requirement for vacant properties and places the responsibility for the cost and maintenance on the property owner or allows the City or a downtown association to coordinate the installation and bill the property owner for time and materials.

3. “Coming Soon” window coverings could serve as a business support tool to provide businesses moving into a vacant space with grant funding toward a vinyl window covering that would celebrate their business moving in. This would reduce the blight of empty windows and would better communicate what is happening in the space rather than the typical brown paper coverings used during the build-out phase prior to opening.

4. Develop a Design Assistance Pilot Program to provide direct assistance to small business owners in order to reduce barriers, save time, and reduce costs to either starting or expanding their business in the City.

17.4 5. Explore codifying the temporary use extension resolution passed during the pandemic to permanently extend the life of use permits. Extending the life of a use permit beyond the current 6-month time frame would significantly reduce planning permitting timelines for those businesses that require a discretionary use permit approval and could be targeted to allow discretion of applicable uses that benefit the desired retail mix in Downtown Santa Cruz.

6. Establish a Vacancy Fee Program to fund mechanisms that address increased public cost for maintenance of vacant storefronts and adjacent public space.

More details of the vacancy analysis conducted and these recommendations for activation initiatives are provided in the attached Downtown Santa Cruz Commercial Vacancy Analysis Report.

Recommendation 3: Planning for future use of the existing library space including a permanent home for the downtown Farmers’ Market.

Action 1: Revisit the three preferred options and recommendations in the 2021 Library Site ReUse Visioning Process Report for future uses for the site and kick off a new community engagement process to finalize the proposed uses for the existing library site.

Action 2: Working with the Farmers’ Market leadership, stakeholders, and community input, finalize the permanent home for the downtown Farmers’ Market including consideration of the existing library site as one of the proposed permanent locations.

The memorandum of understanding is in place now with the Farmer’s Market and their Board has selected the temporary site on Cedar Street between Walnut Avenue and Church Street and a portion of Church Street and parking lot 16, adjacent to the current library. Work is now underway for planning the transition to the temporary site in December 2024. The next steps for this move are finalizing the site layout and permitting for the temporary location.

The City will be contracting with Project for Public Spaces and Group 4 in coordination with the Farmer’s Market to define the goals for the preferred permanent site for the Farmer’s Market at the existing library site. This work will build on the visioning and community outreach process that was initially conducted for the existing library site by Project for Public Spaces and Group 4.

Recommendation 5: Pursue establishment of an Eastside/Midtown and Westside Business or Property-Based Improvement Districts. The Midtown Business Association is currently operated by businesses in the area to promote and advocate for midtown business success. Growth of this organization and further investments for clean, safe, and welcoming services could be delivered if there is support and interest in establishing a Business or Property-Based Improvement Assessment similar to the improvement districts that operate in downtown. Further engagement and outreach would be needed to determine what type of district is preferred and would be successful and to gauge the support from potential assessment payers for such a district.

Following Council direction to begin work on the establishment of a Midtown Business or Property-Based Improvement District (BID/PBID) and exploring interest in a Westside BID/PBID, staff issued a request for proposals (RFP) for a BID/PBID formation consultant to facilitate the outreach and legal processes necessary to develop the districts. The RFP included the scope of work needed to determine the district structure, prepare a management plan for the

17.5 district organization, and complete the ballot and legal process to establish the Midtown Business District. The RFP also included an optional scope to be completed after the Midtown process is completed to provide pre-feasibility analysis of a Westside Business District. This work would evaluate potential district boundaries, district structure options, and identify potential champions for district formation from the businesses in the area. Following that evaluation, staff would determine if there is potential to move forward with the Westside Business District formation process.

The RFP closed March 29, 2024, and staff received five bids. The cost proposals for the Midtown scope of work ranged from approximately $75,500 to $117,000. The proposals for the optional scope of work for Westside ranged from approximately $10,675 to $27,000. Funds are available in the Economic Development Trust Fund to fund the full scope of work. Staff has awarded the contract to the lowest bid and most qualified vendor, a joint consultant team of Kristen Lowell, Inc., Civitas Advisors, and Community Strong Strategies and will begin work in early July. If the business district outreach work proves there is sufficient interest in district formation, the entire process would conclude by July 2025. Following that work, the prefeasibility assessment for the Westside Business District would tentatively begin by August 2025.

HEALTH IN ALL POLICIES (HiAP): The strategies and actions in the EDS align directly with the City's commitment to HiAP. By creating inviting, communal spaces and promoting the establishment of businesses, the City will enhance the quality of life for residents. This not only contributes to economic growth and prosperity but also fosters health equity and sustainability in the community. Moreover, the engagement of community members in the decision-making process ensures that their needs and perspectives are considered, leading to a more inclusive and healthier urban environment.

FISCAL IMPACT: Some of the initial steps in the above recommendations and actions can be achieved within the FY 2024 EDH existing budget including funding for the Midtown Fridays event series. Additional funding for Downtown activation activities is included in the approved FY 2025 budget. Funding is available in the Economic Development Trust Fund for the implementation of the business district formation consultant services.

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. ECONOMIC DEVELOPMENT STRATEGY 2021-2025.PDF

17.6 SANTA CRUZ ECONOMIC DEVELOPMENT

STRATEGY
ADOPTED MARCH 9, 2021
Prepared for:

City of Santa Cruz
February 3, 2021

17.7 TABLE OF CONTENTS
EXECUTIVE SUMMARY .................................................................................................................... 1 INTRODUCTION ............................................................................................................................... 7 About the Economic Development Strategy ....................................................................................... 7 Reference Geographies and Subareas ............................................................................................... 8 Report Contents ................................................................................................................................... 8 GOALS, STRATEGIES, AND WORK PLAN .................................................................................. 10

1. COVID-19 Pandemic Business Support and Recovery ........................................................... 11

2. Tourism and Hospitality ............................................................................................................ 15

3. Small Businesses and Commercial Districts ........................................................................... 21

4. Retail and Shopping Districts ................................................................................................... 25

5. Education and Workforce ......................................................................................................... 30

6. Specialized Industry Sectors .................................................................................................... 33

7. City Services and Processes ..................................................................................................... 37 Tracking Success: Economic Development Indicators ................................................................... 40 ECONOMIC DATA SNAPSHOT ................................................................................................... 41

1. COVID-19 Pandemic Economic Impacts .................................................................................. 41

2. Tourism and Hotels ................................................................................................................... 44

3. Small Businesses and Commercial Districts ........................................................................... 45

4. Retail and Shopping Districts (Downtown, Eastside/ Midtown) ............................................ 46

5. Education, Workforce, and Commutes .................................................................................... 48

6. Specialized Industry Sectors .................................................................................................... 49

7. City Services and Processes ..................................................................................................... 52

17.8 Santa Cruz Economic Development Strategy (City Council Draft) 1

EXECUTIVE SUMMARY
The Santa Cruz Economic Development Strategy (EDS) is a policy document that will guide the City’s economic development activities over the next five years. The EDS focuses on the efforts of the Business Development team within the City’s Economic Development Department, in conjunction with other City departments/divisions and outside partners. The EDS document’s strategies and implementation actions support sustaining Santa Cruz’s economic strengths, retaining and expanding existing businesses, and pursuing new opportunities to attract industries with a high potential for growth based on the City of Santa Cruz’s competitive advantages.

Given the current economic crisis confronting the City of Santa Cruz as a result of the COVID-19 pandemic, the EDS also serves as a roadmap for short-term business support and recovery, followed by longer-term efforts to diversify and expand the City’s economy. Over the next one to two years, implementation of the EDS will be focused on COVID-19 recovery efforts, while longer-term economic strategies will be implemented during the post-recovery phases of work (within 2-5 years) or as ongoing efforts (Figure 1). The timing of the strategies is based partly on whether the action requires additional funding, given that tax revenues are likely to be limited until the economy recovers from the impacts of efforts to slow the spread of the coronavirus that causes COVID-19.

The short-term COVID-19 business support and economic recovery strategies of the EDS function as a complementary supplement to the City of Santa Cruz Interim Recovery Plan. The Interim Recovery Plan focuses on three main goals and objectives:

1. Fiscal stability, both short-term and long-term

2. Investing in Downtown and other business sectors (including housing development)

3. Improving and maintaining infrastructure
FIGURE 1: ECONOMIC DEVELOPMENT STRATEGY IMPLEMENTATION SCHEDULE Source: Strategic Economics, 2020.

17.9 Santa Cruz Economic Development Strategy (City Council Draft) 2 The EDS was developed through a process that included data analyses, outreach to stakeholders, and input by City staff to identify significant opportunities and challenges to be addressed in the EDS. The goals and strategies are organized within seven topic areas based on challenges and opportunities identified through the outreach activities and data analyses. The EDS report also includes detailed implementation actions for each strategy, including schedule, relevant subareas of the City, parties required for implementation, and metrics for tracking progress.

The strategies are summarized by topic area below.

1. COVID-19 PANDEMIC BUSINESS SUPPORT AND RECOVERY STRATEGIES Due to the severity and immediacy of economic impacts associated with the COVID-19 pandemic, the following strategies are the top priorities for implementation during the next one to two years:
 Conducting regular business, broker, and business organization outreach to understand the specific impacts of the COVID-19 pandemic, and then identifying effective means of assisting businesses,
 Through funding and administrative partnerships, providing financial and technical assistance to sustain small businesses and reinvest in the Santa Cruz economy, including implementation of the countywide revolving loan program, Get Virtual program, and other regional recovery efforts,
 Proactively implementing temporary and permanent policy changes that enhance opportunities for businesses to safely resume operations, and  Publicizing and directing businesses to available resources and guidance on how to safely resume, maintain, and expand operations.

2. TOURISM AND HOSPITALITY STRATEGIES
As Santa Cruz recovers from the economic impacts of the COVID-19 pandemic, the City should begin to address broader opportunities and challenges confronting its tourism and hospitality industry; strategies include:
 Exploring opportunities to temporarily modify payment mechanisms for transient occupancy tax collections to provide flexibility for hotel and event operators during the economic recovery,
 Continuing to pursue the implementation of major development projects related to tourism and visitors (including a permanent arena facility, a renovated civic auditorium and City civic center, and the Santa Cruz Wharf Master Plan), and exploring opportunities to attract larger event spaces and expand the use of existing spaces,  Enhancing wayfinding signage and gateways, especially to enhance the connections between the Municipal Wharf, the Santa Cruz Beach Boardwalk, and Downtown Santa Cruz,
 Collaborating with Visit Santa Cruz and area hotels and businesses to expand promotion of unique business niches within the City of Santa Cruz,  Encouraging reinvestment or redevelopment of lower-performing hotel properties through outreach, land use regulation, analysis, and exploration of financial incentives,

17.10 Santa Cruz Economic Development Strategy (City Council Draft) 3  Partnering with Visit Santa Cruz, hotel operators, and visitor destinations as a longerterm strategy to establish a new working group focused solely on pursuing projects and opportunities to enhance visitation outside of the summer peak tourism season,  Re-engaging with hospitality industry businesses regarding pursuing the passage of a transient occupancy tax (TOT) rate increase when appropriate, and  Exploring grant funding opportunities to support reinvestment and mitigation projects undertaken by property owners in areas vulnerable to sea level rise.

3. SMALL BUSINESSES AND COMMERCIAL DISTRICTS STRATEGIES The following strategies address the challenges noted by small businesses regarding confusion about accessing available technical and financial resources, and challenges in accessing commercial districts. However, the primary focus of the next one to two years will be to assist small businesses in recovering from the economic impacts of the COVID-19 pandemic. Strategies include:
 Updating and widely disseminating a description of resources and partnerships for assisting small businesses, including providing information to small businesses about technical assistance programs available through the City, Economic Development, the Santa Cruz County Small Business Development Center and other partners,  Coordinating and collaborating with other City departments and regional transportation agencies to share business concerns about the need for expanded alternatives to automobile access to businesses,
 Developing or updating district-based parking strategies for areas that are undergoing intensification, including the Westside Industrial Area and Downtown,  Developing and implementing a work program to target short-term and long-term streetscape and traffic calming measures in the Eastside/Midtown area, and  Reducing barriers to use of the City’s existing façade improvement program by trying to streamline the State Department of Industrial Relations requirements for prevailing wage payroll certification processes.

17.11 Santa Cruz Economic Development Strategy (City Council Draft) 4

4. RETAIL AND SHOPPING DISTRICTS STRATEGIES
The following strategies respond to long-term shifts in the retail industry overall, as well as several local challenges in different retail districts that were identified as part of the EDS analyses. Strategies include:
 Developing a pop-up program, with streamlined permitting requirements, to allow temporary retail and food uses in vacant storefronts,
 Exploring opportunities to reduce impacts of increased parking fees in Downtown on low wage workers,
 Enhancing the use of outdoor space by restaurants, stores, and personal services through continued implementation of the temporary outdoor expansion program and working on streamlining of permitting processes and reductions of fees for permanent sidewalk dining and parklet programs,
 Providing coordination and communication assistance and support for the formation of a new improvement district in Downtown Santa Cruz, as needed or requested by property and business owners,
 Expanding the diversity of entertainment, dining, nightlife, and retail uses in Downtown Santa Cruz, and exploring opportunities to attract non-retail ground floor storefront uses that would draw foot traffic to Downtown Santa Cruz, including gyms, entertainment, and games; also support inclusion of medical offices in Downtown except along Pacific Avenue and Cedar Street,
 Continuing to partner with the Downtown Association, Visit Santa Cruz, Santa Cruz Works, and others for shop local campaigns and efforts to encourage local spending,  Collaborating with other City departments and the Downtown Santa Cruz improvement district(s) to enhance the effectiveness of ambassador, cleaning services, and homeless outreach to address safety and comfort concerns,  Assisting the Eastside/Midtown area in assessing the support for and potentially creating an improvement district to enhance local marketing, maintenance, and collaboration efforts, and
 Targeting use of the façade improvement program in the Eastside/Midtown area.

5. EDUCATION AND WORKFORCE STRATEGIES
The City of Santa Cruz attracts workers from throughout the surrounding region, but high housing costs are impacting the ability of companies to attract and retain employees. Strategies include:
 Enhancing coordination with education, workforce development, and business support partners through standing meetings and development and implementation of new

17.12 Santa Cruz Economic Development Strategy (City Council Draft) 5 programs and initiatives for technical training, apprenticeships, and other career pathway opportunities,
 Developing a formalized system to track referrals to and outcomes from business engagement with the Santa Cruz County Small Business Development Center at Cabrillo College,
 Continuing to provide related Business Development staff support for public and public-private development projects that contribute workforce housing and/or provide amenities that enhance the quality of life for Santa Cruz residents, and  Continuing to implement the Housing Element policy to work closely with the University of California Santa Cruz (UCSC) to provide more workforce housing opportunities for faculty and staff as part of the UCSC Long Range Development Plan, continuing implementation of workforce housing partnership with Santa Cruz City School District, and exploring similar opportunities to create workforce housing with other large employers in Santa Cruz.

6. SPECIALIZED INDUSTRY SECTORS STRATEGIES
Although the Tourism and Hospitality industry is by far Santa Cruz’s largest economic driver, the City also has unique strengths in four other specialized industry sectors. These include biotechnology and life sciences, sports and outdoor recreation, technology and innovation, and artisanal production (such as small-scale food, beverage, or other manufacturing). Strategies addressing the needs of these sectors include:
 Convening a biotechnology and life sciences industry working group including representation from UCSC and Cabrillo College to collaboratively identify shared challenges and opportunities and develop and implement networking and informational events,
 Reviewing and pursuing updates to zoning and land use regulation in the Westside Industrial, Harvey West, and Seabright areas to ensure a mix of manufacturing, research and development, and limited retail/restaurant/dining and office uses are allowed,
 Encouraging development of additional flexible office space in Downtown Santa Cruz to be responsive to the market,
 Continuing networking events between venture capitalist funders and local businesses/entrepreneurs, especially those in the biotech and innovation industries,  Promoting entrepreneurship through partnerships to continue referrals and disseminate the advantages of locating a business in Santa Cruz, and  Exploring opportunities to promote Santa Cruz’s cluster of sports and outdoor recreation businesses, as well as artisanal producers, to visitors.

17.13 Santa Cruz Economic Development Strategy (City Council Draft) 6

7. CITY SERVICES AND PROCESSES STRATEGIES
Business owners interviewed for the EDS identified a number of challenges in understanding how to navigate City permitting and approvals processes, and in knowing how to access City services.

Strategies for addressing these and other internal process challenges include:
 Continuing to review the City’s permitting and approvals process to find areas for potential streamlining, and support the implementation of the recommendations from the Management Partners review of the permitting process,  Continuing to enhance the partnership between the Business Development team, Planning, and other staff to better assist individual businesses in navigating permitting/approvals processes,
 Developing and disseminating brochures and guides for small businesses on how to access maintenance services, public safety services, and services to assist people experiencing homelessness,
 Facilitating gathering of business input for longer-term city projects such as the Climate Action Plan and potential changes to the Green Business Program, and  Promoting Santa Cruz’s economic assets and City services through maintenance and updating of the Choose Santa Cruz website, better integration of City websites, and regular digital outreach and mailings to businesses.

17.14 Santa Cruz Economic Development Strategy (City Council Draft) 7

INTRODUCTION
About the Economic Development Strategy
The Santa Cruz Economic Development Strategy (EDS) is a policy document that will guide the City’s economic development activities over the next five years. The EDS focuses on the efforts of the Business Development team within the City’s Economic Development Department (which also includes the Housing Development and Preservation, Infrastructure and Property Development, and Arts and Culture Development teams), in conjunction with other City departments and outside partners. The EDS document’s strategies and implementation actions support sustaining Santa Cruz’s economic strengths, retaining and expanding existing businesses, and pursuing new opportunities to attract industries with a high potential for growth based on the City of Santa Cruz’s competitive advantages.

Given the current economic crisis confronting the City of Santa Cruz as a result of the COVID-19 pandemic, the EDS also serves as a roadmap for short-term, one- to two-year business support and recovery efforts, followed by longer-term efforts to diversify and expand the City’s economy. The shortterm COVID-19 business support and economic recovery strategies of the EDS serve as a complementary supplement to the City of Santa Cruz Interim Recovery Plan. The Interim Recovery Plan focuses on three main goals and objectives:

1. Fiscal stability, both short-term and long-term

2. Investing in Downtown and other business sectors (including housing development)

3. Improving and maintaining infrastructure
The EDS complements and builds on other City policy and planning efforts. The Economic Development Department’s recent projects and programs were guided by implementation of the department’s 2017-2019 Strategic Workplan. The EDS builds on the successes achieved through implementation of the department-wide workplan while providing a longer-term, data-driven strategy with a specific focus on business and workforce development. The EDS also supports implementation of the policies enacted by the Santa Cruz 2030 General Plan, which guides growth and development of the City.

The EDS was developed through a multi-step process that included data analyses, outreach to key stakeholders, and input by City staff to identify significant opportunities and challenges to be addressed in the EDS. The EDS itself was then developed through an iterative review and refinement process by staff of the Economic Development Department. Detailed steps included:
 Data Analyses: Strategic Economics completed a detailed economic and workforce analysis to better understand the dynamics of Santa Cruz’s economy and to identify opportunities and challenges for future growth. The analyses examined employment trends by industry sector, commercial real estate market conditions, retail trends, and tourism. The findings and conclusions of the data analyses were summarized in the Economic Conditions and Opportunities Report dated March 31, 2020.
 Outreach to Key Stakeholders: Strategic Economics completed seven local stakeholder focus group interviews to gather insights into economic development issues and opportunities impacting specific industries, business types, and organizations in the City of Santa Cruz. The focus groups consisted of strategic partners, representatives of City departments, retail

17.15 Santa Cruz Economic Development Strategy (City Council Draft) 8 businesses, arts and makers businesses/organizations, tourism and hospitality businesses, sports and outdoor recreation businesses, and technology and life sciences businesses.

Strategic Economics also conducted numerous one-on-one interviews with business owners and with brokers familiar with the Santa Cruz market. The notes and findings of these interviews were presented in a December 10, 2019 memorandum and were subsequently incorporated in the Economic Conditions and Opportunities Report.

 City Staff Input and Review: Based on the findings of the data analysis and stakeholder interviews, Strategic Economics developed an initial set of recommended strategies for the EDS which were then shared with and refined by City staff in conjunction with Strategic Economics. The content of the EDS itself was then produced and underwent an iterative development and refinement process.

Reference Geographies and Subareas
The EDS includes references to smaller geographies, or “subareas,” within the City, as shown in Figure

2. The boundaries of these subareas were created in consultation with City staff. The subareas represent modified Santa Cruz General Plan neighborhood boundaries, with adaptations to better capture locations of commercial and employment concentrations.

Report Contents
The remainder of the EDS report includes two major sections consisting of the following content:

1. Goals, Strategies, and Work Plan: This section describes economic development goals and the strategies and actions that the City should implement to fulfill those goals. The strategies were directly informed by findings from the outreach and data analysis. Strategies are organized around the seven topic areas, and each strategy includes specific action items to guide the City’s efforts over the next five years. For each topic area, a summary table of implementation actions is provided, including schedule, relevant subareas of the City, parties required for implementation, and metrics for tracking progress.

2. Economic Data Snapshot and Key Findings: This section summarizes relevant economic context and key findings, including a snapshot of data describing existing conditions. The snapshot and key findings are organized in the same seven topic areas as the goals, strategies, and work plan.

17.16 Santa Cruz Economic Development Strategy (City Council Draft) 9 FIGURE 2: REFERENCE MAP OF SUBAREAS IN THE CITY OF SANTA CRUZ, 2019 Source: City of Santa Cruz, 2019, Strategic Economics, 2020.

17.17 Santa Cruz Economic Development Strategy (City Council Draft) 10

GOALS, STRATEGIES, AND WORK PLAN
The following sections of this report describe the EDS goals, strategies, and implementation actions for each strategy. These actions will guide the City of Santa Cruz’s economic development activities over the next five years. The strategies are organized around the following seven topic areas (in no particular order) based on the types of challenges and opportunities identified through analyses and interviews, as noted in the Economic Data Snapshot of this report starting on page 41. The topic areas are:

1. COVID-19 Pandemic Impacts

2. Tourism and Hotels

3. Small Businesses and Commercial Districts

4. Retail and Shopping Districts (Downtown, Eastside/ Midtown)

5. Education, Workforce, and Commutes

6. Specialized Industry Sectors (Biotech and Life Sciences, Sports and Outdoor Recreation, Technology and Innovation, Artisanal Production)

7. City Services and Processes
At the end of each topic area, a table summarizes strategies and implementation actions including:
 Schedule: In the first one to two years, implementation will be focused on COVID-19 recovery— in conjunction with the citywide Interim Recovery Strategy—given the severity of the pandemic’s business impacts and resulting limitations on City staff resources and tax revenues. Other items are shown as occurring in post-recovery phases of work: within 2-3 years, within 3-5 years, or as ongoing efforts (although implementation of “ongoing” actions may be delayed while high-priority COVID-19 responses are implemented). The timing of the actions is based partly on whether the action requires additional funding, given that tax revenues are likely to be limited until the economy recovers from the impacts of efforts to slow the COVID-19 pandemic.
 Subarea (if applicable): Indicates whether the action item applies citywide or to specific subareas, as shown in Figure 2.
 Parties Involved: Indicates the City department/division or outside organization with primary responsibility for implementing the action and major partners for implementing the action.  Metrics for Measuring Progress: Identifies potential metrics for tracking progress in implementing a given strategy or action.

The concluding “Tracking Success: Economic Development Indicators” section recommends indicators for tracking the performance of the Santa Cruz economy. These indicators do not directly represent whether the EDS itself is being successfully implemented since broader economic conditions are outside the control of City staff. Instead, the indicators will assist staff in identifying and responding to economic challenges and opportunities as they arise.

17.18 Santa Cruz Economic Development Strategy (City Council Draft) 11

1. COVID-19 Pandemic Business Support and Recovery
The following strategies respond to the COVID-19 pandemic, including the impacts and challenges described on page 41 of this report. These challenges include addressing declining revenues and reduced staffing capacity within the City of Santa Cruz and many of its critical economic development partner organizations. Given these constraints, the economic development strategies and actions to be implemented during the next one to two years are highly targeted, yet flexible, to provide critical support for business during the pandemic and the subsequent economic recovery.

The City of Santa Cruz has already rapidly responded to the COVID-19 pandemic and has already instituted or set in motion a variety of policies, programs, and responses. Some of the strategies described below are a continuation and refinement of those efforts; the strategies and actions note the current status of ongoing programs and efforts, as appropriate. The strategies and actions also include new initiatives. The COVID-19 business support and recovery strategies serve as a detailed implementation guide for the Business Development team’s work to fulfill the goals and actions of the citywide Interim Recovery Plan.

GOALS:
 Assess the needs of local businesses impacted by the COVID-19 pandemic  Develop and provide appropriate support and assistance resources to local businesses  Position the Santa Cruz economy for rapid recovery and resumption of growth STRATEGIES:

Strategy 1. Conduct regular business, broker, and business organization outreach to understand the specific impacts of the COVID-19 pandemic, and to identify effective means of assisting businesses.

Action 1.1. Through coordination with other partners (such as the Santa Cruz Area Chamber of Commerce, Santa Cruz Business Council, and Downtown Association), conduct at least two to three more general or industry-specific business surveys and associated outreach (similar to the survey initiated in May 2020) to gauge business impacts and needs. Ensure that coordination prevents duplication of efforts or excessive survey requests for businesses.

Action 1.2. Conduct follow-up outreach to businesses that take advantage of new programs and policies to determine how the resources were used, and the resulting impacts of the programs and policies on employment/revenues.

Action 1.3. Regularly communicate with brokers and business organizations to proactively identify businesses that may be closing or recently closed; reach out to owners of these businesses to understand key challenges, identify potential assistance to mitigate and avoid closure, and to offer direction to support services for winding down business operations (available via the Cabrillo College Small Business Development Center, Central Coast SCORE, and other organizations).

Strategy 2. Through funding and administrative partnerships, provide financial and technical assistance to sustain small businesses and reinvest in the Santa Cruz economy.

17.19 Santa Cruz Economic Development Strategy (City Council Draft) 12 Action 2.1. Continue to pursue and establish funding assistance targeted to small, local, established businesses as well as newer businesses that are less able to access traditional sources of funding during the pandemic. As part of this process, collaborate with partner cities and organizations in Santa Cruz County as appropriate (including the National Development Council that administers the current Grow Santa Cruz loan fund) to administer $2.5 million U.S. Economic Development Administration funding made available through the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act for a countywide revolving loan fund. As part of the design of the revolving loan fund, identify categories of businesses struggling to receive other aid such as the Paycheck Protection Program, and target the loan fund for use by those businesses (e.g., sole proprietorships, immigrant-owned, and minority-owned businesses).

Action 2.2. Through collaboration with and referrals to local partners, provide guidance and technical assistance to businesses for determining how to use Paycheck Protection Program funds and how to successfully apply for forgiveness of these loans.

Action 2.3. Explore opportunities to redirect City funding to create local grant or loan programs that support and sustain businesses and nonprofit organizations that are not well-served by outside programs (including the revolving loan fund described above), such as additional funding for the Santa Cruz Resilience Microloan Program via the Economic Development Trust Fund.

Strategy 3. Proactively implement temporary and permanent policy changes that enhance opportunities for businesses to safely resume operations.

Action 3.1. Based on findings from business outreach, modify or develop policies as necessary to enable businesses to operate effectively. This includes, for example, assessment and modification of guidelines for how different categories of businesses can safely operate.

Action 3.2. Continue to implement the Temporary Outdoor Expansion program through October 1, 2021, and explore modifications to existing sidewalk dining and parklet policies to streamline implementation of permanent outdoor dining expansions where appropriate when the temporary program expires.

Strategy 4. Publicize and direct businesses to available resources and guidance on how to safely resume, maintain, and expand operations.

Action 4.1. Continue to maintain and publicize available technical and financial resources to assist Santa Cruz businesses in sustaining and growing their operations during the pandemic.

Action 4.2. Collaborate with local partners to offer webinars, on at least a monthly basis over the next six months and a quarterly basis thereafter, to share information about available resources, the current status of allowable business activities, and strategies for recovery of business operations.

Strategy 5. Support local businesses in “pivoting” to expand their e-commerce marketing and sales.

Action 5.1. Continue to provide funding and coordination support for the “Get Virtual” program that pairs UCSC students with local businesses to enhance the businesses’ internet marketing and ecommerce sales through website development.

17.20 Santa Cruz Economic Development Strategy (City Council Draft) 13 FIGURE 3: COVID-19 PANDEMIC BUSINESS SUPPORT AND RECOVERY ACTIONS MATRIX Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

1.1. Conduct at least 2-3 additional business
surveys in partnership with other business
organizations
1-2 years Citywide Business Development
Division (BDD),
Chambers of commerce,
Santa Cruz Business Council,
Downtown Association
Number of surveys
administered

1.2. Conduct follow-up outreach to
businesses using new/modified programs
and policies to determine outcomes
1-2 years Citywide BDD Number of businesses
contacted,
Assessments of
program/policy success

1.3. Communicate with brokers and business
organizations identify businesses at risk of
closure or recently closed; survey business
owners and offer services or direction to
resources
1-2 years Citywide BDD,
Santa Cruz County Small
Business Development
Center (SBDC),
Chambers of commerce
Number of at-risk or
recently closed
businesses identified
and contacted

2.1. Establish revolving loan fund for small,
local, established and new businesses that
are not well served by other loan and grant
programs
1-2 years Citywide BDD,
Santa Cruz County,
Other cities within Santa Cruz
County,
U.S. Economic Development
Administration,
SBDC,
National Development
Council (NDC)
Loans provided,
Success/failure rate of
businesses receiving
loans

2.2. Provide assistance for use of PPP loan
funds and forgiveness of the loans
1-2 years Citywide BDD,
Cabrillo College Small
Business Development
Center
Development of
resources,
Referrals to partners

2.3. Explore opportunities to further fund
local business and nonprofit organization
grant and loan programs
1-2 years Citywide BDD,
City Manager’s Office,
Finance Department,
City Council,
NDC
Review of budget to
identify any funding
opportunities, including
the Economic
Development Trust Fund

17.21 Santa Cruz Economic Development Strategy (City Council Draft) 14 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

3.1. Proactively identify and implement
new/modified policies to assist businesses in
maintaining and expanding operations
1-2 years Citywide BDD,
Planning & Community
Development,
Santa Cruz County Public
Health Department
Number of policy and
program initiatives

3.2. Continue the Temporary Outdoor
Expansion program through October 1, 2021,
and explore modifications to existing
sidewalk dining and parklet policies to
streamline implementation of permanent
outdoor dining expansions where appropriate
when the temporary program expires
1-2 years Citywide BDD,
Planning & Community
Development,
Public Works Department,
Fire Department
Number of temporary
and permanent outdoor
dining permits issued

4.1. Maintain and publicize resources
regarding safe resumption and expansion of
business operations during the pandemic
1-2 years Citywide BDD Weekly review and
updates to website and
any printed materials

4.2. Offer educational webinars to assist
businesses in reopening and recovering
1-2 years Citywide BDD,
Cabrillo College Small
Business Development
Center,
Other partners as needed
Completion of a webinar
on at least a quarterly
basis

5.1. Continue to provide funding and
coordination for the Get Virtual program
1-2 years Citywide BDD,
UCSC
Number of businesses
assisted

17.22 Santa Cruz Economic Development Strategy (City Council Draft) 15

2. Tourism and Hospitality
As Santa Cruz emerges from the economic impacts of the COVID-19 pandemic, the City should begin to address broader opportunities and challenges confronting its tourism and hospitality industry.

Challenges include the seasonality of tourism and hotel stays in Santa Cruz, the need to reinvest in some older hotel properties, and attracting a wider audience of visitors to Santa Cruz to expand the City’s visitor base. The strategies therefore focus on repositioning underperforming hotels, diversifying the City’s visitor attractions and marketing, modifying tourism-related tax revenue mechanisms, and enhancing the physical environment of Santa Cruz.

GOALS:
 Support the continued opening and stabilization of hotels and visitor attractions  Increase visitation and hotel stays in the “shoulder” and off-peak seasons  Diversify the marketing of Santa Cruz’s visitor destinations and assets  Improve the quality of Santa Cruz’s hotel stock, supporting new and renovated hotels 3-star and above
 Expand resources for promoting and enhancing tourism and visitation  Revisioning of Civic center, including an activation of city-owned public spaces STRATEGIES:

Strategy 6. Explore opportunities to temporarily modify payment mechanisms for transient occupancy tax and admission tax collections to provide flexibility for hotel and event operators during the economic recovery.

Action 6.1. Continue and potentially expand/modify temporarily extended payment options for the transient occupancy tax (TOT) and the Admission Tax (similar to the recently adopted temporary quarterly payment system for TOT instead of previously-required monthly payments), and implement any revisions to payment options.

Strategy 7. Encourage reinvestment or redevelopment of lower lower-performing hotel properties through outreach, land use regulation, analysis, and exploration of financial incentives.

Action 7.1. Identify specific hotels as potential reinvestment or redevelopment opportunities based on regular review of establishment-level transient occupancy tax data.

Action 7.2. Review existing zoning and land use regulations for lower-performing hotel properties to determine potential adjustments that would create land use incentives for reinvestment/redevelopment (including for non-hospitality uses such as housing).

Action 7.3. Conduct outreach to owners of lower-performing hotel properties to gauge and explore interest in and needs for reinvestment or redevelopment of properties.

Action 7.4. Explore the creation of potential financial incentives for reinvestment or redevelopment of hotel properties, following review of any applicable legal barriers to such a program such as prevailing wage requirements or other impacts to the feasibility of implementation.

17.23 Santa Cruz Economic Development Strategy (City Council Draft) 16

Strategy 8. Partner with Visit Santa Cruz, hotel operators, and visitor destinations to establish a new working group focused solely on pursuing projects and opportunities to enhance visitation outside of the summer peak season.

Action 8.1. Recruit members and establish working group; conduct meetings on at least a semiannual basis.

Action 8.2. Implement recommendations of the working group in partnership with its members.

Strategy 9. Continue to pursue the implementation of major development projects related to tourism and visitors, including a permanent arena facility, a renovated civic auditorium and City civic center, and the Santa Cruz Wharf Master Plan.

Action 9.1. Provide Business Development team support for the Economic Development Department’s implementation of these projects, including informational communication with affected businesses regarding the benefits of these projects and outreach to determine ways these benefits can be enhanced through changes to the projects and their implementation.

Action 9.2. As projects are constructed, provide Business Development team support for permitting, tenanting, and related needs.

Strategy 10. Enhance wayfinding signage and gateways, especially to enhance the connections between the Municipal Wharf, the Santa Cruz Beach Boardwalk, and Downtown Santa Cruz.

Action 10.1. Provide any necessary Business Development team support for implementation of signage and gateways, including business outreach/communication, gathering of business input, and any required permitting assistance.

Action 10.2. Provide similar support for second phase of implementing wayfinding signage with a focus on improving direction to and branding of different commercial districts in Santa Cruz.

Strategy 11. Explore opportunities to attract larger event spaces and expand use of existing spaces.

Action 11.1. Study and implement potential incentives—or development density bonuses—for hotels with conference spaces.

Action 11.2. Conduct regular outreach to operators of major existing event venues—such as Cocoanut Grove, Civic Auditorium, and Kaiser Permanente Arena—to identify opportunities to promote facilities and expand their use.

Strategy 12. Collaborate with Visit Santa Cruz and area hotels and businesses to expand promotion of unique business niches, including outdoor recreation, artisanal food and beverages, and arts events.

Action 12.1. Conduct meetings with Visit Santa Cruz, hotels, and businesses to develop and implement a plan for expanding marketing of these unique industries within Santa Cruz, similar to

17.24 Santa Cruz Economic Development Strategy (City Council Draft) 17 marketing messages for these industries and businesses presented via the Choose Santa Cruz website.

Strategy 13. Re-engage with hospitality industry businesses regarding pursuing the passage of the transient occupancy tax (TOT) rate increase when appropriate.

Action 13.1. If appropriate, provide business outreach and survey support for further study of the TOT rate increase as hotel performance and economic conditions improve.

Strategy 14. Explore grant funding opportunities to support reinvestment and mitigation projects undertaken by property owners in areas vulnerable to sea level rise.

Action 14.1. Continuously monitor potential State and Federal funding opportunities that could be used to assist in mitigating the effects of sea level rise on visitor-oriented properties.

17.25 Santa Cruz Economic Development Strategy (City Council Draft) 18 FIGURE 4: TOURISM AND HOSPITALITY ACTIONS MATRIX
Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

6.1. Continue and expand temporary TOT and
Admission Tax modifications, including
increased payment options
1-2 years Citywide Business Development
Division (BDD),
Economic Development
Department,
Finance Department
Completion of analysis
of potential options,
Implementation of
temporary changes

7.1. Review TOT data to identify
underperforming hotels
2-3 years,
then ongoing
Citywide BDD,
Finance Department
Annual analysis of TOT
data,
Maintenance of list of
underperforming hotels

7.2. Review zoning at underperforming hotels
to identify current or potential future
incentives for reinvestment/redevelopment
2-3 years Citywide BDD,
Planning & Community
Development
Completion of zoning
and land use review

7.3. Conduct outreach to owners of
underperforming hotel properties
2-3 years Citywide BDD,
Hotel owners
Number of contacts with
hotel owners

7.4. Explore the creation of financial/tax
incentives to encourage
reinvestment/redevelopment of
underperforming hotels
3-5 years Citywide BDD,
Economic Development
Department,
Finance Department
Adoption of incentives
(or determination not to
proceed)

8.1. Establish a working group focused on
expanding visitation in off-peak seasons
2-3 years,
then ongoing
Citywide BDD,
Visit Santa Cruz,
Hotels and visitor
destinations
Completion of semiannual meetings

8.2. Implement the recommendations of the
working group
3-5 years Citywide BDD Semi-annual progress
on implementation

9.1. Provide business outreach,
communication, and gathering of input to
support major publicly-led development
projects related to tourism and visitors
2-3 years Citywide BDD,
Economic Development
Department,
Santa Cruz Seaside
Company,
Santa Cruz Warriors
As-needed support
provided for
implementation of
projects

17.26 Santa Cruz Economic Development Strategy (City Council Draft) 19 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

9.2. Provide support for permitting,
tenanting, and related needs for major
publicly-led development projects
3-5 years Citywide BDD
Economic Development
Department,
Planning & Community
Development,
Arena development partners
Assistance to City
departments and arena
development partners

10.1. Provide outreach, input gathering,
permitting assistance, or other support for
implementation of wayfinding signage and
gateways
1-2 years Beach Area,
Downtown
BDD,
Economic Development
Department,
Public Works
Contacts or assistance
related to wayfinding
signage and gateways

10.2. Provide similar support for a second
phase of implementing wayfinding signage
and gateways focused on additional
commercial districts in Santa Cruz
3-5 years Ocean Street,
Soquel Ave,
Water Street,
River Street,
Westside Industrial
BDD,
Economic Development
Department,
Public Works
Contacts or assistance
related to wayfinding
signage and gateways

11.1. Study and implement incentives to
attract hotels with conference space
3-5 years Citywide BDD,
Planning & Community
Development,
Finance Department
Quarterly progress on
study & implementation
efforts,
Implementation of
incentives

11.2. Conduct outreach to major event
venues to identify opportunities to promote
facilities and expand their use
2-3 years,
then ongoing
Citywide BDD,
Cocoanut Grove,
Kaiser Permanente Arena,
Civic Auditorium,
Other venues
Number of contacts with
event venues

12.1. Conduct meetings with hospitality
organizations and businesses to develop and
implement a plan to promote unique niche
industries in Santa Cruz
2-3 years,
then ongoing
Citywide BDD,
Visit Santa Cruz,
Hotels,
Businesses in targeted
industries,
Chambers of commerce,
Santa Cruz Business Council
Number of meetings,
Development of a
promotion strategy,
Implementation of
promotion

17.27 Santa Cruz Economic Development Strategy (City Council Draft) 20 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

13.1. As needed, study a TOT rate increase,
including business outreach and surveys;
pursue passage of a rate increase if
appropriate
3-5 years Citywide Economic Development
Department,
City Manager
As-needed support to
City Council

14.1. Monitor State and Federal grant
funding opportunities to assist visitororiented properties in addressing sea level rise challenges
Ongoing Beach Area,
Lower Eastside,
Lower Westside
Economic Development
Department,
City Manager (Climate Action
Program),
Affected property owners
Quarterly review of
funding opportunities

17.28 Santa Cruz Economic Development Strategy (City Council Draft) 21

3. Small Businesses and Commercial Districts
The following strategies address the challenges noted by small businesses regarding confusion about accessing available technical and financial resources, and challenges in accessing commercial districts. In the short term, Santa Cruz’s small businesses and commercial districts are currently suffering from major declines in business activity as a result of the COVID-19 pandemic. Therefore, City efforts over the next one to two years should be focused on implementing the strategies and actions listed in the COVID-19 Pandemic Business Support and Recovery category. In the longer term, the City of Santa Cruz can help support and grow small businesses and commercial districts by connecting businesses to available resources, addressing specific transportation and parking needs, and generally investing in the public environment of commercial districts through infrastructure enhancement, focusing on pedestrian improvements, beautification, and activation of public spaces.

GOALS:
 Provide information to small businesses about technical assistance and financial assistance programs
 Improve the street environment in commercial districts to make them more accessible to pedestrians, bicycles, and other transportation modes
 Support regional planning efforts that address transportation challenges in Santa Cruz STRATEGIES:

Strategy 15. Update and widely disseminate a description of resources and partnerships for assisting small businesses.

Action 15.1. Continue to update available resources for assisting small businesses.

Action 15.2. On a quarterly basis, review and revise the methods of disseminating these resources with a goal of reaching as many small businesses as possible.

Strategy 16. Coordinate and collaborate with other City departments and regional transportation agencies to share business concerns about the need for expanded alternatives to automobile access to businesses, including improved bicycle and pedestrian infrastructure and support for regional public transportation improvements.

Action 16.1. As part of regular business outreach, collaboration, and surveys, assemble data regarding business owner priorities for local and regional transportation improvement needs for each commercial district in Santa Cruz.

Action 16.2. Share the results of the above findings with Public Works, the Santa Cruz Regional Transportation Commission (SCCRTC), and other jurisdictions and City departments through scheduled meetings and as part of development of street improvement projects.

Strategy 17. Develop or update district-based parking strategies for areas that are undergoing intensification, including the Westside Industrial Area and Downtown.

17.29 Santa Cruz Economic Development Strategy (City Council Draft) 22 Action 17.1. Study parking needs and work with other City departments to explore the potential need and design of a district-based parking strategy for the Westside Industrial area, including consideration of the intensification of uses occurring at industrial properties.

Action 17.2. Continue exploring parking technology improvements and rate modifications to introduce greater flexibility and lower costs for businesses.

Action 17.3. If supported by study findings above, pursue adoption of a district-based parking program for the Westside Industrial Area
Strategy 18. Develop and implement a work program to target short-term and long-term streetscape and traffic calming measures in the Eastside/Midtown area.

Action 18.1. Collaborate with local businesses, property owners, Public Works, and other City departments to identify potential lower-cost short-term improvements, long-term improvements, implementation costs, and funding sources.

Action 18.2. Pursue implementation of improvements through coordination with Public Works.

Strategy 19. Provide information to small businesses about technical assistance programs available through the City, Economic Development, the Small Business Development Center and other partners.

Action 19.1. Continue to introduce these resources as part of one-on-one outreach to new and growing businesses.

Action 19.2. Examine additional opportunities to broaden access to information about these resources, such as providing materials to all establishments receiving City business licenses.

Strategy 20.Reduce barriers to use of the existing façade improvement program.

Action 20.1. Work with other City departments to streamline and expedite review and approvals, and make efforts to streamline the State Department of Industrial Relations requirements for prevailing wage payroll certification processes.

17.30 Santa Cruz Economic Development Strategy (City Council Draft) 23 FIGURE 5: SMALL BUSINESSES AND COMMERCIAL DISTRICTS ACTIONS MATRIX Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

15.1. Continue to update listings of available
small business resources
Ongoing Citywide Business Development Division
(BDD)
Frequency of updating
information

15.2. Review and revise methods of
disseminating resources
Ongoing Citywide BDD Completion of quarterly
review

16.1. Gather information regarding districtspecific local and regional transportation improvement needs
Ongoing All commercial
districts, with a
focus on:

Downtown,
Westside Industrial,
Eastside/Midtown
BDD Number of business
contacts that resulted in
gathering of relevant
information

16.2. Share findings regarding transportation
improvement needs with partners
Ongoing Citywide BDD,
Public Works,

SCCRTC,
Santa Cruz METRO,
Other jurisdictions
Number of
meetings/contacts in
which findings are
shared

17.1. Study parking needs and potential
adoption of a district-based parking strategy
in the Westside Industrial area
2-3 years Westside Industrial Economic Development
Department,
BDD,
Public Works,
Businesses & property owners
Completion of needs
study

17.2. Explore parking technology
improvements and rate changes to lower
costs for Downtown businesses
2-3 years Downtown Economic Development
Department,
BDD,
Public Works,
Downtown Commission,
DTSC improvement districts
Implementation of
parking technology
improvements and rate
changes

17.3. Pursue adoption of a district-based
parking program in the Westside Industrial
Area, if supported by study
3-5 years Westside Industrial Economic Development
Department,
BDD,
Public Works,
Businesses & property owners
Adoption of districtbased parking program

17.31 Santa Cruz Economic Development Strategy (City Council Draft) 24 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

18.1. Collaboratively identify short-term and
long-term streetscape and traffic calming
improvements in the Eastside/Midtown area
2-3 years Soquel Ave,
Water Street
(Eastside/Midtown)
BDD,
Public Works,
Planning & Community
Development,
Businesses & property owners
Identification of shortterm and long-term
improvements

18.2. Pursue implementation of
improvements through coordination with
Public Works
3-5 years Soquel Ave,
Water Street
(Eastside/Midtown)
BDD,
Public Works,
Planning & Community
Development,
Businesses & property owners
Progress in
implementing
improvements

19.1. Continue to share small business
development resources as part of outreach
to new/growing businesses
Ongoing Citywide BDD Number of businesses
receiving information

19.2. Pursue opportunities to better
disseminate information about small/new
business resources
1-2 years Citywide BDD,
Finance Department,
Planning & Community
Development
Expanded methods of
sharing information

20.1. Streamline and expedite review,
approvals, and living wage payroll
certification processes for the façade
improvement program
2-3 years Citywide BDD,
Finance Department,
Planning & Community
Development
Completion of
modifications to
processes

17.32 Santa Cruz Economic Development Strategy (City Council Draft) 25

4. Retail and Shopping Districts
The following goals and strategies respond to long-term shifts in the retail industry overall, as well as several local, district-level challenges identified as part of the EDS analyses. The retail industry is undergoing an evolution that favors “experiential” businesses such as dining, drinking, and entertainment since these activities cannot be easily replicated through online sales. As a result, there is a need to allow greater flexibility and diversity of uses in storefronts within retail districts, and the types of “anchors” to attract foot traffic may also change since large retailers are less likely to fill these roles. Downtown Santa Cruz is also confronting challenges in parking costs and negative perceptions of street safety. The Eastside/Midtown area could also benefit from improvement of the physical environment for visitors.

The following goals and strategies seek to enhance the diversity of allowable uses in retail districts, reduce parking-related costs and challenges for Downtown businesses, diversify potential “anchors” for Downtown, and encourage investment in the Eastside/Midtown area.

GOALS:
 Create a regionally attractive mix of businesses in Downtown Santa Cruz  Enhance services, appearance, and access to Downtown Santa Cruz and Eastside/Midtown  Diversify Santa Cruz’s mix of retail, dining, and entertainment businesses and spaces to meet modern demand
STRATEGIES:

Strategy 21. Develop a pop-up program, with streamlined permitting requirements, to allow temporary retail and food uses in vacant storefronts.

Action 21.1. Review and partner with other City departments to modify existing permitting requirements to ensure pop-up uses can easily locate temporarily in vacant storefronts.

Strategy 22. Explore opportunities to reduce impacts of increased parking fees in Downtown on low wage workers.

Action 22.1. As part of the parking study and strategies development actions in Strategy 17 (developing or updating district-based parking strategies for areas that are undergoing intensification), explore and implement modifications to reduce the impacts of parking fees on low wage workers.

Strategy 23. Enhance the use of outdoor space by restaurants, stores, and personal services through continued implementation of the temporary outdoor expansion program and working on streamlining of permitting processes and reductions of fees for permanent sidewalk dining and parklet programs.

Action 23.1. Study the recent implementation of the Temporary Outdoor Expansion Area Program to identify successes, challenges, and opportunities applicable to the standard process for permitting use of outdoor space by restaurants, stores, and personal services businesses; also study these permitting times and fee costs in Santa Cruz versus nearby cities.

17.33 Santa Cruz Economic Development Strategy (City Council Draft) 26 Action 23.2. Develop and implement recommendations, in conjunction with other City departments, to streamline permitting and reduce costs for use of public and private outdoor space.

Strategy 24. Provide supportive services for the formation of a new improvement district in Downtown Santa Cruz, as needed and requested by local business and property owners.

Action 24.1. Provide coordination and communication assistance to area businesses and property owners in completing the petition and ballot process to approve and enact a new single improvement district in Downtown Santa Cruz.

Strategy 25. Expand the diversity of entertainment, dining, nightlife, and retail uses in Downtown Santa Cruz, and explore opportunities to attract non-retail ground floor storefront uses that would draw foot traffic to Downtown Santa Cruz, including gyms, entertainment, and games; also support inclusion of medical offices in Downtown except along Pacific Avenue and Cedar Street.

Action 25.1. As opportunities arise, continue connecting business owners with brokers of available spaces.

Action 25.2. Review and pursue modifications to existing land use, permitting, and zoning regulations that create challenges for diversifying uses in Downtown Santa Cruz.

Strategy 26. Continue to partner with the Downtown Association, Visit Santa Cruz, Santa Cruz Works, and others for shop local campaigns and efforts to encourage local spending.

Action 26.1. Through ongoing communications and engagement with the Downtown Association, Visit Santa Cruz, Santa Cruz Works, and other partners, assist in implementation of shop local campaigns via actions such as outreach to businesses, marketing, and financial support.

Strategy 27. Collaborate with other City departments and the Downtown improvement district(s) to enhance the effectiveness of ambassador, cleaning services, and homeless outreach to improve safety and comfort concerns.

Action 27.1. Assist in ongoing coordination between the Downtown Santa Cruz improvement districts, Public Works, Downtown Streets Team, and the Homelessness Response Manager and Downtown Outreach Workers.

Strategy 28. Support and assist the Eastside/Midtown area in assessing the support for and potentially creating an improvement district to enhance local marketing, maintenance, and collaboration efforts.

Action 28.1. Work with engaged business owners in the Eastside/Midtown area to conduct additional outreach and raise awareness of potential for an improvement district among other area businesses and property owners; pursue creation of a district when sufficient support exists.

Strategy 29. Target use of the façade improvement program in the Eastside/Midtown area.

17.34 Santa Cruz Economic Development Strategy (City Council Draft) 27

Action 29.1. As funds are available, proactively reach out to businesses in the Eastside/Midtown area to explore opportunities to deploy façade improvement grants.

17.35 Santa Cruz Economic Development Strategy (City Council Draft) 28 FIGURE 6: RETAIL AND SHOPPING DISTRICTS ACTIONS MATRIX
Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

21.1. Review and modify permitting
requirements for pop-up storefront uses
1-2 years Citywide Business Development Division
(BDD),
Planning & Community
Development
Progress in completing
review and modifications

22.1. Reduce parking costs for lower income
Downtown workers
2-3 years Downtown BDD,
Economic Development
Department,
Public Works,
Downtown Commission,

DTSC PBID
Implementation of
parking-related fee
reductions

23.1. Study lessons learned from the
Temporary Outdoor Expansion Area Program
for allowing use of outdoor space by
businesses, and study City fees and
permitting times versus nearby cities
2-3 years Citywide BDD,
Planning & Community
Development,
Public Works
Completion of study

23.2. Develop and implement
recommendations to reduce barriers to use
of outdoor space by businesses
3-5 years Citywide BDD,
Economic Development
Department,
Planning & Community
Development,
Public Works
Adjustments to outdoor
permitting processes
and costs

24.1. If supported by property and business
owners, provide support for completing the
petition and ballot process to enact a new
improvement district in Downtown
1-2 years Downtown BDD,
Downtown Association,
Downtown Management
Corporation,

DTSC PBID
Completion of petition
and ballot process,

Enactment of district

25.1. Continue connecting diverse
businesses seeking space in Downtown with
area brokers
Ongoing Downtown BDD,
Commercial brokers
Number of businesses
assisted

25.2. Review and modify regulations creating
barriers to diversifying uses in Downtown
2-3 years Downtown BDD,
Planning & Community
Development
Progress in completing
review and modifications

17.36 Santa Cruz Economic Development Strategy (City Council Draft) 29 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

26.1. Assist in implementation of shop local
campaigns via actions such as outreach to
businesses, marketing, and financial
support.

Ongoing Citywide BDD,
Downtown Association,
Visit Santa Cruz,
Santa Cruz Works
Number of shop local
campaigns or related
activities supported by
City staff actions

27.1. Assist in ongoing coordination to
enhance ambassador, cleaning services, and
homeless outreach in Downtown
Ongoing Downtown BDD,
Downtown improvement
districts,
Public Works,
Homelessness Response
Manager,
Downtown Outreach Worker
Specific coordination
issues addressed

28.1. If requested, support outreach,
coordination, and provide other assistance to
potentially implement an improvement
district in the Eastside/Midtown area
2-3 years Soquel Ave,
Water Street
(Eastside/Midtown)
BDD,
Businesses & property owners
Number of
contacts/meetings,
Progress in completing
formation study

29.1. Proactively reach out to businesses in
the Eastside/Midtown area to deploy façade
improvement grants (as funding is available)
Ongoing Soquel Ave,
Water Street
(Eastside/Midtown)
BDD,
Businesses
Number of
contacts/meetings,
Number of façade
improvement grants

17.37 Santa Cruz Economic Development Strategy (City Council Draft) 30

5. Education and Workforce
The City of Santa Cruz attracts workers from throughout the surrounding region, but high housing costs are impacting the ability of companies to attract and retain employees. The following goals and strategies focus on leveraging the region’s robust network of workforce, education, and business partners to better connect workers with high-quality job opportunities and to promote the creation of housing affordable to lower-income workers who might otherwise be priced out of Santa Cruz.

GOALS:
 Partner with workforce development organizations, labor organizations, and employers to connect the local workforce with jobs that offer economic opportunities for local residents.  Collaborate with large employers and institutions to create more workforce housing opportunities in Santa Cruz
STRATEGIES:

Strategy 30. Enhance coordination with education, workforce development, and business support partners through standing meetings and development and implementation of new programs and initiatives for technical training, apprenticeships, and other career pathway opportunities.

Action 30.1. Continue and expand participation in recent COVID-19-related standing meetings with business support partners; meet at least semi-annually to develop and implement new programs and initiatives; incorporate partners such as the Santa Cruz County Workforce Development Board, Santa Cruz Works, local banks, UCSC, Cabrillo College, and other selected organizations.

Strategy 31. Develop a formalized system to track referrals to and outcomes from business engagement with the Santa Cruz County Small Business Development Center at Cabrillo College.

Action 31.1. Implement a new referral outcome tracking system in partnership with the Cabrillo College Small Business Development Center to gauge the effectiveness of and potential modifications to the process, partnership, and services.

Strategy 32. Continue to provide Business Development staff support for public and public-private development projects that contribute workforce housing and/or provide amenities that enhance the quality of life for Santa Cruz residents.

Action 32.1. As needed, assist with business outreach, tenanting assistance for commercial spaces, permitting assistance, and other needs related to the Economic Development Department’s development of housing, commercial, and institutional projects (such as the MixedUse Library Project and the Pacific Station mixed-use redesign of the existing Metro transit center site).

Strategy 33. Continue to implement the Housing Element policy to work closely with UCSC to provide more workforce housing opportunities for faculty and staff. Continue implementation of

17.38 Santa Cruz Economic Development Strategy (City Council Draft) 31 workforce housing partnership with Santa Cruz City School District, and explore similar opportunities to create workforce housing with other large employers in Santa Cruz.

Action 33.1. Continue to partner with Santa Cruz City School District to complete development of a workforce housing development project targeted to teachers.

Action 33.2. Through collaboration with UCSC on its Long Range Development Plan, continue to encourage exploration of potential workforce housing opportunities and partnerships for faculty and staff.

Action 33.3. Monitor and pursue potential new opportunities to create workforce housing in partnership with large employers in Santa Cruz.

17.39 Santa Cruz Economic Development Strategy (City Council Draft) 32 FIGURE 7: EDUCATION AND WORKFORCE ACTIONS MATRIX
Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

30.1. Continue and expand participation in
standing meetings with business support and
workforce development partners
Ongoing Citywide Business Development Division
(BDD),

SCC WDB,
Santa Cruz Works,
Local banks,
UCSC,
Cabrillo College,
Other organizations
Completion of meetings
on at least a semiannual basis

31.1. Implement a new referral outcome
tracking system in partnership with the Santa
Cruz County Small Business Development
Center at Cabrillo College
3-5 years Citywide BDD,
Santa Cruz County Small
Business Development Center
at Cabrillo College
Progress in
implementing a tracking
system

32.1. Assist with business outreach,
tenanting assistance for commercial spaces,
permitting assistance, and other needs
related to public and public-private
development projects
Ongoing Downtown,
Citywide
BDD,
Economic Development
Department,
Santa Cruz Public Library,
Santa Cruz METRO
Actions taken to support
specific public/publicprivate development
projects

33.1. Continue partnership with the Santa
Cruz City School District to develop a
workforce housing project
Ongoing Citywide BDD,
Economic Development
Department,
Santa Cruz City School District
Completion of steps
toward completing
housing development

33.2. Through collaboration with UCSC on its
Long Range Development Plan, continue to
encourage exploration of potential workforce
housing opportunities and partnerships for
faculty and staff.

Ongoing Citywide BDD,
Economic Development
Department,
Planning & Community
Development,
UCSC
Meetings and contacts
with UCSC related to
housing opportunities

33.3. Monitor and pursue new opportunities
to create workforce housing partnership with
large employers
Ongoing Citywide BDD,
Economic Development
Department,
Large businesses
Number of contacts with
businesses regarding
housing partnerships

17.40 Santa Cruz Economic Development Strategy (City Council Draft) 33

6. Specialized Industry Sectors
Although the Tourism and Hospitality industry is Santa Cruz’s most significant economic driver, the City also has unique strengths in four other specialized industry sectors: biotechnology and life sciences, sports and outdoor recreation, technology and innovation, and artisanal production (such as smallscale food, beverage, or other manufacturing). The following goals and strategies focus on supporting these industries by addressing their space needs (including the need for additional office and light industrial/flex space), coordinating with employers and organizations to create connections within the industries and address other industry-specific needs, and promoting the presence of sports and outdoor recreation and artisanal production industries to visitors.

GOALS:
 Ensure availability and access to light industrial, flex, and R&D space that flexibly accommodates diverse business types and sizes (including manufacturing, research and development activities, small scale artisanal production, and other innovative and creative businesses)  Expand the biotechnology and life sciences industry through closer partnerships with UCSC and businesses
 Explore opportunities to accommodate the growth of small innovation firms  Retain and expand the local sports and outdoor recreation industry STRATEGIES:

Strategy 34. Convene a biotechnology and life sciences industry working group to collaboratively identify shared challenges and opportunities and develop and implement networking and informational events. Participants could include Santa Cruz Works, Startup Sandbox, the UCSC Genomics Institute, and Cabrillo College, as well as local employers.

Action 34.1. Convene group, initiate semi-annual meetings, develop and implement work plan.

Strategy 35. Review and pursue updates to zoning and land use regulation in the Westside Industrial, Harvey West, and Seabright areas to ensure a mix of manufacturing, research and development, and limited retail/restaurant/dining and office uses are allowed in existing and new buildings.

Action 35.1. Review existing zoning and land use regulation to identify barriers to allowing a diverse mix of the identified business types, and work with the Planning and Community Development Department to modify zoning and land use regulation.

Strategy 36.Encourage development of additional flexible office space in Downtown Santa Cruz to be responsive to the market.

Action 36.1. Conduct outreach to office developers to identify major barriers to developing additional office space in Downtown Santa Cruz.

Action 36.2. Based on developer feedback, pursue policy, program, and regulatory changes to reduce office development costs and incentivize development of additional flexible and mixed-use office space.

17.41 Santa Cruz Economic Development Strategy (City Council Draft) 34

Strategy 37. Continue networking events between venture capitalist funders and local businesses/entrepreneurs, especially those in the biotech and innovation industries.

Action 37.1. Continue to convene and hold networking events on at least an annual basis, in partnership with businesses and venture capitalists focused on biotech and innovation industries.

Strategy 38. Promote entrepreneurship through partnerships with organizations such as Santa Cruz Works and the SBDC Tech Futures Group to continue referrals, hold networking events, and disseminate the advantages of locating a business in Santa Cruz.

Action 38.1. Continue to refer relevant businesses to the SBDC Tech Futures Group and Santa Cruz Works.

Action 38.2. Continue partnerships with the SBDC Tech Futures Group and other organizations to disseminate information about Santa Cruz for entrepreneurs in innovation-focused industries.

Strategy 39. Explore opportunities to promote Santa Cruz’s cluster of sports and outdoor recreation businesses, as well as artisanal producers, to visitors.

Action 39.1. Include a focus on sports and outdoor businesses and artisanal producers as part of the actions described in Strategy 12 to promote Santa Cruz’s unique business niches as part of marketing to visitors.

17.42 Santa Cruz Economic Development Strategy (City Council Draft) 35 FIGURE 8: SPECIALIZED INDUSTRY SECTORS ACTIONS MATRIX
Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

34.1. Create and regularly convene a biotech
and life sciences working group to develop
and implement a shared work plan
1-2 years,
then Ongoing
Citywide Business Development Division
(BDD),
Biotech and life sciences
businesses,
Santa Cruz Works,
Startup Sandbox,
UCSC Genomics Institute,
Cabrillo College
Semi-annual meetings,
Development and
implementation of work
plan

35.1. Review regulations to identify barriers
to increasing business diversity in targeted
areas, and collaboratively modify regulations
2-3 years Westside Industrial,
Harvey West,
Lower Eastside
(Seabright)
BDD,
Planning & Community
Development
Progress in completing
review and modifications

36.1. Conduct outreach to office developers
to identify barriers to building more space in
Downtown
1-2 years Downtown BDD,
Office developers
Completed contacts,
Development of findings

36.2. Pursue policy, program, and regulatory
changes to increase development potential
for flexible and mixed-use office space
2-3 years Downtown BDD,
Planning & Community
Development
Progress in completing
modifications

37.1. Continue to convene and hold
biotech/innovation-focused industry
networking events on at least an annual
basis
Ongoing Citywide BDD,
Business/entrepreneurs,
Funders
Number of networking
events per year (at least
one)

38.1. Continue to refer business to the SBDC
Tech Futures Group and Santa Cruz works
Ongoing Citywide BDD,
SBDC Tech Futures Group,
Santa Cruz Works
Number of referrals

38.2. Continue partnership with the SBDC
Tech Futures Group and other organizations
to disseminate information about Santa
Cruz’s advantages to entrepreneurs
Ongoing Citywide BDD,
SBDC Tech Futures Group,
Santa Cruz Works,
Other organizations
Number of contacts/
marketing initiatives

17.43 Santa Cruz Economic Development Strategy (City Council Draft) 36 Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

39.1. Include a focus on sports and outdoor
businesses and artisanal producers as part
of new/expanded visitor marketing
2-3 years,
then ongoing
Citywide BDD,
Visit Santa Cruz,
Hotels,
Businesses in targeted
industries
Number of meetings,
Development of a
promotion strategy,
Implementation of
promotion

17.44 Santa Cruz Economic Development Strategy (City Council Draft) 37

7. City Services and Processes
Business owners interviewed for the EDS identified a number of challenges in understanding how to navigate City permitting and approvals processes, and in knowing how to access City services. The following goals and strategies seek to clarify and streamline permitting and approvals processes and enhance the dissemination of information regarding how to access public services.

GOALS:
 Improve the city’s permitting and approvals process to cut back on delays and associated costs to businesses.
 Enhance communications so that businesses are aware of the services provided by the City, and can easily access those resources.

STRATEGIES:

Strategy 40. Continue to review the City’s permitting and approvals process to find areas for potential streamlining, and support the implementation of the Management Partners review of the permitting process.

Action 40.1. Continue to convene regular inter-departmental working groups focused on review and modification of permitting and approvals processes; continue to support implementation of recommendations from the Management Partners review of the Planning and Community Development Department, and incorporate ongoing input from businesses and developers that interact with the City.

Strategy 41. Continue to enhance the partnership between Economic Development, Planning, and other staff to better assist individual businesses in navigating permitting/approvals processes.

Action 41.1. As-needed, assist businesses in navigating the new online business license and zoning clearances system.

Action 41.2. As part of the interdepartmental working group, clarify and formalize the roles of the Business Liaison, Planning, and other staff to clarify when and how Economic Development staff should be engaged with specific applications.

Strategy 42. Develop and disseminate brochures and guides for small businesses on how to access maintenance services, public safety services, and services to assist people experiencing homelessness.

Action 42.1. Collaborate with the City’s Homelessness Response Manager to develop, produce, and distribute updated informational materials.

Strategy 43. Facilitate gathering of business input for longer-term city projects such as the Climate Action Plan and potential changes to the Green Business Program.

17.45 Santa Cruz Economic Development Strategy (City Council Draft) 38 Action 43.1. Coordinate with the Climate Action Program Manager to facilitate business input on an as-needed basis.

Strategy 44. Promote Santa Cruz’s economic assets and City services through maintenance and updating of the Choose Santa Cruz website, better integration of the website, and regular digital outreach and mailings to businesses.

Action 44.1. Continue engagement with a branding and marketing consultant to maintain and promote the website and other new information.

17.46 Santa Cruz Economic Development Strategy (City Council Draft) 39 FIGURE 9: CITY SERVICES AND PROCESSES ACTIONS MATRIX
Action Schedule
Subarea
(if applicable)
Parties Involved
Metrics for Measuring
Progress

40.1. Continue inter-departmental working
group focused on review and modification of
permitting and approvals processes, based
on business feedback and implementation of
the recommendations from the Management
Partners review of the City permit process
Ongoing Citywide Business Development Division
(BDD),
Planning & Community
Development,
Fire Department
Number of working
group meetings held per
year

41.1. As-needed, assist businesses in
navigating the new business license and
permitting portal
Ongoing Citywide BDD,
Planning & Community
Development
Number of businesses
assisted in navigating
the portal

41.2. Clarify and formalize the roles of
staff/departments involved in planning
applications
1-2 years Citywide BDD,
Economic Development
Department,
Planning & Community
Development,
Fire Department,
City Manager
Development and
adoption of internal
policies

42.1. Collaborate with the Homelessness
Response Manager to develop, produce, and
distribute updated informational materials
for small businesses regarding public
services
2-3 years Citywide BDD,
Homelessness Response
Manager
Development and
distribution of updated
guides/materials

43.1. Coordinate with the Climate Action
Program Manager to facilitate business input
as-needed
Ongoing Citywide BDD,
City Manager (Climate Action
Program)
Completion of
assistance as-needed

44.1. Continue engagement with a branding
and marketing consultant to maintain and
promote the Economic Development website
and other new information
Ongoing Citywide BDD,
Economic Development
Department,
Branding and marketing
services consultant
Progress on website
updates and marketing

17.47 Santa Cruz Economic Development Strategy (City Council Draft) 40 Tracking Success: Economic Development Indicators
The following economic development indicators are recommended for use by the Economic Development Department to track market and economic conditions in the City of Santa Cruz. These indicators are a gauge of the overall health of the Santa Cruz economy, but are outside the direct control of the City of Santa Cruz since they are also heavily influenced by regional, national, and international economic and market conditions. In contrast, the “Metrics for Measuring Progress” listed for each of the EDS implementation actions track the City’s direct actions.

The first five economic indicators are already in use by the Economic Development Department, while measures six and seven are new.

1. New Business Licenses – Number of business licenses issued annually: overall, by location, by business size

2. Sales Tax Revenue – Amount of citywide sales tax collected annually

3. Transient Occupancy Tax Revenue – Amount of transient occupancy tax revenue collected annually

4. Building Permits – Number and value of commercial and industrial building permits issued by the City each quarter

5. Employment and Unemployment Rate – Total number of jobs and unemployment rate, updated quarterly based on data provided by the County of Santa Cruz Workforce Development Board

6. Real Estate Market Data – Quarterly summary of asking rents, vacancy rates, and absorption for all commercial and industrial product types in Santa Cruz, compared to neighboring cities and Santa Cruz County (obtained via the City’s CoStar data subscription)

7. Discontinued Business Licenses – Number of business licenses that are discontinued annually, with comparison to new business licenses in order to determine a “net new” number of licenses

17.48 Santa Cruz Economic Development Strategy (City Council Draft) 41

ECONOMIC DATA SNAPSHOT
This section of the EDS provides a snapshot of economic data and related findings from the Economic Conditions and Opportunities Report, which informed the development of the goals, strategies and work plan shown in Section III. The majority of the data research and analysis was completed prior to the COVID-19 pandemic. Additionally, Strategic Economics collected and summarized available information about the known impacts of the pandemic on the Santa Cruz economy.

This section is organized into the following key topic areas, which correspond to the organization of Section III’s categories.

1. COVID-19 Pandemic Economic Impacts

2. Tourism and Hotels

3. Small Businesses and Commercial Districts

4. Retail and Shopping Districts (Downtown, Eastside/ Midtown)

5. Education, Workforce, and Commutes

6. Specialized Industry Sectors (Biotech and Life Sciences, Sports and Outdoor Recreation, Technology and Innovation, Artisanal Production)

7. City Services and Processes

1. COVID-19 Pandemic Economic Impacts
The COVID-19 pandemic has imposed severe negative economic impacts on the economies of the City of Santa Cruz, the country, and the world. The “shelter-in-place” orders enacted to slow the spread of the coronavirus that causes COVID-19 resulted in the temporary closure of numerous retail, hospitality, and service businesses, the cancellation of events, and a shutdown of most travel. This reduction in revenues and economic activity has led to layoffs and furloughs in a variety of industry sectors and some permanent business closures.

The overall length and severity of the economic impacts due to the COVID-19 pandemic are still unknown, but will depend on several factors, including the duration of the pandemic and associated public health measures, and availability of relief programs offered by the federal, state, and local governments. The following findings describe examples of what is known about the local impacts of the COVID-19 pandemic, and provide insights into how the pandemic is likely to affect Santa Cruz given the City’s specific industry mix.

Examples of known local impacts of the COVID-19 pandemic include the following:
 Santa Cruz County Chamber of Commerce Business Survey Results: The Santa Cruz County Chamber of Commerce surveyed businesses within the County between May 5th and May 11th of this year.1 111 businesses responded, with about half of these businesses located in the City of Santa Cruz. The results are not a scientific sampling of businesses, but do provide evidence of the pandemic’s impacts. 30 percent of respondents noted that their businesses are closed, and 28 percent had reduced their hours of operation. 68 percent of respondents

1 The full survey results described in this report are available at http://www.santacruzchamber.org/uploads/5/5/5/1/55516451/covid_-- _19_survey_results_may_18%5Ej_2020_2.pdf, and a summary is available at https://web.santacruzchamber.org/news/newsarticledisplay.aspx?ArticleID=1858

17.49 Santa Cruz Economic Development Strategy (City Council Draft) 42 expected that their business would still not be fully operational once the shelter in place order is lifted, and nearly half had already suffered losses of more than $50,000. While over 60 percent of respondents received business assistance loans or grants, 44 percent noted that the amount received was inadequate to meet their needs, and respondents heavily prioritized the need to receive additional financial assistance.
 City of Santa Cruz Business Survey Results: The City of Santa Cruz received survey responses from 203 area businesses during late spring and early summer of this year. Over 38 percent of respondents are making permanent or temporary changes to their business models. Onethird of businesses stated a need for direct financial assistance, and nearly a quarter noted a need for assistance in developing their online presence or e-commerce platform. Fortunately, 87 percent of businesses were able to access supplemental assistance through grants and loans, and business owners appeared more optimistic about the future than in a previous survey conducted early in the pandemic.
 Layoff Notices: The California Worker Adjustment and Retraining Notification (WARN) Act requires businesses with at least 75 employees to file a notification when they anticipate laying off or placing on temporarily furloughing 50 or more employees (although WARN Act notices may also be filed for smaller layoff events). Review of WARN Act notices filed by Santa Cruz employers in the second quarter of 2020 shows that the vast majority of notices are for unusual temporary furloughs of workers at hotels, retail stores, restaurants, and, to a lesser extent, medical and personal services.

 Unemployment Data: Preliminary data produced by the State of California Employment Development Department indicates that the Santa Cruz County unemployment rate was an exceptionally high 14.4 percent as of May 2020, versus 8.1 percent in March, and that the unemployment rate in the City of Santa Cruz was 12.7 percent in May. Actual unemployment rates are likely higher since the data does not capture workers who are experiencing delays in applying for Unemployment Insurance benefits or that have stopped searching for work. Data for Santa Cruz County indicates that employment declined most significantly for businesses in the hospitality, restaurant/food service, personal services, and arts, entertainment, and recreation industries.

Declines in economic activity have reduced local tax revenues significantly and will continue to affect the City’s budget in the near future. A large share of City of Santa Cruz General Fund revenues are associated with businesses and spending impacted by the COVID-19 pandemic. Based on estimates of actual revenues for the 2019-2020 fiscal year, Sales and Use Taxes constituted 22 percent of revenues, the Transient Occupancy (hotel) Tax constituted 15 percent of revenues, the Utility Users Tax constituted 14 percent of revenues, and Admission (event) Taxes constituted three percent of revenues. All of these revenue sources, which together make up over half of General Fund revenues, depend on business activity, consumer spending, and tourism.2 As of January 26, 2021, the City of Santa Cruz Finance Department generated estimates of projected General Fund revenue losses and required spending cuts for the coming fiscal years. Under a “realistic scenario,” the City anticipated a total $6 million reduction in revenues in fiscal years 2021 and 2022, accompanied by $3.75 million in structural and onetime spending cuts in fiscal year 2022 and again in 2023. These numbers could

2 City of Santa Cruz, California: 2021 Annual Budget, http://www.cityofsantacruz.com/home/showdocument?id=80120.

17.50 Santa Cruz Economic Development Strategy (City Council Draft) 43 differ if the City receives additional outside funding; under a scenario in which the City receives $3 million in total federal and state aid in 2021, the City would instead need to implement structural and onetime spending cuts of $3.75 million in fiscal year 2022 and $3 million in fiscal year 2023.

The pandemic is impacting the capacity of City staff and other partner organizations. Declining City of Santa Cruz revenues are already reducing staff capacity, with the City implementing staff furloughs and a hiring freeze. Staff levels are likely to remain reduced for at least one to two years. Sources of revenue and/or staffing levels are also declining for critical partners such as the Santa Cruz Area Chamber of Commerce and the Santa Cruz County Small Business Development Center at Cabrillo College.

In the short term, the City of Santa Cruz’s economic development activities will be focused on assisting businesses to sustain operations and recover from the COVID-19 crisis. The City has already implemented immediate actions to support businesses, including:
 business surveys to identify needs,
 creating a microloan program for immediate gap financing for businesses that are otherwise less able to access state and federal programs,  creating business start-up kits to enable businesses to safely reopen with hard to source supplies and mandated safety protocols, procedures and supporting materials,  creating/expanding forgivable business loan programs with regional partners,  creating and implementing a temporary outdoor expansion program and streamlining of outdoor dining permitting processes,
 sponsoring shop local online programs to help sustain businesses during closure periods, and
 collaborating with UCSC and local tech entrepreneurs to support the creation of the “Get Virtual” program, helping businesses develop website and online e-commerce platforms.

17.51 Santa Cruz Economic Development Strategy (City Council Draft) 44

2. Tourism and Hotels
 Prior to the COVID-19 pandemic, the Santa Cruz tourism and hospitality industry experienced strong growth. In 2018, jobs in the Accommodation and Food Services and Arts, Entertainment, and Recreation industries made up 23 percent of all jobs in Santa Cruz. These industries grew rapidly between 2009 and 2018, and support many other related businesses in retail and other sectors.

 The Santa Cruz tourism and hospitality industry is heavily driven by Bay Area and California residents, as well as Bay Area companies holding events in the City. San Francisco Bay Area residents accounted for nearly 37 percent of Santa Cruz visitors in 2016,3 creating a strong link between Santa Cruz’s tourism industry and the strength of the Bay Area economy.

 Some older hotel properties require updates. The City of Santa Cruz has approximately 1,950 rooms in its stock of hotels, motels, and bed and breakfasts. Some older underperforming hotels create opportunities for future redevelopment as new lodging or other uses.  The COVID-19 pandemic has created significant uncertainty and volatility in tourism and hotel demand, which will likely slow development of additional hotels. Prior to the COVID-19 pandemic, City transient occupancy tax (TOT) revenues were growing, and developers were pursuing new hotel projects. City hotel performance declined significantly during travel and shelter-in-place restrictions, although performance has since improved due to travelers taking road-trip vacations. Despite this improvement, hotel investment is likely to remain limited while uncertainty exists about whether travel restrictions will need to be implemented again.  Santa Cruz has a highly seasonal, leisure-based tourism industry; diversification of the city’s visitor attractions could draw more visitors outside the peak summer season. The Santa Cruz Beach Boardwalk, Municipal Wharf, and a variety of natural recreation opportunities continue to be popular attractions that drive summertime visitation to the City. However, Figure 10 shows the decline in tourism activity during the winter off-season. An opportunity may exist to expand visitor segments in Santa Cruz by marketing other “niche” industries and assets, such as outdoor sports and artisanal foods and crafts, and by drawing business or event travelers.

FIGURE 10: TOTAL ANNUAL TOT REVENUES BY QUARTER, CITY OF SANTA CRUZ, 2016 AND 2018 Note: “BnBs” are bed and breakfasts. Q1: January, February, and March; Q2: April, May, and June; Q3: July, August, and September; Q4: October, November, and December.

Source: City of Santa Cruz, 2019; Strategic Economics, 2020.

33 “Profile of Santa Cruz Area Visitors For 2016”, Lauren Schlau Consulting, 2016. $0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2016 2018
2019 Dollars
Short-term Home Rentals
Hotels, Motels, and BnBs

17.52 Santa Cruz Economic Development Strategy (City Council Draft) 45

3. Small Businesses and Commercial Districts
 Small businesses constitute a high share of businesses in the City of Santa Cruz, with 70 percent of businesses including fewer than 10 employees (Figure 11).  Owners of small businesses reported challenges related to accessing city services. Owners of small businesses interviewed for this study noted confusion about the availability of city services and how to access those services.
 Owners of small businesses also reported challenges related to traffic congestion. Traffic congestion is an additional challenge throughout Santa Cruz County, which makes it more difficult for workers to access jobs and for customers to access small, local businesses.  Transit, pedestrian, and bicycle infrastructure improvements are an opportunity to improve consumer access to businesses and enhance consumer quality of experience. At the regional scale, efforts are underway to improve transit, expand bicycle and pedestrian infrastructure, and reduce traffic congestion. At the local level, Santa Cruz is making gradual improvements to its bicycle and pedestrian networks within and between employment districts. An opportunity exists to improve the pedestrian experience in the Eastside/Midtown area along Soquel Avenue. The area today is marked by high automobile traffic speeds, limited shade, and limited and uncomfortable or dangerous pedestrian crossings.  Parking is a challenge in light industrial districts that increasingly include customer-oriented uses such as breweries and rock-climbing walls, or more intensive employment uses such as additional office/flex space. This is especially true of the Westside Industrial area.

FIGURE 11: SHARE OF FIRMS BY SIZE AND INDUSTRY SECTOR, CITY OF SANTA CRUZ, 2018 Note: The following industry sectors are not displayed in the figure above: Other Services, Ex. Public Admin; Construction; Administrative & Waste Services; Transportation & Warehousing; Wholesale Trade; Finance & Insurance; Real Estate & Rental & Leasing; Information; Utilities; Agriculture, Forestry, Fishing & Hunting; Management of Companies & Enterprises; Unclassified; and Mining.

Source: California Employment Development Department, 2018; Strategic Economics, 2020. 84%
13%
2% 0%
69%
23%
6% 2%
67%
24%
7%
2%
65%
28%
6% 1%
65%
29%
6%
0%
47%
42%
8% 3%
44% 46%
10%
0%

69.8%

24.4%

5.1%

0.8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
1 to 9 10 to 49 50 to 250 250 or more
Share of Total Firms
Number of Employees
Professional & Technical Services Manufacturing
Education Health Care and Social Assistance
Retail Trade Arts, Entertainment, and Recreation
Accommodation and Food Services Total Firms
50 to 249

17.53 Santa Cruz Economic Development Strategy (City Council Draft) 46

4. Retail and Shopping Districts (Downtown, Eastside/
Midtown)
 Matching national trends, the retail sector in Santa Cruz is shifting away from traditional hard and soft goods retailers and towards “experiential” businesses such as dining and drinking establishments (Figure 12). As e-commerce continues to erode brick-and-mortar sales, tenants seeking storefront space will diversify; examples include greater demand from gyms/fitness businesses, restaurants/cafes, entertainment and activities, and retail stores that also include elements of small-scale production (e.g. breweries) or online sales.

 Downtown Santa Cruz may struggle to attract large traditional retail stores as “anchors” that drive foot traffic. Instead, an opportunity exists to attract other generators of foot traffic.

Examples include, gyms and fitness uses, unique art or interactive attractions, civic uses, entertainment and nightlife, and stores or restaurants focused on unique locally-produced goods. Increased office employment and residential development would also increase demand for stores and restaurants.
 Historically high occupancy rates of office space in Downtown suggest a need to encourage additional office development to meet future needs. Demand for office space in Santa Cruz may decline in the near future due to the economic impacts of the COVID-19 pandemic and businesses’ reassessments of their space needs as employees work remotely. However, officebased industry sectors in the City have undergone rapid growth in recent years and vacancy rates were recently at historic lows. Achievable rents are still not high enough for developers to build additional office space in Downtown. However, additional space will be needed to accommodate long-term growth in office demand. This demand is driven partly by employers seeking to locate near Santa Cruz’s concentration of skilled workers drawn to the City’s high quality of life. Adding flexible office or coworking spaces can also help meet some future office demand and accommodate residents working remotely who are seeking local professional space.
 The Eastside/Midtown area—which includes the Water Street and Soquel Avenue subareas— could potentially become a better-known local shopping and dining destination if the area functioned as a more cohesive district. The current street design along Soquel Avenue discourages walking between businesses. Eastside/Midtown businesses also lack a shared voice and capacity for developing and marketing the district as a whole.  Parking-related challenges exist in different areas of the city. Within Downtown, multiple businesses interviewed for this study experienced difficulties in obtaining employee parking or in paying extra costs associated with parking deficiency fees.

17.54 Santa Cruz Economic Development Strategy (City Council Draft) 47 FIGURE 12: SALES TAX REVENUES BY CATEGORY, CITY OF SANTA CRUZ, 2009 TO 2018 Source: City of Santa Cruz, 2019; Strategic Economics 2020. $0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Sales Tax Revenue
General Consumer
Goods
Restaurants & Hotels
Food & Drugs
Autos & Transportation
Business & Industry
Building & Construction
Fuel & Service Stations

17.55 Santa Cruz Economic Development Strategy (City Council Draft) 48

5. Education, Workforce, and Commutes
 Santa Cruz is a major employment destination within the county, though many residents also commute to jobs in the Bay Area. Approximately three-quarters of Santa Cruz’s workforce commutes from outside the City (Figure 13), while more than a quarter of the City’s working residents commute to jobs in the Bay Area (Figure 14). Santa Cruz residents that work in the Bay Area are generally attracted by the Bay Area’s larger number of job opportunities and higher salaries.
 High housing costs are a top concern for workforce attraction and retention. As housing costs and rents increase, Santa Cruz businesses are have having difficulty recruiting and retaining workers at all skill levels and occupations. This is particularly challenging for industries that employ large numbers of workers in lower-wage occupations, such as tourist-driven service industries (hotels, restaurants, and retail).
 A robust network of workforce development organizations, services, initiatives, and small business support services exist in Santa Cruz County. The City of Santa Cruz’s communication and coordination with these organizations is generally strong, although opportunities exist to formalize tracking of coordination outcomes.

FIGURE 13: COMMUTE PATTERNS OF EMPLOYED RESIDENTS AND WORKERS IN THE CITY OF SANTA CRUZ, 2017 Number Share
Workers Employed in the City of Santa Cruz 28,097 100%
Employed and living in the city 7,427 26%
Employed in the city but living elsewhere 20,670 74%
City of Santa Cruz Residents 22,528 100%
Employed and living in Santa Cruz 7,427 33%
Living in Santa Cruz, but working elsewhere 15,101 67%
Source: U.S. Census Bureau, LEHD, 2017; Strategic Economics, 2020.

FIGURE 14: WORK LOCATIONS OF CITY OF SANTA CRUZ RESIDENTS, 2017 Number Share
Santa Cruz County 12,959 58%
Santa Clara County 3,717 16%
Monterey County 875 4%
Alameda County 834 4%
San Mateo County 626 3%
San Francisco County 566 3%
All Other Locations 2,951 13%
Total Santa Cruz Residents 22,528 100%
Source: U.S. Census Bureau, LEHD, 2017; Strategic Economics, 2020.

17.56 Santa Cruz Economic Development Strategy (City Council Draft) 49

6. Specialized Industry Sectors
The following four specialized industry sectors represent unique sets of businesses within the City of Santa Cruz economy. The specialized industries were identified and defined based on the results of employment data analyses, consideration of local economic assets, review of the City’s Economic Development 2017-2019 Strategic Workplan, and interviews with City staff and local businesses.

BIOTECH AND LIFE SCIENCES
 The biotechnology and life sciences industry has a unique presence within Santa Cruz, though the industry represents a small share of jobs in the City overall and constitutes a modest concentration of jobs compared to Santa Clara County (Figure 15). Business owners and other local stakeholders in the industry identified challenges to local growth, including distance from the Bay Area’s biotech hubs in South San Francisco and Emeryville, the lack of nearby venture capital, and a relatively small pool of local talent compared to the Bay Area.  Santa Cruz has many assets to support the biotechnology and life sciences industry, UCSC has a productive relationship in driving investment and growth of local private biotechnology and life sciences businesses. UCSC is known for its biotech and life science research, particularly in the field of genomics. The university has successfully helped launch several local biotech startups and provides a pipeline of industry talent. UCSC is also exploring the potential for oncampus incubator space and is affiliated with a local incubator, Startup Sandbox, which has launched several companies.4

SPORTS AND OUTDOOR RECREATION
 The Outdoor Sports and Recreation industry is highly concentrated in Santa Cruz, and industry employment has grown rapidly since 2009 (Figure 15). Santa Cruz features a unique niche of businesses in this industry, forming a global reputation for surfing, skateboarding, mountain biking, and general outdoor sports and recreation. The businesses in this industry attract consumer spending from throughout the world, and manufacturers attract corporate buyers and high net worth individual buyers to their facilities.  The limited availability of light industrial space is a potential challenge for attracting new and emerging businesses in the sports and recreation industry—as well as other manufacturers requiring light industrial space. Outdoor Sports and Recreation businesses typically require light industrial space in a variety of sizes. Business owners interviewed for this study noted that light industrial space is increasingly hard to find in Santa Cruz, which is indicated by low industrial vacancy rates. The limited availability of light industrial space is a potential challenge for attracting new and emerging businesses in the industry. Because of high construction costs and relatively low rents, industrial buildings are not currently financially feasible to construct.

However, mixed-use projects that incorporate a combination of industrial condos and residential units—such as Delaware Addition—can help to expand Santa Cruz’s industrial inventory, especially if City fees and zoning are designed to reduce barriers to building these projects.

4 https://qb3.soe.ucsc.edu/entrepreneurship-programs/

17.57 Santa Cruz Economic Development Strategy (City Council Draft) 50

TECHNOLOGY AND INNOVATION
 Employment in the Information, Computer Technology, Communications, and Social Media industries in Santa Cruz grew rapidly from 2009 to 2018 (Figure 15). While the City of Santa Cruz includes the county’s largest concentration of these types of jobs, the industry is relatively small compared to neighboring Santa Clara County. However, given that many Santa Cruz residents are employed in this sector and currently commute to jobs in Santa Clara County, opportunities may exist to capture more of this sector’s business and entrepreneurial activity in Santa Cruz.
 Like biotech, the knowledge/innovation industries are less competitive in Santa Cruz compared to other locations in the Bay Area that provide better access to technology workers and venture capital. The large Silicon Valley market has a noticeable influence on Santa Cruz.

The City of Santa Cruz is located just 30 miles from San Jose and a significant number of Santa Cruz residents commute to the Silicon Valley region for work. Additionally, Santa Cruz has attracted Amazon and Google offices and increasing levels of venture capital. 5 However, investors still perceive funding Santa Cruz businesses as risky due to the area’s smaller pool of workers. Funders also often prefer companies to be located nearby within the Silicon Valley region where business leaders can more easily meet in person and access specialized business services.
 Businesses in knowledge/innovation industries require office or flex space. Santa Cruz has a very limited inventory of office space, and occupancy rates are very high for light industrial space. These factors could constrain growth of emerging companies unless the city can provide sufficient office/R&D spaces for them.

ARTISANAL PRODUCTION
 A variety of creative artisanal production companies exist in the City of Santa Cruz, including a notable concentration of specialty food and beverage companies such as coffee roasters, breweries, and wineries.
 Artisanal producers require smaller, flexible industrial spaces that accommodate a combination of production activities, administrative office space, shipping/receiving, and often customer-facing spaces for dining, drinking, or retail sales. As such, artisanal producers create demand for light industrial spaces in Santa Cruz. Artisanal producers could also potentially create a variety of opportunities to fill retail spaces in Santa Cruz, such as storefronts for locally produced goods that also include limited production and shipping activity.

5 https://www.sccvitality.org/Portals/23/pdfs/2018-County-of-Santa-Cruz-Tech-Sector-and-Ecosystem.pdf?ver=2019-12-31-143843- 187

17.58 Santa Cruz Economic Development Strategy (City Council Draft) 51 FIGURE 15: SPECIALIZED INDUSTRIES IN THE CITY OF SANTA CRUZ, 2018 Specialized Industry Group
Number of
Jobs
% Total
Jobs
% Growth
2009-2018
Santa Cruz
County LQ
2-County
Region LQ*
Tourism & Hospitality 2,419 7% 43% 2.0 5.2
Technology & Information 1,428 4% 38% 1.4 0.2
Specialty Food & Beverage Mfg. 894 3% 204% 1.3 4.6
Sports & Outdoor Rec 562 2% 33% 2.0 4.6
Biotech & Life Sciences 558 2% 8% 1.3 0.6
*The two-county region includes Santa Cruz County and Santa Clara County.

Note: A location quotient (LQ) is used to measure the concentration of an industry relative to a larger geography. An LQ of greater than 1.2 indicates a generally high concentration relative to the reference geography, while an LQ of less than 0.8 indicates a relatively low concentration relative to the reference geography.

Source: California Employment Development Department, 2018; Strategic Economics, 2020.

17.59 Santa Cruz Economic Development Strategy (City Council Draft) 52

7. City Services and Processes
 Many Santa Cruz business owners were unsure of how to access City resources. During interviews conducted for this report, business representatives reported not knowing how to access day to day services, especially regarding cleaning and maintenance of public streets and sidewalks. Business owners were especially concerned about accessing services related to addressing the impacts of homelessness on their operations. Additionally, while the “Choose Santa Cruz” website is well-designed and information-rich, business and property owners rarely mentioned the website during interviews for this study.  The City’s approvals, permitting, and development requirements were identified as a major obstacle for stakeholders. Key challenges that business representatives said they faced when interfacing with City services and processes included the following:
o Lengthy and unpredictable project approvals, which add costs for businesses o Inadequate communications from City staff
o Inconsistency in determinations made by inspectors and planning staff o Stringent and costly requirements
o Opportunities for extensive interventions by neighbors o Inadequate zoning code definitions
o Lack of assistance from City staff to take project sponsors through the process  Businesses are facing challenges in the City’s permitting process for a wide range of projects.

Specific types of projects noted by business operators included the following:
o Tenant improvements
o Parking modifications
o Signage
o Temporary structures
o Outdoor seating and lighting
During the COVID-19 crisis, the City has streamlined permitting across project types—including parking modifications, signage, temporary structures, and outdoor seating and dining—to quickly respond as businesses adapt to changing regulations and consumer preferences. As the City moves forward from the COVID-19 crisis, it has expressed its commitment to making permanent improvements to its permitting processes.
 Upcoming sustainability projects initiated by other City departments may present creating opportunities for interdepartmental coordination and business outreach. Notable projects include the Climate Action Plan, implementation of “reach” building codes that exceed state requirements, and potential changes to the Green Business Program.

17.60 DOWNTOWN SANTA CRUZ

COMMERCIAL VACANCY

ANALYSIS REPORT
Prepared by:

City of Santa Cruz
Economic Development and Housing Department
M A Y 2 0 2 4

17.61 OVERVIEW
In response to a directive from City Council, this
report examines the landscape of commercial
vacancies within Downtown Santa Cruz.

This report aims to:

Detail challenges and opportunities for both
property owners and prospective tenants
Understand underlying factors contributing
to long-term vacancies
Discuss approaches to further expand the
City’s strategic interventions to activate these
spaces.

17.62 RESEARCH AND OUTREACH

03. 1547 Pacific Ave,
Nanda Apartments

04. 1207 Pacific Ave.

Joe’s Pizza & Subs

01. 1117 Pacific Avenue (Logos)
Logos Bookstore

02. 1365 Pacific Ave
Our research focused on 4
ground-floor retail s ites in
Downtown Santa Cruz that
have been vacant for at least
4 years and remain vacant
today.

Data was collected through
stakeholder interviews and by
informat ion available through
City records and online
commercial real estate
platforms .

E. C. Rittenhouse Building

17.63 Vacancy rates are currently low in Downtown and
re-leasing of recently vacated spaces is healthy.
$2.33

PER SQUARE FT

DOWNTOWN SANTA CRUZ

RETAIL MARKET

DOWNTOWN
$2.36

PER SQUARE FT

LONG-TERM VACANCIES
AVERAGE ASKING RENT Q2 2024

AVERAGE SIZE

OF LONG-TERM

VACANCIES
9,058

SQUARE FT

DOWNTOWN

VACANCY RATE

5.2%
AS OF Q2 2024
SOURCE: COSTAR

17.64 SUMMARY OF

FACTORS

CONTRIBUTING

TO LONG-TERM
VACANCIES:

Our research uncovered a
range of factors contribut ing
to long-term vacancies in
Downtown Santa Cruz.

These factors are complex
and interrelated, impact ing
the overall economic health
and vibrancy of our
downtown core.

D o w n t o w n Z o ni n g, P e rmi t t i n g
a n d U s e C o n si d e r a t i o n s
01 02
03 04
05 Hi g h R e al E s t a t e C o s t s
P u bli c S a f e t y P e r c e p t i o n s
C o n di t i o n s o f A v ail a bl e S p a c e s
- Si z e / B uil d O u t /I n f r a s t r u c t u r e
C om p e t i t i o n wi t h E - C omm e r c e

17.65 KEY FINDINGS
After conduct ing research and stakeholder
interviews , it was found that vacancies in
Downtown are not due to a s ingle underlying
cause, but are a combinat ion of s ite-specific
and district-level factors , and will likely
require a broad set of strategies as opposed
to a s ingle policy or program.

Challenges expressed by stakeholders can be
categorized into 5 main themes :
01 02
04 Vacancies range
from 4 to 15 years
High rent, tenant
improvement (TI)
costs , and permitting
timelines can be
obstacles for
potential tenants .
03 Large, open floor
plans and awkward
layouts pose
challenges for some
spaces

VACANCY

DURATIONS

LEASING
DESIGN

LIMITATIONS
05 Current zoning regulations might limit the
flexibility and timing for approval some
bus inesses need to operate in today's retail
environment.

ZONING IMPACTS

CHALLENGES
SAFETY

PERCEPTIONS
Public safety
perceptions and
vis ible loitering
discourage tenants

17.66 RECOMMENDATIONS
Building upon the outcome of these practices, here are specific recommendations and current actions tailored to address local challenges in our Downtown commercial district

17.67 1. FLEXIBLE LEASING

OPTIONS/POP-UP

SHOP PROGRAM

DEVELOPMENT
Encourage property owners to consider participation in the Downtown Pops! Program or offer flexible lease terms on their own, including shorter lease durations or pop-up
opportunities.

The Downtown Pops! Program was designed to lower the
barriers to entry for businesses looking to open a brickand-mortar space and intended to reduce the risk for property owners to take on new tenants.

Staff is exploring expansion of this Program to potentially fund or offset tenant improvements needs to create micro retail opportunities in large retail spaces that have long term vacancies.

17.68 2. COLLABORATIVE

DESIGN SOLUTIONS
Partner with property owners to identify
opportunities to address design limitations
within vacant spaces.

The Economic Development and Housing
Business Services team currently works with
business owners to discuss and track
permitting, communicate timelines and
coordinate with other departments to
provide process transparency and make vital
connections as government liaisons. .

Pursue development of a Design Assistance
Pilot Program to provide direct assistance to
prospective small business tenants in
evaluating a potential retail space.

17.69 3. STOREFRONT

BEAUTIFICATION &

MAINTAINENCE

INITIATIVES
Prioritize initiatives that enhance the overall
cleanliness and visual appeal of downtown
Santa Cruz.

The Storefront Beautification Grant program
provides financial assistance to property
owners for façade improvements,
contributing to a more inviting and wellmaintained environment Develop a set of pre-approved window
coverings can be installed by property
owners when a storefront is vacant more
than 30 days.

Staff is researching efficacy, administration
workload and ordinance modifications to
implement a “vacancy fee” or “vacancy
registry” program.

17.70 4. LOCAL BUSINESS

SUPPORT PROGRAMS
Continue to implement programs that provide
targeted support to local businesses. Examples
include mentorship programs, access to
microloans or grants, and marketing assistance.

The Business Services team coordinates
ongoing business assistance programs
through community partnerships.

Examples include:

Business mentorship through the Santa
Cruz Small Business Development Center
Digital Marketing through the GetVirtual
Program
Flexible Lending through the Grow Santa
Cruz Loan program

17.71 4. USE PERMIT

FLEXIBILITY
Allow for creative use of space and reduced
permitting approvals to reduce time to occupancy
for vacant storefronts.

Exploring ways to permanently extend the use
extension resolution, significantly streamlining
the approval process for similar businesses
occupying vacant spaces.

Consider further modifications to the
Downtown Plan to modernize use definitions to
activate large retail spaces more easily.

Progress has already been made to reduce the
review requirements for low-risk alcohol
establishments to a staff level review use
permits.

17.72 DOWNTOWN SANTA CRUZ

COMMERCIAL VACANCY

ANALYSIS REPORT
More information about available spaces available at:
www.ChooseSantaCruz.com/resources/space-available

17.73 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: Economic Development and Housing
SUBJECT: River Street Shelter Site License Agreement, 115-C Coral Street (EDH) RECOMMENDATION: Motion to approve and authorize the City Manager to execute the License Agreement with Housing Matters in a form approved by the City Attorney for the River Street Shelter site at 115-C Coral Street.

BACKGROUND: Under the City/County River Street Shelter Joint Operational Plan of 1986, the City acquired the River Street Shelter site from University of California Santa Cruz (UCSC) and the County agreed to provide for operation of a 5:00pm-8:00am shelter facility with 30-35 shelter beds, related services and a 30 day maximum stay with exceptions. In 1989, Community Foundation Santa Cruz (CFSC), the asset management non-profit support organization of Santa Cruz County Counseling Center, now known as Encompass, entered into a lease for operation of the River Street Shelter. The River Street Shelter, providing specialty mental health services, was operated by Encompass under contract with the County until May 2021.

The tenant was responsible for maintenance plans, keeping the premises in good order and the majority of maintenance and repairs in exchange for free/under market rent. The City was responsible for structural elements (building foundation, roof, sewer).

After the lease termination in 2021, Housing Matters and the City explored options for repurposing the River Street Shelter facility. Initial indications from Housing Matters were that they would need to install new flooring throughout, remodel the bathrooms, and make accessibility upgrades such as ramps and improvements to exterior access ways. Although the shelter had approximately 32 beds, there were rooms with multiple bunk beds, as well as hallway areas with multiple bunk beds. The shelter had been operating at a significantly reduced capacity due to COVID-19 pandemic.

It was thought that the long-term use of the site would be better suited to a more intensive use with multiple stories and a more efficient layout that could serve more clients than the existing structure. During the City Public Works Hwy 1/9 Intersection Improvement Project, the decision was made to abandon the utilities for that site since their condition was poor. The buildings were later demolished and the site was recently paved to prepare for interim usage.

DISCUSSION: Housing Matters has a long-term lease for the remainder of the Coral Street Campus, 115 Coral Street, A and B. In addition, Housing Matters owns the adjoining property known as 119 Coral Street, the future site of the Harvey West Studios. Housing Matters is

18.1 preparing to move into construction phase of that project and has requested to use the River Street Shelter site for relocation of 24 pallet shelters and for construction staging. The Harvey West Studios construction is anticipated to take up to three years.

Housing Matters has applied to the Planning and Community Development Department for a Minor Modification to the Land Use CP24-0090. When that application is approved, it will serve as the allowable use as defined in the License Agreement. The License Agreement prepared by the City Attorney is attached.

The River Street Shelter site was identified as an opportunity space in the Coral Street Visioning report. While there are no immediate plans for the City to redevelop that site, the three-year License Agreement will provide time to plan for future usage and/or negotiating the potential sale of the property.

HEALTH IN ALL POLICIES (HIAP): Licensing the River Street Shelter site to Housing Matters will provide space for 24 pallet shelters that must be relocated. The on-going use of the pallet shelters improves the public health by not reducing the facilities available for interim housing. Collaborating with Housing Matters by offering a $1/year license fee supports the nonprofit development of Harvey West Studios, permanent supportive care housing and an on-site recuperative care center for the most vulnerable members of our community.

FISCAL IMPACT: The City has not received revenue from the River Street Shelter site since the lease termination in 2021. The License Agreement requires a $1/year license fee which will go to the General Fund (101).

Prepared By:

Kathryn Mintz
Development Manager
Submitted By:

Bonnie Lipscomb
Director of Economic
Development and Housing
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. HOUSING MATTERS LICENSE AGREEMENT.PDF

18.2 License Agreement 1

LICENSE AGREEMENT

BETWEEN

CITY OF SANTA CRUZ AND HOUSING MATTERS
THIS LICENSE AGREEMENT (“License Agreement”) is made and entered into this _____day of __________, 2024 (“Effective Date”) by and between the City of Santa Cruz, a municipal corporation (“City” or “Licensor”) and Housing Matters, a California nonprofit corporation (“Housing Matters” or “Licensee”). Licensor and Licensee may also be identified individually as “Party” or collectively as the “Parties.” I. RECITALS
A. City owns the paved area, formerly the site of the River Street Shelter, located at 115C Coral Street, Santa Cruz, California, 95060 (the “Area”), depicted further in Exhibit A.

B. Licensee has requested a license to use the Area to relocate up to twenty-four (24) pallet shelters from the Housing Matter campus and for use as a construction staging area for the Harvey West Studios construction project at 119 Coral Street (the “Project”).

C. City agrees to grant Licensee the requested license to access City property and use the Area for the Project, subject to the terms and conditions contained in this License Agreement.

NOW, THEREFORE, incorporating the above-stated Recitals, in consideration of the conditions herein contained, and for other good and valuable consideration, the City and Licensee agree as follows:

II. AGREEMENT

1. LICENSE AREA.
a. City grants to Licensee an exclusive license (“License”) for the use of the Area, located on an estimated 15,322 square feet on APN 008-171-33 of City’s property described and as shown in the attached Exhibit A (the “License Area”), incorporated herein.
b. The License is for the sole purpose of relocating, storing, and utilizing up to 24 existing pallet shelters on the Area, as well as using the Area for construction staging purposes for the Harvey West Studios construction project at 119 Coral Street (collectively, the “Permitted Use”).
c. Licensee does not hold any ownership or vested property interest in the License Area by virtue of this License. This License Agreement is not a lease but merely entitles Licensee to use the License Area as provided herein.

2. TERM. This License shall commence on ________________, 2024 or upon the approval of Minor Modification CP24-0090, whichever occurs later (“Commencement”), and shall

18.3 License Agreement 2
expire on the first anniversary of the Commencement (“License Term”). At City’s sole discretion and provided that Licensee is in full compliance with the terms of this License, this License Agreement may be renewed on an annual basis for a maximum of two (2) times for a total term of three (3) years, upon Licensee providing written notice to the City requesting to exercise the option to extend the License term not less than ninety (90) days prior to the termination of the License Term.

3. TERMINATION. Either Party may terminate this Agreement by providing written notification to the other Party, at least 90 days in advance of the effective date of termination. Upon termination of this Agreement, unless otherwise instructed by Licensor, Licensee shall remove any fixtures or improvements in the License Area at Licensee’s sole expense and return the License Area to the condition it was in immediately prior to Licensee’s use, excepting normal wear and tear.

4. USE. City and Licensee agree that the purpose of this License is for exclusive use of the License Area, twenty-four hours a day, seven days a week for the Permitted Use. “Exclusive” shall be construed for License Area management purposes as granting to Licensee the right to restrict access to the License Area during the hours of operation.

Licensee must apply to City in writing and receive approval for any change or modification in Permitted Use scope.

5. CONDITION OF LICENSE AREA AS-IS. Licensee acknowledges the uniqueness of the License Area and accepts the current “AS-IS, IN ITS CURRENT CONDITION, WITH ALL FAULTS” condition existing on the date of execution of this License Agreement. Licensee acknowledges Licensee has satisfied itself, by its own independent investigation, that the License Area is suitable for Licensee’s intended use and neither City nor its agents or representatives have made any representation or warranty as to the present or future suitability of the License Area for the Permitted Use by Licensee, including, without limitation, any representations or warranties regarding, (a) the condition or repair of the License Area, (b) whether the License Area complies with Applicable Laws (as defined below), including without limitation the Americans with Disabilities Act (ADA) or other accessibility laws, (c) whether there are any facts or conditions affecting the License Area that might, individually or in the aggregate, interfere with the use or occupancy of the License Area or any portion thereof by Licensee.

Licensee shall comply with all applicable statutes, laws, ordinances and rules and regulations adopted by the Federal, State or any City, City and County, County or other body politic, including without limitation all applicable health and building codes, rules, and protocols, the ADA or other accessibility laws (“Applicable Laws”) and which pertains to use of the License Area or any provisions of the License Agreement, and will indemnify, defend and hold City, its officials, officers, agents, and employees harmless from and against any violations thereof and any and all liabilities, suits, causes of action, judgments, demands and claims for damages, including all reasonable costs of any litigation and attorney’s fees and expenses, arising out or by reason of any such violation.

18.4 License Agreement 3

6. LICENSEE OBLIGATIONS. Licensee agrees as follows:
a. To maintain and keep the License Area and its contents in a good, clean, safe, and sanitary condition during the Licensee’s use as set forth herein. b. To comply with all applicable Federal, State, and local laws, while utilizing the License Area, including regulations, protocols, and guidelines in the interest of public health, safety, and welfare, including but not limited to those required in response to the COVID-19 pandemic.
c. To not intentionally or negligently destroy, deface, damage, impair or remove any part of the License Area.
d. To be responsible for setting up and dismantling all equipment and supplies associated with the use of the License Area.
e. To provide the City for approval, a security plan to manage entry into the License Area and to ensure only those activities consistent with this License Agreement are permitted.

7. CITY OBLIGATIONS. City agrees as follows:
a. To provide access to the License Area throughout the duration of the License Term.

8. FEES.
a. License Fee. Licensee agrees to pay a License Fee in the amount of one ($1) dollar per year for use of Area for the Permitted Use. License Fees and billing procedures may be adjusted by City in the future upon 30 days’ written notice. b. Billing. City will issue an annual invoice to Licensee with payment due within thirty (30) calendar days.

9. LATE CHARGES AND INTEREST ON UNPAID LICENSE FEES. If any fees are not received by City when due, Licensee shall pay to City an additional sum of ten percent (10%) of the overdue License Fee as a late charge, as well as interest at the rate of one-and one-half percent (1 1/2 %) per month, or the maximum rate of interest allowed by law, on the unpaid balance of said rent or sum until paid. The parties agree that said late charges and interest represent a fair and reasonable estimate of the costs that City will incur by reason of late payment by Licensee. The acceptance by City of any late charge shall not constitute a waiver of Licensee's default with respect to the overdue amount, nor prevent City from exercising any of the other rights and remedies available to City under this License Agreement or as provided by law.

10. ALTERATIONS. Any alterations, improvements, additions or utility installations in, on, or about the Licensed Area that Licensee shall desire to make will require the written consent of Licensor. Such proposed alterations, improvements, additions or utility installations shall be presented to the Licensor in written form, with proposed detailed plans. If Licensor shall give its consent, the consent shall be deemed conditioned upon Licensee acquiring a permit or other approvals to do so from appropriate governmental agencies, if applicable, the furnishing of a copy thereof to Licensor prior to the commencement of the work, and the compliance by Licensee of all conditions of said permit or other approvals in a prompt and expeditious manner.

18.5 License Agreement 4

11. HAZARDOUS OR TOXIC MATERIALS. Licensee shall comply, at Licensee’s sole expense, with all federal, state, and local statutes or regulations concerning environmental conditions, emissions, pollutants, and controls. Licensee shall not cause, store, use or permit any Hazardous Material (defined to include, but not limited to: (i) any material, substance or waste which is or hereafter shall be listed, regulated or defined by state or federal laws to be hazardous, acutely hazardous, extremely hazardous, radioactive toxic, or dangerous; (ii) asbestos or asbestos-containing materials; (iii) polychlorinated biphenyls (PCBs); (iv) radon gas; (v) laboratory wastes; (vi) experimental products, including genetically engineered microbes; (vii) petroleum, natural gas, or other petroleum product; and (viii) medical waste) to be brought upon, kept or used in or about the License Area by Licensee, its agents, employees, contractors or invites, without the prior written consent of Licensor, which Licensor shall not unreasonably withhold as long as Licensee demonstrates to Licensor’s reasonable satisfaction that such Hazardous Material is necessary or useful to Licensee’s use of the License Area, does not violate any requirements of the Licensor’s policies of fire, causality or public liability insurance and will be used, kept and stored in a manner that complies with all laws regulating any such Hazardous Material so brought upon or used or kept in or about the License Area.

If Licensee breaches any of its obligation stated herein, or if the presence of Hazardous Material on the License Area caused or permitted by Licensee results in contamination of the License Area, then Licensee shall indemnify, defend and hold Licensor harmless from any and all claims, judgment, damages, penalties, fines, costs, liabilities or losses, including, without limitation, diminution in value of the License Area, damages for the loss or restriction on use or marketing of rentable or usable space of the License Area, and sums paid in settlement of claims, attorneys' fees, consultant fees and expert fees which arise during or after the License term as a result of such contamination. Without limiting the foregoing, if the presence of any Hazardous Material on the License Area caused or permitted by Licensee results in any contamination of the License Area, Licensee shall promptly take all actions at its sole expense as are necessary to return the License Area to the condition existing prior to the introduction of any such Hazardous Material to the License Area; provided that Licensor’s approval of such actions shall first be obtained, which approval shall not be unreasonably withheld so long as such actions would not potentially have any material adverse long-term or short-term effect on the License Area.

12. INDEMNIFICATION/WAIVER OF LIABILITY.
a. Licensee agrees, to the fullest extent permitted by law, to indemnify, defend, and hold harmless the City, its officials, officers, employees, agents, and volunteers (collectively, “Indemnitees”) from and against any and all liability, claim, action, loss, injury, damage, judgment, or expense, including attorneys’ fees and costs (“Losses”) which arise from or are connected with the entry on, occupancy, or use of the License Area under this License Agreement by Licensee, its officials, officers, employees, agents, or invitees. Licensee’s duty to indemnify and hold harmless Indemnitees shall not apply to the extent such Losses are caused by the sole or active negligence or willful misconduct of Indemnitees. Licensee’s obligation to defend

18.6 License Agreement 5
shall arise regardless of any claim or assertion that Indemnitees caused or contributed to the Losses. This Section 12 shall survive the expiration or early termination of this License Agreement.
b. Licensee agrees to require any subcontractor engaged by the Licensee for any Permitted Use in the License Area to waive and hold harmless the City, its officials, employees, and agents for any Claims relating to subcontractor’s use of the License Area. Licensee agrees to provide the City with a copy of the signed agreement between Licensee and its subcontractor(s) to verify compliance with this obligation.

13. INSURANCE.
a. Prior to the beginning of and throughout the duration of the License Agreement, Licensee will maintain and comply with the Insurance Requirements as set forth in Exhibit B. Licensee will insure the City against claims for injuries to persons or damages to property which may arise from or in connection with this License Agreement. The insurance coverages required shall not in any way limit the liability of the Licensee. The coverage requirements may be satisfied by self-insurance or pooled risk plans that provide comparable coverage.
b. Licensee agrees to require any subcontractor engaged by the Licensee in the performance any Permitted Use in the Area to comply with the City’s Insurance Requirements, including but not limited to, the subcontractor’s commercial general liability insurance policy naming the City, its officials, officers, employees, and agents as additional insureds. Licensee must provide the required certificate of insurance and endorsements by its subcontractor(s) to the City prior to commencement of any use of the License Area related to this License Agreement. c. Licensee agrees that if Licensee does not maintain any insurance policy required under this License Agreement or fails to pay any premiums when due, City may, at its election, either terminate this License Agreement, require that the Premises be immediately closed for business pending reinstatement of insurance by Licensee, or obtain the necessary insurance and pay the premium, and the repayment thereof shall be deemed to be additional rent due by the Licensee and payable on the next date upon which a payment of rent is due.

City has the right at any time to demand a copy of a Certificate of Insurance from Licensee for the policies of insurance required herein and any other reasonable evidence proving compliance with these provisions. The failure to provide the City with such evidence within five (5) calendar days of such demand shall constitute a material breach of this License Agreement.

If Licensee is unable to obtain any policy of insurance required by City under this License Agreement, then City, at its sole discretion, and subject to the availability of coverage, may purchase such policy of insurance and Licensee shall reimburse City for Licensee's pro rata share of the cost of such insurance. In determining Licensee's pro rata share of the premiums for any such insurance specified herein, the schedule

18.7 License Agreement 6
issued by the organization making the insurance rate on the improvements, areas and/or risks covered, showing the various components of such rates, shall be conclusive evidence of the charges which make up the insurance rate and the pro rata share to be charged to the Premises. If such a schedule cannot be obtained, then Licensee's pro rata share shall be based upon the ratio that the gross floor area of the Premises bears to the total gross leasable floor area of the building or buildings for which said insurance policy relates. City may estimate the cost of insurance and collect and impound Licensee's share of these costs upon written notice to Licensee.

Licensee’s failure to repay at that time any amount expended by City shall be considered the same as a failure to pay rent and a default by Licensee under this License Agreement.
d. If Licensee cannot obtain its own insurance policies for fire and extended coverage and City, at its sole discretion, exercises its option to purchase such insurance to cover the Premises, Licensee understands the City's current insurance policy for fire and extended coverage has a deductible. In the event of damage or loss to the Premises, the Licensee will be responsible for payment of the deductible costs for said fire and extended coverage, assuming that City elects to include the Premises under City's insurance policy and if City’s policy is being applied toward the damage or loss to the Premises.

14. REPAIR AND RESTORATION. If Licensee, its agents or contractors cause any damage to the License Area, or to Licensor’s roads, infrastructure or other property and improvements in connection with the exercise of this License, Licensee shall repair and restore the damaged property to its original condition prior to Licensee's use pursuant to this License Agreement. Licensee shall perform the repair and restoration required hereunder prior to the expiration of this License, or within ten (10) days of the earlier termination of Licensee’s rights hereunder. In the event that repair and restoration is performed following the termination this License, Licensee’s Indemnity and Insurance obligations in this License Agreement shall continue until repair and restoration is completed as provided herein. Licensor shall have the right (but not the obligation) to make such repairs or replacements which are Licensee’s responsibility under this License Agreement without liability to Licensee for any loss or damage that may occur to Licensee’s business, and Licensee shall pay for all costs and expenses incurred by Licensor in making such repairs and/or replacements, plus an administrative overhead fee of ten percent (10%) from the date of commencement of the work through the date of payment.

15. FORCE MAJEURE. Neither party hereto shall be considered in default in the performance of its obligation hereunder to the extent that the performance of its obligation hereunder is prevented or delayed due to an act of God, natural disaster, pandemic, acts of terrorism, war, a strike, lockout or other labor difficulty, or other peril, which is beyond the reasonable control of the affected party and not caused by the fault or negligence of the party obligated to perform under this License Agreement. If the License Area is damaged in part or as a whole during the license term thus necessitating repairs or otherwise restricting the use of the License Area by Licensee, City may in its sole

18.8 License Agreement 7
discretion reduce or excuse payment of any applicable fees up to the period that the use of the License Area is restricted solely due to the above stated causes.

16. INSPECTION. City, and City’s agents and employees shall have the right to enter the License Area at any time to inspect the same, to see that Licensee is performing its obligations under this License Agreement, that no damage has been or is done to the License Area, and to protect any and all rights of City, and to post such reasonable notices as City may desire as to protect the rights of the City.

17. CITY AUTHORITY. The City shall at all times retain exclusive final authority over the use of the License Area and the use of the adjacent public right-of-way, including the use of fixtures thereon. The City shall have the right to promulgate and enforce any and all ordinances, rules and regulations, and to take action authorized by its police power, as the City, in its sole discretion, deems necessary to advance the public’s health, safety and welfare.

18. RIGHT TO ENTRY FOR ALTERATIONS AND REPAIRS. It is agreed that the City has reserved and shall at all times have the right to alter, repair, and improve the nonexclusive areas which may affect the License Area. Licensee also waives any claims for damages against City by reason of City’s entry into or onto License Area for the purpose of making repairs to the License Area or to any other area. City agrees to give Licensee reasonable notice of intention to make repairs, except in situations involving immediate peril and hazard to the public, when such entry shall be made summarily by City. City shall be the sole and exclusive judge as to what constitutes immediate peril and hazard to the public.

19. ASSIGNMENT PROHIBITED. Licensee shall not, either voluntarily or involuntarily, assign or encumber its interests in this License Agreement or allow any other person or entity (except Licensee's authorized representatives) to operate under the terms of this License Agreement without the prior written approval and consent of the City. Any such assignment without prior written approval of the City shall be null and void.

20. ATTORNEY’S FEES. In the event of any legal action, arbitration or judicial proceeding between the parties, the prevailing party shall be entitled to reasonable attorneys’ fees and expenses.

21. WAIVERS. Any subsequent acceptance of License Fees hereunder by City shall not be deemed a waiver of any preceding breach of any obligation hereunder by Licensee other than the failure to pay the particular License Fees so accepted; and the waiver of any breach of any covenant or condition by City herein shall not constitute a waiver of any other breach regardless of knowledge thereof. Any waiver by City of any breach must be in writing.

22. RIGHTS AND OPTIONS. Licensee’s failure to exercise any right, option, or privilege hereunder shall not thereafter preclude City from exercising any right, option, or privilege hereunder, and shall not be deemed a waiver of said right, option, or privilege. Nor shall

18.9 License Agreement 8
such a failure relieve Licensee from Licensee’s obligation to perform each and every covenant and condition on the Licensee’s part to be performed hereunder or relieve it from liability for damages or any other remedy for Licensee’s failure to perform or meet the obligations of this License.

23. CITY OF SANTA CRUZ AS LICENSOR. Licensee acknowledges and understands that the City as Licensor is a municipality consisting of numerous offices, departments, agencies, and districts. Whenever a provision contained in this License Agreement or any extension, modification, or amendment requires the "written consent" of the City, such consent must be obtained from the then City Manager or Director of Economic Development for the City of Santa Cruz, or their respective designee. Licensee may not rely on any statement or representation by any other employee, agent, or representative of City in obtaining such consent, and any such statement or representation other than the express written consent of the City Manager or Director of Economic Development, or their respective designee, shall be null and void and have no effect. Nothing contained in this Section shall limit in any way the authority of any office, department, agency, or district of the City or County of Santa Cruz, California from approving or withholding consent to any event or activity regulated by local law.

24. MISCELLANEOUS.
a. This License Agreement, along with any attachments, is the full and complete integration of the Parties’ agreement with respect to the matters addressed herein, and this License Agreement supersedes any previous written or oral agreements between the Parties with respect to the matters addressed herein. b. The covenants and agreements contained in this License Agreement shall be binding upon the Licensor and Licensee, and upon their respective heirs, executors, and successors.
c. This License Agreement shall be construed and interpreted in accordance with the laws of the State of California.
d. The unenforceability, invalidity, or illegality of any provision(s) of this License Agreement shall not render the other provisions unenforceable, invalid, or illegal. e. This License Agreement may only be amended in writing as agreed to by both Parties.
f. Each party acknowledges that it has reviewed this License Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this License Agreement.
g. The Parties may execute this License Agreement in two or more counterparts, which shall, in the aggregate, be deemed an original but all of which, together, shall

18.10 License Agreement 9
constitute one and the same instrument. Electronic signatures and fully executed copies of this License Agreement are deemed valid as originals. h. The signatories to this License Agreement warrant and represent that each is authorized to execute this License Agreement and that their respective signatures serve to legally obligate their respective representatives, agents, successors and assigns to comply with the provisions of this License Agreement.

25. NOTICES. If either party shall desire or is required to give notice to the other such notice shall be given in writing, via email and concurrently delivered by: (a) personal delivery, in which case notice is effective upon delivery; (b) overnight courier (i.e., Federal Express) with charges prepaid or charged to the sender’s account, in which case notice is effective when delivered; (c) priority U.S. Mail, in which case notice shall be deemed delivered on the fifth business day after the deposit thereof with the U.S. Postal Service. Notices shall be addressed to recipient as follows:

To CITY:

City of Santa Cruz
Attn: Bonnie Lipscomb
337 Locust Street
Santa Cruz, CA 95060
[email protected]
To LICENSEE:

Housing Matters
Attn: Phil Kramer
115B Coral Street
Santa Cruz, CA 95060
[email protected]
Changes to the above information shall be given to the other party in writing ten (10) business days before the change is effective.

IN WITNESS WHEREOF, the parties hereto have executed this License Agreement the day and year first herein written.
[SIGNATURES ON FOLLOWING PAGE]

18.11 License Agreement 10
LICENSOR:

By____________________________
Matt Huffaker
City Manager
Date__________________________

APPROVED AS TO FORM
________________________________
Office of the City Attorney
Date__________________________
LICENSEE:

By____________________________
Phil Kramer
Chief Executive Officer
Date__________________________
By____________________________
________________
Date__________________________
June 6, 2024

18.12 License Agreement 11
Exhibit “A”

LICENSE AREA
Exhibit from Minor Modification Application CP24-0090

18.13 Drawing Title
Sheet No.

Project No.Date
Set Title
San Francisco, CA 94107
dbarchitect.com
David Baker Architects
461 Second St, Loft c127
Date
Issuances
Description
415.896.6700
License Stamp
Date
Revisions
Rev. Description
21709

C G /CIVIL
Engineers/PlannersScotts Valley, CA 950664444 Scotts Valley Drive / Suite 6831.438.4420 2 CONSULTANTS GROUP, INC.

HARVEY WEST

STUDIOS

SANTA CRUZ

SUPPORTIVE

HOUSING
1 FACTORY BUILT REV1 2/18/22
2 SCBSD REV1 2/18/22
3 10/10/22
4 SCBSD REV2 10/10/22
FACTORY BUILT REV2
100% SD 05/24/2021
50% DD 07/14/2021
100% DD 09/08/2021
50% CD 11/10/2021
PERMIT SET 12/17/2021PERMIT SET REV. 1 02/18/2022
INTERIM PRICING SET 05/10/2022
PERMIT SET REV.2 10/10/2022BID PRICING SET 11/21/2022

BID PRICING SET
11/8/2022 11:59:35 AM

SILT FENCE

EROSION CONTROL MEASURES

1. EROSION CONTROL MEASURES FOR WIND, WATER, MATERIAL STOCKPILES, AND TRACKING SHALL BE IMPLEMENTED ON ALL

PROJECTS AT ALL TIMES AND SHALL INCLUDE SOURCE CONTROL, INCLUDING PROTECTION OF STOCKPILES, PROTECTION OF SLOPES, PROTECTION OF ALL DISTURBED AREAS, PROTECTION OF ACCESSES, AND PERIMETER CONTAINMENT MEASURES.

EROSION CONTROL SHALL BE PLACED PRIOR TO THE COMMENCEMENT OF GRADING AND SITE DISTURBANCE ACTIVITIESUNLESS THE PUBLIC WORKS DEPARTMENT DETERMINES TEMPORARY MEASURES TO BE UNNECESSARY BASED UPONLOCATION, SITE CHARACTERISTICS OR TIME OF YEAR. THE INTENT OF EROSION CONTROL MEASURES SHALL BE TO KEEP ALL GENERATED SEDIMENTS FROM ENTERING A SWALE, DRAINAGE WAY, WATERCOURSE, ATMOSPHERE, OR MIGRATE ONTOADJACENT PROPERTIES OR ONTO THE PUBLIC RIGHT-OF-WAY.

2. SITE INSPECTIONS AND APPROPRIATE MAINTENANCE OF ALL EROSION CONTROL MEASURES/DEVICES SHALL BE CONDUCTED AND DOCUMENTED AT ALL TIMES DURING CONSTRUCTION AND ESPECIALLY PRIOR TO, DURING, AND AFTER RAIN EVENTS.

3. THE DEVELOPER SHALL BE RESPONSIBLE FOR THE PLACEMENT AND MAINTENANCE OF ALL EROSION CONTROL

MEASURES/DEVICES AS SPECIFIED BY THE APPROVED PLAN UNTIL SUCH TIME THAT THE PROJECT IS ACCEPTED AS COMPLETE BY THE PUBLIC WORKS DEPARTMENT OR UNTIL RELEASED FROM THE CONDITIONS OF APPROVAL OF THEIRGENERAL PERMIT. EROSION CONTROL MEASURES/DEVICES MAY BE RELOCATED, DELETED OR ADDITIONAL MEASURES/DEVICES MAY BE REQUIRED DEPENDING ON THE ACTUAL CONDITIONS ENCOUNTERED DURING CONSTRUCTION.

ADDITIONAL EROSION CONTROL MEASURES/DEVICES SHALL BE PLACED AT THE DISCRETION OF THE ENGINEER OF WORK, CITY INSPECTOR, SWPPP MONITOR, OR RWQCB INSPECTOR. GUIDELINES FOR DETERMINING APPROPRIATE EROSIONCONTROL DEVICES SHALL BE INCLUDED IN THE PLANS WITH ADDITIONAL MEASURES/DEVICES NOTED FROM THE APPENDIXOF THE PUBLIC IMPROVEMENT STANDARDS.

4. EROSION CONTROL DEVICES SHALL BE THE FIRST ORDER OF WORK AND SHALL BE IN PLACE AT ALL TIMES DURING CONSTRUCTION. ADDITIONAL MEASURES/DEVICES SHALL BE AVAILABLE DURING THE RAINY SEASON (BETWEEN OCTOBER 15 AND APRIL 15) OR ANYTIME WHEN THE RAIN PROBABILITY EXCEEDS 30%. THESE MEASURES/DEVICES SHALL BE AVAILABLE, INSTALLED, AND/OR APPLIED AFTER EACH AREA IS GRADED AND NO LATER THAN FIVE (5) WORKING DAYS AFTER COMPLETION OF EACH AREA.

5. THE CONTRACTOR, DEVELOPER, AND ENGINEER OF WORK SHALL BE RESPONSIBLE TO REVIEW THE PROJECT SITE PRIOR TO OCTOBER 15 (RAINY SEASON) AND TO COORDINATE AN IMPLEMENTATION PLAN FOR WET WEATHER EROSION CONTROL DEVICES. A LOCALLY BASED STANDBY CREW FOR EMERGENCY WORK SHALL BE AVAILABLE AT ALL TIMES DURING THE RAINY SEASON (OCTOBER 15 THROUGH APRIL 15). NECESSARY MATERIALS SHALL BE AVAILABLE AND STOCK PILED AT CONVENIENT LOCATIONS TO FACILITATE RAPID CONSTRUCTION OR MAINTENANCE OF TEMPORARY DEVICES WHEN RAIN IS IMMINENT.

6. IN THE EVENT OF A FAILURE, THE DEVELOPER AND/OR HIS REPRESENTATIVE SHALL BE RESPONSIBLE FOR CLEANUP AND ALL ASSOCIATED COSTS OR DAMAGE. IN THE EVENT THAT DAMAGE OCCURS WITHIN THE RIGHT-OF-WAY AND THE CITY IS

REQUIRED TO PERFORM CLEANUP, THE OWNER SHALL BE RESPONSIBLE FOR CITY REIMBURSEMENT OF ALL ASSOCIATED COSTS OR DAMAGE.

7. IN THE EVENT OF FAILURE AND/OR LACK OF PERFORMANCE BY THE OWNER AND/OR CONTRACTOR TO CORRECT EROSION CONTROL RELATED PROBLEMS THE PUBLIC WORKS DEPARTMENT MAY REVOKE ALL ACTIVE PERMITS AND RECOMMEND THATCITY CODE ENFORCEMENT PROVIDE A WRITTEN NOTICE OR STOP WORK ORDER.

8. PERMANENT EROSION CONTROL SHALL BE PLACED AND ESTABLISHED WITH 90% COVERAGE ON ALL DISTURBED SURFACES OTHER THAN PAVED OR GRAVEL SURFACES, PRIOR TO FINAL INSPECTION. PERMANENT EROSION CONTROL SHALL BE FULLY ESTABLISHED PRIOR TO FINAL ACCEPTANCE. TEMPORARY EROSION CONTROL MEASURES SHALL REMAIN IN PLACE UNTILPERMANENT MEASURES ARE ESTABLISHED.

9. THE CITY AIR POLLUTION CONTROL DISTRICT (APCD) MAY HAVE ADDITIONAL PROJECT SPECIFIC EROSION CONTROL REQUIREMENTS. THE CONTRACTOR, DEVELOPER, AND ENGINEER OF WORK SHALL BE RESPONSIBLE FOR MAINTAINING SELFREGULATION OF THESE REQUIREMENTS.

1. IT IS THE CONTRACTOR'S RESPONSIBILITY TO PROVIDE AND MAINTAIN EROSION CONTROL MEASURES AS REQUIRED

THROUGHOUT THE LIFE OF THE PROJECT IN CONFORMANCE WITH THE CITY OF SANTA CRUZ AND ASSOCIATED BAY AREA GOVERNMENTS.

2. CONTRACTOR TO PROVIDE BACK-UP EROSION PREVENTION MEASURES (SOIL STABILIZATION) WITH SEDIMENT CONTROL MEASURES SUCH AS STRAW WATTLES, SILT FENCE, FILTREX 8" SOXX AND MIRAFI 140N, AND/OR SEDIMENT TRAPS ORBASINS. ENSURE CONTROL MEASURES ARE ADEQUATE, IN PLACE, AND IN OPERABLE CONDITIONS. SEDIMENT CONTROLS, INCLUDING INLET PROTECTION, ARE NECESSARY BUT SHOULD BE A SECONDARY DEFENSE BEHIND GOOD EROSIONCONTROL MEASURES.

3. ALL EROSION PREVENTION AND SEDIMENT CONTROL MEASURES SHALL BE MAINTAINED AND REPAIRED THROUGHOUT THE SEASON. REPLACEMENT SUPPLIES SHOULD BE KEPT ON SITE.

4. SITE INSPECTIONS SHALL BE CONDUCTED BEFORE AND AFTER EACH STORM EVENT, AND EVERY 24 HOURS FOR EXTENDED

STORM EVENTS, TO IDENTIFY AREAS THAT CONTRIBUTE TO EROSION AND SEDIMENT PROBLEMS OR ANY OTHER POLLUTANT DISCHARGES. IF ADDITIONAL MEASURES ARE NEEDED, REVISE THE EROSION CONTROL PLAN AND IMPLEMENT THEMEASURES IMMEDIATELY. DOCUMENT ALL INSPECTION FINDINGS AND ACTIONS TAKEN.

5. CONTRACTOR SHALL USE BEST MANAGEMENT PRACTICES DURING CONSTRUCTION FOR CONTROL OF STORM WATER RUNOFF.

6. BETWEEN OCTOBER 15 AND APRIL 15, EXPOSED SOIL SHALL BE PROTECTED FROM EROSION AT ALL TIMES. HAY BALES, FILTER BERMS, OR OTHER MEANS SHALL BE EMPLOYED TO PREVENT TURBID RUNOFF TO ADJOINING PROPERTIES.

7. UNNECESSARY GRADING AND DISTURBING OR SOIL SHALL BE AVOIDED.8. ANY EXCESS MATERIAL SHALL BE DISPOSED OF OFF-SITE OR STOCKPILED IN A MANNER TO AVOID RUNOFF ONTO ADJOINING PROPERTIES.

9. ANY MATERIAL STOCKPILED DURING CONSTRUCTION SHALL BE COVERED WITH PLASTIC.

10. CONTRACTOR SHALL NOTIFY THE CITY OF SANTA CRUZ 48 HOURS BEFORE ANY EARTHWORK BEGINS.11. CONTRACTOR SHALL REMOVE FILTER FABRIC AND ALL SEDIMENT BARRIERS FROM STORM DRAIN INLET UPON COMPLETION OF PROJECT.

GENERAL EROSION CONTROL NOTES • CONSTRUCTION BEST MANAGEMENT PRACTICES (BMPS) - PROJECT CONSTRUCTION AND DEMOLITION ACTIVITIES SHALL COMPLY WITH THE CITY’S STORM WATER BEST MANAGEMENT PRACTICES FOR CONSTRUCTION. SEE THE CITY WEBSITE AT:

HTTP://WWW.CITYOFSANTACRUZ.COM/HOME/SHOWDOCUMENT?ID=6031 • INSPECT EROSION & SEDIMENT CONTROL MEASURES, SUCH AS FIBER ROLLS OR WATTLES, ROUTINELY DURING CONSTRUCTION AND AFTER EACH SIGNIFICANT RAIN EVENT. MAKE ANY NEEDED REPAIRS IMMEDIATELY. • CHECK THE SIDEWALK AND STREET DAILY DURING DEMOLITION AND CONSTRUCTION FOR SOIL DRAG-OUT, AND SWEEP IF NEEDED • STORE OPEN BAGS OF PARTICULATE, GRANULAR OR POWDER MATERIALS (SUCH AS PLASTER OR CONCRETE) INDOORS IFPOSSIBLE. IF STORED OUTSIDE, THEY MUST BE KEPT COVERED OR CLOSED, AND DURING THE RAINY SEASON KEPT WITHIN SECONDARY CONTAINMENT. • DUMPSTER LIDS MUST BE KEPT CLOSED AND SECURED WHEN NOT IN USE. • SOIL & MATERIAL STOCKPILES - SOIL AND MATERIALS STOCKPILES MUST BE PROTECTED FROM RUNOFF/RUN-ON BY BMPS

WHEN NOT IN USE SUCH AS SURROUNDED BY BERMS, FIBER ROLLS OR WATTLES AND COVERED WITH PLASTIC SHEETING OR TARPS. ALL SOIL STOCKPILES SHOULD BE STORED ON A FLAT AREA. IF STORED ON AN AREA WITH A 10% SLOPE OR MORE, PLEASE ADD NOTE THAT SOIL SHALL BE HAULED OFFSITE AT END OF EACH THE DAY. • PERVIOUS PAVERS OR PAVEMENT - PROTECT PERVIOUS PAVERS OR PAVEMENT, ONCE INSTALLED, SO THAT ANY REMAINING CONSTRUCTION ACTIVITIES WILL NOT DAMAGE OR CLOG THE PAVERS/PAVEMENT. • CONSTRUCTION ENTRANCE/EXIT - INSTALL THE STABILIZED CONSTRUCTION ENTRANCE/EXIT AT THE PROJECT’SCOMMENCEMENT. ROUTINELY MAINTAIN THE CONSTRUCTION ENTRANCE/EXIT AND ENSURE IT REMAINS EFFECTIVE AT PREVENTING DRAG-OUT ONTO THE STREET. ON A DAILY BASIS, CHECK FOR DRAG OUT ONTO THE STREET. • PORTA-POTTIES - DO NOT LOCATE PORTA-POTTIES ADJACENT TO WATERCOURSES OR STORM DRAIN INLETS. • STORM DRAIN INLET/CATCH BASIN PROTECTION - IF APPLICABLE, PLEASE USE FILTER FABRIC OR INSERTS FOR ON-SITE ORNEARBY STREET CATCH BASINS. (SAND BAGS, GRAVEL BAGS AND STRAW WATTLES AROUND STORM DRAIN INLETS EXPOSED TO STREET TRAFFIC ARE NOT RECOMMENDED). IF USING FILTER FABRIC, RECOMMEND FILTREX 8” SOXX WITH MIRAFI 140N FABRIC (OR SIMILAR) UNDERNEATH THE GRATE. ENSURE FABRIC EXTENDS A MINIMUM OF 6-INCHES BEYOND CATCH BASIN AFTER PLACEMENT OF GRATE AND SECURE PROPERLY. CONTRACTOR SHALL REMOVE FILTER FABRIC UPON PROJECT COMPLETION. • PLEASE CONTACT SUZANNE HEALY, AT [email protected] OR ADDITIONAL EROSION CONTROL NOTES 831-420-5131, FOR THE FOLLOWING INSPECTIONS: • INSPECTIONS DURING INSTALLATION OF ANY REQUIRED STORM WATER LID (LOW IMPACT DEVELOPMENT) FEATURES AND BEST MANAGEMENT PRACTICES (BMPS) SUCH AS INSTALLATION OF PERMEABLE PAVERS, PERMEABLE PAVEMENT, BIO-SWALES, BIO-RETENTION AREAS AND RETENTION/INFILTRATION FACILITIES. • INSPECTIONS DURING INSTALLATION OF ANY REQUIRED STORM WATER QUALITY TREATMENT UNITS SUCH BIO-PLANTERS, BIO-FILTRATION TREE UNITS, PERK FILTERS, CUDOS, STORM WATER FILTER UNITS, ETC. • FINAL INSPECTION FOR STORM WATER ONCE THE WORK IS COMPLETED AS PART OF THE PERMIT “SIGN-OFF” PROCESS.

INSPECTIONS LEGEND

STRAW WADDLE/FIBER
ROLL

DIRECTION OF FLOW WITH

STORM DRAIN INSTALLED

STABILIZEDCONSTRUCTION

ENTRANCE/EXIT

SEDIMENT CATCHER
(SAND BAGS)

SANITARY FACILITY

CONCRETE/WASTE WASHOUT C

MATERIALS &EQUIPMENT

STORAGE AREA
NOTE: SEE SHEET C5.2 FOR

BMP NOTES AND DETAILS

SWPPP MANAGER TO MARK

KNOWN LOCATIONS
FILTREXX 8" SOXX W/MIRAFI 140N FABRIC
C

EROSION

CONTROL PLAN
C5.1
STOCKPILE AREA • INVESTIGATE POLLUTION PREVENTION OPPORTUNITIES. EVALUATE THE SITE TO LOOK FOR OPPORTUNITIES TO PREVENT POLLUTION SOURCES ON THE LAND FROM BECOMING MOBILIZED BY RUNOFF. • DESIGN SITE TO MINIMIZE RUNOFF. ASSESS WHETHER ANY BETTER SITE DESIGN TECHNIQUES CAN BE APPLIED AT THE SITE TO MINIMIZE RUNOFF AND THEREFORE REDUCE THE SIZE OF STRUCTURAL BMPS. • SELECT TEMPORARY CONSTRUCTION EROSION AND SEDIMENT CONTROL TECHNIQUES. CHECK TO SEE WHAT SET OF TEMPORARY SEDIMENT CONTROL TECHNIQUES WILL PREVENT EROSION AND MINIMIZE SITE DISTURBANCE DURING CONSTRUCTION. • IDENTIFY RECEIVING WATER ISSUES. UNDERSTAND THE REGULATORY STATUS OF THE RECEIVING WATER TO WHICH THE SITE DRAINS. DEPENDING ON THE NATURE OF THE RECEIVING WATER, CERTAIN BMPS MAY BE PROMOTED, RESTRICTED OR PROHIBITED, OR SPECIAL DESIGN OR SIZING CRITERIA MAY APPLY. • IDENTIFY CLIMATE AND TERRAIN FACTORS. CLIMATE AND TERRAIN CONDITIONS VARY WIDELY ACROSS THE STATE, AND DESIGNERS NEED TO EXPLICITLY CONSIDER HOW EACH REGIONAL FACTOR WILL INFLUENCE THE BMPS PROPOSED FOR THE SITE. • EVALUATE STORMWATER TREATMENT SUITABILITY. NOT ALL BMPS WORK OVER THE WIDE RANGE OF STORM EVENTS THAT NEED TO BE MANAGED AT THE SITE, SO DESIGNERS NEED TO CHOOSE THE TYPE OR COMBINATION OF BMPS THAT WILL PROVIDE THE DESIRED LEVEL OF TREATMENT. • ASSESS PHYSICAL FEASIBILITY AT THE SITE. EACH DEVELOPMENT SITE HAS MANY PHYSICAL CONSTRAINTS THAT INFLUENCE THE FEASIBILITY OF DIFFERENT KINDS OF BMPS. DESIGNERS CONFIRM FEASIBILITY BY ASSESSING EIGHT PHYSICAL FACTORS AT THE SITE. • INVESTIGATE COMMUNITY AND ENVIRONMENTAL FACTORS. EACH GROUP OF BMPS PROVIDES DIFFERENT ECONOMIC, COMMUNITY, AND ENVIRONMENTAL BENEFITS AND DRAWBACKS. DESIGNERS NEED TO CAREFULLY WEIGH THESE FACTORS WHEN CHOOSING BMPS FOR THE SITE. • DETERMINE ANY SITE RESTRICTIONS AND SETBACKS. CHECK TO SEE IF ANY ENVIRONMENTAL RESOURCES OR INFRASTRUCTURE ARE PRESENT THAT WILL INFLUENCE WHERE A BMP CAN BE LOCATED AT THE DEVELOPMENT SITE.

BMP SELECTION PROCESS
OSDC
O S CS
O S CS

VAN ACCESSIBLE SPACE
Proposed Pallet Relocation layout to RSS Lot-Estimate: 22 - 23 8x8 Pallets (64sqft)-Includes 4' space in between pallets-Includes Temporary Smoking Area Relocation-Includes Temp Facilities relocation ( 1-ADA RR, 2- Standard units)-Includes path of travel from emergency egress walkway out to River into RSS lot-Includes Construction Staging area using part of the RSS lot 109' Construction Fencing Pallet House 104'-11"
19'-5"
23'-10"
12'-8"
6'-7"
11'-5"
3'-5"
27'-5"
Construction Area
10 x 10 Temp.Smoking Area

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX Unuseable
Port O Potties:

Bioswale/Civil Area
1-ADA, 2-Standard
Port O Pottys 18.14
License Agreement 12
Exhibit “B”

CITY OF SANTA CRUZ INSURANCE REQUIREMENTS
Licensee shall procure and maintain for the duration of the License Agreement, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the obligations thereunder by Licensee, Licensee’s respective employees, subcontractor(s), agents, representatives, or volunteers.

B. MINIMUM SCOPE AND LIMITS OF INSURANCE
Licensee acknowledges that the insurance coverage and policy limits set forth in this section constitute the minimum amount of coverage required. If Licensee maintains broader insurance coverage and/or higher limits than the minimums shown below, the City of Santa Cruz requires and shall be entitled to the broader insurance coverage and/or higher limits maintained by Licensee. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Santa Cruz.

Coverage will be at least as broad as:
• COMMERCIAL GENERAL LIABILITY (CGL): $1,000,000 PER OCCURRENCE; $2,000,000 AGGREGATE Proof of coverage for $1 Million per occurrence and $2 Million in the aggregate including products and completed operations, property damage, bodily injury, personal and advertising injury will be provided on Insurance Services Office (ISO) Form CG 00 01 covering CGL. • WORKERS’ COMPENSATION AS REQUIRED BY THE STATE OF CALIFORNIA, WITH STATUTORY LIMITS, AND EMPLOYER’S LIABILITY INSURANCE: $1,000,000 per accident for bodily injury or disease.

The Worker’s Compensation policy must be endorsed with a waiver of subrogation in favor of the City for all work performed by the Licensee and its employees. (Not required if Licensee provides written verification it has no employees) - If Licensee has no employees, Licensee shall complete and sign a Workers’ Compensation Exemption Declaration and Release of Liability.
• PROPERTY INSURANCE.

18.15 License Agreement 13
a. “All Risk” Property Insurance Coverage. Licensee shall, at Licensee 's sole expense, obtain and keep in full force and effect an insurance policy covering all of Licensee's personal property, trade fixtures, equipment and merchandise located in or upon the Premises in an amount sufficient to cover not less than one hundred percent (100%) of the replacement value thereof, providing protection against any peril included within including sprinkler damage, vandalism and malicious mischief endorsements ordinarily included in extended coverage casualty insurance policies. Licensee shall be solely responsible for any uninsured loss or damage caused to Licensee 's personal property, trade fixtures, equipment and merchandise located in or upon the Premises for any reason. b. Fire Insurance\Legal Liability Coverage. Licensee, at its sole cost, shall procure and maintain in full force and effect at all times during the Term of this License, fire and extended coverage insurance satisfactory to Licensor covering the Premises to keep all leased property or rented space, Licensee improvements therein in an amount not less than one hundred percent (100%) of the full replacement cost against loss or destruction by fire and all perils, including vandalism, malicious mischief, special extended perils (“special form”), Licensor shall be named as an additional insured and loss payee on the policies.

Any loss payable under any policy described in this section shall be paid by the insurance company to Licensor or as otherwise agreed by the Parties to be used to fund the repair or replacement of the damaged Premises or improvement pursuant to this License. “Full replacement cost,” as used in this section, shall mean the actual cost of replacement for the building and other improvements on the Premises, as determined from time to time.

If at any time during the term of this License, Licensor believes that the full replacement cost has increased, Licensor shall notify Licensee in writing. If Licensee agrees with the increased full replacement cost set forth in Licensor’s notice, Licensee shall, within 30 days of the notice, increase the amount of insurance carried to the amount stated in the notice. If the parties are unable to agree within the 30-day period, the increased full replacement cost, if any, shall be determined by the insurance carrier that is then carrying the largest amount of fire and extended coverage on the Premises. That determination shall be final, and Licensee shall immediately increase the amount of insurance to the amount determined by that carrier. Regardless of the preceding sentence, if Licensee makes improvements or alterations to the Premises during any given year of the term of this License, Licensor may request an increase in coverage pursuant to the provisions of this section.

1. PRIMARY COVERAGE
For any claims related to this Agreement, Licensee’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees,

18.16 License Agreement 14
agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of Licensee’s and all subcontractor’s insurance and will not contribute with it.
• NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
• WAIVER OF SUBROGATION
Licensee hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Licensee may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. Licensee agrees to obtain any endorsement that may be necessary to effectuate this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.
• EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
Licensee may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Licensee’s primary and excess liability policies are exhausted.
• DURATION OF COVERAGE
CGL & Excess Liability/Umbrella policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Such Insurance must be maintained, and evidence of insurance must be provided, for at least five (5) years after completion of the contract of work.
• SELF-INSURED RETENTIONS (SIR)
Self-insured retentions must be declared to and approved by the City. City may require Licensee to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City. • ACCEPTABILITY OF INSURERS
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A: VII, unless otherwise acceptable to the City.
• CLAIMS MADE POLICIES
If any of the required policies provide coverage on a claims-made basis:

1. The Retroactive Date must be shown and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained, and evidence of insurance must be provided, for at least five (5) years after completion of the contract of work.

18.17 License Agreement 15

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the contract effective date, the Licensee must purchase “extended reporting” coverage for a minimum of five (5) years after completion of contract work.
• VERIFICATION OF COVERAGE
Licensee will furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy (and CPL, automobile and any Excess Liability/Umbrella policies, as applicable) listing all policy endorsements to be approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the Licensee’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

D. SUBCONTRACTORS
Licensee shall include their subcontractor(s) as additional insured(s) under the policies or shall furnish separate certificates and endorsements for each contractor and subcontractor. Licensee shall require and verify that all contractors and subcontractors maintain insurance meeting all the requirements stated herein, and Licensee shall ensure that City, its officers, officials, employees, agents, and volunteers are named as additional insureds on insurance required from its contractor(s) and subcontractor(s).

18.18 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: Finance
SUBJECT: Proposition 4 Appropriations Limit Adjustment Factors (FN) RECOMMENDATION: Motion to adopt a resolution approving the selection of the annual adjustment factors to be utilized in the calculation of the City’s Proposition 4 Appropriations Limit (GANN Limit) based on the adopted budget for FY 2025, with amendments thereto, if any.

BACKGROUND: In 1979, the voters of California approved Proposition 4, also known as the GANN Initiative. This initiative, now Article XIIIB of the State Constitution, was drafted as a companion measure to Proposition 13, which is Article XIIIA of the Constitution. Basically, Article XIIIB establishes a limit on annual appropriations, or spending limit, for all governmental entities in the State of California. To comply with Article XIIIB, the City Council is required to select the adjustment factors in both price and population to be used in making the actual calculation of the Appropriations Limit.

The Appropriation Limit is determined by multiplying the limit for the prior year by either the percentage change in (a) per capita personal income or (b) non-residential new construction assessed value, and then multiplying the figure resulting from this step by either the percentage change in (a) City population or (b) County population. That figure then becomes the Appropriations Limit for the new fiscal year. The appropriations subject to the limit are those General Fund expenditures that are funded by general taxes. Pursuant to government Code Section 37200, the Appropriations Limit and the total Appropriations Subject to limitation must be published in the annual budget.

DISCUSSION: The City Council is being asked at this time to approve the selection of the adjustment factors that will be used to prepare the appropriations limit calculation. As noted above, the two factors to be selected fall into the categories of price and population.

Staff recommends the selection of the change in California per capita personal income (3.62%) for the price category and the selection of the change in City population (-0.2%) for the population category as the adjustment factors, because these selections will maximize the Appropriations Limit and provide the City with a higher ceiling for adopting future City budgets.

Using these factors, and as shown on the attached schedule, the appropriations limit is calculated to be $205,966,303. The City’s spending level is well below this limit.

FISCAL IMPACT: There is no fiscal impact to any city funds. Calculation is required to show that the portion of the City’s adopted budget which is subject to the limit does not exceed the

19.1 Appropriations Limit under Proposition 4. The City’s appropriations that are subject to the limit are approximately $97,958,565 million below the limit for FY 2025.

Prepared By:

Emily Burton
Management Analyst
Submitted By:

Elizabeth Cabell
Finance Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. FY 2025 PROP 4 GANN LIMIT RESOLUTION.DOCX

2. FY 2025 PROP 4 GANN COMPUTATION OF APPROPRIATIONS LIMIT.PDF

3. FY 2025 PROP 4 GANN DETERMINATION PROCEEDS OF TAXES.PDF

19.2 RESOLUTION NO. NS-XX,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ

APPROVING THE SELECTION OF THE ANNUAL ADJUSTMENT FACTORS USED IN THE CALCULATION OF THE CITY’S PROPOSITION 4 APPROPRIATIONS LIMIT FOR FISCAL YEAR 2025
WHEREAS, Proposition 111 requires a recorded vote by the Council regarding which annual adjustment factors will be used in the City’s calculation of the Proposition 4 limitation beginning with budget year 1990-91; and
WHEREAS, it is in the City’s best interest to select the factors with the largest increase; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz as follows:

The 3.62% increase in California per capita personal income for the price factor and selects the City of Santa Cruz population growth of -0.2% for the population factor are selected to be used as the annual adjustment factors in the calculation of the City’s Proposition 4 Appropriations Limit for Fiscal Year 2025.

PASSED AND ADOPTED this 25th day of June, 2025 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

19.3 Calculation of Spending Limit
Last Year's Appropriations Limit (FY 2024) $ 199,169,061 Adjustment Factors:

A. Change in Population - City 0.998000
B. Change in California per Capita Personal Income 1.036200 A times B 1.03413
Total Adjustment Percentage (A times B) 3.4128%
Total Adjustment Dollars 6,797,242
New Appropriations Limit For Fiscal Year 2025 $ 205,966,303 Appropriations Compared To Limit
Projected Proceeds From Taxes $ 110,555,099
Less: Federal Mandates $ 1,404,648
Qualified Capital Outlays -
Debt Service Appropriations 1,142,713
Total Exclusions 2,547,361
Appropriations Subject to Limit For Fiscal Year 2025 108,007,738 Appropriations Limit For Fiscal Year 2025 205,966,303
Amount Over / (Under) Appropriations Limit $ (97,958,565)

CITY OF SANTA CRUZ

APPROPRIATIONS SPENDING LIMIT
PROP 4 - GANN LIMIT
BASED ON 2025 ADOPTED BUDGET

19.4 Proceeds Non-Proceeds
of Taxes of Taxes Total
General Fund Taxes
Property Taxes $ 28,561,984 $ - $ 28,561,984
Sales and Use Taxes 35,257,150 - 35,257,150
Business License Taxes 957,682 - 957,682
Franchise Taxes 4,730,540 - 4,730,540
Utility Users' Tax 14,701,461 - 14,701,461
Transient Occupancy Tax 14,199,520 - 14,199,520
Admissions Tax 3,055,004 - 3,055,004
Cannibas Tax 2,134,350 - 2,134,350
Property Transfer Tax 284,256 - 284,256
Parking Lot Tax 680,495 - 680,495
CRM Assessment 410,000 - 410,000
General Fund License & Permits
Construction Permits - 1,190,000 1,190,000
Other Licenses and Permits - 478,500 478,500
General Fund Intergovernmental
Federal - 233,508 233,508
State - Homeowner's Property Tax Relief 80,000 - 80,000 State - Measure D SCCRTC - 34,000 34,000
State - Motor Vehicle In-Lieu 75,000 - 75,000
State - Other - 205,000 205,000
Local - 133,000 133,000
General Fund Charges for Services
General Government - 1,671,160 1,671,160
Public Safety - 7,416,100 7,416,100
Culture and Recreation - 4,550,732 4,550,732
Public Works - 2,073,266 2,073,266
Community and Economic Development - 33,000 33,000
Library - 576,352 576,352
Interfund Charges - 19,847,080 19,847,080
Miscellaneous Charges for Services - 800 800
General Fund Other Revenues:

Fines and Forfeits - 1,504,147 1,504,147
Rents and Royalties - 6,960,621 6,960,621
Contributions and Donations - 68,800 68,800
Other Miscellaneous Revenues - 601,686 601,686
Interfund Transfers In - 1,523,915 1,523,915
Proceeds of Asset Dispositions - 1,500 1,500
Loan Principal Receipts - 339,359 339,359
Other Funds Revenue
State Highway Funds - Gas Tax - 25,481,524 25,481,524
State Highway Funds - Measure D City 1,760,000 - 1,760,000 Housing and Community Development Funds - 2,907,942 2,907,942 Other Special Revenue Funds 635,000 1,200,000 1,835,000 Capital Projects Funds 1,955,611 43,084,000 45,039,611
Debt Service Funds - 924,275 924,275
SUB-TOTAL 109,993,053 123,658,812 233,651,865
Interest Earnings 562,046 660,058 1,222,104
GRAND TOTAL $ 110,555,099 $ 124,318,870 $ 234,873,969

CITY OF SANTA CRUZ

CALCULATION OF PROCEEDS OF TAXES
PROP 4 - GANN LIMIT
BASED ON 2025 ADOPTED BUDGET
Determination of Proceeds of Taxes

19.5 City Council

AGENDA REPORT
DATE: 06/06/2024
AGENDA OF: 06/25/2024
DEPARTMENT: Finance
SUBJECT: Award Contracts for Tree Services (FN)
RECOMMENDATION: Motion to award two contracts for the citywide on-call tree services to Lewis Tree Service Incorporated (Lewis Tree), Kent, Ohio and Community Tree Services, LLC (Community Tree), Royal Oaks, California, for three years, and to authorize the City Manager to execute a contract in a form approved by the City Attorney with both Lewis Tree and Community Tree. The Purchasing Manager is authorized to execute change orders within the approved budget.

BACKGROUND: Staff makes significant efforts to source companies that deliver the right products, at the right time, at the right price that provide the greatest value to the City. Santa Cruz is a Tree City USA and our community highly values its urban forest. The City maintains approximately 6,000 inventoried trees in parks, at public facilities, and along city streets, and tens of thousands more trees in open spaces and watershed lands. Additionally, the City provides emergency response to privately maintained trees that impede the public right-of-way. Tree services are used to support multiple departments within the City of Santa Cruz for on-going maintenance, project work, and in emergencies.

The existing tree services contract has been in place since 2011. Therefore, in alignment with best procurement practices and the City’s purchasing procedures, staff issued a competitive solicitation for a new on-call contract as a replacement to the existing contract.

DISCUSSION: On November 21, 2023, staff issued a Request for Proposals (RFP) for citywide on-call tree services. The RFP Scope of Services included tree pruning by climbing, aerial lift, or crane and disposal or recycling of related wood and green waste, tree removal by climbing, aerial lift, or crane and disposal or recycling of related wood and green waste, stump removal and disposal/recycling of related wood and green waste, clean up and disposal or recycling of wood, and green waste outside of tasks, ongoing tree work and support services, and emergency response tree services. The RFP was posted on the City’s website to ensure that the RFP was conducted in an open and competitive manner and the city issued a solicitation notification to a bid list of 11,384 vendors the same day.

Proposals were due at 3:00 PM PST on January 4, 2024, and the City received proposals from eight firms by that time. After being checked for responsiveness, six firms were evaluated by an evaluation committee made up of subject matter experts in tree service and maintenance for adherence to RFP requirements, firm background, firm qualifications, expertise, and experience,

20.1 team qualifications expertise and experience, work plan for providing both routine and emergency service, references, and cost.

Lewis Tree received a total score of 94.99 out of 100 and Community Tree received a score of

94.62 out of 100. Because tree services are an essential service, and there are two firms that are within a competitive range, staff is recommending the award of two contracts resulting from his solicitation to provide a contingency plan to maintain continuity of operations if one company is unable to provide services. An on-call contract allows departments throughout the city to utilize the goods and services provided under the contract as they are needed to support operations.

Staff recommends awarding the contracts to be effective on July 1, 2024, to align with the beginning of the new fiscal year.

The proposed contract would have an initial contract period of three years, with two additional one-year renewals.

FISCAL IMPACT: None. Funds are available in department budgets for the purchase of these items which are necessary for routine operations.

Prepared By:

Elizabeth Millwee
Purchasing Manager
Submitted By:

Elizabeth Cabell
Finance Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. CONTRACT FOR TREE SERVICES WITH LEWIS TREE INC..PDF

2. CONTRACT FOR TREE SERVICES WITH COMMUNITY TREE LLC.PDF

3. EVALUATION TABULATION.PDF

20.2 PURCHASE AGREEMENT Page 1

PURCHASE AGREEMENT FOR TREE SERVICES
WITH LEWIS TREE SERVICE, INC., A DAVEY COMPANY
THIS PURCHASE AGREEMENT (“Purchase Agreement” or “Contract”), made and entered into on July 1 2024, (“Effective Date”) by and between the CITY OF SANTA CRUZ, a municipal corporation, hereinafter called “City,” and Lewis Tree Service, Inc., A Davey Company hereinafter called “Vendor” or “Contractor” for Tree Services. City and Vendor are individually referred to as a “Party” or collectively, as the “Parties”.

The Parties mutually agree as follows:

SECTION I: SERVICES
A. That for and in consideration of the City’s Request for Proposal and the Vendor’s response thereto, the Vendor hereby covenants and agrees to furnish any and all required services, further described below in the Scope of Work, attached hereto as Exhibit A, and will bear any and all other expense necessary or incidental to the performance of certain work hereinafter specified for On-Call Tree Services in strict conformity and compliance with the Contract Documents, as hereinafter defined, and in accordance with this Purchase Agreement.

B. Vendor will furnish all labor, material, equipment and services required to comply with the Contract Documents.

C. Vendor agrees that it may not begin providing the goods/services until the City approves a Purchase Order for such.

SECTION II: CONTRACT DOCUMENTS
A. Incorporation of Documents.

It is expressly agreed and understood by City and Vendor that the following documents are hereby incorporated and made a part of this Purchase Agreement (hereinafter the “Contract Documents”):

1. This Purchase Agreement with Exhibit A: Scope of Work and Fee Schedule;

2. Supplemental Contract Provisions for Contracts Funded in-Part by FEMA Public Assistance attached hereto as Exhibit B; and

3. City of Santa Cruz Standard Terms and Conditions of Purchase, except as amended herein by this Purchase Agreement in Section V – attached hereto as Exhibit C; B. Priority of Contract Documents.

The Parties to this Purchase Agreement do hereby expressly acknowledge that they have read, understand, and promise to comply with each and every provision of Contract Documents. In the event inconsistencies, conflicts, or ambiguities between and among the Contract Documents are discovered, the Parties shall attempt to resolve any ambiguity, conflict, or inconsistency informally, recognizing that the terms of the Contract Documents shall take precedence in the DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.3 PURCHASE AGREEMENT Page 2
order in which they are listed above. The terms of this Purchase Agreement shall take priority and control in the case of any conflicts with any of the exhibits attached hereto.

SECTION III: TERM OF PURCHASE AGREEMENT
The term of the Purchase Agreement will be from the Effective date for 3 years, terminating on June 30, 2027. Unless terminated consistent with the Contract Documents, the Parties have the option to renew for two (2) additional two (2)-year terms effective on the third and fifth anniversary of the Effective Date with an amendment to this Purchase Agreement based on the mutual agreement of the Parties. If either Party does not intend to renew this Purchase Agreement, they shall provide notice of non-renewal at least sixty days prior to the end of the then-current term.

SECTION IV: PAYMENT
The City agrees to pay Vendor at the rates specified in the Fee Schedule attached hereto, and in the manner and at the times set forth in the Contract Documents. Vendor shall not undertake any work beyond the Scope of Work set forth therein unless such additional work is approved in advance and in writing by City.

SECTION V: AMENDMENTS TO CITY’S STANDARD TERMS AND CONDITIONS The City of Santa Cruz Standard Terms and Conditions of Purchase (“City’s Standard Terms”), which is attached hereto as Exhibit C, as amended below, apply to this Purchase Agreement:

1. Section 8 of the City’s Standard Terms is deleted and replaced with the following:
“8. Insurance: Prior to the beginning of and throughout the duration of this Purchase Agreement, Vendor will maintain insurance in conformance with the requirements set forth herein. Vendor will insure the City against claims for injuries to persons or damages to property which may arise from or in connection with the goods, or the work performed hereunder and the results of that work by Vendor, Vendor’s agents, representatives, employees or subcontractors.
a. Standard Certificate Requirements
The City will be issued a Certificate of Insurance (a Memorandum of Understanding will not be accepted) with the following minimum requirements:
• Certificate(s) will show current policy number(s) and effective dates, • Coverage and policy limits will meet, or exceed, requirements below, • The Certificate Holder will be City of Santa Cruz, Risk Management, 1200 Pacific Ave., Suite 290, Santa Cruz, CA 95060,
• Certificate will be signed by an authorized representative, • An endorsement, if required below, will be provided to show the City, its officers, officials, employees, and volunteers as additional insureds, and • Coverages must be maintained during the term of the Purchase Agreement with the City, unless a longer duration is required as specified below.

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b. Minimum Scope and Limits of Insurance:

The Vendor acknowledges that the insurance coverage and policy limits set forth in this section constitute the minimum amount of coverage required. The City will be entitled to coverage for the highest limits maintained by the Vendor. Coverage will be at least as broad as:
• Commercial General Liability (CGL): $2,000,000 per occurrence $2,000,000 aggregate
Proof of coverage for up to $2 Million per occurrence/aggregate including products and completed operations, property damage, bodily injury, personal injury and advertising injury will be provided on Insurance Services Office (ISO) Form CG 00 01 covering CGL.
• Automobile Liability: $1,000,000
Proof of coverage for $1 Million will be provided on ISO Form Number CA 00 01 covering any auto (Code 1), or if Vendor has no owned autos, hired, (Code 8) and non-owned autos (Code 9), per accident for bodily injury and property damage.
• Workers’ Compensation: as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance: $1,000,000 per accident for bodily injury or disease. Must include a waiver of subrogation in favor of the City for all work performed by the Vendor and its employees in favor of the City for all work performed by the Vendor and their employees.
c. Other Insurance Provisions
The insurance policies are to comply with the following provisions:
• Additional Insured Status
The City, its officers, officials, and employees are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Vendor including materials, parts, or equipment furnished in connection with such work or operations, products and completed operations. General liability coverage will be provided in the form of an endorsement to the Vendor’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used). • Primary Coverage
For any claims related to this Purchase Agreement, the Vendor’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees, agents and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents or volunteers will be excess of the Vendor’s and all subcontractor’s insurance and will not contribute with it. • Notice of Cancellation
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Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
• Waiver of Subrogation
Vendor hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Vendor may acquire against the City by virtue of the payment of any loss, including attorneys’ fees, under such insurance. Vendor agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.
• Self-Insured Retentions/Acceptability of Insurers
Self-insured retentions must be declared to and approved by the City. City may require Vendor to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City. Acceptability of Insurers
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VII, unless otherwise acceptable to the City. • Verification of Coverage
Vendor will furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause. All certificates and endorsements are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the Vendor’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.
• Subcontractors
Vendor shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and Vendor shall ensure that City, its officers, officials, employees, and volunteers are additional insureds on insurance required from subcontractors.

SECTION VI: MISCELLANEOUS PROVISIONS

1. Compliance with Laws. All activities of Vendor, its employees, subcontractors and/or agents will be carried out in compliance with all applicable federal, state, and local laws and regulations.

2. Site Conditions and Safety. During the course of performing the scope of work under this Purchase Agreement, the security and safety of the work area/site, materials, and equipment will be Vendor’s sole responsibility. Vendor shall not unreasonably interfere with the use of the public right-of-way to the extent the public right-of-way is usable and accessible in part during the course DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.6 PURCHASE AGREEMENT Page 5
of performing the work under this Purchase Agreement. Vendor shall provide all equipment, devices, signage, and personnel needed to ensure public safety at the work area/site and comply with applicable traffic safety requirements including the California Manual on Uniform Traffic Control Devices (MUTCD) standards. Vendor is responsible for supplying and using all safety equipment necessary to close or delineate traffic lanes to vehicle or pedestrian traffic. Lane closures, including parking lanes, will require notification to the City’s Traffic Management Division of the Transportation Department and posting of notices not less than 48 hours prior to closure. All waste, rubbish, other debris, and any excess excavated material shall be removed from the work site at the completion of the work, as applicable, in a manner that conforms to all applicable state, federal, and local laws and regulations. Vendor shall leave the City property and public right-of-way in a clean and orderly condition.

3. Dispute Resolution. The Parties agree to attempt in good faith to resolve through negotiation any dispute, claim or controversy arising out of or relating to this Purchase Agreement. Either party may initiate negotiations by providing written notice in letter form to the other party, setting forth the subject of the dispute and the relief requested. Promptly upon such notification, the Parties shall meet at a mutually agreeable time and place in order to exchange relevant information and perspective, and to attempt to resolve the dispute. In the event that no resolution is achieved, and if, but only if, the parties mutually agree, then prior to pursuing formal legal action, the parties shall make a good faith effort to resolve the dispute by non-binding mediation or negotiations between representatives with decision-making power, who, to the extent possible, shall not have had substantive involvement in the matters of the dispute. The Parties agree to attempt to resolve the dispute by complying with the claims process as set forth in Public Contract Code sections 9204(e), 20104-20104.6, but without waiving the requirements of the California Tort Claims Act, Gov’t Code section 800 et seq. unless otherwise agreed to by the Parties.

4. Vendor's Records. Vendor shall maintain accurate accounting records and other written documentation pertaining to the costs incurred relating to this Purchase Agreement for examination and audit by the City, State, or federal government, as applicable, in compliance with Gov. Code §8546.7 for a contract in excess of $10,000, or in compliance with other applicable federal laws (e.g. 48 CFR 31) or regulations for a period of three (3) years from: the date of the final City payment for Vendor’s goods/ or services, or from the date of final disposition of real property or equipment acquired with federal funds, or date of the termination of this Purchase Agreement, whichever is later. If Vendor engages a subcontractor to perform work related to this Purchase Agreement with a cost of $10,000 or more over a 12-month period, such subcontract shall contain these same requirements. This provision shall survive the termination of this Purchase Agreement.

5. Conflicts of Interest. Vendor acknowledges and agrees to comply with applicable provisions of conflict of interest laws and regulations, including the CA Political Reform Act (Gov’t. Code §§1090, 87100), Levine Act (Gov’t. Code §84308), and the City’s conflict of interest code, and make any necessary disclosures.

6. California Public Records Act. City is a public agency subject to the disclosure requirements of the California Public Records Act (“CPRA”). If Vendor’s proprietary information is contained DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.7 PURCHASE AGREEMENT Page 6
in documents or information submitted to City, and Vendor claims that such information falls within one or more CPRA exemptions, Vendor must clearly mark such information “Confidential and Proprietary,” and identify the specific lines containing the information. In the event of a request for such information, City will make best efforts to provide notice to Vendor prior to such disclosure. If Vendor contends that any documents are exempt from the CPRA and wishes to prevent disclosure, it is required to obtain a protective order, injunctive relief, or other appropriate remedy from a court of law in Santa Cruz County before the City is required to respond to the CPRA request. If Vendor fails to obtain such remedy within the time the City is required to respond to the CPRA request, City may disclose the requested information without any liability. Vendor further agrees that it shall defend, indemnify and hold City harmless against any claim, action or litigation (including but not limited to all judgments, costs, and attorney’s fees) that may result from denial by City of a CPRA request for information arising from any representation, or any action (or inaction), by the Vendor.

7. Notices. If either Party shall desire or is required to give notice to the other such notice shall be given in writing, via email, and concurrently delivered by: (a) personal delivery, in which case notice is effective upon delivery; (b) overnight courier (i.e., Federal Express) with charges prepaid or charged to the sender’s account, in which case notice is effective when delivered; (c) priority U.S. Mail, in which case notice shall be deemed delivered on the second business day after the deposit thereof with the U.S. Postal Service. Notices shall be addressed to recipient as follows:

To CITY:

Finance Department
Elizabeth Millwee
1200 Pacific Avenue, Suite 290
Santa Cruz, California 95060
[email protected]
To VENDOR:

Lewis Tree Service, Inc., A Davey Company
Michael Hernandez
1500 North Mantua Street
Santa Cruz, California 95062
[email protected]
Changes to the above information shall be given to the other party in writing ten (10) business days before the change is effective.

9. Complete Agreement. This Purchase Agreement, and its incorporated documents comprising the Contract Documents, contain the entire agreement between the Parties with respect to the matters addressed herein and shall supersede all prior or other agreements, oral and written declarations of intent and other legal arrangements (whether binding or non-binding) made by the Parties.

10. Severability. The unenforceability, invalidity or illegality of any provision(s) of this Purchase Agreement shall not render the other provisions unenforceable, invalid or illegal.

11. Waiver. Waiver by any party of any portion of this Purchase Agreement shall not constitute a waiver of the same or any other portion hereof.

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12. Governing Law. This Purchase Agreement shall be governed by and interpreted in accordance with California law.

13. Contract Interpretation. Each party acknowledges that it has reviewed this Purchase Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Purchase Agreement.

14. Counterparts. The Parties may execute this Purchase Agreement in two or more counterparts, which shall, in the aggregate, be deemed an original but all of which, together, shall constitute one and the same instrument. A scanned, electronic, facsimile or other copy of a party’s signature shall be accepted and valid as an original.

15. Warranty of Authority. The signatories to this Purchase Agreement warrant and represent that each is authorized to execute this Purchase Agreement and that their respective signatures serve to legally obligate their respective representatives, agents, successors and assigns to comply with the provisions of this Purchase Agreement.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, this Purchase Agreement is executed by the on the day and year first hereinabove written.

Approved As To Form:

By: _____________________________ Date: __________________ Office of the City Attorney

CITY OF SANTA CRUZ
By: _____________________________ Date: __________________ ____________________, ____________
VENDOR
By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ Signature Requirements for Business Entity:
a. Corporation – 2 officer signatures required (one from each group, unless person signing holds officer positions in both Group 1 and 2):

Group 1: Chief Executive Officer, Chairman of the Board, President, or Vice President Group 2: Secretary, Assistant Secretary, Chief Financial Officer, Treasurer, Assistant Treasurer b. Partnership - Signature of General Partner, or signature of partner who is authorized to execute documents per the Certificate of Partnership. If authorized partner is a corporation, follow Corporation signature requirement. c. LLC- For a member-managed LLC, signature of any member. For a manager-managed LLC, signature of the manager. If the LLC has corporate officer designations, follow Corporation signature requirement.

DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983 6/20/2024

20.10 PURCHASE AGREEMENT Exhibit A

EXHIBIT A

SCOPE OF WORK AND FEE SCHEDULE
I. SCOPE OF WORK
A.Contract Objectives
The City's Contract Objectives are intended to ensure adequate ongoing maintenance of trees within the City of Santa Cruz limits and surrounding any City of Santa Cruz public assets. The goal of this contract will be to provide ongoing tree services to mitigate tree hazards to reduce risk to the public at a level expected by the City’s residents and visitors of the community.

Provide tree services in response to any emergencies.

The requirements of this contract have been separated into categories of work: on-call on an as-need basis and emergency work.

B.Minimum Qualifications
• Firm has no fewer than five years of experience in performing tree services. • Demonstrate experience in conducting work for government institutions of similar or larger size and scope.
• Have experience performing emergency work for a public agency and have the ability to have a crew onsite in response to an emergency call for service within 1 hour from the call from the city. • Firm must have a current D-49 state license.

C.Scope of Services
The Scope of Services includes categories of work that the Vendor may be asked to perform under this contract. Please note that because this is an on-call agreement that there is no guarantee of work. The actual scope of work may vary depending on the specific work requested.

General Tree Maintenance Standards
All work shall be done in conformity with:
• the most recent OSHA, American National Standards Institute (ANSI) A300 and Z133 standards and International Society of Arboriculture Best Management Practices, as may be updated, amended, or superseded.
• all City of Santa Cruz ordinances, policies, standards, and regulations, including Santa Cruz Municipal Code Chapters 13.30 (Street Tree and Nuisance Vegetation), 9.56 (Preservation of Heritage Trees and Heritage Shrubs) and Title 24 (Zoning). • All traffic control plans and devices must meet Manual on Uniform Traffic Control Devices (MUTCD) standards.

All work performed under the contract resulting from this solicitation shall be performed by qualified tree workers who, through related training or on the job experience, or both, are familiar with the practices and DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.11 PURCHASE AGREEMENT Exhibit A
hazards of arboriculture and the equipment used in such operations. Vendor shall have a certified arborist on staff or access to one as needed.

Vendor must present sufficient qualified personnel to carry out the project tasks in a timely fashion.

Task Category 1 - Tree Pruning by Climbing, Aerial Lift, or Crane and Disposal/Recycling of related Wood and Green Waste
Pruning trees may be requested in order to reduce failure potential of branches or entire tree, improve or maintain tree health, develop desired structure and appearance, prevent interference with the built environment or pedestrian or vehicular circulation, and other specific objectives. All tree debris generated as a result of the Contactor’s operations under this Contract will be recycled, disposed of, or left on site as agreed upon with the City Contact.

Task 1 Deliverables: Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints. Work to meet satisfaction of City Contact.

Task 1 Timing: Based on the specific project work requested.

Task Category 2 - Tree Removal by Climbing, Aerial Lift, or Crane and Disposal/Recycling of related Wood and Green Waste
Tree removal shall consist of the total removal of all above ground plant parts in accordance with accepted industry standards leaving a stump that is as close to natural grade as possible unless otherwise specified.

All tree debris generated as a result of the Contactor’s operations under this Contract will be recycled, disposed of, or left on site as agreed upon with the City Contact.

Care shall be taken to prevent limbs, branches, trunks, and/or other tree parts from falling and creating damage to adjacent homes, driveways, sidewalks, streets, adjacent trees, and other property, both public and private.

Task Category 2 Deliverables: Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints.

Work to meet satisfaction of City Contact.

Task Category 2 Timing: Based on the specific project work requested.

Task Category 3 – Stump Removal and Disposal/Recycling of related Wood and Green Waste Stump removal shall consist of the removal of the entire remaining tree trunk and associated buttress roots and grinding of the root ball to a depth and width specified by the City department requestor, typically within 4 to 18 inches below grade. The Contractor shall complete entire Underground Service Alert process prior to commencement of work. For applicable above grade stump removal projects, the stump removal area shall be crowned at two (2) inches above grade to allow for settling and shall be raked smooth and all remaining debris disposed of, or as specified by City Contact.

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20.12 PURCHASE AGREEMENT Exhibit A
Task 3 Deliverables: Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints. Work to meet satisfaction of City Contact.

Task 3 Timing: Based on the specific project work requested.

Task Category 4 – Clean up and Disposal/Recycling of Wood, and Green Waste Outside of tasks listed in Categories 1 and 2
All tree debris under this Contract will be recycled, disposed of, or left on site as agreed upon with the City Contact.

Task 4 Deliverables: Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints. Work to meet satisfaction of City Contact.

Task 4 Timing: Based on the specific project work requested.

Task Category 5 – Ongoing Tree Work and Support Services As part of ongoing maintenance to city facilities and parks, the vendor may be called upon to complete ongoing routine tree work inclusive of the list below.

1. Relocating existing trees to another location

2. Planting replacement trees and providing tree establishment support;

3. Completing mulching related to other tree services

4. Cabling, bracing, propping

5. Root pruning and root barrier installation
Task 5 Deliverables: Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints. Work to meet satisfaction of City Contact.

Task 5 Timing: Based on the specific project work requested.

Task Category 6 – Emergency Response Tree Services
Emergency response shall occur within 30 minutes for a call back and 1 hour to have a crew on site for city service areas and working, and may be required during evenings, weekends, and holidays.

Vendor shall provide the name and contact information of a representative who shall be available (respond to phone or text messages within 15 minutes) 24 hours a day, 7 days a week, in the event of an emergency.

During the emergency, Vendor shall provide the City of Santa Cruz with all available supplies, materials, equipment and/or services on a priority basis. Vendor shall provide all equipment, devices, and personnel DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.13 PURCHASE AGREEMENT Exhibit A
needed to ensure public safety and establish proper traffic patterns per Manual on Uniform Traffic Control Devices (MUTCD) standards.

Service location(s) and estimated arrival time will be mutually agreed upon, by the City and Vendor, at time of call and will be determined based on need and existing conditions. It is understood that current conditions, such as power outages, road closures, natural disasters, and damages to the Vendor’s facility and/or equipment, will be taken into consideration. The City reserves the right to cancel the contract for unacceptable slow response to emergency calls.

City will be billed consistent with the Fee Schedule.

Task 6 Deliverables: On going communication to City Contact, Emergency Operations Director or any designee as needed during an emergency to report the status and completion of the work for each specific project. Communication to City Contact reporting the scheduling and completion of the work for each specific project and any issues such as incidental damage or neighbor complaints. Work to meet satisfaction of City Contact.

Task 6 Timing: within the expected completion time with the city contact.

D.Responsibilities of City
The City will be responsible for providing a designated City contact during the course of the project. Access to the facilities needed to complete the work.

E.Communication
Vendor and its employees shall be accessible for communication by cellular phone during all hours that the Vendor is conducting work within the city and during the City’s normal working hours. The Vendor shall have the ability to contact its lead person and crewmembers within 30 minutes of notification by the City.

F.Public Relations, Safety, and Cooperation
All tree work shall be conducted in a manner as to cause the least possible interference or annoyance to others. The Contractor shall endeavor to maintain good public relations at all times. The Contractor is required to identify the name of their company, confirm that they are a contracted vendor with the City of Santa Cruz, and identify the Foreman on duty if asked by a member of the public. Any follow up communication or inquiries from the public are to be directed and handled by the City Contact.

Contractor shall ensure that all fire hydrants, meter vaults, water and gas shut off valves and similar facilities are accessible during the course of work. Contractor shall maintain clear passage and least amount of inconvenience to public and private traffic ways, businesses, and residences.

Contractor shall strive to keep noise levels to a minimum at all times. Additionally, the Contractor shall abide by the City’s Noise Ordinance (Santa Cruz Municipal Code Section 9.36). The City’s noise ordinance prohibits performing loud work after 10:00 p.m. and before 8:00 a.m.. The City's Public Works Director may grant exceptions on a case by case basis and allow work to begin as no earlier than 7:00 a.m. for projects that have the potential to disrupt traffic, and whereby, that disruption could be alleviated by authorizing work to commence at 7:00 a.m..

The Contractor shall maintain all work sites in a safe, neat, clean, and orderly condition. All work sites are to be kept free from trash, debris, surplus material or other objectionable matter of any kind, subject to the satisfaction of the City Contact.

The Contractor shall provide an extra ground person on site for safety to ensure low impact to city, residents and businesses operations.

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20.14 PURCHASE AGREEMENT Exhibit A
G.Inspection and Review
The City may inspect all tree work as needed or as time allows. If deficiencies are detected, the Vendor will be required to make the necessary adjustments at the Vendor’s expense. The quality of tree service provided by the Vendor will be evaluated throughout the contract term. Unsatisfactory service may result in termination of the contract.

H.Accident Reporting
Vendor shall immediately notify the City of any accident, regardless of whether or not injury or damage is evident, involving the Vendor's staff, vehicles, or equipment while on a City work site. Vendor shall cooperate fully with City in the investigation of any injury or death occurring at any work site, including the supplying of reports or documentation as requested by the City.

I.Protection of Existing Facilities
The Contractor shall follow all ISA safety standards in the performance of the work on this project not to damage utility structures and substructures. Prior to beginning any operation, the Contractor is responsible for the entire Dig Alert process and other necessary utilities within the construction area.

The Contractor shall provide adequate and reasonable protection of existing City facilities from damage or injury at all times. The Contractor shall be responsible for the costs associated with all repairs or replacements of existing improvements that are damaged, injured, or removed as a result of performing work under these Specifications.

Contractor is prohibited from any unauthorized entry of private property during the execution of this Contract unless authorized by the City Contract Supervisor or property owner.

J.Damage to Public of Private Property
Contractor shall contact the City Contact immediately via email upon discovery of damage caused by the Contractor and include a photo image of the damage. Repairs to private or city property damaged by the Contractor shall be made within 48 hours, except utility lines that shall be repaired within the same working day. Repairs on private property shall be made in accordance with the appropriate building code under permits issued by the City of Santa Cruz Planning Department. Any damage caused by the Contractor shall be repaired or restored at the contractor’s expense to a condition similar or equal to that existing before the damage, in a manner acceptable to the City. Special attention should be taken to prevent damage to sprinkler and irrigations systems in parkways and parks. The contractor shall ensure that crews do not drive on City sidewalks in the performance of the work.

K.Interference with Other City Operations
Tree work for this project shall be coordinated with other City projects to minimize possible conflicts. The City reserves the right to direct a green waste disposal location as long as it does not cause undue hardship on the contractor.

Occasionally, activities or events deemed necessary by the City will interfere with the Contractor’s ability to complete services. In the event of a scheduling conflict, the City shall notify the Contractor within 24 hours to reschedule its work to avoid conflicts with any planned activities or other occurring work at the site(s).

L.Wildlife Protection
Contractor shall abide by all State and Federal wildlife protection regulations. State and Federal law prohibits disturbing eggs, active nests or nesting birds. The majority of nesting activity occurs in the late winter, spring, and can continue into early summer. Nests can also occur in cavities of trees. If birds or DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.15 PURCHASE AGREEMENT Exhibit A
nests are found, report to the City Contact or to the Urban Forester immediately. It is the Contractor’s responsibility to leave undisturbed any or all trees scheduled for removal if active nesting birds or eggs occupy the tree(s).

M.Vendor’s Employee Conduct
Vendor employees shall be fully clothed; clothing and tools shall be compliant with OSHA and ANSI standards
Vendor will agree to remove any employee whose conduct is unsafe, improper, inappropriate, or offensive as determined by the City. A removed employee(s) is not to work on City premises again without the written consent of the City. The Vendor will remove any employee from working in, or delivering to, a City facility that is convicted of a felony during his/her employment.

N.Traffic Control
The Contractor shall conform to all City traffic safety requirements and operating rules at all times. The Contractor will be responsible for supplying and using all safety equipment necessary to close or delineate traffic lanes to vehicle or pedestrian traffic. Lane closures, including parking lanes, when required by the City Contact, will require notification to the City’s Traffic Management Division of the Transportation Department and posting of notices not less than 48 hours prior to closure.

Pedestrian and vehicular traffic shall be allowed to pass through the work areas only under conditions of safety and with as little inconvenience and delay as possible. Unless the work area is totally barricaded otherwise kept safe, at least one representative of the Contractor shall serve to coordinate safe operations on the ground at all times when work operations are in progress.

O.Background Check
Only employees of the firm who successfully pass the City-required background check will be allowed on Police Department, Water Treatment Plant, and Wastewater Treatment Facility properties. The Vendor will be responsible for the cost of background checks and must confirm that all proposed employees have completed and passed a background check. Background checks will be completed before the employee is allowed facility access.

P.Exclusions and Alternate Sources
Vendor will provide services covered in the contract. In the event the Vendor is unable to supply the services when needed, the City reserves the right to order services from any source able to perform the work.

Excluded from this specification are all good or services purchased separately on other City contracts. The City also reserves the right to bid separately any item or items where it is determined by the Purchasing Manager that a substantial savings in cost will result due to a large quantity purchase, or the commodity is not appropriately classified under this specified contract.

Q.Service Area
The “Service Area” shall include areas within the City of Santa Cruz limits and any outlying areas serviced by the City Departments. Service to the “Service Area” must be available seven (7) days a week, if required.

Each City Department may have different hours of operations, but all non-urgent deliveries shall be done within regular business hours. All emergency/urgent deliveries shall be coordinated with each respective ordering Department. The Vendor is required to provide as needed [RFP Title] upon request by any City Department.

R.Contractor Responsibilities
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20.16 PURCHASE AGREEMENT Exhibit A

1. Standards of Conduct. Vendor is responsible for maintaining standards of employee competence, conduct, courtesy, appearance, honesty, and integrity satisfactory to the City during its performance of the Work.

2. Supervision. Vendor shall provide adequate and competent supervision at all times during the Contract Term, as specified in Section 2.3. Vendor shall be readily available to meet with the City upon the City’s request. Contractor shall provide the telephone numbers where its representative(s) can be reached during regular business hours and an emergency contact for non-business hours.

3. City Premises. Vendor’s employees and agents shall comply with all City rules and regulations while performing the Work and while on City premises.

4. Removal of Employee. City may request Vendor immediately remove from assignment to the City any employee found unfit to perform duties at the City. Vendor shall comply with all such requests.

Communication. Vendor shall ensure that onsite employees can communicate in English both verbally and in writing.

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20.17 PURCHASE AGREEMENT Exhibit A
II. FEE SCHEDULE
On-Call Tree Services
Pricing for all Labor at prevailing wage rates and Equipment Needed to complete the following Task Categories from the Scope of Work below:

Task Category 1 - Tree Pruning by Climbing, Aerial Lift, or Crane and Disposal/Recycling of Related Wood and Green Waste Task Category 2 - Tree Removal by Climbing, Aerial Lift, or Crane and Disposal/Recycling of Related Wood and Green Waste Task Category 3 - Stump Removal and
Disposal/Recycling of Wood, and Green Waste
Task Category 4 - Clean up and Disposal/Recycling of Wood, and Green Waste Outside of tasks listed in categories 1, 2, and 3 Task Category 5 - Ongoing Tree Work and Support Services Task Category 6 - Emergency Response Tree Services*
*For Task 6 - Emergency Response Rates, please note that contractor may be paid at the 1.5X or 2X Overtime rate for emergencies, as applicable.

If work for Task 6- Emergency response is being conducted during normal business hours, the normal hourly rate will apply.

Name of Position (For example Senior Tree Trimmer,
Tree Trimmer, Tree Maintenance Laborer,
Groundsperson, Equipment Operator, Crane Operator,
Supervisor, ISA Certified Arborist, etc.)
Total Hourly
Rate of Pay at
Prevailing
Wage Rates
*if applicable
Fully Burdened
Hourly Rate
(include all
benefits and
overhead)

1.5X
Overtime
Hourly
Rate
Fully
Burdened

1.5X
Overtime
Hourly
Rate
2X
Overtime
Hourly
Rate
Fully
Burdened
2X
Overtime
Hourly
Rate
Qualified Tree Worker $40.52 $75.00 $60.00 $115.00 $120.00 $150.00 Stump Grinder/Tractor/Fertilizer/Excavator Operator $40.52 $80.00 $62.50 $125.00 $135.00 $166.00 Crane Operator (30 ton) $48.00 $100.00 $72.00 $150.00 $96.00 $187.00 Crane Operator (55 ton) $95.99 $187.00 $132.08 $280.00 $168.61 $374.00 Driver (roll-off truck) $40.52 $85.00 $62.50 $128.00 $135.00 $166.00 DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.18 PURCHASE AGREEMENT Exhibit A
Equipment (For example loader, excavator, trailers,
stump grinder, chipper, crane, trucks, water tanker)
Fully
Burdened
Hourly Rate of
Equipment
Climbing truck $61.00
Bucket truck $83.00
Pick up truck $44.00
Roll off truck $84.00
Hand Fed Chipper $59.00
Machine fed Chipper $150.00
30 ton crane $165.00
55 ton crane $225.00
Small tractor/mower/excavator $83.00
Stump grinder $110.00
Spray rig $120.00
Airspade $62.00
Light tower $25.00
String weed trimmer $18.00
Cabling material $195.00
Disposal fees (only applicable if materials disposed of at a Resource Recovery Facility)
By weight,
volume, or
load (please
specify)
Wood waste $70 per ton
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20.19 PURCHASE AGREEMENT Exhibit B

EXHIBIT B

SUPPLEMENTAL CONTRACT PROVISIONS FOR CONTRACTS FUNDED IN-PART

BY FEMA PUBLIC ASSISTANCE
ARTICLE 1 - REMEDIES

1.01 Remedies for Breach of Contract
A. For contracts exceeding $250,000, the following shall apply. If the Contractor violates or breaches the Contract, the City may avail itself of any or all of the remedies provided for elsewhere in this Contract. If there are no remedies provided for elsewhere in this Contract, the City may avail itself of any or all of the following remedies. After declaring the Contractor in default pursuant to the procedures in paragraph (a) of subdivision (2) of this section (B) below, the City may (i) withhold payment for unsatisfactory services, (ii) suspend or terminate the Contract in whole or in part; and/or(iii) have the services under this Contract completed by such means and in such manner, by contract procured with or without competition, or otherwise, as the City may deem advisable in accordance with all applicable Contract provisions and law. After completion of the services under this Contract, the City shall certify the expense incurred in such completion, which shall include the cost of procuring that contract. Should the expense of such completion, as certified by the City, exceed the total sum which would have been payable under the Contract if it had been completed by the Contractor, any excess shall be promptly paid by the Contractor upon demand by the City. The excess expense of such completion, including any and all related and incidental costs, as so certified by the City may be charged against and deducted out of monies earned by the Contractor.

ARTICLE 2 - TERMINATION

2.01 Termination for Cause and Convenience
A. The City shall have the right to terminate the Contract in whole or in part for cause, for convenience, due to force majeure.

1. Termination for Cause. The City shall have the right to terminate the Contract, in whole or in part, for cause upon a determination that the Contractor is in default of the Contract.

Unless a shorter time is determined by the City to be necessary, the City shall effect termination according to the following procedure:
i. Notice to Cure. The City shall give written notice of the conditions of default, setting forth the ground or grounds upon which such default is declared (“Notice to Cure”).

The Contractor shall have ten (10) days from receipt of the Notice to Cure or any longer period that is set forth in the Notice to Cure to cure the default. The City may temporarily suspend services under the Contract pending the outcome of the default proceedings pursuant to this section.
ii. Opportunity to be Heard. If the conditions set forth in the Notice to Cure are not cured within the period set forth in the Notice to Cure, the City may declare the DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.20 PURCHASE AGREEMENT Exhibit B
Contractor in default. Before the City may exercise his or her right to declare the Contractor in default, the Contractor must be given an opportunity to be heard upon not less than five (5) business days’ notice. The City may, in its discretion, provide for such opportunity to be in writing or in person. Such opportunity to be heard shall not occur prior to the end of the cure period but notice of such opportunity to be heard may be given prior to the end of the cure period and may be given contemporaneously with the Notice to Cure
iii. Notice of Termination. After an opportunity to be heard, the City may terminate the Contract, in whole or in part, upon finding the Contractor in default. The City shall give the Contractor written notice of such termination (“Notice of Termination”), specifying the applicable provision(s) under which the Contract is terminated and the effective date of termination. If no date is specified in the Notice of Termination, the termination shall be effective either 10 calendar days from the date the notice is personally delivered or 15 calendar days from the date Notice of Termination is sent by another method. The Notice of Termination shall be personally delivered, sent by certified mail return receipt requested, or sent by fax and deposited in a post office box regularly maintained by the United States Postal Service in a postage pre-paid envelope.
iv. Grounds for Default. The City shall have the right to declare the Contractor in default:

1. Upon a breach by the Contractor of a material term or condition of this Contract, including unsatisfactory performance of the services;

2. Upon insolvency or the commencement of any proceeding by or against the Contractor, either voluntarily or involuntarily, under the Bankruptcy Code or relating to the insolvency, receivership, liquidation, or composition of the Contractor for the benefit of creditors;

3. If the Contractor refuses or fails to proceed with the services under the Contract when and as directed by the City;

4. If the Contractor or any of its officers, directors, partners, five percent (5%) or greater shareholders, principals, or other employee or person substantially involved in its activities are indicted or convicted after execution of the Contract under any state or federal law of any of the following:
a. a criminal offense incident to obtaining or attempting to obtain or performing a public or private contract;
b. fraud, embezzlement, theft, bribery, forgery, falsification, or destruction of records, or receiving stolen property; a criminal offense incident to obtaining or attempting to obtain or performing a public or private contract;
c. fraud, embezzlement, theft, bribery, forgery, falsification, or destruction of records, or receiving stolen property;
d. a criminal violation of any state or federal antitrust law; e. violation of the Racketeer Influence and Corrupt Organization Act, 18 U.S.C. § 1961 et seq., or the Mail Fraud Act, 18U.S.C. § 1341 et seq., for acts in connection with the submission of bids or proposals for a public or private contract;
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20.21 PURCHASE AGREEMENT Exhibit B
f. conspiracy to commit any act or omission that would constitute grounds for conviction or liability under any statute described in subparagraph (d) above; or
g. an offense indicating a lack of business integrity that seriously and directly affects responsibility as a City vendor.

5. If the Contractor or any of its officers, directors, partners, five percent (5%) or greater shareholders, principals, or other employee or person substantially involved in its activities are subject to a judgment of civil liability under any state or federal antitrust law for acts or omissions in connection with the submission of bids or proposals for a public or private contract; or

6. If the Contractor or any of its officers, directors, partners, five percent (5%) or greater shareholders, principals, or other employee or person substantially involved in its activities makes or causes to be made any false, deceptive, or fraudulent material statement, or fail to make a required material statement in any bid, proposal, or application for the City of Santa Cruz or other government work.
v. Basis of Settlement. The City shall not incur or pay any further obligation pursuant to this Contract beyond the termination date set by the City in its Notice of Termination. The City shall pay for satisfactory services provided in accordance with this Contract prior to the termination date. In addition, any obligation necessarily incurred by the Contractor on account of this Contract prior to receipt of notice of termination and falling due after the termination date shall be paid by the City in accordance with the terms of this Contract. In no event shall such obligation be construed as including any lease or other occupancy agreement, oral or written, entered into between the Contractor and its landlord.

2. Termination for Convenience. The City shall have the right to terminate the Contract for convenience, by providing written notice (“Notice of Termination”) according to the following procedure. The Notice of Termination shall specify the applicable provision(s) under which the Contract is terminated and the effective date of termination, which shall be not less than 10 calendar days from the date the notice is personally delivered or 15 days from the date the Notice of Termination is sent by another method. The Notice of Termination shall be personally delivered, sent by certified mail return receipt requested, or sent by fax and deposited in a post office box regularly maintained by the United States Postal Service in a postage pre- paid envelope. The basis of settlement shall be as provided for in subparagraph (v) of paragraph (a) of subdivision (2) of this section (B), above.

3. Termination due to Force Majeure
i. For purposes of this Contract, a force majeure event is an act or event beyond the control and without any fault or negligence of the Contractor (“Force Majeure Event”). Force Majeure Events may include, but are not limited to, fire, flood, earthquake, storm or other natural disaster, civil commotion, war, terrorism, riot, and labor disputes not brought about by any act or omission of the Contractor. ii. In the event the Contractor cannot comply with the terms of the Contract (including any failure by the Contractor to make progress in the performance of the services) because of a Force Majeure Event, then the Contractor may ask the City to excuse the nonperformance and/or terminate the Contract. If the City, in its reasonable discretion, determines that the Contractor cannot comply with the terms of the DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.22 PURCHASE AGREEMENT Exhibit B
Contract because of a Force Majeure Event, then the City shall excuse the nonperformance and may terminate the Contract. Such a termination shall be deemed to be without cause.
iii. If the City terminates the Contract due to a Force Majeure Event, the basis of settlement shall be as provided for in subparagraph (v) of paragraph (A) (1) of Section 2.01 above.

ARTICLE 3 – EQUAL EMPLOYMENT OPPORTUNITY

3.01 Equal Employment Opportunity Requirements
A. The following applies to all construction contracts. During the performance of this contract, the contractor agrees as follows:

1. The contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, sexual orientation, gender identity, or national origin. The contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their race, color, religion, sex, sexual 7 See 2 C.F.R. Part 200, Appendix II, § C. Contract Provisions Guide 11 orientation, gender identity, or national origin. Such action shall include, but not be limited to the following: Employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause.

2. The contractor will, in all solicitations or advertisements for employees placed by or on behalf of the contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, sexual orientation, gender identity, or national origin.

3. The contractor will not discharge or in any other manner discriminate against any employee or applicant for employment because such employee or applicant has inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant. This provision shall not apply to instances in which an employee who has access to the compensation information of other employees or applicants as a part of such employee's essential job functions discloses the compensation of such other employees or applicants to individuals who do not otherwise have access to such information, unless such disclosure is in response to a formal complaint or charge, in furtherance of an investigation, proceeding, hearing, or action, including an investigation conducted by the employer, or is consistent with the contractor's legal duty to furnish information.

4. The contractor will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding, a notice to be provided advising the said labor union or workers' representatives of the contractor's commitments under this section, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.

5. The contractor will comply with all provisions of Executive Order 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor.

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20.23 PURCHASE AGREEMENT Exhibit B

6. The contractor will furnish all information and reports required by Executive Order 11246 of September 24, 1965, and by rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the administering agency and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders.

7. In the event of the contractor's noncompliance with the nondiscrimination clauses of this contract or with any of the said rules, regulations, or orders, this contract may be canceled, terminated, or suspended in whole or in part and the contractor may be declared ineligible for further Government contracts or federally assisted construction contracts in accordance with procedures authorized in Executive Order 11246 of September 24, 1965, and such other Contract Provisions Guide 12 sanctions may be imposed and remedies invoked as provided in Executive Order 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.

8. The contractor will include the portion of the sentence immediately preceding paragraph (1) and the provisions of paragraphs (1) through (8) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to section 204 of Executive Order 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The contractor will take such action with respect to any subcontract or purchase order as the administering agency may direct as a means of enforcing such provisions, including sanctions for noncompliance:

Provided, however, that in the event a contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the administering agency, the contractor may request the United States to enter into such litigation to protect the interests of the United States.

The applicant further agrees that it will be bound by the above equal opportunity clause with respect to its own employment practices when it participates in federally assisted construction work: Provided, that if the applicant so participating is a state or local government, the above equal opportunity clause is not applicable to any agency, instrumentality or subdivision of such government which does not participate in work on or under the contract.

The applicant agrees that it will assist and cooperate actively with the administering agency and the Secretary of Labor in obtaining the compliance of contractors and subcontractors with the equal opportunity clause and the rules, regulations, and relevant orders of the Secretary of Labor, that it will furnish the administering agency and the Secretary of Labor such information as they may require for the supervision of such compliance, and that it will otherwise assist the administering agency in the discharge of the agency's primary responsibility for securing compliance. The applicant further agrees that it will refrain from entering into any contract or contract modification subject to Executive Order 11246 of September 24, 1965, with a contractor debarred from, or who has not demonstrated eligibility for, Government contracts and federally assisted construction contracts pursuant to the Executive Order and will carry out such sanctions and penalties for violation of the equal opportunity clause as may be imposed upon contractors and subcontractors by the administering agency or the Secretary of Labor pursuant to Part II, Subpart D of the Executive Order. In addition, the applicant agrees DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.24 PURCHASE AGREEMENT Exhibit B
that if it fails or refuses to comply with these undertakings, the administering agency may take any or all of the following actions: Cancel, terminate, or suspend in whole or in part this grant (contract, loan, insurance, guarantee); refrain from extending any further assistance to the applicant under the program with respect to which the failure or refund occurred until satisfactory assurance of future compliance has been received from such applicant; and refer the case to the Department of Justice for appropriate legal proceedings.

ARTICLE 4 – CONTRACT WORK HOURS AND SAFETY STANDARDS ACT

4.01 Compliance with the Contract Work Hours and Safety Standards Act The following applies to contracts exceeding $100,000 and involve the employment of mechanics, laborers, and construction work.

A. Overtime requirements. No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek.

B. Violation; liability for unpaid wages; liquidated damages. In the event of any violation of this section the contractor and any subcontractor responsible therefor shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United States (in the case of work done under contract for the District of Columbia or a territory, to such District or to such territory), for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in this section, in the sum of $27 for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in this section.

C. Withholding for unpaid wages and liquidated damages. The City shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the contractor or subcontractor under any such contract or any other federal contract with the same prime contractor, or any other federally-assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same prime contractor, such sums as may be determined to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in this section.

D. Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set forth in paragraph (A) through (D) of this section and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in paragraphs (A) through (D) of this section.

4.02 Further Compliance with the Contract Work Hours and Safety Standards Act A. The contractor or subcontractor shall maintain payrolls and basic payroll records during DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.25 PURCHASE AGREEMENT Exhibit B
the course of the work and shall preserve them for a period of three years from the completion of the contract for all laborers and mechanics, including guards and watchmen, working on the contract. Such records shall contain the name and address of each such employee, social security number, correct classifications, hourly rates of wages paid, daily and weekly number of hours worked, deductions made, and actual wages paid.

B. Records to be maintained under this provision shall be made available by the contractor or subcontractor for inspection, copying, or transcription by authorized representatives of the Department of Homeland Security, the Federal Emergency Management Agency, and the Department of Labor, and the contractor or subcontractor will permit such representatives to interview employees during working hours on the job.

ARTICLE 5 – CLEAN AIR ACT AND FEDERAL WATER POLLUTION CONTROL ACT

5.01 Compliance with Clean Air Act
A. For contracts exceeding $150,000, the contractor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act, as amended, 42 U.S.C. § 7401 et seq.

B. The contractor agrees to report each violation to the City and understands and agrees that the City will, in turn, report each violation as required to assure notification to the Federal Emergency Management Agency (FEMA), and the appropriate Environmental Protection Agency Regional Office.

C. The contractor agrees to include these requirements in each subcontract exceeding $150,000 financed in whole or in part with federal assistance provided by FEMA.

5.02 Compliance with Federal Water Pollution Control Act A. For contracts exceeding $150,000, the contractor agrees to comply with all applicable standards, orders, or regulations issued pursuant to the federal Water Pollution Control Act, as amended, 33 U.S.C. § 1251 et seq.

B. The contractor agrees to report each violation to the City and understands and agrees that the City will, in turn, report each violation as required to assure notification to the Federal Emergency Management Agency (FEMA) and the appropriate Environmental Protection Agency Regional Office.

C. The contractor agrees to include these requirements in each subcontract exceeding $150,000 financed in whole or in part with federal assistance provided by FEMA.

ARTICLE 6 – DEBARMENT AND SUSPENSION

6.01 Suspension and Debarment
A. This contract is a covered transaction for purposes of 2 C.F.R. Part 180 and 2 C.F.R. Part 3000. As such, the contractor is required to verify that none of the contractor’s principals (defined at 2 C.F.R. § 180.995) or its affiliates (defined at 2 C.F.R. § 180.905) are excluded (defined at 2 C.F.R. § 180.940) or disqualified (defined at 2 C.F.R. § 180.935).

B. The contractor must comply with 2 C.F.R. Part 180, subpart C and 2C.F.R. Part 3000, subpart C, and must include a requirement to comply with these regulations in any lower tier covered transaction it enters into. This certification is a material representation of fact relied upon by the City. If it is later determined that the contractor did not comply with 2 DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.26 PURCHASE AGREEMENT Exhibit B
C.F.R. Part 180, subpart C and 2 C.F.R. Part 3000, subpart C, in addition to remedies available to the City, the federal government may pursue available remedies, including but not limited to suspension and/or debarment.

C. The bidder or proposer agrees to comply with the requirements of 2 C.F.R. Part 180, subpart C and 2 C.F.R. Part 3000, subpart C while this offer is valid and throughout the period of any contract that may arise from this offer. The bidder or proposer further agrees to include a provision requiring such compliance in its lower tier covered transactions.

ARTICLE 7 – BYRD ANTI-LOBBYING AMENDMENT

7.01 Byrd Anti-Lobbying Amendment, 31 U.S.C. § 1352 (as amended) A. Contractors who apply or bid for an award of more than $100,000 shall file the required certification. Each tier certifies to the tier above that it will not and has not used federally appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, officer or employee of Congress, or an employee of a Member of Congress in connection with obtaining any federal contract, grant, or any other award covered by 31 U.S.C. § 1352.

Each tier shall also disclose any lobbying with non-federal funds that takes place in connection with obtaining any federal award. Such disclosures are forwarded from tier to tier up to the recipient who in turn will forward the certification(s) to the federal awarding agency.

ARTICLE 8 – PROHIBITION ON CONTRACTING FOR COVERED

TELECOMMUNICATIONS EQUIPMENT OR SERVICES

8.01 Prohibitions
A. Section 889(b) of the John S. McCain National Defense Authorization Act for Fiscal Year 2019, Pub. L. No. 115-232, and 2 C.F.R. § 200.216 prohibit the head of an executive agency on or after Aug.13, 2020, from obligating or expending grant, cooperative agreement, loan, or loan guarantee funds on certain telecommunications products or from certain entities for national security reasons.

B. Unless an exception in paragraph (C.) of this clause applies, the contractor and its subcontractors may not use grant, cooperative agreement, loan, or loan guarantee funds from the Federal Emergency Management Agency to:

1. Procure or obtain any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology of any system;

2. Enter into, extend, or renew a contract to procure or obtain any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology of any system; or

3. Enter into, extend, or renew contracts with entities that use covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system; or
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20.27 PURCHASE AGREEMENT Exhibit B

4. Provide, as part of its performance of this contract, subcontract, or other contractual instrument, any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.

C. Exceptions.

1. This clause does not prohibit contractors from providing— i. A service that connects to the facilities of a third-party, such as backhaul, roaming, or interconnection arrangements; or
ii. Telecommunications equipment that cannot route or redirect user data traffic or permit visibility into any user data or packets that such equipment transmits or otherwise handles.

2. By necessary implication and regulation, the prohibitions also do not apply to:
i. Covered telecommunications equipment or services that:
i. Are not used as a substantial or essential component of any system; and ii. Are not used as critical technology of any system.
ii. Other telecommunications equipment or services that are not considered covered telecommunications equipment or services.

D. Reporting requirement.

1. In the event the contractor identifies covered telecommunications equipment or services used as a substantial or essential component of any system, or as critical technology as part of any system, during contract performance, or the contractor is notified of such by a subcontractor at any tier or by any other source, the contractor shall report the information in paragraph (d)(2) of this clause to the recipient or subrecipient, unless elsewhere in this contract are established procedures for reporting the information.

2. The Contractor shall report the following information pursuant to paragraph (d)(1) of this clause:
i. Within one business day from the date of such identification or notification: The contract number; the order number(s), if applicable; supplier name; supplier unique entity identifier (if known); supplier Commercial and Government Entity (CAGE) code (if known); brand; model number (original equipment manufacturer number, manufacturer part number, or wholesaler number); item description; and any readily available information about mitigation actions undertaken or recommended. ii. Within 10 business days of submitting the information in paragraph (d)(2)(i) of this clause: Any further available information about mitigation actions undertaken or recommended. In addition, the contractor shall describe the efforts it undertook to prevent use or submission of covered telecommunications equipment or services, and any additional efforts that will be incorporated to prevent future use or submission of covered telecommunications equipment or services.

E. Subcontracts. The Contractor shall insert the substance of this clause, including this paragraph (E.), in all subcontracts and other contractual instruments.

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20.28 PURCHASE AGREEMENT Exhibit B
ARTICLE 9 – DOMESTIC PREFERENCES FOR PROCUREMENTS

9.01 Domestic Preference for Procurements
A. As appropriate, and to the extent consistent with law, the contractor should, to the greatest extent practicable, provide a preference for the purchase, acquisition, or use of goods, products, or materials produced in the United States. This includes, but is not limited to iron, aluminum, steel, cement, and other manufactured products.

B. For purposes of this clause:

1. Produced in the United States means, for iron and steel products, that all manufacturing processes, from the initial melting stage through the application of coatings, occurred in the United States.

2. Manufactured products mean items and construction materials composed in whole or in part of non-ferrous metals such as aluminum; plastics and polymer-based products such as polyvinyl chloride pipe; aggregates such as concrete; glass, including optical fiber; and lumber.

ARTICLE 10 – OTHER PROVISIONS

10.01 Access to Records
A. The Contractor agrees to provide the City, the FEMA Administrator, the Comptroller General of the United States, or any of their authorized representatives access to any books, documents, papers, and records of the Contractor which are directly pertinent to this contract for the purposes of making audits, examinations, excerpts, and transcriptions.

B. The Contractor agrees to permit any of the foregoing parties to reproduce by any means whatsoever or to copy excerpts and transcriptions as reasonably needed.

C. The Contractor agrees to provide the FEMA Administrator or his authorized representatives access to construction or other work sites pertaining to the work being completed under the contract.

D. In compliance with section 1225 of the Disaster Recovery Reform Act of 2018, the City and the Contractor acknowledge and agree that no language in this contract is intended to prohibit audits or internal reviews by the FEMA Administrator or the Comptroller General of the United States.

10.02 Changes
A. The cost of any contract change, modification, amendment, addendum, change order, or constructive change must be necessary, allocable, within the scope of the agreement, reasonable for the scope of work, and otherwise allowable.

10.03 Department of Homeland Security Seal, Logo, and Flags A. The Contractor must obtain permission before using the Department of Homeland Security (DHS) seal(s), logos, crests, reproductions of flags, or likenesses of DHS agency officials.

DocuSign Envelope ID: AD301E56-D285-4AEE-8533-0C61E9617983

20.29 PURCHASE AGREEMENT Exhibit B

10.04 Compliance with Federal Law, Regulations, And Executive Orders and Acknowledgement of Federal Funding
A. This is an acknowledgement that FEMA financial assistance will be used to fund all or a portion of the contract. The Contractor will comply with all applicable federal law, regulations, executive orders, FEMA policies, procedures, and directives.

Santa Cruz City CouncilJune 25, 2024

Santa Cruz City Council
June 25, 2024