SJ 2126026.1
The stated intent by the City for this Proposed Ordinance is to undo an alleged “loophole” created by California Civil Code Section 1947.13 according to the City’s Agenda Report of September 10, 2024 (“City Report”).
Section 1947.13 is not a loophole; it provides owners a one-time rent increase to an unassisted level after maintaining low rents for years, sometimes decades, and then only after providing residents with at least a year’s notice of the anticipated expiration of the rent restrictions. These are owners who have been contributing to the City’s affordable housing stock and now, after dedicating their property to this purpose as they agreed to do, the City seeks to unfairly burden them with artificially low rents without any mechanism by which they can seek a fair rate of return on their property.
For context, Section 1947.12 of the state rent control law imposes a cap on rent increases of five percent (5%) plus regional CPI or ten percent (10%), whichever is less, on most rental properties which are more than fifteen years old in the State of California.2 Along with the rent caps, the State of California also enacted Civil Code Section 1947.13, which provides, in pertinent part:
(a) Notwithstanding subdivision (a) of Section 1947.12, upon the expiration of rental restrictions, the following shall apply:
(1) The owner of an assisted housing development who demonstrates, under penalty of perjury, compliance with all applicable provisions of Sections 65863.10, 65863.11, and 65863.13 of the Government Code and any other applicable federal, state, or local law or regulation may establish the initial unassisted rental rate for units in the applicable housing development. Any subsequent rent increase in the development shall be subject to Section 1947.12.3
Thus Section 1947.13 creates a one-time exemption from the rent caps of Section 1947.12 for the providers of affordable housing who or which have fulfilled their contractual obligations to restrict rents under their applicable regulatory agreement(s) and complied with the notice requirements of the Government Code. Section 1947.13 only allows such owners to set the initial unassisted rent at their properties after which increases are subject to the limitations in Section 1947.12. Again, this is not a loophole. It ensures that such owners can obtain a fair rate of return on their investment after the expiration of the applicable regulatory agreement(s).
Although the legislative history does not specifically explain why the exemptions codified in Section 1947.13 were enacted, the legislative history does reflect that legislators were concerned about the constitutionality of AB 1482. A June 28, 2019, Senate Judiciary Committee Report addressed potential constitutional arguments that could be raised to challenge the law: specifically, whether it allows a fair rate of return.
In considering this issue, the legislative history states that two types of rent control laws have been viewed as “confiscatory” and unconstitutional: (1) laws which directly prevent individual landlords from obtaining a fair rate of return, and (2) laws which create such “significant procedural hurdles that the landlord[s] [are] effectively prevented from obtaining a fair rate of return. (Fisher v. City of Berkeley (1984) 37 Cal. 3d 644, aff’d (1986) 475 US 260.).”4 Laws falling within the first category – i.e., those which prevent specific landlords from obtaining a fair rate of return under their specific circumstances – are subject to “as-applied” constitutional challenges. Laws falling within the second category – those which present “significant procedural hurdles” which “effectively prevent []” the landlord from obtaining a fair rate of return – are subject to facial constitutional challenges. The Proposed Ordinance is vulnerable to both forms of constitutional challenge. 2 Cal. Civ. Code § 1947.12.
3 Cal. Civ. Code § 1947.13(a)(1) (emphasis added).
4 See June 28, 2019, Senate Judiciary Committee Report, AB 1482, pages 9-11.
13.14 Anthony P. Condotti
September 20, 2024
SJ 2126026.1
The Proposed Ordinance supersedes the provisions of Civil Code Section 1947.13 and imposes the rent caps of Section 1947.12 to all projects with expiring regulatory agreements prohibiting them from establishing the initial unassisted rental rates. The consequence is that the rents will remain artificially restricted so long as residents who had ample notice of the expiration of the restrictions remain in their existing units. While the Proposed Ordinance allows for rents to be increased by 5% plus regional CPI or 10%, whichever is less, the rents may never provide owners with a fair rate of return because the starting point for the increases under the Proposed Ordinance is the restricted rent level. The deeper the original rent restriction in the regulatory agreement, the longer it will take for the rents to reach a level that will provide a fair rate of return. Such is a confiscatory taking in violation of the Fifth Amendment to the United States Constitution.
The Fifth Amendment to the United States Constitution prohibits the taking of private property “for public use, without just compensation.” The purpose of this “Takings Clause” is to prevent the government “from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.”5 “[P]roperty is taken when a government regulation ‘compel[s] [a] property owner to suffer a physical “invasion” of his property’ or ‘denies all economically beneficial or productive use of land.’”6 Thus, where a rent control ordinance deprives landlords of a “fair rate of return” or fails to include “certain structural features that safeguard against confiscatory results,” the rent control ordinance may have the effect of an unconstitutional taking.7
Here, the Proposed Ordinance deprives impacted owners from obtaining a fair rate of return, and thus, is a confiscatory taking which may expose the City to significant damage claims. The Proposed Ordinance fixes the base rent for the previously assisted housing units, which were exempt from Section 1947.12 while they were rent-restricted, to the rent amount set under the expiring regulatory agreements rather than allow the owner to establish the initial unassisted rental units as permitted under Civil Code Section 1947.13(a)(1). The Proposed Ordinance essentially takes from the owner the rental value between the restricted rates under the regulatory agreement and the unassisted rate permitted under Section 1947.13(a)(1) and there is absolutely no mechanism within the Proposed Ordinance that would allow the owner to seek an additional rent increase above the limitations within the Proposed Ordinance to ensure a fair rate of return, which should in and of itself invalidate the provision.
California courts have addressed these issues in several cases. In Santa Monica Beach, Ltd. v. Superior Ct., the California Supreme Court recognized that “rent control laws must possess certain structural features that safeguard against confiscatory results.”8 The California Supreme Court stated:
“In addition, when a rent control law establishes a ‘base rent’ by reference to rents on a specified date, the law should permit adjustments of that base rent for those rental units that had artificially low rents at that time. [Citation.] Similarly, the law should permit individualized rent adjustments in appropriate cases even if base rent was not artificially low [citation], and the procedural mechanism by which landlords may obtain any of these adjustments must not be prohibitively burdensome [citations].”9
5 Armstrong v. United States, 364 U.S. 40, 49 (1960).
6 Santa Monica Beach, Ltd. v. Superior Court, 19 Cal. 4th 952, 964 (1999) (quoting Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1015-16 (1992)) (emphasis added).
7 Santa Monica Beach, Ltd., 19 Cal. 4th at 962-63 (citing Kavanau v. Santa Monica Rent Control Bd., 16 Cal. 4th 761, 777 (1997)).
8 Id.
9 Santa Monica Beach, Ltd., 19 Cal. 4th at 963 (quoting Kavanau, 16 Cal. 4th at 772–73) (emphasis added).
13.15 Anthony P. Condotti
September 20, 2024
SJ 2126026.1
The Proposed Ordinance falls squarely within some of the factors quoted above on which the California courts have invalidated rent control ordinances. For example, under the Proposed Ordinance, the rents are artificially low because they were set by agreement to amounts affordable to very low-, low-, and moderate-income households with the contractual expectation, and arguably a vested interest, that when the contracts expired, rents could be increased to a market rate that would allow for a fair return on the owner’s property. As a result, to withstand challenge, the City must provide a procedural mechanism by which owners may obtain an adjustment to the rental rates where, as will no doubt result at every property impacted by the Proposed Ordinance, the restriction on rent increases deprives owners of a fair rate of return. Such a mechanism was not required by Civil Code Section 1947.12 because Section 1947.13 permits the step-up to an initial unassisted rental rate thus ensuring owners have a fair rate of return. The Proposed Ordinance removes this protection.
As noted in the City Report, the notice provisions of the Government Code are intended to provide affected tenants sufficient time to locate suitable alternative subsidized or rent-restricted housing in anticipation of the expiration of regulatory agreements restricting their rents. While there may be a shortage of such housing within the City of Santa Cruz, it is neither fair nor constitutional to put the burden of housing these individuals on private property owners who or which have supported the City’s affordable housing efforts for years and are entitled to a fair rate of return after the expiration of their regulatory agreements.
Thank you for your time and consideration.
Sincerely,
Spencer Fane LLP
Karen K. McCay
13.16 City Council
AGENDA REPORT
DATE: 09/05/2024
AGENDA OF: 09/24/2024
DEPARTMENT: Public Works
SUBJECT: Santa Cruz County Regional Vehicle Miles Traveled Mitigation Program (PW)
RECOMMENDATION: Motion to:
1) Receive a presentation on the Santa Cruz County Regional Vehicle Miles Traveled Mitigation Program;
2) Provide input on and accept the preliminary final report; and 3) Direct staff to participate in the development of a Joint Powers Authority to administer the program as well as other efforts related to finalizing the program.
BACKGROUND: Senate Bill (SB) 743 was signed into law in 2013 and required the Governor’s Office of Planning and Research (OPR) to identify new metrics for identifying and mitigating transportation impacts under California Environmental Quality Act (CEQA). OPR identified vehicle miles traveled (VMT) as the new metric. VMT is a measure of the number of vehicle trips multiplied by the length of those trips. To comply with SB 743, the County of Santa Cruz and other local lead agencies adopted new CEQA thresholds using OPR’s recommended VMT metrics for transportation impacts under CEQA. The City of Santa Cruz adopted thresholds at their June 9, 2020 Council meeting and updated these thresholds at the May 12, 2022, Council meeting.
In 2022, the County of Santa Cruz, the City of Watsonville, and the Santa Cruz County Regional Transportation Commission (SCCRTC) were awarded a grant from the California Department of Transportation (Caltrans) through the Caltrans Sustainable Communities Grants Program to fund the creation of the Santa Cruz County Regional VMT Mitigation Program – a regional framework for offsite mitigation of VMT for projects that are not able to mitigate the entirety of their impacts onsite. The City of Santa Cruz has participated on the technical advisory team for this project.
The Santa Cruz County Regional VMT Mitigation Program will provide local jurisdictions with a regionally coordinated mechanism to mitigate VMT impacts associated with land use development. The fees collected through this program will fund projects throughout Santa Cruz County that decrease VMT and greenhouse gas (GHG) emissions, improve safety, combat climate change, and improve the quality of infrastructure within disadvantaged communities. A
14.1 countywide program holds the potential to implement a more effective framework for offsite VMT mitigation than any jurisdiction could achieve on its own. The program would fund active transportation, transit, affordable housing, and other VMT reducing projects across the county.
DISCUSSION: To determine the most suitable regional VMT mitigation mechanism, a study was done to explore the viability of a programmatic regional approach to fund VMT reducing projects. The results found in the study are presented in the preliminary Final Report for the Santa Cruz County Regional Vehicle Miles Traveled (VMT) Mitigation Program (Attachment).
As part of this study, project staff evaluated the following types of programs which are described in more detail in the report: a VMT Bank, a VMT Exchange, a VMT Bank with Exchange and a VMT Impact Fee program. The programs were evaluated based on legal considerations, their potential efficacy, their ability to equitably meet the needs for the region, their impact on the geographic distribution and approach to mitigation, the complexity of administering the program and their alignment with the goals of the overall region.
In addition to programmatic approaches, a list of VMT-reducing projects was established to evaluate the feasibility of including them in a fee-based VMT mitigation program. Projects from the County of Santa Cruz Active Transportation Plan, the SCCRTC’s Regional Transportation Plan, and local Capital Improvement Programs were screened for feasibility of implementation, their potential for VMT reduction, and the estimated cost of VMT reduction credits.
To guide the study, a Stakeholder Advisory Committee and a Technical Advisory Committee were assembled to provide oversight and input during the study. The committees were comprised of subject matter experts, member jurisdictions, community-based organizations, and developers, including those who have expertise in affordable housing. The City of Santa Cruz participated in this Committee.
The preliminary Final Report, guided by the committees’ recommendations, provides more detail on the analyses performed which resulted in a determination that a VMT Bank is the most appropriate for county jurisdictions and that a mix of bicycle, transportation demand management, transit, and affordable housing projects within Santa Cruz County were good candidates for inclusion in the program. Input from the four cities, the University of California, Santa Cruz, and the SCCRTC on the preliminary final report is being sought to finalize the report.
The report also recommends that a Joint Powers Authority (JPA) comprised of each of the local cities and the County be formed to administer the VTM Bank and that the SCCRTC program the funds as part of their regularly occurring programming efforts. Given the makeup of the SCCRTC Commission, the report recommends that the SCCRTC Commission act as the JPA.
Next Steps
County staff and consultants are in the process of presenting the results of the project at each local city council to seek continued participation in the development of the program. Program implementation will require the establishment of the JPA. Program administration is an ongoing area of research and development. The intent is to receive feedback from each of the cities and agencies on the proposed structure of the program as well as input on what additional information and guidance would be needed to implement and administer the VMT Bank.
Presentations to the local city councils, to the SCCRTC board, and to the County Board of
14.2 Supervisors are currently underway. The Final Report, including final recommendations for program structure, implementation, and administration is anticipated to be delivered by March 2025.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:
CEQA is not being evaluated in this action. The SCCRTC will be responsible for determining how it will be addressed.
HEALTH IN ALL POLICIES (HiAP): The reduction of vehicle-miles-traveled encourages infill development reduces greenhouse gas emissions and improves transportation safety by reducing crashes. The proposed program supports Health and Wellness, Healthy Environments, and Stable, Affordable Housing and Shelter tenants of Health in All Policies.
FISCAL IMPACT: There is no immediate impact to the general fund. If a VMT Bank is adopted, it could offer an additional funding source for City priorities that reduce VMT.
Prepared By:
Claire Gallogly
Transportation Planner
Submitted By:
Nathan Nguyen, P.E.
Director of Public Works
Approved By:
Matt Huffaker
City Manager
ATTACHMENTS:
1. SANTA CRUZ COUNTY REGIONAL VMT MITIGATION PROGRAM PRELIMINARY FINAL REPORT.PDF
14.3 0
Final Report
April 19, 2024
Santa Cruz County Regional
VMT Mitigation Program
Prepared by:
14.4 i
Santa Cruz County Regional
VMT Mitigation Program
Table of Contents
Executive Summary....................................................................................................................................... 1 Study Oversight......................................................................................................................................... 1 VMT Mitigation Projects........................................................................................................................... 2 VMT Mitigation Programs......................................................................................................................... 3 VMT Bank.............................................................................................................................................. 4 VMT Exchange....................................................................................................................................... 4 VMT Impact Fee .................................................................................................................................... 4 Micro (Localized) VMT Banking............................................................................................................. 5 Hybrid VMT Mitigation Programs......................................................................................................... 5 Mitigation Projects.................................................................................................................................... 5 Equity and Mitigation................................................................................................................................ 6 Program Evaluation................................................................................................................................... 7 Study Outcome ......................................................................................................................................... 8 Background ................................................................................................................................................... 1 VMT Mitigation Approaches..................................................................................................................... 4 Fee-Based VMT Mitigation Program Framework Options........................................................................ 5 VMT Bank.............................................................................................................................................. 6 VMT Exchange....................................................................................................................................... 7 VMT Impact Fee .................................................................................................................................... 8 Fee-based VMT Mitigation Program Variations ....................................................................................... 9 Micro (Localized) VMT Banking............................................................................................................. 9 Hybrid VMT Mitigation Programs......................................................................................................... 9 Literature Review and State of the Practice ........................................................................................... 10 Framework Pros and Cons.................................................................................................................. 12 Fee-Based VMT Mitigation Program Legal Considerations ................................................................ 12 Mitigation Fee Act (AB 1600).............................................................................................................. 12 State of the Practice............................................................................................................................ 14 Establishing Mitigation Need...................................................................................................................... 15 Identifying and Evaluating Candidate VMT-Reducing Projects .............................................................. 17
14.5 ii
Santa Cruz County Regional
VMT Mitigation Program
Transportation Infrastructure Project Evaluation............................................................................... 19 Bike Project Evaluation ....................................................................................................................... 20 Transit Project Evaluation................................................................................................................... 22 Non-Infrastructure Projects................................................................................................................ 23 Mobility Hub Projects ......................................................................................................................... 24 Transportation Demand Management (TDM) Projects...................................................................... 25 Additionality............................................................................................................................................ 27 Other factors........................................................................................................................................... 29 Amount of Funding to Achieve $1,000/VMT Framework Cost............................................................... 30 Bicycle Projects: .................................................................................................................................. 31 Non-Infrastructure Projects:............................................................................................................... 31 Mobility Hub Projects: ........................................................................................................................ 31 Transit Projects: .................................................................................................................................. 31 TDM Projects:...................................................................................................................................... 31 Equity Analysis............................................................................................................................................ 34 VMT Mitigation Need.......................................................................................................................... 36 Program Evaluation..................................................................................................................................... 38 Program Recommendation................................................................................................................. 39 Outreach Summary................................................................................................................................. 40 Program Administration and Other Considerations................................................................................... 42 Nexus Documentation ............................................................................................................................ 42 Other Considerations.............................................................................................................................. 43 Additional Study Outcomes.................................................................................................................... 44 Appendices
Literature Review…………………………………………………………………………………………………………………….Appendix A Modeling Approach………………………………………………………………………………………………………………...Appendix B
14.6 iii
Santa Cruz County Regional
VMT Mitigation Program
List of Exhibits
Exhibit ES-1 – Study Process.........................................................................................................................2 Exhibit ES-2 – VMT Mitigation Project Types...............................................................................................3 Exhibit ES-3 – Application of a VMT Mitigation Program.............................................................................4 Exhibit ES-4 – Santa Cruz County Environmental Justice Communities.......................................................7 Exhibit ES-5 – Regional VMT Mitigation Program Evaluation ......................................................................8 Exhibit 1 – Level of Service vs. Vehicle Miles Traveled.................................................................................1 Exhibit 2 – How to Calculate Vehicle Miles Traveled (VMT).........................................................................2 Exhibit 3 – Vehicle Miles Traveled Residential Project Example ..................................................................3 Exhibit 4 – Effect of Local-Serving Retail on Regional Vehicle Miles Traveled.............................................4 Exhibit 5 – VMT Mitigation Projects.............................................................................................................5 Exhibit 6 – Application of a VMT Mitigation Program..................................................................................6 Exhibit 7 – VMT Bank Example .....................................................................................................................7 Exhibit 8 – VMT Exchange Example..............................................................................................................7 Exhibit 9 – VMT Impact Fee Example ...........................................................................................................8 Exhibit 10 – VMT Impact Fee Program with Multiple Benefit Areas............................................................9 Exhibit 11 – VMT Bank with Regional and Local Split.................................................................................10 Exhibit 12 – Residential VMT Mitigation Need by TAZ...............................................................................16 Exhibit 13 – Employment VMT Mitigation Need by TAZ ............................................................................16 Exhibit 14 – VMT Mitigation Project Types................................................................................................17 Exhibit 15 – VMT-reducing Candidate Active Transportation Project Screening Example ........................20 Exhibit 16 – Calculating Cost per VMT Reduced.........................................................................................28 Exhibit 17 – Cost per VMT Reduced by Project Type and Additionality Method.......................................29 Exhibit 18 – Balance of Factors Needed for Successful Fee-based VMT Mitigation Program ...................30 Exhibit 19 – VMT-Reducing Project by Revenue Percentage of Total Cost based on $1,000/VMT Reduced ....................................................................................................................................................................33 Exhibit 20 – Santa Cruz County Environmental Justice Communities........................................................34 Exhibit 21 – 20-year Vehicle Miles Traveled Mitigation Need (Residential) ..............................................35 Exhibit 22 – 20-year Vehicle Miles Traveled Mitigation Need (Employment) ...........................................36 Exhibit 23 – Fee-Based VMT Mitigation Program Framework Variations..................................................39 Exhibit 24 – Regional VMT Mitigation Program Evaluation .......................................................................39
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Santa Cruz County Regional
VMT Mitigation Program
List of Tables
Table 1 – Framework Pros and Cons ..........................................................................................................13 Table 2– Fee-based VMT Mitigation Program State of the Practice ..........................................................14 Table 3 – Potential Land Use Growth and VMT to Mitigate, 2019 to 2045 ...............................................15 Table 4 – Summary of Bike Project Evaluation...........................................................................................21 Table 5 – Summary of Transit Project Evaluation.......................................................................................23 Table 6 – Summary of Affordable Housing Project Evaluation...................................................................24 Table 7 – Summary of Mobility Hubs Project Evaluation ...........................................................................25 Table 8 – Summary of TDM Project Evaluation..........................................................................................26 Table 9 – VMT-reducing Project Evaluation Summary ...............................................................................32 Table 10 – VMT Mitigation Need by Environmental Justice Community...................................................36
14.8 ES-1
Santa Cruz County Regional
VMT Mitigation Program
Executive Summary
This study evaluates program options that mitigate Vehicle Miles Traveled (VMT) in order to meet the requirements of the California Environmental Quality Act (CEQA) for the County of Santa Cruz and the cities within the county, collectively referred to as the “region” in this study. Entities such as the Regional Transportation Commission (RTC), the California Department of Transportation (Caltrans), and the University of California, Santa Cruz (UCSC), can also use the program to mitigate VMT impacts. The study was funded by a grant awarded to the County of Santa Cruz, the City of Watsonville, and the Santa Cruz County Regional Transportation Commission (SCCRTC) from the Caltrans Sustainable Communities Grants program. The goal of the grant project is to establish a framework for offsite mitigation of VMT for projects that are not able to mitigate the entirety of their impacts onsite. The VMT mitigation program would fund active transportation, transit, and other VMT reducing projects such as transportation demand management (TDM) programs throughout the region that decrease VMT and greenhouse gas (GHG) emissions, improve safety, combat climate change, and improve the quality of infrastructure within disadvantaged communities.
As detailed in the Background section, current VMT reducing strategies, which rely heavily on TDM measures onsite, often fall short of fully mitigating the VMT impacts of a project. This study explores the viability of a programmatic approach, primarily through fee assessments, to fund off-site projects within the region that reduce VMT as a solution to address transportation related CEQA mitigation needs in the region.
To determine feasibility and evaluate program options, this study considers the following questions:
• What is the state of the practice for VMT mitigation programs? • What is the magnitude of need for VMT mitigation within the region? • What are the program options available to be considered to meet this need? • What are the appropriate evaluation criteria to select a VMT mitigation program? • What types of VMT-reducing mitigation projects should be considered with a program? • What are the challenges to implementing a program?
• How can equity concerns be addressed within the program? • Which program has the potential to best meet the needs of the region? • What are the administration considerations when implementing the program? • Which projects could be potentially included in the region’s future program? Study Oversight
To guide the study, a Stakeholder Advisory Committee (SAC) and a Technical Advisory Committee (TAC) were assembled to provide oversight and input during the study. The committees were comprised of subject matter experts, member jurisdictions, community-based organizations (CBOs), and developers, including those who have expertise in affordable housing. Later in the project oversight the two groups were combined to reduce repetition.
14.9 ES-2
Santa Cruz County Regional
VMT Mitigation Program
Exhibit ES-1 – Study Process
VMT Mitigation Projects
If a project needs to address its VMT impact, there are various types of VMT reducing projects that could be implemented. Exhibit ES-2 below presents examples of projects aimed at reducing VMT within a region. As part of a fee based VMT mitigation program, the implementation of projects other than sitespecific TDM become more feasible as the region would pool mitigation fees increasing their spending power.
A regional VMT mitigation program holds the potential to implement more extensive mitigation projects, thereby achieving a more substantial impact on regional VMT. Given that many of the mitigation projects within these programs can entail significant costs, it is unlikely that any single project applicant would require such extensive VMT mitigation or have the capacity to independently finance these mitigation projects. However, through a program akin to the one under consideration in this study, multiple project applicants can pool their resources to fund larger and more impactful VMT-reducing projects.
14.10 ES-3
Santa Cruz County Regional
VMT Mitigation Program
Exhibit ES-2 – VMT Mitigation Project Types
VMT Mitigation Programs
This study evaluated different types of programmatic strategies for mitigating VMT, including VMT banks, VMT exchanges, and VMT impact fee programs. Exhibit ES-3 offers a visual representation of how a project would proceed with mitigating its transportation impact in an area with a VMT fee program, such as a VMT bank. Even in instances where a VMT fee program is in place, project applicants still employ Transportation Demand Management (TDM) and other project-specific onsite measures to reduce VMT impacts before turning to a VMT mitigation program, as illustrated in Exhibit ES-3.
The example project in Exhibit ES-3 below shows that a project is 450 VMT above its threshold (5,000 VMT – 4,550 VMT = 450 VMT). The project uses various TDM measures to reduce its VMT by 225 (5,000 – 4,775 = 225) and then pays into the fee program to reduce the final 225 VMT (450 – 225 = 225).
14.11 ES-4
Santa Cruz County Regional
VMT Mitigation Program
Exhibit ES-3 – Application of a VMT Mitigation Program
While VMT mitigation programs can manifest in various formats, this study primarily centers on the three most prevalent program categories, which are:
VMT Bank
VMT banking involves identifying, evaluating, and combining various VMT-reducing projects (like bike paths, pedestrian improvements, and public transit enhancements) to calculate a total VMT reduction and associated costs. Projects collectively reduce VMT by a specific amount, with a cost assigned per VMT reduced. With VMT bank, developers can buy VMT credits from the bank to offset their projects’ VMT impacts, paying a fee based on the cost per VMT reduced. The bank requires replenishment once the available VMT credits are exhausted, necessitating continuous investment in new mitigation projects.
VMT Exchange
This is similar to a VMT bank but offers more flexibility by allowing applicants to select from a list of VMTreducing projects or propose their own. The focus is on implementing specific projects rather than accumulating and selling VMT reductions as credits. With VMT Exchange, developers can sell excess VMT reductions (if their project mitigates more VMT than required) to others needing to offset their VMT impacts. It does not require monetizing VMT reductions unless the applicant wants to sell excess mitigation as credits, focusing more on direct implementation of projects.
VMT Impact Fee
This is similar to traditional development impact fee programs but tailored for VMT mitigation. Fees are calculated based on the anticipated VMT impact of new developments, with costs allocated according to the type of land use (residential, commercial, etc.). With a VMT Impact fee, developers pay a fee based on their project’s size and land use type to offset the estimated VMT impact. This approach simplifies the process for developers by integrating VMT mitigation into existing fee structures. Fees can vary by zone,
14.12 ES-5
Santa Cruz County Regional
VMT Mitigation Program
encouraging development in areas with better VMT performance. The program can be tailored to regional and local needs, potentially incorporating benefit areas that align fees with local VMT efficiency.
Micro (Localized) VMT Banking
Focuses on establishing smaller, localized VMT banks catering to specific areas or jurisdictions. This can address equity issues by ensuring mitigation efforts are proportional and relevant to the areas most affected by development projects.
Hybrid VMT Mitigation Programs
Combines elements of VMT banks, exchanges, and impact fee programs, allowing for flexible, tailored approaches to VMT mitigation. This can involve distributing funds both regionally and locally, ensuring that mitigation efforts benefit both broader and more specific community needs.
Mitigation Projects
As shown in Exhibit ES-2, a variety of mitigation project types can be considered for inclusion within a regional VMT mitigation program. A list of candidate VMT-reducing projects was established to evaluate the feasibility of including them in a fee-based VMT mitigation program. Projects from the County of Santa Cruz Active Transportation Plan, the SCCRTC’s Regional Transportation Plan, and local Capital Improvement Programs (CIPs) were screened for feasibility of implementation, their potential for VMT reduction, and the estimated cost of VMT reduction credits. Of those projects, 34 total projects were advanced for evaluation, including 19 bicycle projects, 6 transit projects, 3 land use/affordable housing projects, 2 mobility hub projects, and 3 TDM projects. Based on this evaluation the following are the key takeaways:
• Bicycle Projects. Bicycle projects were evaluated using big data1 and (National Cooperative Highway Research Program) NCHRP 552 for their ability to reduce VMT. The projects resulted in a mitigation cost per VMT reduced that varied between $85 and $8,605 due to project cost and characteristics.
• Transit Projects. Transit projects were evaluated using the Bus Rapid Transit (BRT) Practitioner’s Guide and the region’s countywide travel demand model. The three projects evaluated resulted in a cost per VMT reduced that varied between $529 and $392,753. • Non-Infrastructure. Affordable housing projects were evaluated based on a case study of affordable housing project costs proposed and constructed in the region. The projects resulted in a mitigation cost per VMT reduced that varied between $18,620 and $47,981. • Mobility Hub Projects. Mobility hub projects were evaluated using the travel demand model and the BRT Practitioner’s Guide. The projects resulted in a mitigation cost per VMT reduced that varied between $204 and $7,552.
1 Big Data: a data analytics platform that provides detailed insights into the movement, behaviors, and patterns of people. It leverages aggregated and anonymized mobile location data to model the travel habits and demographics of populations. Replica, the platform used for this project, uses synthetic data that is calibrated and validated using anonymized real-world data sources.
14.13 ES-6
Santa Cruz County Regional
VMT Mitigation Program
• TDM Projects. TDM projects were evaluated using the travel demand model and assumptions based on research. The projects resulted in a mitigation cost per VMT reduced that varied between $485 and $3,528.
The costs per VMT for the improvements were calculated based on the assumption that they would be funded solely through the regional VMT mitigation program without other funding sources, such as state or federal grants. This cost analysis exercise highlights the substantial variations in capital expenses that are due to factors beyond just the type of project (transit, land use, etc), aligning with findings from other recent state-wide VMT mitigation studies. Because of this substantial cost variation, a viable program will likely need additional funding sources to maintain a per VMT dollar amount that is financially feasible. In other words, the VMT program would close gaps in funding for VMT reducing projects that have some funding identified but are short on complete funding for implementation.
Equity and Mitigation
In contrast to Level of Service (LOS), which assesses specific impacts near a new development, VMT evaluates the entire trip, considering regional impacts. When a development project or large transportation project is built, its VMT impact can be offset by a VMT-reducing project anywhere in the region, as the impact is not confined to a particular location. However, concerns about equity can arise when new developments and transportation projects are concentrated in specific communities, while the corresponding VMT mitigation projects are implemented in different parts of the region. This scenario might lead to some communities experiencing the negative effects of new development and transportation infrastructure without reaping the benefits of VMT-reducing projects funded by a VMT bank or similar framework.
To assess the equity of a fee-based VMT mitigation program, an environmental justice (EJ) analysis was conducted. This analysis aimed to determine if the impacts of new development and VMT mitigation projects would be distributed fairly across the region. It specifically examined whether VMT impacts would disproportionately affect low-income and/or disadvantaged communities that are identified by the County of Santa Cruz General Plan2 and where mitigation projects would most likely be implemented.
Exhibit ES-4 presented below highlights the different areas in the region categorized as low-income communities (marked in blue), minority and low-income communities (in light orange), minority (orange) and areas that are neither (depicted in pale yellow). The focus for the implementation of VMT mitigation projects should be in areas where it would yield the greatest impact, which are areas with high population density. Exhibit ES-4 suggests that the majority of VMT mitigation projects would likely occur in environmental justice communities if VMT reducing projects are implemented in denser areas of the region. This study has integrated the categorization displayed below with an analysis aimed at assessing future VMT mitigation requirements for residential and employment purposes, please refer to the Equity Analysis section for detailed information.
2 The Santa Cruz County General Plan/LCP,
https://sccoplanning.com/Portals/2/County/Planning/SustainabilityUpdate/General_Plan/GeneralPlanChapter2_BuiltEnvironment_public_draft.pdf?ver=eW8J4dPc _PcM7wjL2sGWXg%3d%3d, accessed on 3/20/2024
14.14 ES-7
Santa Cruz County Regional
VMT Mitigation Program
Exhibit ES-4 – Santa Cruz County Environmental Justice Communities Program Evaluation
As part of this study, mitigation program options were evaluated in terms of their potential to meet the identified needs of the region. The following are considerations and questions that guided the evaluation of the feasibility of the fee-based VMT mitigation program framework for Santa Cruz County:
Legal - Does the fee-based VMT mitigation program meet CEQA and statutory requirements, including additionality?
Effective - Does the fee-based VMT mitigation program result in a long-term financially feasible mitigation program?
Geography - Can the fee-based VMT mitigation program scale to meet the region’s needs? Administration - Does the fee-based VMT mitigation program fund oversight and management of the program and maintain analysis and technical requirements for administering the program? Equitable - Does the fee-based VMT mitigation program avoid disproportionate impacts to disadvantaged and/or low-income communities? Does the program encourage an equitable benefit distribution throughout the region?
Alignment - Does the fee-based VMT mitigation program support good design of projects and align with community values and existing plans?
Exhibit ES-5 below provides a summary of the evaluation of each fee-based VMT mitigation program based on the considerations mentioned above. For more information, please refer to the Program Evaluation section.
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Exhibit ES-5 – Regional VMT Mitigation Program Evaluation In considering CEQA transportation mitigation, a key factor is the principle of additionality. The principle of additionality requires that mitigation measures must be improvements that would not have occurred were it not for the VMT program. Essentially, a project proponent must propose either a novel mitigation approach or significantly advance a planned one to offset their impact. Caltrans’ recent guidance clarifies the interpretation of additionality, permitting applicants to claim complete VMT mitigation benefits from a VMT-reducing project even if they aren’t the sole funder, provided no other claims exist on the mitigation. This interpretation allows the use of external funding sources to reduce the amount of money contributed by the VMT Program, effectively reducing per unit VMT costs, thus enhancing project viability.
An additional aspect considered in the assessment of a fee-based VMT mitigation program is the potential for unintended consequences. These may arise from the program’s execution and could lead to diverse outcomes such as significant alterations in development or transportation expenses, shifts in development patterns, or changes in prioritizing infrastructure projects. Historically, transportation programs and projects had disproportionate impacts on disadvantaged populations. It is also crucial that a VMT mitigation program does not deter sound project design or conflict with community values.
Study Outcome
Upon completing the VMT-reducing project analyses, study outreach, framework evaluations, and reviewing all considerations, feasible program options and candidate projects exist and can be implemented for Santa Cruz County. It was determined that a VMT Bank framework was the most appropriate for the region and that a mix of VMT-reducing bicycle, TDM, and transit projects were good candidates for inclusion in the program. This framework and these VMT-reducing projects were selected for their ease of understanding by the public and decision-makers and their ability to successfully address the considerations outlined above. Key findings and recommendations from the study include:
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▪ A regional VMT mitigation program offers a new viable mitigation option for project applicants facing VMT impacts that cannot be mitigated through other means. ▪ Selectivity in choosing VMT-reducing projects for the program is crucial to ensure financial and practical feasibility. Projects should be evaluated for potential other funding sources and their ability to meet additionality requirements.
▪ Equity must be a core element in both the final design of the VMT mitigation program and the projects selected for it. This study suggests that a fee-based VMT mitigation program could lead to equitable outcomes, avoiding concentration of VMT impacts in environmental justice communities and ensuring mitigation is not limited to non-environmental justice areas. ▪ Developing a project list for the program will be an ongoing process, necessitating accurate methods of VMT analysis in line with best analysis practices to ensure robust outcomes. The study’s established framework should serve as the basis for future analysis. ▪ There needs to be clear documentation of the connection (nexus) between the program’s necessity and the impact of the VMT mitigation during final program design. ▪ The program’s success hinges on support from decision-makers, agencies, the community, and participants in the VMT mitigation program. A diverse range of perspectives should be considered in the final design and project selection.
▪ Implementing a fee-based VMT mitigation program introduces a new fee, potentially increasing housing costs and other development expenses, as well as the cost of transportation capacityenhancing projects. ▪ Without a well-defined and well-established VMT mitigation solution, significant uncertainty will persist for many projects, hindering their progress even if they align with other plans and programs.
▪ A single entity should administer the program, likely the SCCRTC, and work with member agencies in the form of a Joint Powers Authority (JPA) to ensure consistent application of the program and long-term viability.
▪ It is recommended that a pilot program be implemented prior to the full rollout of the program.
This pilot program would include shovel ready or immediately implementable projects and programs that are cost efficient and run for a set time period. Once the pilot program ends, its effectiveness should be evaluated, and any lessons learned be incorporated into the full rollout of the program within the region.
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Background
California’s Senate Bill (SB) 743 is a legislative bill altering the approach to review of transportation impacts for proposed projects, encompassing both land use initiatives like housing developments and transportation ventures such as road expansions. The bill shifts focus away from vehicle delay and instead to vehicle miles traveled (VMT) generated by a project.
Historically, before SB 743’s enactment, transportation impacts were evaluated based on delay, using the Level of Service (LOS) concept, a standard in the transportation sector since the first Highway Capacity Manual (HCM) was released in 1950. Over the HCM’s seven editions, LOS influenced decision-making, yet LOS is linked to unwanted outcomes such as urban sprawl and adverse effects on active transportation (bikes, pedestrians) public transit, road safety, and public health. LOS focuses on vehicle travel speed and throughput and neglects other travel modes. Since the metric is based on the driver’s experience and cost of time, the solution is often to increase roadway capacity either by adding vehicle lanes or new roadways.
Another solution to improving LOS or reducing delay is to build in less populated areas, which increases sprawl and greenfield development. As has been shown in recent years, increased capacity can cause a phenomenon called “induced demand” wherein more people start using the previously congested facility, causing increases in driver demand and subsequent increases in delay thereby starting the whole cycle of increasing capacity all over again. SB 743 aims to reverse these trends by adopting VMT as a more holistic measure of impact on transportation systems. This shift from LOS to VMT encourages urban infill development, where VMT is typically lower. However, it also highlights the lack of practical, cost-effective mitigation options for suburban and rural projects, as many previously employed LOS mitigations do not align with VMT reduction goals. This change led to different outcomes in CEQA-related transportation analyses and necessitated novel mitigation approaches. Exhibit 1 provides a summary of the differences between LOS and VMT.
Exhibit 1 – Level of Service vs. Vehicle Miles Traveled
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VMT is calculated exactly as the term sounds, the sum of the number of miles traveled by each vehicle in a system. As shown in Exhibit 2 below, four vehicles each traveling 3 miles results in each individual vehicle producing 3 VMT. When combined, all four vehicles account for a total of 12 VMT.
Exhibit 2 – How to Calculate Vehicle Miles Traveled (VMT) When determining if a project results in a significant transportation impact, the project must be compared to a threshold of significance which is determined by the jurisdiction. Two types of thresholds exist:
efficiency thresholds, such as VMT per capita, and net change thresholds. Residential and office projects can vary in size so using an efficiency metric allows the projects to be easily compared to a threshold.
Retail and customer-serving projects often do not create new trips but can change trip lengths, so it is more appropriate to consider how the location of the project changes VMT; this is more easily measured as a net change in VMT.
Exhibit 3 summarizes how a residential project is evaluated using VMT. Each household has every trip measured, both to and from a location, to determine the total VMT. The graphic below shows how trips to the child’s school are 7 miles each way (14 miles total), the trip to work is 10 miles each way (20 miles total), and the trip to the store is 8 miles each way (16 miles total). When adding the total length of all trips together, the household has 50 daily VMT.
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Exhibit 3 – Vehicle Miles Traveled Residential Project Example To determine whether the project results in an environmental impact, the project’s VMT per capita must be compared to the regional threshold. In the example shown in Exhibit 3, the household contains 3 people, so the VMT per capita is determined by dividing the household’s total VMT (50) by the household size (3) resulting in a household VMT per capita of 16.7. If the regional threshold is 17.5 VMT per capita, the project would not result in an impact as it is more efficient than the regional threshold.
There is a distinction between regional retail (e.g., Lowes or Target) and local-serving retail (e.g., coffee shops, restaurants, or gas stations) when it comes to evaluating VMT. Local-serving retail primarily serves preexisting needs: it does not generate new trips because it meets existing demand. Because of this, local-serving retail uses can be presumed to reduce trip lengths when a new store is proposed. Essentially, the assumption is that someone will travel to a newly constructed, local-serving store because of its proximity compared to a comparable store located further away. This results in a trip on the roadway network becoming shorter, rather than adding a new trip to the roadway network. Conversely, residential and office land uses often create new trips, given that they introduce new participants to the transportation system.
Exhibit 4 graphically explains this concept. It shows how a new retail store typically redistributes existing customer trips, reducing average trip lengths and thus decreasing VMT (e.g., reducing trip segments from 3 miles to 1 mile with the new store).
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Exhibit 4 – Effect of Local-Serving Retail on Regional Vehicle Miles Traveled Additional documentation on the County of Santa Cruz’s VMT policy, including thresholds by land use, can be found on the County of Santa Cruz’s VMT website3.
VMT Mitigation Approaches
Various strategies are available for project applicants that need to reduce their VMT impacts. Exhibit 5 below highlights examples of projects that can reduce VMT in the region. Pedestrian initiatives aim to enhance walkability with additional sidewalks or intersection improvements such as crossings, reducing reliance on short-distance driving. Bike projects introduce new facilities and bike-share programs, promoting cycling as an efficient transport alternative. Transit improvements, such as new lines and Bus Rapid Transit (BRT) systems, increase public transport use by offering faster and more reliable options.
Road Diets rebalance street space to better accommodate non-automotive travel, creating safer routes for cyclists and pedestrians while calming traffic. Intelligent Transportation Systems (ITS) and Traffic System Management (TSM) leverage technology for better traffic flow and information, reducing idle time and unnecessary trips. Mobility Hubs centralize transport options, streamlining the transition between modes like cycling, buses, and trains, fostering a cohesive network. Affordable Housing projects in dense, transit-accessible areas encourage a mode shift away from driving toward the use of public transport and active transportation modes. Vanpool and Carpool programs expand shared travel, diminishing the number of vehicles on the road. Park-and-Ride facilities support these efforts by enabling commuters to combine car travel with public transit, lessening the VMT for individual journeys. Trip reduction programs encourage employers to develop telecommuting programs to reduce the number of commute trips made 3 Santa Cruz County Vehicle Miles Traveled (VMT). https://sccoplanning.com/PlanningHome/Environmental/CEQAInitialStudiesEIRs/VehicleMilesTraveled(VMT).aspx
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by employees. Each strategy is instrumental in curbing VMT by offering convenient, sustainable alternatives to single-occupancy vehicle use.
Exhibit 5 – VMT Mitigation Projects
Fee-Based VMT Mitigation Program Framework Options
To broaden the scope of VMT mitigation options, regional VMT mitigation programs, like those under consideration in this study, are being explored for implementation across California. These regional programs support larger-scale development projects with more significant impacts by providing alternative options to reduce VMT. Often larger projects are not able to mitigate their VMT entirely on site, however given the high cost of more significant VMT reducing projects, often reaching millions of dollars, it’s improbable for individual project applicants to afford such extensive VMT mitigation. A program as envisioned in this study would enable multiple applicants to collectively fund substantial VMTreducing projects thereby mitigating the impacts of their individual projects.
This study evaluated various programmatic methods for VMT mitigation, including VMT banks, VMT exchanges, and VMT impact fee programs.
Exhibit 6 visually illustrates the process of mitigating transportation impacts in regions with a fee-based VMT mitigation program. Even in areas with a fee-based VMT mitigation program, project applicants still must exhaust mitigations on site to reduce their VMT impacts, using strategies such as a VMT bank to address any remaining VMT impacts.
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The example project in Exhibit 6 below shows that the project is 450 VMT above its threshold (5,000 VMT – 4,550 VMT = 450 VMT). The project uses various on-site TDM measures to reduce its VMT by 225 (5,000 VMT – 4,775 VMT = 225 VMT) and then pays into the fee program to reduce the final 225 VMT (450 VMT – 225 VMT = 225 VMT).
Exhibit 6 – Application of a VMT Mitigation Program
Although VMT mitigation programs can take multiple forms, the three most common program types, and the primary focus of this study, are discussed below.
VMT Bank
As shown in Exhibit 7, the following steps are used to establish a VMT mitigation bank:
1. Identify VMT-reducing projects, such as bicycling facilities, pedestrian infrastructure, and public transit.
2. Evaluate these projects to determine the extent of VMT reduction.
3. Combine the VMT reductions from all projects to calculate the total mitigated VMT. For this example we will use, the total VMT reduction is 1,000 VMT.
4. Sum the costs associated with each project. In this instance, the collective cost of all VMT-reducing projects amounts to $1 million.
5. Calculate the cost per VMT reduced by dividing the total project cost by the total VMT reduction.
In this example, the cost to mitigate 1 VMT is $1,000.
Once the cost per VMT is established, and the VMT bank is operational, a project can offset its VMT impact by paying a per VMT fee to the bank. As shown in Exhibit 7 below, the example project needs to reduce its VMT impact by 225 VMTs to meet the regional threshold. Therefore, the total fee would be $225,000 calculated by multiplying the cost of each VMT reduced, $1,000, by the total VMT needing to be reduced, 225. Note that once the available VMT is used up by development projects purchasing VMT from the VMT bank, the VMT bank would need to be replenished with new VMT mitigation projects.
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Exhibit 7 – VMT Bank Example
VMT Exchange
VMT exchanges function similarly to VMT banks, with the main difference being that in a typical VMT exchange, applicants have the option to choose a single project from an existing list or program of VMTreducing projects or propose a VMT-reducing project for implementation which may not appear in a list or program. In the case of a VMT exchange, it is not necessary to monetize the selected VMT-reducing project unless the project applicant wishes to make excess VMT mitigation available to others for purchase as credits. As illustrated in Exhibit 8 below, an applicant develops a bicycle project that reduces regional VMT by 300 VMT. However, the applicant only needs to reduce the VMT impact to the VMT threshold by 225 VMT. Consequently, the applicant has 75 surplus VMT available for sale to others at a market rate.
Exhibit 8 – VMT Exchange Example
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VMT Impact Fee
Instead of establishing a VMT bank or exchange, the program could be structured in a manner similar to existing development fee programs. In this setup, a new development project would be obliged to pay a fee to offset its VMT impact, determined by factors such as the total number of planned dwelling units or the total square footage of planned building construction. The VMT impact fee program would function akin to existing development fee programs, with the distinction that it exclusively includes projects that reduces VMT.
As shown in Exhibit 9 below, the fees would be calculated by land use types based on the projected VMT generation from planned developments over the next 10-20 years, with a specific emphasis on offsetting the VMT mitigation requirement. Similar to the VMT bank, fees are computed by dividing the total VMT needed to be mitigated by future projects by the cumulative cost of VMT-reducing projects. However, unlike a VMT bank, this calculation is performed separately for each land use type rather than collectively.
The fee for each land use type is determined by first quantifying the VMT that needs to be mitigated for each land use type, calculating the share of the total VMT requiring mitigation, multiplying that percent share by the total cost of the VMT-reducing projects, and then dividing the land-use specific cost by the growth for each land use (either dwelling units or square-feet). For example, in Exhibit 9, if the residential land use accounts for 50-percent of all future VMT mitigation needs and the total cost of VMT-reducing projects is $1 million, then the residential land use would have a total mitigation cost of $500,000 (50% of $1 million). If the anticipated number of houses to be constructed in the future is 250 houses, the fee would be calculated by dividing $500,000 by 250, resulting in a fee of $2,000 per home.
Exhibit 9 – VMT Impact Fee Example
When considering a VMT impact fee framework, it may be beneficial to divide the region into multiple benefit areas. This allows for fees to be assessed based on the VMT efficiency of a benefit zone in terms of overall VMT performance. This approach can incentivize projects to locate in VMT-efficient areas within
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the region. As shown in Exhibit 10 below, the areas that combine to form Zone 1 all fall below the regional VMT threshold for both residential and non-residential uses, resulting in no fees being administered for projects in that zone. Alternatively, Zone 2 has the worst VMT performance and contains the highest fees charged for the region.
Exhibit 10 – VMT Impact Fee Program with Multiple Benefit Areas Fee-based VMT Mitigation Program Variations
Alongside the three primary fee-based VMT mitigation program frameworks, several alternative models were explored, including:
Micro (Localized) VMT Banking
This approach considers establishing multiple VMT banking programs instead of a singular regional program. This method allows for funding and implementing smaller groups of projects simultaneously, potentially addressing equity issues by ensuring mitigation projects are located near the development projects causing VMT impacts. Alternatively, a micro VMT bank could be integrated with a regional VMT bank or VMT exchange. Smaller jurisdictions in less-populated areas may not have as many projects included in the bank or exchange due to lower efficacy with smaller population densities. In these cases, multiple smaller jurisdictions may join to form a single multi-jurisdictional banking program or participate in the regional-scale program as a backstop, while funding smaller group of projects through their local bank.
Hybrid VMT Mitigation Programs
This approach involves a combination of different strategies such as banking, exchanges, impact fee programs, and micro VMT banking. Combining regional and micro VMT banking programs appears most effective. As shown in Exhibit 11, mitigation funds are distributed both regionally and locally by a predetermined value, utilizing the efficiency of regional projects while supporting local communities. This hybrid model also addresses equity concerns by funding VMT-reducing projects in the communities where
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the development projects are located. Similarly, a program may wish to form multiple “benefit basins” or zones within their respective regions to keep a sufficiently local focus under the rubric of a program administered by a single entity.
Exhibit 11 – VMT Bank with Regional and Local Split
Literature Review and State of the Practice
The initial phase of this study involved conducting a comprehensive literature review and analyzing current practices. This entailed evaluating existing programmatic approaches and examining both legal and non-legal factors that could impact the development of the program. The findings from this review are organized into four key sections: the advantages and disadvantages of various frameworks, legal considerations specific to fee-based VMT mitigation programs, details of the Mitigation Fee Act (AB 1600), and a general overview of the current state of practice.
The review covered a range of local pertinent documents. These included impact fee guidelines from member jurisdictions, regional guidelines for implementing SB 743 in Santa Cruz County, along with screening criteria and threshold parameters. Additionally, the review encompassed various significant documents such as climate action plans, bicycle and pedestrian master plans, transit plans, and transportation demand management ordinances from within the region. Moreover, the review also considered best practices in CEQA mitigation methods that align with the objectives of SB 743.
Other resources and documents that were reviewed as a part of this effort included new analysis methodologies from industry experts and relevant professional organizations (ITE, ITS, APA, CAPCOA, OPR, CARB, etc.) for providing multimodal solutions to mitigate VMT impacts. The complete literature
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review can be found in Appendix A. The following are some of the key relevant findings that were identified during these efforts that helped shape this study:
• Agencies need to verify VMT reductions and additionality for projects before approving participation in the banking regime. Any agency implementing a bank or exchange must demonstrate both a reasonable substantive relationship and financial proportionality between the proposed development and the fee or condition placed on it. • Agencies should also be diligent in their VMT mitigation duration as the nexus between improvements and timely use of fees varies region by region. o Banks that receive and pool funds from multiple projects should account for the delay between payment and deployment of funds.
o All frameworks should also include a method of prioritization of individual mitigation projects, to ensure that reductions are achieved as quickly and efficiently as possible. • A VMT exchange might be simpler for developers, but it could also limit the usefulness of funds from smaller developments and be less politically agreeable to local communities. o Offer more certainty for developers regarding the kinds and costs of mitigations needed to address cumulative VMT impacts.
• New plans and programs might increase new home costs, which can push disadvantaged communities further behind in their ability to access homeownership. o Significant equity issues may also arise if disadvantaged communities host developments but not beneficial mitigation projects.
o Any lead agency will need to include rigorous backstops to ensure that disadvantaged communities are not negatively impacted by—and ideally can benefit from—the ability of developers to move mitigation off-site. Such backstops would include an accounting of where money is spent and ensuring geographic equity and of who the users are of the mitigations that were funded.
• Implementing agencies should consider requiring or providing incentives for developers or lead agencies to demonstrate that onsite mitigation is not feasible before being permitted to undertake off-site measures.
• VMT Banks and Exchanges comprehensively address VMT impacts across jurisdictional boundaries.
• Geography plays an important role in VMT reduction impact assessment. According to the difference between the VMT impact and the mitigation strategy as well as the variation among low and high VMT zones, using different ratios for impact and mitigation in the pricing structure seems necessary. For instance, Low VMT is defined as 15% below the defined thresholds for that area. For a detailed analysis on Geography please refer to Appendix A: Literature Review. • Incorporating equity in VMT banking is essential and challenging, particularly in the case of offsite mitigation programs. The benefits of fee-based mitigation strategies must carefully be distributed. In general, VMT bank identifies lower income, communities of color, rural areas, and low transit accessible zones as equity priority. However, the local definition of equity and
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disadvantaged communities should be considered as well since it affects public acceptance and political feasibility. In addition to local equity considerations, each mitigation project category comes with specific equity criteria to address while evaluating the VMT impacts and the effectiveness of mitigation strategies. Agencies can prioritize equity at various points, mainly before/at the beginning of a program or during the program’s operation. Depending on this, the mechanism of intervention varies (Table 4). Community engagement in the jurisdictional decision-making process supports equity by reducing the risk of unintended consequences on communities of concern.
• Local jurisdictions should look for projects and programs and their financial constraints in the RTP before using for VMT Mitigation to ensure that the additionality criteria is met and that the project is feasible and timely.
Framework Pros and Cons
The literature review revealed advantages and disadvantages of different programmatic approaches for VMT mitigation, aiding in decision-making for implementing agencies. Table 1 below outlines these pros and cons for two program types, mitigation exchanges and banks, highlighting factors like complexity, cost implications, and effectiveness.
Fee-Based VMT Mitigation Program Legal Considerations
The following is a summary of the legal requirements related to fee-based VMT mitigation programs:
▪ A fee-based VMT mitigation program can encompass projects aimed at reducing VMT that require clearance under the California Environmental Quality Act (CEQA). However, the program itself may not require environmental review. CEQA review may be completed once funding is secured for a VMT-reducing project, but before its construction or implementation starts. Furthermore, numerous VMT-reducing projects may be eligible for CEQA exemptions, such as active transportation projects already included in a master plan that has undergone CEQA evaluation. ▪ Fee-based VMT mitigation programs share many similarities with GHG (Greenhouse Gas) mitigation programs. CEQA case law offers guidance on the necessary features to meet legal requirements.
▪ A fee-based VMT mitigation program will need to adhere to the legal requirements for the timing of implementing mitigation.
Mitigation Fee Act (AB 1600)
The following presents a summary of essential considerations outlined in the Mitigation Fee Act as they pertain to non-voluntary fee-based VMT mitigation programs:
▪ The components of the Mitigation Fee Act are applicable to non-voluntary fee-based VMT mitigation programs, including VMT banks and exchanges, wherein developers make payments instead of constructing infrastructure. Many existing programs also permit direct infrastructure construction with credits offsetting owed fees.
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▪ A notable departure from existing fee-based mitigation programs is the shift in focus from trips to VMT as the primary metric.
▪ It is important to recognize that the options for managing fees, whether through banking, exchanges, or other means, do not necessarily fall into a strict dichotomy. ▪ Regardless of the specific program, maintaining a clear nexus and proportionality remains a fundamental requirement.
▪ The nexus must demonstrate a delicate balance between mitigation efforts and their corresponding impacts.
▪ Proportionality should serve as the foundation for calculating the cost of mitigation measures. ▪ Each jurisdiction should exercise caution when implementing a fee-based VMT mitigation program, taking into account potential unintended consequences, such as inhibiting overall housing growth if the program becomes overly expensive.
Table 1 – Framework Pros and Cons
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State of the Practice
Table 2– Fee-based VMT Mitigation Program State of the Practice provides a high-level summary of the current state of the practice in California of fee-based VMT reduction/mitigation programs. As shown, there are relatively few fee-based VMT reduction/mitigation programs active in the state. Some of the programs included are not specifically focused on meeting CEQA VMT mitigation needs (they instead are focused on general VMT reductions), however they are still important models that show how specific elements programs being considered by the study could function.
Table 2– Fee-based VMT Mitigation Program State of the Practice
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Establishing Mitigation Need
Future development locations, development quantity, and the corresponding mitigation requirements play a crucial role in assessing the necessity of a regional VMT mitigation program and its potential scope.
To accomplish this, a dataset was created by utilizing data from the current countywide travel demand model. This dataset estimates the VMT mitigation needs for the region as well as projects the potential revenue that a fee-based VMT mitigation program could generate. This data analysis assisted in evaluating the overall feasibility of different program options and determine the scale of projects that would be needed to mitigate the region’s VMT. This dataset holds significance in understanding the potential cost magnitude that individual projects may need to bear to fully mitigate their VMT impacts. It also provides insights into how these costs may influence policy considerations concerning the definition of “feasible mitigation” under CEQA.
By leveraging the countywide travel demand model and previous VMT research in establishing thresholds, the total potential VMT to be mitigated was determined by calculating the difference between the VMT per capita and VMT per employee for each Traffic Analysis Zone (TAZ) that was over the established thresholds. The difference was then multiplied by the population and total employees for each TAZ to develop a total VMT per TAZ to be mitigated, which then allowed for a countywide total to be calculated.
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Exhibit 12, and Exhibit 13 show the VMT amount that will need to be mitigated through 2045 numerically and spatially, based on current land use plans. As shown in Error! Not a valid bookmark self-reference., it is anticipated that based on the households and jobs that will be constructed or created between 2019 and 2045 in locations that are currently above the relevant adopted VMT threshold, a total VMT need of 119,005 VMT for residential land uses and 126,928 VMT for employment land uses is expected. Error! Not a valid bookmark self-reference.3 displays the highest potential revenue per year that a fee-based VMT mitigation program could generate within the region when considering a cost of $1,000 per VMT reduced.
It is important to emphasize that this calculation assumes that development will take place at the maximum possible rate per year, occurring in the same locations planned for through 2045. However, it is crucial to acknowledge that factors such as the need to mitigate VMT, economic fluctuations, and numerous other variables may diminish the actual revenue potential of implementing a fee-based VMT mitigation program.
Exhibit 12, and Exhibit 13 breakdown the total VMT need for residential and employment by TAZs. A higher VMT within a TAZ indicates a significant need for VMT mitigation by 2045. Furthermore, these figures can highlight the maximum possible annual revenue per TAZ, assuming a reduction cost of $1,000 per VMT.
Table 3 – Potential Land Use Growth and VMT to Mitigate, 2019 to 2045
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Exhibit 12 – Residential VMT Mitigation Need by TAZ
Exhibit 13 – Employment VMT Mitigation Need by TAZ
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Identifying and Evaluating Candidate VMT-Reducing Projects Along with evaluating the need and options for a fee-based VMT mitigation program, the study also analyzed the specific mitigation measures that could be offered. The initial phase involved the identification of project categories that would undergo review before individual projects were selected for evaluation. These project categories encompassed two overarching groups: transportation infrastructure projects and non-infrastructure projects. Further classification was applied to noninfrastructure projects, dividing them into land use and transportation demand management projects.
In 2023, possible candidate projects were solicited from study partner agencies. Example sources of projects include the Santa Cruz County Regional Transportation Commission’s (SCCRTC’s) Regional Transportation Plan, Active Transportation Plans produced by agencies throughout the region, the City of Watsonville VMT Mitigation Program, projects shared by Public Works departments, Santa Cruz Metro, the University of California-Santa Cruz, and affordable housing representatives.
Exhibit 14 below summarizes the project categories and provides project examples that are commonly considered in practice:
Exhibit 14 – VMT Mitigation Project Types
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Transportation Infrastructure Project Evaluation
Only projects meeting the criteria of “additionality” can be considered for inclusion within a fee-based VMT mitigation program. A methodology has been devised to further scrutinize and assess transportation projects eligible for potential implementation as VMT mitigation measures. A separate methodology has also been crafted for land use projects, which will be elaborated upon later in this report. Below is the methodology designed for candidate transportation projects:
• Step 1 – Screen for Candidate Mitigation Projects
• Step 2 – Evaluate Mitigation Project’s Performance (project analysis) • Step 2A – Set Project Benefit Area (buffer)
• Step 2B – Monetize Mitigation Project
• Step 3 – Implementation
To identify projects worthy of further evaluation, a screening process has been established for candidate mitigation projects. This process involves estimating the project cost and potential VMT reduced to determine whether it would exceed the established price per VMT of $1,000. Projects are also screened out if it is not feasible to construct it in the next 5 years. Once the project bucket is filtered down from the screening process, the following criteria are employed to select projects for further evaluation using the travel demand model, which determines their overall VMT reduction:
1. High non single occupancy or active transportation trip rate potential: improvements with higher usage (i.e., high bike ridership)
2. Located in a denser area: projects located in existing infill areas are favorable
3. Shorter trip lengths: shorter trips tend to favor active transportation and transit usage
4. Financial need: project has financial need sufficient to meet additionality requirements. Note that this can also be accomplished by advancing a project that would not otherwise be constructed in the next 5-10 years.
5. Project feasibility: other than financial needs, the project is likely to be constructed in the next 5- 10 years.
Each project was organized with an ID, title, a description of the project, the estimated cost, and the project’s total length in miles. The Replica big data platform was used to determine the average distance traveled for bicycle and pedestrian trips in the region. A target cost per VMT of $1,000 was established based on the result of the literature review and review of existing/proposed fee-based VMT mitigation programs. Note that the actual fee of a resultant program could be more or less, but that this value needs to be of sufficient order of magnitude to facilitate analysis. Using the Replica data for the average trip distance the number of trips needed to meet the target cost of $1,000 per VMT was calculated. These values were subsequently used to quickly sort the VMT-reducing potential of various projects both in terms of estimated usage and the cost/VMT so that projects could be screened for further analysis. Exhibit 15 below provides an example of how the screening process was applied for bicycle projects.
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Exhibit 15 – VMT-reducing Candidate Active Transportation Project Screening Example The screening process was completed for both active transportation projects and transit projects as these types of projects could be evaluated using the countywide travel demand model. In order to evaluate the effect that a particular project has on localized and regional VMT reductions, the baseline model run results were compared with the future build model run results to produce the VMT reduction associated with the VMT-reducing project.
The countywide travel demand model’s most recent update for this program includes land use updates, calibration, and validation to represent the most recent travel patterns in the region. Documentation for the countywide travel demand model, including the recent update is provided as Appendix B.
VMT reductions due to small changes in the model network cannot be accurately captured by analyzing the change in regional VMT due to the size of the network and the inherency in the travel demand models.
Therefore, as the model failed to reflect these nuances, projects were analyzed utilizing big data analytics platform called Replica to identify and analyze patterns of travel behavior and mobility trends at a granular level. Replica is a data analytics platform that provides detailed insights into the movement, behaviors, and patterns of people. It leverages aggregated and anonymized mobile location data to model the travel habits and demographics of populations. Replica uses synthetic data that is calibrated and validated using anonymized real-world data sources. This approach allowed for a more precise understanding of the impacts of smaller scale projects on regional VMT, ensuring that the smaller but significant changes in the transportation network were accounted for during project evaluation.
Bike Project Evaluation
The modeling approach to calculate VMT reductions typically involves a multi-step process that integrates various data inputs and modeling techniques. Here’s an overview of the approach used in this study to analyze bicycle projects:
• Estimate future ridership based on National Cooperative Highway Research Program (NCHRP) 5524 methodology
4 NCHRP Report 552, produced under the auspices of the Transportation Research Board (TRB), offers a framework for evaluating bicycle infrastructure investments, guiding planners in assessing economic, social, and environmental impacts. It provides methods to quantify benefits like accessibility, reduced congestion, health,
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o Factor additional ridership using the Transit Cooperative Research Program (TCRP)5 bus rapid transit (BRT) Practitioner’s Guide 118 as needed. • Use big data (Replica) to determine average trip distance along project alignment o To better isolate the effects of the project, the change in VMT was calculated for areas within 0.25, 0.5, and 1 mile of the project.
• Used big data to calibrate ridership levels using existing mode split and ridership along the project’s alignment
o Filter out trips not associated with replacing vehicle trips such as exercise trips. • Multiply the factored ridership by average trip distance to determine total VMT reduction Nineteen active transportation projects were evaluated to determine their feasibility for inclusion in a fee-based VMT mitigation program. Table 4 below summarizes the change in VMT for the bicycle projects.
Among the projects listed, the Soquel Drive Road Improvements project stands out as the most costeffective, with a project cost of $410,000 and a cost per VMT reduced of $85/VMT, reducing a total of 4,833 VMT daily. The Soquel Avenue Corridor Widening (between Branciforte and Morrissey) also offers relatively low costs at $303 per VMT reduced with a project cost of $2,320,000, reducing a total of 7,653 VMT daily. Other notable projects in terms of lower cost per VMT include the Freedom Boulevard Multimodal Improvements (Bonita Drive to the City of Watsonville) with a cost per VMT of $585 and the 41st Avenue Improvements Phase 2 (Hwy 1 Interchange to Soquel Drive) with a cost per VMT of $531/VMT. In addition, the Bike Share Expansion project has a budget of $1,000,000 and aims to reduce 2,395 daily VMT, which results in a cost efficiency of $418 per VMT reduced. This project is specifically tailored for the Watsonville area, focusing on providing a realistic number of bikes for a bike-share program. In comparison, the Electric Bike Subsidies project, with the same budget of $1,000,000, is $150 per VMT reduced and is expected to reduce a total of 6,667 daily VMT. It is also notable that this project is designed to fund the expansion of the electric bike program.
Table 4 – Summary of Bike Project Evaluation
and environmental gains, supporting informed decisions on bike facilities. The NCHRP itself is a program funded by member states of the American Association of State Highway and Transportation Officials (AASHTO), in cooperation with the Federal Highway Administration (FHWA). 5 TCRP Report 118, is managed by the Transportation Research Board (TRB) of the National Academies of Sciences, Engineering, and Medicine, serves as an essential manual for designing and implementing Bus Rapid Transit (BRT) systems. It provides comprehensive insights into planning, operating, and maintaining BRT services to improve urban mobility efficiently. The guide outlines best practices, operational strategies, and design principles to help practitioners develop high-quality BRT systems that are adaptable to different urban contexts.
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Transit Project Evaluation
The modeling approach to calculate VMT reductions for transit was as follows:
• Used countywide travel demand model to determine ridership increases • Factored additional ridership using BRT practitioners guide • Determined average transit trip length using big data and countywide travel demand model • Determined total VMT reduction by multiplying additional ridership by average trip length Table 5 below summarizes the change in VMT for the transit projects. The Youth Ride Free Program emerged as the most cost-effective project with a low cost of $209 per daily VMT reduced, featuring a project cost of $740,950 and reducing 3,553 VMT daily. The Real-Time Travel Information initiative also presents a lower cost per VMT of $529, with a project cost of $1,600,000 and reducing 3,025 VMT daily.
These projects are managed by METRO, with the Youth Ride Free Program allowing for free travel for youth, potentially increasing ridership and reducing the need for private vehicle trips. The Real-Time Travel Information project aims to provide signage at bus stops indicating next arrivals, which can enhance the usability of public transport.
In contrast, the Capitola Mall Transit Center project is significantly less cost-effective, with a high cost per VMT of $392,753, due to only a slight reduction in daily VMT of 64 despite and a project cost of $25,000,000. This project involves changes to move the transit center from the mall to the streetside for faster service.
The other projects, including the Intercity Transit Expansion and the University of California, Santa Cruz (UCSC) Terminal, have higher costs per VMT of $9,416 and $3,255, respectively. The Intercity Transit Expansion is aimed at expanding service on Highway 1 and Highway 17 to a 15-minute peak, while the UCSC Terminal project would create a lay-over location at UCSC to restructure service routes and expand service beyond the downtown loop. The Rapid Bus Enhancements project falls in the mid-range in terms of cost-effectiveness with a cost of $3,112 per VMT, aimed at providing passenger boarding islands and other improvements for rapid bus service on selected corridors.
Overall, the Youth Ride Free Program and Real-Time Travel Information offer more cost-effective solutions for reducing VMT and enhancing public transport usage, suggesting that they may provide better value for the investment in terms of daily VMT reduction.
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Table 5 – Summary of Transit Project Evaluation
Non-Infrastructure Projects
The following methodology was developed for candidate land use projects:
• Step 1 – Screen for Candidate Mitigation Projects
• Step 2 – Evaluate Mitigation Project’s Performance
• Step 2A – Monetize Mitigation Project (Optional)
• Step 3 – Implementation
A screening process was also developed for candidate land use mitigation projects based on several criteria including the socioeconomic details of an area, the existing VMT efficiency of an area, the availability of mobility options apart from vehicular travel, and the feasibility of constructing the project.
The screening considerations used to develop the screening criteria are listed below:
1. Socioeconomic criteria – Low income correlates to low vehicular trip generation (i.e., affordable housing)
2. Low trip rate – Land uses with abnormally low trip generation (i.e., transit oriented development)
3. Located in a low VMT area – Existing land uses patterns in proximity are favorable to reducing trips.
4. Availability of alternate transportation options – Transportation options can lead to lower vehicular use.
5. Financial need – Project has financial need sufficient to meet additionality requirements.
6. Project feasibility – Other than financial need, it is likely to be constructed.
To evaluate affordable housing projects, the project team identified three affordable housing projects currently proposed and or previously constructed in the Santa Cruz region with cost data. The first project is an 88 unit affordable housing project in an unincorporated area just north of Watsonville. Second project is another affordable housing project with 72 units located at Miles Ln and Kimberly Ln in Watsonville. Third project located near the second the project on Freedom Blvd has 53 units.
For evaluation purposes, it was assumed that the average occupancy rate for Santa Cruz County would apply to this project, which is currently at 3.1 people per household. As summarized in
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Table 6 below, based on the location of the project, project VMT per capita are compared to Santa Cruz County’s regional threshold of 13.6 VMT per capita. When multiplied by the total population identified previously, it resulted in overall VMT reductions summarized in Table 6 below. Focusing on the low cost per VMT, the Affordable Housing project in unincorporated area, referred to as Project 1, is the most cost-effective with a project cost of $34,800,000 and a daily VMT reduction of 1,869, resulting in a cost of $20,634 per VMT. This potential project is located on Freedom Blvd.
In comparison, the Affordable Housing, referred to as Project 2in Watsonville is the least cost-effective, with a high cost per VMT of $47,981 and a project cost of $54,000,000; it achieves a relatively low daily VMT reduction of 1,125. Project 3, another potential Watsonville affordable housing project in Watsonville, also has a cost per VMT of $35,676 with the same project cost of $43,000,000 but a lower daily VMT reduction of 1,205. The variation and the range in the daily VMT, and the cost per VMT depend on various factors, such as location of the project, total units, the VMT threshold.
Table 6 – Summary of Affordable Housing Project Evaluation Mobility Hub Projects
For the mobility hub projects, the following modeling approach was used:
• Used countywide travel demand model and BRT practitioners guide to estimate additional transit ridership
• Used NCHRP 552 to estimate additional bike ridership and pedestrian trips • Used big data to estimate average trip length for bikes, transit and pedestrian • Multiplied average trip distance by additional ridership/bike trips/pedestrian trips to determine total VMT reduction
The Table 7 – Summary of Mobility Hubs Project Evaluationdetails two multi-modal hub projects with different cost efficiencies. The Delaware Multi-Modal Hub, which is a part of the UCSC and located on the westside of Santa Cruz, has a significantly lower cost per VMT of $204. It costs $580,000 and reduces daily VMT by 2,843. This hub includes bus, bicycle, kiss & ride facilities, and housing units, with connections to the rail trail, but it does not include affordable housing.
On the other hand, the Watsonville Multi-Modal Hub is a more costly project at $55,230,000, reducing daily VMT by 7,313, which results in a higher cost per VMT of $7,552. This hub is situated in downtown
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Watsonville and includes similar multi-modal facilities: bus, bicycle, kiss & ride, and also adds 60 affordable housing units, with rail trail connections.
Table 7 – Summary of Mobility Hubs Project Evaluation
Transportation Demand Management (TDM) Projects
The Federal Highway Administration (FHWA) traditionally defines TDM as commuter ridesharing and its plannings applications restricted to air quality mitigation, reducing trip generation, and efforts to increase multi-modal travel6. In that context, when defining TDM projects for the region’s VMT Mitigation Program, projects that focused on reducing car trips in the region either by increasing occupancy (carpools and vanpools) or incentivizing individual trip reduction (school bussing and commuter programs) were included. Other types of projects that may commonly be referred to as TDM projects for VMT mitigation prior to the advent of VMT Mitigation Programs were not defined as TDM projects for the purposes of the region’s program as they could be difficult to address or quantify. For instance, spot amenities cannot be tracked, education programs are difficult to make an additionality argument for since it is a program expansion. Telework is also a measure that traditionally is defined as a TDM measure but was not included in the region’s Program as it requires individual employers to separately implement the program on-site.
Therefore, for the region’s Program several types of projects were evaluated under the TDM umbrella.
For instance, a vanpool is a group of up to 15 people who lease a van for the purpose of commuting to and from work together and live at least 20 miles from their workplace. A carpool is a system administered and funded solely or in combination with an employer and/or a public agency that matches employees living in close proximity or along a similar commute route to ride together to and from their workplace. A school bussing program provides fixed school bus routes and stops to take children to and from school in school buses. Finally, a commuter program that involves incentives for commuters to rethink their ride and choose a different mode such as walk, bike, carpool or ride bus to work .
An evaluation of three types of TDM projects (Table 8 – Summary of TDM Project Evaluation) was undertaken to determine their feasibility for being included in a future fee-based VMT Mitigation Program.
Vanpool
An exercise was undertaken to determine the unit cost per VMT reduced if a vanpool program was implemented within the region based on previous vanpools operated by CalVans within the region.
Using the information provided by CalVans for vanpools that operated within Santa Cruz County, the following evaluation was undertaken:
• Average number of riders (excluding driver): 9.4
6 Transportation Demand Management, U.S. Department of Transportation, Federal Highway Administration, https://ops.fhwa.dot.gov/plan4ops/trans_demand.htm, accessed on 3/20/2024.
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• Monthly VMT reduced: 10,190 VMT reduced
• Monthly VMT reduced per person: 10,190 /9.4 passengers = 1,084 VMT reduced per person o This assumes that all vanpool participants would have driven separately absent the vanpool, but the driver of the vanpool’s VMT remains the same • Number of workdays per month: 21
• Total daily VMT reduced: 10,190 / 21 = 485 VMT per day reduced • Monthly cost to operate vanpool: $1,202
• Total cost for a 20-year lifespan (design life of comparable infrastructure projects): $288,480 • Total cost per VMT reduced: $594.5
School Buses
The primary evaluation tool for this project was the countywide travel demand model, supplemented with research7 on costs and participation on bussing programs throughout California. This evaluation assumes a 50% participation rate of students in the bussing program and average cost per student to operate the program is $530. The remainder of the variables were obtained from the countywide travel demand model.
Using the information provided by the countywide travel demand model and the research on bussing programs throughout California, the following evaluation was undertaken with a reference provided for each assumption:
• Number of students within the region: 11,726 (countywide travel demand model) • Total number of shared-ride trips to a K12 school within the region: 13,800 (countywide travel demand model)
• Total daily VMT for shared-ride trips to a K12 school within the region: 66,767 VMT • Percent of students who would take a school bus: 50% (California statewide research) • Total daily VMT reduced when implementing a school bussing program: 66,767 VMT * 50% = 33,383 VMT
• Average cost per rider: $530 (California statewide research) • Average annual cost for school bussing program: $530/student * 11,726 students = $3,107,390 • Total cost for a 20-year lifespan: $3,107,390 * 20 years = $62,147,800 • Total cost per VMT reduced: $1,862
Table 8 – Summary of TDM Project Evaluation
7 Review of School Transportation in California. State of California Legislative Analyst’s Office. February 25, 2014. https://lao.ca.gov/reports/2014/education/schooltransportation/school-transportation-022514.aspx. Accessed on 8/22/2023.
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Cruz511 Expansion
An exercise was undertaken to determine the unit cost per VMT reduced if a commuter program was implemented within the region. This program would involve incentives for commuters to rethink their ride and choose a different mode such as walk, bike, carpool or ride bus to work. The following evaluation was undertaken with a reference provided for each assumption:
• Trip Type: Home-Based Work
• Trip Period: 5:00 AM – 10:00 AM
• Primary Mode: Private Auto, Single Occupant
• Total Trips: 33,350
• Median Trip Distance: 5.4
• %Employees Eligible: 20
• %Max VMT Reduction: 6.2
• Total daily VMT reduced: 2,232
• Total cost for a 20-year lifespan: $7,874,000
• Total cost per VMT reduced: $3,528
Additionality
Caltrans defines additionality as “a critical step in asserting such mitigation is to assure that the investment provides additional resources that otherwise would not have been provided or providing the additional resources substantially earlier than they otherwise would have been available.” Put simply, additionality means that a mitigation can only be claimed by one person or project to avoid the benefits of a mitigation being claimed by multiple future projects.
The concept of proportionality traditionally implies that mitigation efforts should correspond to the level of investment. For instance, if a bike lane project leads to a 100 VMT reduction but is financed by various sources, with a fee-based VMT mitigation program covering 40-percent of the cost, then the bank can only claim a 40 VMT reduction.
This principle is particularly relevant for including affordable housing in a fee-based VMT mitigation program. The Caltrans SB 743 Program Mitigation Playbook notes that dense, affordable housing can reduce VMT more than lower-density housing. If a project funds half the cost of an affordable housing development that cuts VMT by 10,000 miles per day, it could claim a 5,000 mile per day reduction.
However, this raises challenges since affordable housing is complex to build and often requires multiple funding sources. Strict adherence to proportionality, as defined by Caltrans, could make the unit cost per VMT too high for inclusion in a fee-based program.
Caltrans has recently 8reconsidered this interpretation of proportionality, suggesting that a project does not need to be the sole funder to claim the full mitigation credit. This applies to models like in-lieu fee payments or mitigation programs where the sponsor transacts with another party for mitigation. As long as the mitigation is enforceable, feasible, not deferred, and mechanisms are in place to avoid double counting, a sponsor can claim full mitigation credit. This means a transportation project could claim full credit for a housing development’s mitigation if it is shown that the development depended on its contribution, likely enforced through a funding agreement. This interpretation allows Santa Cruz County 8Caltrans, Housing and VMT Mitigation https://dot.ca.gov/programs/esta/sb-743/resources/housing, accessed on 3/6/2024
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to calculate the unit cost per VMT for VMT-reducing projects using three methods: proportionality, remaining cost, and fixed cost. The proportionality method reflects Caltrans’ original approach, assigning credit proportional to funding, and the unit cost is calculated by dividing the total cost of the project by the proportional VMT credit. Remaining cost, Caltrans’ updated approach, allows for claiming full credit for VMT reduction assuming no other claims. The unit cost is calculated by dividing the proportional cost by the full VMT credit. Fixed cost, a method developed by this study’s team, sets a standard unit cost per VMT for all VMT-reducing projects, with the program’s contribution calculated by multiplying this cost by the total VMT reduction. If this funding doesn’t fully cover the project, additional funding must be secured.
This approach enables the inclusion of a wide array of VMT-reducing projects in the program but could pose difficulties in justifying the pre-set unit VMT cost and in securing extra funding to fill any financial shortfall if the program does not fully fund the project.
Exhibit 16 provides a visual representation of how either the unit cost per VMT or the amount of funding provided by the fee-based VMT mitigation program is calculated using each methodology.
Exhibit 16 – Calculating Cost per VMT Reduced
Exhibit 17 below provides an example of how much funding would be provided by the fee-based VMT mitigation program for four different VMT-reducing project types, the unit cost per VMT for each of the projects, and the overall unit price per VMT sold to project applicants looking to purchase VMT to mitigate their project’s VMT impact, based on the additionality method chosen. Exhibit 17 assumes that all four project types provide an identical amount of VMT reduction (250 VMT) and that costs range from $250,000 to $1.5 million. As shown in Exhibit 17, the proportionality method results in the highest unit price per VMT for each project type both individually and collectively and the fixed cost method results in the lowest unit price per VMT for each project type both individually and collectively. The fixed cost method also provides the least amount of funding and for all project types except the bicycle/pedestrian
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project and the projects would require more than 50-percent of funding to be identified elsewhere to fully fund the VMT-reducing project.
Exhibit 17 – Cost per VMT Reduced by Project Type and Additionality Method Other factors
When setting up a fee-based VMT mitigation program, in addition to considering the additionality method to use, several additional factors should be also taken into consideration. These factors include the overall unit cost per VMT reduced, the availability of VMT mitigation, and the effect of project feasibility.
Consideration of the effect each factor will have on the overall success of the fee-based VMT mitigation program needs to be balanced as each factor can come into conflict with one another.
Exhibit 18 below provides a summary of the balance needed between the three factors needed for a successful fee-based VMT mitigation program.
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Exhibit 18 – Balance of Factors Needed for Successful Fee-based VMT Mitigation Program As shown in Exhibit 18, an ideal fee-based VMT mitigation program can balance cost, availability, and the program’s effect on project feasibility of VMT-reducing projects. Additional considerations include:
▪ Fewer mitigation options may be feasible given high funding requirements from other sources, which leads to a shortage of needed mitigation
▪ Low, little, and minimal effect on cost, availability, and feasibility may encourage outcomes contrary to SB 743
▪ Low, little, and minimal effect on cost, availability, and feasibility may result in a minimal number of new VMT-reducing projects being implemented due to the need for high funding requirements from other sources
▪ High, much, and significant effect on cost, availability, and feasibility may result in many development projects still needing to seek a finding of overriding considerations ▪ High, much, and significant effect on cost, availability, and feasibility may exacerbate the need for housing or other land use issues
▪ High, much, and significant effect on cost, availability, and feasibility may result in a minimal number of new VMT-reducing projects being implemented
Amount of Funding to Achieve $1,000/VMT Framework Cost
Based on the project evaluations summarized above, and on research completed during the literature review, it was determined that a unit cost of $1,000 per VMT mitigated is a reasonable target that the market can bear. $1,000 per VMT would provide necessary funding to the projects contained within a feebased mitigation program and would not be so high as to discourage participation in the fee-based mitigation program by project applicants. Therefore, an exercise was undertaken to determine how much external funding would need to be secured to include each of the active transportation, transit, and TDM projects evaluated and summarized above in Santa Cruz County’s Fee-based VMT Mitigation Program.
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Bicycle Projects:
• Bike Share Expansion and Electric Bike Subsidies are highly cost-effective, with no additional funding needed as they were calculated to be funded at a unit cost well below the $1,000 per VMT target.
• Other projects, such as the Soquel Drive Road Improvements project, also perform exceptionally well, with costs per VMT of $85, needing no additional funding • Projects such as the Monterey Bay Sanctuary Scenic Trail segments and Soquel Drive Buffered Bike Lane have significant daily VMT reductions but also considerably higher costs, leading to considerable funding needs of $55,344,210 and $14,451,539, respectively. • Projects such as the Hwy 9 – Downtown Felton Bike Lanes & Sidewalks and Freedom Boulevard (Green Valley Road to Airport Boulevard) exceed the target cost per VMT but have relatively smaller funding needs compared to large-scale projects.
Non-Infrastructure Projects:
• Affordable Housing projects, particularly in the unincorporated parts of the county, have high costs per VMT, far exceeding the $1,000 target, resulting in substantial funding needs of up to $52,874,545.
Mobility Hub Projects:
• The Watsonville Multi-Modal Hub exceeds the cost per VMT target, with funding needs of $47,916,950.
• The Delaware Multi-Modal Hub is well within the target cost per VMT of $1,000, requiring no additional funding.
Transit Projects:
• Intercity Transit Expansion and Capitola Mall TC have costs per VMT much higher than the target, indicating a significant need for funding of $28,422,841 and $24,936,347, respectively. • Ride Free Programs and Real-Time Travel Information have costs per VMT below the target and do not require additional funding.
TDM Projects:
• School Buses show a moderate cost per VMT of $1,862 but require a large funding need of $28,764,800 due to the overall project size.
• The Cruz511 Expansion exceeds the cost per VMT target, with funding needs of $5,642,000.
In summary, while several projects are efficient with costs per VMT below the $1,000 target and require no additional funding, others, particularly large-scale land use and transit projects, will need substantial financial support to meet the target cost per VMT reduced of $1,000 per VMT reduced.
Table 9 – VMT-reducing Project Evaluation Summarybelow provides a summary of all projects analyzed in terms of their cost, VMT reduced, and price per VMT produced. As shown in Table 9 – VMT-reducing Project Evaluation Summary, all thirty-three projects analyzed resulted in VMT reductions, with the daily VMT reduced ranging between 64 VMT (Capitola Mall Transit Center) and 33,383 VMT (School Bussing Program). The cost per VMT reduced ranged between $85 (Soquel Drive Road Improvements) and $392,753 (Capitola Mall Transit Center). The final test undertaken was a determination of what percentage of the total cost would be covered if the cost per VMT was fixed at $1,000/VMT reduced. As
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shown in Exhibit 19, a cost of $1,000 per VMT reduced would cover between 1% and 100% of the project costs. Note that this considers the total cost of all projects, including the affordable housing projects, without additional other funding.
Table 9 – VMT-reducing Project Evaluation Summary
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Exhibit 19 – VMT-Reducing Project by Revenue Percentage of Total Cost based on $1,000/VMT Reduced
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Equity Analysis
In order to determine whether the fee-based VMT mitigation program would be equitable, an environmental justice analysis was completed to determine whether the impact of new development and the mitigation projects to reduce the VMT from new development would occur equitably across the region. Specifically, the analysis was used to determine whether VMT impacts would be concentrated in low-income and disadvantaged communities while the mitigation would occur outside of these communities.
Exhibit 20 below identifies the areas in Santa Cruz County that are low-income communities (yellow), lowincome and disadvantaged communities (red), or neither (green). Understanding that VMT mitigation would be concentrated in areas where they would be most effective, i.e., areas with the densest population, Exhibit 20 shows that the majority of VMT mitigation projects would occur in environmental justice communities (non-green areas).
Exhibit 20 – Santa Cruz County Environmental Justice Communities
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The categorization shown above was combined with an analysis completed to determine the future need for VMT mitigation for both residential and employment uses, as shown in Exhibit 21 and Exhibit 22. The green areas in Exhibit 21 and Exhibit 22 are non-environmental justice communities while the others are low income, low income or disadvantaged. The height of the area indicates the amount of VMT that may be needed in the future based on how closely the area is to the region’s VMT threshold multiplied by the total residential (dwelling unit) or employment (jobs) growth.
Exhibit 21 and Exhibit 23 show that VMT is spread relatively consistently throughout the region and therefore the implementation of a fee-based VMT mitigation program can be considered equitable as VMT impacts would not be concentrated in environmental justice communities and VMT mitigation would not be concentrated in non-environmental justice communities.
Exhibit 21 – 20-year Vehicle Miles Traveled Mitigation Need (Residential)
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Exhibit 22 – 20-year Vehicle Miles Traveled Mitigation Need (Employment) VMT Mitigation Need
The VMT mitigation need over the model horizon (2019 – 2045) is summarized in Table 10 – VMT Mitigation Need by Environmental Justice Community below by environmental justice community to provide a numeric summary of what is displayed in Exhibit 21 and Exhibit 22. VMT mitigation is often more effective for non-residential uses and when there is a high mix of residential and employment uses.
Table 10 shows the total VMT needing mitigation between 2019 and 2045, aggregating to 119,005 VMT for residential and 126,928 VMT for employment across all community types. Environmental Justice VMT to Mitigate constitutes almost 20-30% of the total VMT mitigation need for both residential and employment categories. Regions in poverty constitutes around 20% of the total VMT mitigation need for both categories. This comprehensive data underscores the varying needs for VMT mitigation across different community types, with environmental justice communities, especially those that are both low income and disadvantaged, requiring significantly more effort in reducing vehicular travel compared to their non-environmental justice counterparts.
Table 10 – VMT Mitigation Need by Environmental Justice Community
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Program Evaluation
Once the candidate projects were evaluated, the framework options for a fee-based VMT mitigation program were revisited. Specifically, based on feedback received from the Stakeholder Advisory Committee (SAC), additional framework options were developed that combined portions of a VMT bank and VMT exchange into a new option. Details of the five framework options are summarized in Exhibit 23 below and the options include:
1. VMT Bank
2. VMT Exchange
3. VMT Bank with Exchange (newly developed)
4. VMT Impact Fee
The mitigation program options were subsequently evaluated in terms of their potential to meet the identified needs of the region. The following are considerations and questions that guided the evaluation of the feasibility of the VMT mitigation program options:
Legal
Does the fee-based VMT mitigation program meet CEQA and statutory requirements, including additionality?
Effective
Does the fee-based VMT mitigation program result in a long-term financially feasible mitigation program? Geography
Can the fee-based VMT mitigation program scale to meet the region’s needs? Administration
Does the fee-based VMT mitigation program fund oversight and management of the program and maintain analysis and technical requirements for administering the program? Equitable
Does the fee-based VMT mitigation program avoid disproportionate impacts to disadvantaged and/or low-income communities? Does the program encourage an equitable benefit distribution throughout the region?
Alignment
Does the fee-based VMT mitigation program support good design of projects and align with community values and existing plans?
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Exhibit 23 – Fee-Based VMT Mitigation Program Framework Variations Program Recommendation
Exhibit 24 below provides a summary of how each type of VMT mitigation program was evaluated against the above considerations. Yellow dots indicate a “concern” that the complexity of a specific program element or the lack of practical experience with it may represent a challenge to its implementation. As it is believed that all the program types are ultimately implementable, these designations should simply be thought of as areas of consideration that will require additional evaluation prior to their respective programs being considered for implementation. As shown in the exhibit belowExhibit 24, only the VMT bank framework would address all considerations identified.
Exhibit 24 – Regional VMT Mitigation Program Evaluation
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A VMT exchange raised concerns about nexus and proportionality if an applicant or a city were to request improvements that were disproportionate in consideration of the impact and/or not closely tied to the VMT threshold of the region. Additionally, administering a program where unknown projects are proposed raises questions of predictability of VMT reductions available to the region. Since a VMT exchange allows for mitigation projects that may not be on the radar or plans of the jurisdiction there are also questions as to whether proposed mitigation projects would align with jurisdictional goals as established in community plans. Lastly such projects could be implemented indiscriminately around the region and/or with a bias towards certain areas therefore raising concerns about equitable distribution of mitigation.
While a VMT impact fee addresses many of the concerns raised by the VMT Exchange model it is fixed with regard to geographic implementation and does not allow for as much flexibility to respond to development mitigation needs. The way impact fees are calculated adds more complexity to administration of the program and more staff time on both the part of the jurisdiction and the bank organization.
After discussions with stakeholders, it was decided that any program with a VMT Exchange should be removed due to these concerns and that an impact fee approach was not a good fit for a pilot program given its complexity to administer. This left the two VMT banking options left for consideration.
Ultimately, it is the recommendation of the stakeholders and the project team that a VMT Bank be implemented for this pilot program to reduce complexity and allow for concerns around equity to be addressed by the public agencies implementing the program.
In addition to the above and as mentioned previously, one of the important considerations that must be addressed when considering CEQA transportation mitigation is the requirement of additionality. Along with additionality, there are other legal and administrative considerations, depending on the program format, that will need to be considered during the implementation of a VMT mitigation program.
Another important consideration incorporated into the evaluation of a fee-based VMT mitigation program was the concept of unintended consequences. Unintended consequences that relate to the implementation of a fee program include: significant changes to development or transportation costs, changes in development patterns, or changes to the priority of infrastructure implementation.
Historically, transportation programs and projects had disproportionate impacts on disadvantaged populations. Another important consideration is that the implementation of a VMT mitigation program should not discourage good project design or contradict community values.
Outreach Summary
In assessing the viability of a fee-based VMT mitigation program for Santa Cruz County, a comprehensive outreach plan was established. This plan aimed to gather insights from various stakeholders in the region, including member agencies, community-based organization (CBO) representatives, and members of the development community. The goal was to form a Stakeholder Advisory Committee (SAC) and a Technical Advisory Committee (TAC) consisting of technical experts from across California. The project team convened with both committees twice during the beginning of the project, but due to the amount of attendees and overlap between the two groups, the two committees were combined into one single Stakeholder Advisory Committee that was convened an additional three times for a total of five meetings.
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These meetings were held to share updates, gather feedback on possible VMT-reducing projects, discuss the most suitable framework type, choose between a regional or a hybrid regional/local framework, and decide on the method for calculating cost per VMT.
In addition to the five SAC meetings, three public meetings were held throughout the regoin over the project lifecycle to solicit feedback on the study from members of the public. The following is a summary of the dates and locations in which the public meetings were held:
• City of Santa Cruz and City of Capitola, March 6, 2023 • City of Watsonville, May 31, 2023
• Online Meeting, Nov 9, 2023
In conjunction with the three public meetings and the five meetings held with the SAC, a dedicated website9 was established. This website served as a central hub for information, allowing the public to stay informed about the program's developments, access meeting materials, and provide feedback. In addition, a public survey was drafted with a link posted on the study’s website and distributed to the public via social media posts to solicit direct feedback from the public on the study.
Furthermore, to ensure wide-reaching engagement and accessibility, social media posts were crafted to spread awareness about the study and the public meetings. These posts are designed to capture the attention of various demographics across different platforms.
To cater to a diverse audience and address language barriers, informational videos were produced and posted on the study’s website in both Spanish and English. These videos are aimed at providing clear and concise explanations of the program's objectives, its potential impact, and how individuals can get involved in the process.
9 Santa Cruz County VMT Mitigation Program, https://sccoplanning.com/PlanningHome/Environmental/VMTMitigationProgram.aspx, accessed on 3/6/2024.
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Program Administration and Other
Considerations
When considering the administration of a fee-based VMT mitigation program, the structure of the program is the first thing that needs to be determined. Based on feedback received from the SAC, the Santa Cruz County Regional Transportation Commission (SCCRTC) should oversee and administer the region’s fee-based VMT mitigation program with the approval of mitigation projects provided by a Joint Powers Authority of the jurisdictions within the region. It is recommended that the JPA be represented by the Commission of the SCCRTC which includes representatives from all jurisdictions in the region. The SCCRTC is well suited to administering such a program given their current role in the region of administering funding to local entities. In this model the JPA as represented by SCCRTC’s Commission would approve funding decisions, changes to the program, and provide general oversight. The SCCRTC interagency technical advisory committee (ITAC) which is comprised of staff from each of the JPA member agencies would review the program’s projects, provide recommendations to the JPA, and suggest projects for the VMT Program.
The VMT Program would be rolled out initially as a pilot to provide insight and determine the feasibility of the program before implementing the program fully. The pilot program would include a limited number of projects, ideally those that are shovel-ready and cost efficient, to determine the feasibility of continuing the program with a wider array of projects that may not be as cost efficient. Frequency for updating the project list would be on an as needed basis depending on how quickly the VMT is purchased form the program. Based on the average amount of VMT purchased by each project applicant, ITAC staff could determine a point at which the program would need to be replenished with additional projects to provide enough VMT for future project applicants to purchase. Jointly, the JPA and the SCCRTC would be responsible for the implementation, monitoring, and enforcement of mitigation measures, facilitating the exchange of VMT credits, and maintaining transparency and accountability in the program's operations.
Nexus Documentation
The Court has been clear on land-use regulations stating that any regulation must “substantially advance legitimate state interests”. This means including the establishment of an “essential nexus” between the mitigation fee and government interest. Furthermore, the doctrine requires those fees to be “rough[ly] proportional” to the adverse impacts of a project. This also means that mitigation must be appropriately sized to offset the actual impact. Under an approach where the VMT reductions are determined in terms of “vehicle miles” or similar units, an amount of mitigation that matches the impact can be purchased by developers through a fee program. As long as these fees are justified to further a legitimate purpose with an essential nexus to government interest and roughly proportional to the adverse impacts, they may be permissible.
Similar to traditional fee programs, the mitigation projects within the bank would be selected based on the need to mitigate VMT from anticipated development. However, unlike traditional fee programs the application of the fee is directly tied to the individual development project and is not based on a future need but the VMT mitigation for that individual proposal. When a development project is proposed the
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VMT reduction required for the proposal would be calculated and the applicant would purchase the credits equal to the amount of VMT needed for their project. Once those VMT credits are purchased a VMT reducing mitigation would come online within a reasonable timeframe to mitigate the development proposal. Agencies should also be diligent in their VMT mitigation duration as the nexus between improvements and successful use of fees varies region by region. Bank arrangements that receive and pools funds from multiple projects should account for the delay between payment and deployment of funds as it measures the cost of VMT mitigation and negotiates with developers.
Other Considerations
One of the primary considerations of implementing a fee-based VMT mitigation program is the economics of providing feasible mitigation. If Santa Cruz County implements a VMT mitigation bank or other feebased VMT mitigation program framework, such as a VMT exchange, a feasible mitigation option will be introduced that did not exist previously. The introduction of a feasible mitigation option will likely necessitate participation by development projects that have CEQA-specific significant impacts where previously they would seek to obtain a finding of “overriding considerations.” The implementation of a fee-based VMT mitigation program results in more regional changes than solely providing an additional feasible mitigation option for development projects.
Often it is less expensive to construct development projects outside of urban areas than it is to construct those same projects at an infill location. This is primarily due to the use of “overriding considerations” for any VMT impacts identified at suburban and rural locations without feasible mitigations, as well as existing infrastructure and regulatory challenges facing infill sites, including the use of LOS to determine improvement recommendations by local jurisdictions. However, with the introduction of a fee-based VMT mitigation program, a new feasible mitigation for development projects is required and the cost of developing at those suburban and rural locations may increase as mitigation costs are included in the overall development cost. The net result is to bring the costs of developing in a suburban or rural location more in line with the cost to develop an infill location. The equaling of development costs between infill and suburban or rural locations could result in long-lasting impacts on future development patterns that may bring them more in line with an agency’s long-term development plan and its associated Metropolitan Planning Organization’s (MPO) Sustainable Communities Strategy (SCS). When combined with the number of state, regional, and local incentives to promote affordable and infill development, the implementation of a fee-based VMT mitigation program provides agencies with an additional tool to achieve their preferred long-range development growth plan and strengthens their overall strategy to achieve the VMT and GHG emission reduction goals set by the California Air Resources Board (CARB).
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Additional Study Outcomes
Upon completing the project analyses, outreach, framework evaluations, and reviewing all considerations, feasible program options and candidate projects for the region were evaluated, as described above. These options were selected for their ease of understanding by the public and decision-makers and their flexibility in accommodating local VMT mitigation programs.
Other findings and recommendations that have resulted from the study include:
▪ A regional VMT mitigation program offers a new viable mitigation option for project applicants facing VMT impacts that cannot be mitigated through other means. ▪ Selectivity in choosing VMT-reducing projects for the program is crucial to ensure financial and practical feasibility. Projects should be evaluated for potential other funding sources and their ability to meet additionality requirements.
▪ Equity must be a core element in both the final design of the VMT mitigation program and the projects selected for it. This study suggests that a fee-based VMT mitigation program could lead to equitable outcomes, avoiding concentration of VMT impacts in environmental justice communities and ensuring mitigation is not limited to non-environmental justice areas. ▪ Developing a project list for the program will be an ongoing process, necessitating accurate methods of VMT analysis in line with best analysis practices to ensure robust outcomes. The study’s established framework should serve as the basis for future analysis. ▪ There needs to be clear documentation of the connection (nexus) between the program’s necessity and the impact of the VMT mitigation during final program design. ▪ The program’s success hinges on support from decision-makers, agencies, the community, and participants in the VMT mitigation program. A diverse range of perspectives should be considered in the final design and project selection.
▪ Implementing a fee-based VMT mitigation program introduces a new fee, potentially increasing housing costs and other development expenses, as well as the cost of transportation capacityenhancing projects. ▪ Without a well-defined and well-established VMT mitigation solution, significant uncertainty will persist for many projects, hindering their progress even if they align with other plans and programs.
▪ A single entity should administer the program, likely the SCCRTC, and work with member agencies in the form of a Joint Powers Authority (JPA) to ensure consistent application of the program and long-term viability.
▪ It is recommended that a pilot program be implemented prior to the full rollout of the program.
This pilot program would include shovel ready or immediately implementable projects and programs that are cost efficient and run for a set time period. Once the pilot program ends, its effectiveness should be evaluated, and any lessons learned be incorporated into the full rollout of the program within the region.
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APPENDIX A – LITERATURE REVIEW
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APPENDIX B – MODELING APPROACH
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Task 1: Review Existing and Concurrent Research
Efforts
05/09/2023
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Table of Contents
Chapter 1: Introduction.......................................................................................................................................... 6 Chapter 2: Fee-based VMT Mitigation ................................................................................................................... 7 Chapter 3: Example Programs................................................................................................................................ 8 ACTUAL PROGRAMS ..................................................................................................................................... 8 City of San Diego – Active Transportation In-Lieu Fee Program..................................................................... 8 City of San Jose – Transportation Analysis Policy........................................................................................... 9 Contra Costa Transportation Authority (CCTA) ............................................................................................10 San Bernardino County Transportation Authority (SBCTA)..........................................................................10 Tahoe Regional Planning Agency – Mobility Mitigation Fee Program .........................................................10 City of Salinas................................................................................................................................................11 City of Watsonville........................................................................................................................................11 City of Tracy..................................................................................................................................................12 QUASI PROGRAMS ......................................................................................................................................12 San Francisco Transportation Demand Management Program ...................................................................12 San Francisco Transportation Sustainability Fee..........................................................................................13 City of Pasadena Complete Streets Program................................................................................................13 City of Los Angeles Coastal Transportation Corridor Specific Plan, West LA Transportation Improvement and Mitigation Specific Plan .........................................................................................................................14 Los Angeles Metro Transit Pass Study..........................................................................................................14 Metropolitan Transportation Commission Bay Area Express Lanes Strategic Plan......................................14 WETLAND BANKS.........................................................................................................................................15 Chapter 4: Legal Considerations...........................................................................................................................16 Court Decisions.............................................................................................................................................16 Regional Transportation Plans......................................................................................................................16 The California Environmental Quality Act ....................................................................................................16 Mitigation Fee Act (AB 1600)........................................................................................................................17 Congestion Management Program ..............................................................................................................17 Senate Bill 375 ..............................................................................................................................................18 Assembly Bill 602..........................................................................................................................................18
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California Fish & Game Code........................................................................................................................18 LEGAL CHALLENGES ....................................................................................................................................19 Case 1: Petitioners vs County of San Diego ..................................................................................................19 Case 2: Petitioners vs County of San Diego ..................................................................................................20 Case 3: Petitioners vs Governor’s Office of Planning and Research, California Natural Resources Agency, Office of Administrative Law ........................................................................................................................20 Chapter 5: Non-legal Considerations....................................................................................................................21 TARGETED STRUCTURE..............................................................................................................................21 VERIFICATION AND ADDITIONALITY .....................................................................................................21 GEOGRAPHY ..................................................................................................................................................23 LINKAGE BETWEEN GOVERNMENTS ......................................................................................................23 EQUITY ...........................................................................................................................................................24 VMT MITIGATION FUNDING STATUS ....................................................................................................26 Programmed Projects...................................................................................................................................26 Projects in a “Fiscally-Constrained” Portion of a Regional Transportation Plan ..........................................26 Projects in an “Unconstrained” Portion of a Regional Transportation Plan.................................................26 UNINTENDED CONSEQUENCES ...............................................................................................................27 OTHER CHALLENGES ..................................................................................................................................27 Projects approved before SB743:.................................................................................................................27 Slow Down on Home Building: .....................................................................................................................28 Charging Developers a VMT Tax...................................................................................................................28 Chapter 6: Current Situation in California ............................................................................................................29 Chapter 7: Key Takeaways....................................................................................................................................30
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List of Figures
Figure 1 Sample VMT Mitigation Additionality Framework .................................................................................22 List of Tables
Table 1 Sample VMT Mitigation Bank/Exchange Plan.........................................................................................19 Table 2 Evaluation Checklist for Program Administrator .....................................................................................22 Table 3 Categories for VMT Equity Concerns.......................................................................................................25 Table 4 VMT Mechanism before and during the Program Operation..................................................................26 Table 5 Current Situation in California .................................................................................................................29
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Abbreviation Definition
AB Assembly Bills
C/CAG City/County Association of Governments of San Mateo County CA California
CAP Cap-and-Trade Program
CAPCOA California Air Pollution Control Officers Association CBTP Community-Based Transportation Plan
CCTA Contra Costa Transportation Authority
CEQA California Environmental Quality Act
CMP Congestion Management Program
COG Council of Governments
EIR Environmental Impact Report
FGC Fish & Game Code
Gov Government
GHG Greenhouse Gas
GPA
IE
General Plan Amendment
Inland Empire
MMF Mobility Mitigation Fee
MTC Metropolitan Transportation Commission
MUNI The San Francisco Municipal Railway
LA Los Angeles
LOS Level of Service
RFP Request for Proposal
ROI Return of Investment
RTIP Regional Transportation Improvement Program
RTP Regional Transportation Plan
SANDAG San Diego Association of Governments
SB
SBCTA
Senate Bill
San Bernardino County Transportation Authority
SCS
SEIR
Sustainable Communities Strategies
Supplemental Environmental Impact Report
SloCOG San Luis Obispo Council of Governments
SR State Route
TBD To Be Determined
TDM Transportation Demand Management
TIA Transportation Impact Assessment
TIM Traffic Impact Mitigation
TOD Transit-oriented development
TS Transportation System
TSF Transportation Sustainability Fee
TMP Transportation Master Plan
TPA Transportation Priority Area
TRPA Tahoe Regional Planning Agency
UC University of California
VMT Vehicle Miles Traveled
VTA Valley Transportation Authority
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14.70 Santa Cruz County Regional VMT Mitigation Program 6 Chapter 1: Introduction
The sustainable transportation planning grant program is released by The California Department of Transportation (Caltrans) for cities and counties to begin or complete planning toward a variety of sustainable transportation projects, including but not limited to environment friendly mobility and emission reduction technologies, with the aim to support state climate goals. This grant program consists of Sustainable Communities Grants and Strategic Partnerships Grants. The former is to encourage local and regional planning that extend state goals and the latter is to identify and address the deficiencies on the State highway system in partnership with Caltrans.
County of Santa Cruz is a grantee of Sustainable Communities Grants with City of Watsonville and Santa Cruz County Regional Transportation Commission to develop and adopt Vehicle Miles Traveled (VMT) mitigation program to work, school, and essential services by building active transportation and transit improvements on and off the state highway system that decrease VMT and greenhouse gas emissions, improve safety, combat climate change and improve the quality of lifeline infrastructure provided to disadvantaged communities within the Santa Cruz region. This document presented is the first task of this project.
Senate Bill (SB) 743 reformed the transportation impacts review process under California Environmental Quality Act (CEQA) to align with greenhouse emissions reduction goals. As a result, VMT became the key metric to measure transportation impacts and estimate mitigation effects. The California Air Pollution Control Officers Association (CAPCOA) Handbook for Analyzing Greenhouse Gas Emission Reductions, Assessing Climate Vulnerabilities, and Advancing Health and Equity, which is an updated version of the VMT and Greenhouse Gas (GHG) mitigation guide released previously in 2010, was released in January 2022. CAPCOA’s Handbook is one of the primary sources for estimating mitigation effects in California (CA). Although this resource is invaluable, it is still challenged by the limitations of the prior 2010 version given that it provides solutions that work best in highly urbanized areas, with Transportation Demand Management (TDM) applications in suburban and rural contexts often having limited or questionable efficacy. TDMs can also be challenging from the standpoint of mitigation monitoring and are often unpopular with project applicants because they may need to be managed and paid for in perpetuity.
These limitations have led jurisdictions to increasingly consider other programmatic approaches to VMT mitigation. In response, policymakers started considering new designs such as “banks” and “exchanges”.
This document summarizes example programmatic approaches in practice, assesses the legal and nonlegal considerations that can identify a direction for jurisdictions, as well as provides key takeaways.
14.71 Santa Cruz County Regional VMT Mitigation Program 7 Chapter 2: Fee-based VMT Mitigation
Programmatic approaches that rely on collectively funding projects appear to hold great promise for VMT mitigation as they can allow a project to obtain an amount of mitigation precisely commensurate with their impact. In addition, these programmatic approaches allow developers to make a single payment, avoid the complexity of ongoing Transportation Demand Management (TDM) management and do not require mitigation monitoring by the project applicant. Programmatic approaches can also provide a public benefit in terms of funding transportation improvements that would not otherwise be constructed, resulting in potential improvements to congestion, Greenhouse Gas Emissions (GHG) emissions, increased transportation choices, and additional opportunities for active transportation and related health benefits. This study focuses on programmatic approaches to VMT mitigation including VMT Banking, VMT Exchanges, and VMT Mitigation Impact Fee Programs, as described below:
VMT Banking – Under a VMT Banking framework, multiple VMT-reducing projects are grouped and their associated VMT reductions are monetized in the form of credits. These credits are then purchased for the purposes of mitigating VMT in excess of determined impact thresholds. The underlying projects may be either regionally or locally beneficial to the area in which the project is located.
VMT Exchanges – VMT Exchanges are similar to VMT Banking with the exception that they deal with a single VMT-reducing project that can be established by the project applicant, other entity, or potentially be selected from a predetermined project list. As this approach eliminates the need to convert a group of projects into equivalent VMT-reducing credits, its administration could potentially be simplified, and funding can be directed at a single mitigation solution which may be of greater benefit to the project than funding a VMT Bank.
VMT Mitigation Impact Fee Programs – Some jurisdictions have also considered the creation or conversion of an existing Transportation Impact Mitigation (TIM) Fee Program to serve the purpose of VMT mitigation. This, however, can be complicated for most jurisdictions given that, to not be counterproductive in terms of VMT mitigation, all capacity-enhancing projects would need to be purged from the TIM Fee Program. Simply, a TIM Fee Program cannot have roadway widening projects and be VMT mitigating at the same time. While a full conversion to VMT mitigation projects is feasible in some urban locations, most jurisdictions still desire to have some level of roadway widening/capacity enhancement within their programs for the purpose of facilitating travel and reducing congestion, even if the approach may be conflicting with Senate Bill (SB) 743 given that most capacity-enhancing projects result in induced demand and increased VMT. An important difference between a VMT Mitigation Impact Fee Program and a Banking/Exchange program is that every project would participate in it, not just those projects that require VMT mitigation under CEQA law. Note that, SB 743 modifies CEQA for VMT to be used as the metric based on which the impacts from transportation projects are evaluated. In response to SB 743, agencies are required to use VMT to evaluate the transportation impacts under CEQA.
The next chapter will introduce some of the example programs across the state: actual programs, quasi programs, and wetland banks.
14.72 Santa Cruz County Regional VMT Mitigation Program 8 Chapter 3: Example Programs
This chapter will present some examples from around the state to compare how different jurisdictions have approached VMT mitigation under SB743 over the years. The chapter will consider examples as follows:
• Actual Programs that fully implements fee-based mitigation programs (Actual programs) within a jurisdiction
• Quasi programs focusing on one aspect of VMT mitigation • Wetland Banks where bank sponsors are allowed to transfer credits to permit developers to compensate for environmental impacts in exchange for permanent protection and monitoring of the wetlands
Mote that, unless otherwise noted all the examples provided here are using thresholds that follow the Office of Planning and Research Technical Guide to Implementing SB 743.
ACTUAL PROGRAMS
City of San Diego – Active Transportation In-Lieu Fee Program In 2020, the City of San Diego proposed implementing a program for the purpose of complying with SB 743.1 The intent of this program was to reduce Citywide VMT to address impacts of development related to noise, air pollution, and greenhouse gas emissions, and to promote public health and enjoyment, by investing in active transportation infrastructure and measures that will result in reductions to Citywide VMT.
Under the program, the city has identified four (4) zones, as follows:
• Mobility Zone 1 – reflects the Downtown Community Planning Area boundary • Mobility Zone 2 – includes any parcel that falls wholly, or partially, within the State’s identified • Transit Priority Areas (TPAs)
• Mobility Zone 3 – reflects any Community Planning Area boundary with a VMT threshold that is 85% or less of the regional average for either VMT per capita or VMT per employee • Mobility Zone 4 – represents an area that is not located within Mobility Zones 1, 2, or 3; Mobility. Zone 4 generally reflects the non-urban areas of the city Under the Program, all development located in Mobility Zone 4 would be required to pay an active transportation in-lieu fee instead of funding the cost of VMT reducing mitigation measures. In addition, development projects in Mobility Zone 4 would not be required to provide on-site TDM. This is mainly because zone 4 is less bike and walk friendly, located farther away from jobs, services, and shopping centers, and has limited access to transit. Thus, it is not effective to implement VMT reduction strategies though the VMT generation rate would be high. Funds collected from the program would be used to pay for transportation and VMT-reducing multimodal infrastructure projects within Mobility Zones 1, 2, and 3, thereby reducing Citywide VMT impacts. The regulations required that all development located in Mobility Zones 2 and 3 provide on-site TDM measures that reduce VMT. TDM measures could include a variety of pedestrian improvements (e.g., eliminating sidewalk gaps, new crosswalks), bicycle supportive 1 County of San Diego, San Diego Citywide Active Transportation In Lieu Fee Program Estimated Impacts and Cost Savings, https://www.sandiego.gov/sites/default/files/8_active_transportation_in_lieu_fee_cost_impact_analysis.pdf, accessed on April 11th,2022
14.73 Santa Cruz County Regional VMT Mitigation Program 9 amenities (e.g., lockers, showers), transit improvements (e.g., installing a shelter), and other multimodal enhancements (e.g., moving or adding a new stop closer to the project. Average total cost for regional VMT normalized across modes of bike/transit/pedestrian is identified $1,400.
KEY TAKEAWAYS
The city is divided into zones
Developments in non-urban areas pay an Active Transportation In-Lieu Fee Developments in urban areas would provide on-site Transportation Demand Management (TDM) amenities that reduce VMT
City of San Jose – Transportation Analysis Policy
Effective by March 29, 2018, the City adopted a Transportation Analysis Policy replacing the Transportation Impact Policy to align with SB 743.2 Transportation projects that are environment friendly and support land use and goals of City and State by mitigating traffic significantly or at least are neutral against City’s screening criteria are listed by SB 743 publication. Projects that do not meet the screening criteria must include a detailed evaluation to measure the VMT against City’s thresholds of significance and include feasible mitigation measures to offset the effects if needed. In case a project is unable to fully mitigate VMT, the project must fund multimodal transportation improvements—called Transportation System Improvements— that would improve system efficiency and/or safety, enhance non-auto travel modes, and promote the citywide reduction of VMT. San José provides an example of a way to use the VMT “budget” to create a transportation project threshold of significance. San José evaluates transportation projects in relation to the regional transportation plan. The City of San Jose Transportation Analysis Handbook identifies screening criteria that determines whether a CEQA transportation analysis would be required for development projects. The criteria are based on the type of project, characteristics, and/or location. If a project meets the City’s screening criteria, the project is expected to result in less-than-significant VMT impacts and a detailed CEQA VMT analysis is not required. Projects must demonstrate consistency with the Envision San José 2040 General Plan to address cumulative impacts. Consistency with the City’s General Plan is based on the project’s density, design, and conformance to the General Plan goals and policies. If a project is determined to be inconsistent with the General Plan, a cumulative impact analysis is required per the City’s Transportation Analysis Handbook. Per VMT cost was stated as follows:
• Commercial/Industrial: $3,200 per Vehicle Mile Traveled not mitigated • Residential $2,300 per Vehicle Mile Traveled not mitigated
KEY TAKEAWAYS
Applicants must construct or fund citywide multimodal transportation improvement(s) if a project was unable to fully mitigate VMT
Improvements to the citywide multimodal transportation system would not necessarily reduce or avoid the significance of VMT impacts that cannot be mitigated
An improvement would be one of the overriding benefits to the community 2 City of San Jose Council Policy, Transportation Analysis Policy, 636691896044230000 (sanjoseca.gov), accessed on April 11th,2022
14.74 Santa Cruz County Regional VMT Mitigation Program 10 Contra Costa Transportation Authority (CCTA)
A California Department of Transportation Sustainable Planning Grant of $400,000 was awarded to the Contra Costa Transportation Authority (CCTA) in 2021 to build a VMT Mitigation Framework.3 The study will examine the possibility of allowing developers and transportation agencies whose projects contribute to VMT increases to offset emissions by paying into a “VMT Mitigation Program”.
In March 2023, A draft VMT mitigation framework has been released. CCTA has expressed interest in establishing a pilot hybrid exchange/in-lieu fee program targeted toward implementing the Mobility on Demand (MOD) app. The MOD app would function as a voluntary commute trip reduction program and a source of community-based travel information. The app offers the ability to monitor the VMT generation, hence quantifying the VMT effects. This would create the ability to directly calculate the program’s cost-effectiveness for VMT. The draft framework estimates a $0.10 -$0.35 per VMT reduced over 10 years. If MOD proves to be effective, it could use demonstrated VMT reductions and cost data as the basis for a future fee program.
KEY TAKEAWAYS
The program is funded by the California Department of Transportation Sustainable Planning Grant The county is establishing a pilot hybrid exchange/in-lieu fee program Estimated cost: $0.10 -$0.35 per VMT reduced over 10 years San Bernardino County Transportation Authority (SBCTA)
In August 2022, A VMT mitigation bank was proposed by City/County Manager’s Technical Advisory Committee. SBTA would develop this bank using a mode-choice based framework, with telework as the initial regional mitigation measure. Initially, the program would focus on incentivizing individuals to earn reduction credits by making choices to reduce their travel. After establishing a verified home-based work trip (HBW) “baseline,” individuals who volunteer for the program can generate credits whenever they choose to telework for a particular day. The volunteers would need to live or work in the County.
The verified VMT reduction credit would then be assigned an economic value and the volunteers would be paid a share of that value as an incentive for reducing their VMT. The purchased credit would be banked by SBCTA and then sold to development projects that would need mitigation. Additional projects and programs already established under the Inland Empire (IE) Commuter Rideshare Program could be added in the future (e.g. choices to ride transit or vanpool/carpool). It is estimated to have a cost of $0.05 -$0.08 per VMT reduced over 20 years.
KEY TAKEAWAYS
SBCTA would develop a regional VTM Mitigation bank using a mode-choice based framework The program is focusing on telework as the initial regional mitigation measure Estimated cost: $0.05 -$0.08 per VMT reduced over 10 years Tahoe Regional Planning Agency – Mobility Mitigation Fee Program As of April 2021, the Tahoe Regional Planning Agency (TRPA) introduced the Mobility Mitigation Fee (MMF) program basing the fee on average daily VMT instead of the average daily trip ends.4 VMT mitigating projects are drawn from the 2020 Regional Transportation Plan (RTP) constrained project list. 3 Contra Costa Transportation Authority, Press Release, https://ccta.net/wp-content/uploads/2021/10/CCTA_SustainableGrantAward_FINAL.pdf, accessed on April 11th,2022
4 Tahoe Regional Planning Agency, Mobility Mitigation Fee Update, 2021. https://www.trpa.gov/wp-content/uploads/Ops-Committee-Item-5- Mobility-Mitigation-Fee-Update.pdf, accessed on April 11th,2022
14.75 Santa Cruz County Regional VMT Mitigation Program 11 MMF may charge as high as $218.00 per VMT depending on the development. This program is different from its equivalents in the region as it strictly charges a VMT mitigation fee. These fees are for mitigating project impacts on transportation, not for revenue-generating to offset the vehicular impacts of a project including roadway improvements. The updated process requires all projects to mitigate their transportation impacts through payment in the MMF Program and to do more at the project level if generated VMT is significant. The new process charges a fee for retail/commercial development only if it generates a net increase in VMT.
The process encourages projects located in low-VMT areas, and any needed VMT-reducing strategies to further reduce VMT can be reflected in lower MMF fees. TRPA’s mitigation fund release policy states that collected funds can only be used for VMT mitigating transportation projects.
KEY TAKEAWAYS
Fee based on VMT instead of daily trip ends and dependent on type of project Fees are strictly for mitigating project impacts on transportation, not for revenue-generating to offset the vehicular impacts of a project
The new process charges a fee only if project generates a net increase in VMT City of Salinas
As of October 2020, the City of Salinas started developing a VMT mitigation bank based solely on bicycle infrastructure projects. As a part of developing the bank, several key citywide bicycle projects were costed and the VMT reductions associated with them were calculated. Projects that could be constructed in the next ten years were included in the program.5 However, in order for the City to more easily administer the program, the cost was calculated on a per trip basis rather than a per mitigated VMT basis. The resulting program charges $204.89 per gross vehicle trip. A project that wishes to mitigate its VMT impact must determine the number of vehicle trips to be reduced before determining its overall mitigation cost.
An important aspect of this program is that additional projects can be added to the bank to increase the supply of VMT for mitigation purposes. The City of Salinas is one of the first cities in California to undertake the development of a VMT Banking program.
KEY TAKEAWAYS
VMT Bank comprised by bicycle infrastructure projects only Developer pays one time to mitigate amount of total VMT project that is over the threshold VMT Bank can be refilled by new projects if additional VMT is needed City of Watsonville
As of September 2022, The City of Watsonville developed a VMT mitigation bank based on bicycle and pedestrian infrastructure projects. The proposed projects were taken from existing plans such as the bicycle master plan. Then, projects were costed, and the VMT reductions associated with their construction were calculated. Projects that could be constructed in the next ten years were included in 5 While this VMT Banking program consists of potential projects that could be constructed in the next ten years, some but not all of them are anticipated to be constructed in that timeframe.
6 Project level depends on project site and land use types. Chapter 65: Air Quality / Transportation of the TRPA Code of Ordinances details the defined levels
14.76 Santa Cruz County Regional VMT Mitigation Program 12 the program.6 This provides a small program with a cost per VMT reduced that the developers can use to reduce their project’s VMT impact as part of a regional VMT banking approach to VMT mitigation. The resulting cost for each VMT to be reduced was calculated to be $1,524.21 per VMT reduced. Note that this rate does not include any non-fee funding sources (grants, etc.). The addition of any funding sources for these projects could significantly reduce the cost of per VMT reduction cost.
An important aspect of this program is that additional projects can be added to the bank to increase the supply of VMT for mitigation purposes.
KEY TAKEAWAYS
VMT Bank comprised by bicycle and pedestrian infrastructure projects Developer pays one time to mitigate amount of total VMT project that is over the threshold VMT Bank can be refilled by new projects if additional VMT is needed City of Tracy
As of July 2022, The City of Tracy developed a VMT mitigation bank based on bicycle and pedestrian infrastructure projects, as well as a mobility hub project. The mobility hub links several different modes of travel together at a transit station to make commuting by transit easier and reduce the number of drive-alone automobile trips. As a part of developing the bank, the proposed projects were taken from existing documents such as the transportation master plan (TMP), then the projects were costed, and the VMT reductions associated with their construction were calculated. Projects that could be constructed in the next ten years were included in the program. This resulted in a small program with a cost per VMT reduced that the developers can use to reduce their project’s VMT impact that can be use as part of a VMT banking approach to VMT mitigation. The resulting cost for each VMT to be reduced was calculated to be $633.11 per VMT reduced. Note that this rate does not include any non-fee funding sources (grants, etc.). The addition of any funding sources for these projects could significantly reduce the cost per VMT reduction cost.
An important aspect of this program is that additional projects can be added to the bank to increase the supply of VMT for mitigation purposes.
KEY TAKEAWAYS
VMT Bank comprised by bicycle, pedestrian, and mobility hub projects Developer pays one time to mitigate amount of total VMT project is over threshold VMT Bank can be refilled by new projects if additional VMT is needed
QUASI PROGRAMS
San Francisco Transportation Demand Management Program
The San Francisco Transportation Demand Management Program, which “seeks to promote sustainable travel modes by requiring new development projects to incorporate design features, incentives, and tools that support transit, ride-sharing, walking, and bicycle riding” is one potential example of a VMT exchange program. Each project was given several points based on its land-use category, size, and parking requirements by program staff. The project developers must then choose applicable demandmanagement measures (primarily on-site) totaling an equal number of points from a city-prepared 6 While this VMT Banking program consists of potential projects that could be constructed in the next ten years, some but not all of them are anticipated to be constructed in that timeframe.
14.77 Santa Cruz County Regional VMT Mitigation Program 13 menu of options and develop a plan to put the measures in place. Each point corresponds to a 1% reduction in VMT.7
KEY TAKEAWAYS
An early example of VMT Exchange
Each project was given several points based on its land-use category, size, and parking requirements Project developers choose applicable measures totaling the points from this menu and develop a plan San Francisco Transportation Sustainability Fee
San Francisco Transportation Sustainability Fee (TSF) required developers of qualifying projects to pay approximately $8 per square foot of residential development and $18 per square foot of commercial development into a fund. Millions of dollars generated from this program were funneled to transit improvements such as adding more The San Francisco Municipal Railway (MUNI) services, expanding the fleet, and improving services as well as transit stops, and streets. A thorough nexus study was conducted to explore legality, justified fees and other aspects, and potential projects. A well-designed analysis of transportation demand and adjusted fees and measures was enough to set the groundwork to satisfy core CEQA requirements.8
KEY TAKEAWAYS
San Francisco Transportation Sustainability Fee required developers of qualifying projects to pay development commercial development into a fund
Fees were funneled to transit improvements such as MUNI services expanding fleets, and improving services A well-designed analysis of transportation demand and adjusted fees and measures was enough to set the ground to satisfy core CEQA requirements
City of Pasadena Complete Streets Program
The City of Pasadena had organized its Complete Streets Program to implement innovative approaches to reduce VMT. 9 Thresholds that require analysis and potential mitigation for any significant impacts were included for both VMT and Level of Service (LOS), along with other metrics. The guidelines set the significance threshold for VMT at 22.6 additional trips per capita (residential population plus jobs) and require LOS to be held at D.
This also helped solve a potential CEQA-Congestion Management Plan (CMP) compliance conflict by evaluating LOS and VMT at the same geographical scale on which VMT mitigation is permitted. Since VMT programs are designed to reduce vehicle miles traveled, LOS may not be negatively impacted at the intersection level, for instance. If the scale of LOS evaluation is expanded from intersection impacts to larger segments in the region, then VMT mitigation should coincide with LOS goals under CMP.
Additionally, if project reduces VMT but would not comply with LOS requirements under CMP, jurisdiction can designate “infill opportunity zones” that are exempt from the LOS requirements under LOS. These zones are within one-half mile of a major transit stop or high-quality transit corridor included in the application regional transit plan.10 Agencies must consider all aspects of legal requirements. 7 City and County of San Francisco Planning Commission, Standards for the Transportation Demand Management Program (2016), See http://www.sftdmtool.org/, accessed on April 11th,2022
8 Robert D. Spencer, San Francisco Municipal Transportation Agency, San Francisco Transportation Sustainability Fee (TSF) Nexus Study (2015). 9 City of Pasadena Department of Transportation, Mobility Element (2015). https://ww5.cityofpasadena.net/transportation/completestreets/development-review/pasadena-transportation-management-association, accessed on April 11th,2022 10 See Cal. Gov’t Code § 65088.4.
14.78 Santa Cruz County Regional VMT Mitigation Program 14 KEY TAKEAWAYS
Complete Streets Program was organized to implement innovative approaches to reduce VMT Thresholds included both VMT and LOS, along with other metrics This helped solve a potential CEQA-CMP compliance conflict by evaluating LOS and VMT at the same level City of Los Angeles Coastal Transportation Corridor Specific Plan, West LA Transportation Improvement and Mitigation Specific Plan
As the earliest application of mitigation fee programs, these area-wide-specific plans included lists of transportation improvements such as transit, bicycle, pedestrian, roadway, intelligent transportation system (TS), and trip reduction programs to be funded by the impact fees collected from new development. The fair share (trip fee) is based on a “nexus” and is calculated in direct proportion to PM Peak hour trips generated by new development. The amount of the TIA fees is based on each land uses proportionate to the use of the transportation facilities. At the time, the Transportation Impact Assessment fee program was also updated to include a VMT-based nexus plan, revisions to the fees, exemptions, in-lieu credits, affordable housing credits; and new transit-oriented development credit.
Other proposed changes include administrative amendments and minor revisions that are consistent with SB 743.11
KEY TAKEAWAYS
The earliest application of VMT Mitigation programs
Area-specific plans included lists of transportation improvements to be funded by the impact fees The transportation Impact assessment program included VMT-based nexus plans, in-lieu credits, and new transitoriented development credit Los Angeles Metro Transit Pass Study
Metro is the Los Angeles County mobility provider. One of the programs they offer is a transit pass subsidy and based on a study in 2020 it may qualify as a VMT mitigation exchange. Metro offers some students and employees free transit by allowing anyone to ‘sponsor’ a particular school or employer. 12 LA Metro considered a program as an SB 743 VMT mitigation exchange where developers could purchase these passes and could use the Metro performance data to estimate the VMT reduction per pass. However, this process is still experimental.
KEY TAKEAWAYS
LA Metro transit passes could be sponsored by anyone
LA Metro considered a program as an SB 743 VMT mitigation exchange where developers could purchase these passes This may have qualified as a VMT exchange
Metropolitan Transportation Commission Bay Area Express Lanes Strategic Plan The Metropolitan Transportation Commission (MTC) is exploring a simplified VMT bank or exchange options as on-site mitigation may not be feasible for all projects. 13 MTC is considering a VMT exchange program that can reinforce existing multi-county efforts focusing on corridor-planning within the express lane corridor. Through VMT exchange, implementing agencies will offset any VMT impacts of 11 Los Angeles Department of Transportation, Transportation Impact Assessment (TIA) Fee Program Study for Coastal Transportation Corridor Specific Plan and West Los Angeles Transportation Improvement and Mitigation Specific Plans Amendment Project, 2015. 12 Fehr & Peers, VMT Mitigation Through Fees, Banks, and Exchanges, April 2020 13 Metropolitan Transportation Commission, Bay Area Express Lanes Strategic Plan, https://mtc.ca.gov/sites/default/files/Bay_Area_Express_Lanes_Strategic_Plan_Appendices.pdf, accessed on April 11th,2022
14.79 Santa Cruz County Regional VMT Mitigation Program 15 the express lanes. On the other hand, MTC is also considering VMT banks that allow developers to fund off-site mitigation projects. In this case, an improved Impact fee that is used to fund demonstrated VMT mitigation projects, could fund current mitigation such as a regional express bus service.
MTC notes that implementing agencies should consider scenarios where the toll revenue drops, and mitigation funds are needed to operate and maintain highways. In that sense, how and where these banks are used remains an important challenge for these agencies.
KEY TAKEAWAYS
MTC is exploring a simplified VMT bank or exchange options for Bay Area express lanes VMT exchange can reinforce existing multi-county efforts focusing on corridor planning within the express lane corridor Implementing agencies could offset any VMT impacts of the express lanes
WETLAND BANKS
Wetland banks have been in practice for years now. A wetland (mitigation) bank is “privately or publicly owned land managed for its natural resource values. In exchange for permanently protecting, managing, and monitoring the land, the bank sponsor is allowed to sell or transfer habitat credits to permits who need to satisfy legal requirements and compensate for the environmental impacts of developmental projects.”14 Although there may be a variety of technical and legal differences, they can be potential models for VMT mitigation strategies. These models typically include a process through which the impacts of various transportation projects are estimated. Mitigation (Wetlands) banking credits are established to compensate for unavoidable wetland losses. One of the differences with VMT banks is the use of mitigation banks. This must occur in advance of development when the mitigation is not possible at the site or would not be as beneficial. Here are some examples sponsored by Caltrans15:
• State Route (SR) 149 Freshwater Marsh (1990) – Caltrans mitigated impacts of SR 149 widening project. Initial mitigation funding was provided by local funds for cash flow that is later reimbursed by Caltrans.
• Beach Lake Mitigation Bank (1991) – Beach Lake Mitigation Bank compensated for losses to wetland resources from future Caltrans projects in 14 counties. As of 2014, 43 projects in total had been debited from the bank to mitigate the impacts. • Elkhorn Slough Early Mitigation Partnership (2009) – Program developed funding strategies and conservation agreements for the watershed. Caltrans sponsored the partnership to set up advance mitigation for four transportation projects.
KEY TAKEAWAYS
Collaboration with local/regional partners facilitates state-level (Caltrans) efforts to develop advanced mitigation The timeline for bank development could be different from agency to agency Sometimes smaller agencies can have the flexibility to achieve advance mitigation, since they may have less restricted processes compared to Caltrans.
14 California Department of Fish and Wildlife, Conservation and Mitigation Banking (ca.gov), accessed on April 11th,2022 15 Sciara, G., Bjorkman,J., Lederman,J., Thorne, J.H., Schlotterbeck, M., Wachs, M., Setting the Stage for Statewide Advance Mitigation in California, UC Davis, Institute of Transportation Studies, 2015.
14.80 Santa Cruz County Regional VMT Mitigation Program 16 Chapter 4: Legal Considerations
There are a few potential sources of legal considerations that need to be considered to create a VMT mitigation bank, exchange, or impact fee program including CEQA, associated court decisions, California’s Mitigation Fee Act, associated Assembly Bills (AB), the Congestion Management Program, and other Senate Bills. Any agency or authority designing or operating a bank would need to consider these to minimize risk of litigation. This section will discuss these considerations in further detail.
Court Decisions
The Court has been clear on land-use regulations stating that any regulation must “substantially advance legitimate state interests”. This means including the establishment of an “essential nexus” between the mitigation fee and government interest.16 Furthermore, the doctrine requires those fees to be “rough[ly] proportional” to the adverse impacts of a project.17 This also means that mitigation must be appropriately sized to offset the actual impact. Under an approach where the VMT reductions are determined in terms of “vehicle miles” or similar units, an amount of mitigation that matches the impact can be purchased by developers through a fee program. As long as these fees are justified to further a legitimate purpose with an essential nexus to government interest and roughly proportional to the adverse impacts, they may be permissible.
KEY TAKEAWAYS
Essential Nexus: There must be an essential nexus between the mitigation fee and the government interest Roughly Proportionality: Mitigation must be approximately sized to offset the actual impact Regional Transportation Plans
A bank or exchange may need to take into account certain transportation planning frameworks that are covered by California law. Regional Transportation Plans (RTPs) are long-term plans created and updated frequently by regional transportation agencies (RTAs) and metropolitan planning organizations (MPOs) incorporating local, regional, state and federal plans and priorities. While RTPs are not focused on VMT reduction, in certain cases there might be overlaps. A project that is to be funded under an RTP may not qualify as additional for mitigation. In addition, large scale mitigation investment might overlap with RTPs as they reflect regional transportation investment priorities. VMT Programs should include mechanisms to make sure additionality requirements are met.
KEY TAKEAWAYS
The components of the RTP must be considered by the VMT mitigation bank and exchange programs to guarantee that the project satisfies the criteria for additionality and prioritization requirements The California Environmental Quality Act
SB 743 directly amends The California Environmental Quality Act (CEQA) to require an updated analysis of transportation impacts. Reducing greenhouse gas emissions through means such as VMT is a justified purpose for the state’s interest. CEQA requires that feasible mitigation be applied to projects that result in a significant impact. The impact is defined as the changes to the baseline environment caused by the 16 See Nollan, 483 U.S. at 837. 17 Dolan v. City of Tigard, 512 U.S. 374, 391,1994
14.81 Santa Cruz County Regional VMT Mitigation Program 17 project. Lead agencies or authorities can choose their thresholds to determine the significance of the impact. Here are the main statutes and guidelines:
• CEQA Statute (CA Public Resources Code 21099)
• CEQA Guidelines (CA Code of Regulations, Title 14, Division 6, Chapter 3, Sections 15064.3) Other relevant statues and guidelines are as following:
• CEQA Statute (CA Public Resources Code 21068.5, 21083, 21093, 21094, 21100, 21002) • CEQA Guidelines (CA Code of Regulations, Title 14, Division 6, Chapter 3, Sections 15007, 15041(a), 15064(h)(3), 15093,15091,15125, 15151,15152, 15364, 15384,15385) Mitigation Fee Act (AB 1600)
Development Impact Fees thar\t were created under Assembly Bill 1600 (AB 1600), also known as the Mitigation Fee Act is now codified as Government (Gov.) Code Sections 66000 through 66008 (“Mitigation Fee Act”). The main purpose of the mitigation fee act is to “address concerns over the fact that local agencies are imposing fees for purposes unrelated to development projects.”18
KEY TAKEAWAYS
Gov. Code § 66000 (d) – The bank or the recipient of the fund should use funds for a public facility. While it is defined broadly, mitigation measures such as public transit infrastructures or subsidies can be defined as a public facility Gov. Code § 66001(a) – A reasonable relationship between the development fee, its use, and the need for the mitigation measure should be identified. Mitigation projects such as contributions to transit services should meet legal requirements and the relationship should be properly documented Gov. Code § 66005 identifies a course for a fee reduction regarding new infill or transit-oriented housing developments.
If development is a one-half mile from a transit station and meets basic requirements – generates lower auto trips–that development is entitled to a fee reduction. Under SB743, affordable housing, housing within ½ mile of transit, housing projects generating fewer than 110 trips per day, and new housing in existing low-VMT neighborhoods can forego transportation analysis and mitigation entirely. SB 743 makes it easier to use two CEQA exemptions for infill projects that can only be used when a project will not have significant transportation/traffic impacts. These are Public Resources Code section 21159.25’s statutory exemption for housing projects in unincorporated areas and the Class 32 categorical exemption for infill projects within city limits.
Congestion Management Program
The current CMP in California requires urban areas to develop and adopt a program to enforce the LOS of E or promote alternative methods if below LOS E. However, SB 743 identifies VMT as the new measure of effectiveness for CEQA considerations, which creates a conflict with the existing CMP. VMT mitigation banks or exchanges may be funding or permitting a VMT reducing project that does not necessarily improve LOS.
KEY TAKEAWAYS
Until the CMP is updated to comply with SB 743, a simple solution would be to consider, having transportation impact analysis thresholds for both LOS and VMT on the same geographical scale 18 Elkind, N.E., Lamm,T., Prather,E., Implementing SB 743 An Analysis of Vehicles Miles Traveled Banking and Exchange Frameworks, October 2018, U.C. Berkeley.
14.82 Santa Cruz County Regional VMT Mitigation Program 18 Senate Bill 375
SB 375 (Steinberg, 2008) requires MPOs to create and implement Sustainable Communities Strategies (SCS) and that adopted RTP components to integrate land use, housing, and transportation planning strategies to meet regional greenhouse gas emission reduction goals set by the state of California.SB475 promotes robust planning process that integrate regional and local strategies. However, in terms of implementation significant gaps has been observed. One of the limitations was the adequate incentives for inducing local development choices conducive to regional plan goals. Disruptive technology such as Uber, Lyft, and autonomous vehicles, increased vehicle availability, reduced time spent driving, lower operating costs in shared platforms potentially increases VMT absent new regulations. One of the other challenges were local zoning and permitting practices that constrain housing production and/or make it more expensive. Also, SB375 state that no aspect of it should be understood to initiate local control of land use decision-making, which makes it hard for MPOs to impose policy directives upon local jurisdictions. There has been concerns about infill strategies, lack of adequate incentives and support for compact development.
KEY TAKEAWAYS
While it is unlikely that SCSs will conflict with SB 743, lead agencies must review the applicable Sustainable Communities Strategies (SCS) for any potential conflicts.
SB 375 can provide useful considerations to design and operate VMT banks or exchanges as it ensures that cities and counties are closely involved in developing effective plans for the regions, increases public participation and local government input, strengthens several existing requirements for public involvement in regional planning. It establishes a collaborative process between regional and state agencies to set GHG goals and prices CEQA incentives for development projects that are consistent with regional plan.
Assembly Bill 602
AB 602 reforms housing impact fees to make them more fair, transparent and streamlined such that smaller, more affordable units are not unfairly penalized with higher costs.19 AB 602 requires impact fees to be proportional to the size of a new home so that smaller individual homes pay reduced fees.
However, before the adoption of the fee, an impact fee nexus study should be adopted that identifies the existing level of service for each public facility, proposed new level of service, and should include an explanation of why the new level of service is needed. If a fee program was adopted before the state adopted AB 602, it would require a capital improvement plan as part of its nexus study.
KEY TAKEAWAYS
This bill would require that a local agency that calculates fees proportionately to the square footage of the proposed units be deemed to have used a valid method to establish a reasonable relationship between the fee charged and the burden posed by the development. Bill went into effect on January 1, 2022 VMT banking rates are not calculated based on service levels or standards. The fee is based on VMT reduction and therefore housing square footage is not applicable. . However, lead agencies should review and consider AB 602 for potential conflicts with their programs
California Fish & Game Code
While research shows there are no specific statutes for VMT exchanges and banks, U.C. Berkeley used conservation programs as a proxy established under the California Fish & Game Code (FGC) to develop a 19 California Legislative Information, AB 602 Development Fees: Impact fee nexus study, https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202120220AB602, accessed on April 11th, 2022
14.83 Santa Cruz County Regional VMT Mitigation Program 19 list of requirements associated with existing statutes as shown in Table 1. 20 The intent is to show that
behind VMT exchanges and banks aligning as a VMT mitigation program, is a form of conservation where they are trying to limit environmental impacts and the VMT generated through development.
Table 1 Sample VMT Mitigation Bank/Exchange Plan
Requirements Statutory Ref.
An explanation of theVMT mitigation purpose and need for the bank or exchange. FGC § 1852(c)(1) The geographic area covered by the bank or exchange and rationale for the selection ofthe area,together with a description of the existing transportation and development dynamics that provide relevant context for the development of the bank or exchange.
FGC § 1852(c)(2)
The public transit and VMT reduction opportunities are currently located within the bank or exchange area.
FGC § 1852(c)(3)
Important residential and commercial communities and transportation resources within the bank or exchange area, and an explanation of the criteria, data, and methods used to identify those important communities and resources.
FGC § 1852(c)(4)
A summary of historic, current, and projected future transportation stressors and pressuresin the bank or exchange area, including economic, population growth, and development trends. FGC § 1852(c)(5)-(6) Provisions ensure that the bank or exchange will be in compliance with all applicable state and local legal and other requirements and does not preempt the authority of local agencies to implement infrastructure and urban development in local general plans.
FGC § 1852(c)(7)
VMT mitigation goals and measurable objectives for regional transportation resources and important mitigation elements identified in the plan that address or respond to the identified stressors and pressures on transportation within the bank or exchange area.
FGC § 1852(c)(8)
VMT mitigation projects, including a description of specific projects that, if implemented, could achieve the mitigation goals and objectives, and a description of how the mitigation projects were prioritized and selected about the mitigation goals and objectives.
FGC § 1852(c)(9)
Provisions ensuring that the bank or exchange plan is consistent with and complements any local, regional, or federal transportation or congestion management plan that overlaps with the bank or exchange area, a summary of any such plans, and an explanation of such consistency.
FGC § 1852(c)(10)-(11)
LEGAL CHALLENGES
SB 743 has completely changed how jurisdictions analyze transportation impacts under CEQA. In 2018, the Governor's Office of Planning and Research (OPR) released technical recommendations regarding SB 743, which were helpful in evaluating transportation impacts for certain types of projects, such as housing, office and retail development. However, the guidelines do not comprehensively cover every land use scenario and there are still legal and practical scenarios falling through the cracks as shown in the three cases described below.
Case 1: Petitioners vs County of San Diego21
California Appellate Court rejected San Diego County’s plan to mitigate greenhouse gas impacts with offsite offsets. The appellate court held that a mitigation measure in the Supplemental Environmental 20 Elkind, N.E., Lamm,T., Prather,E., Implementing SB 743 An Analysis of Vehicles Miles Traveled Banking and Exchange Frameworks, October 2018, U.C. Berkeley.
21 Court of Appeal, Fourth Appellate District, https://law.justia.com/cases/california/court-of-appeal/2020/d075328.html, accessed on October 3rd, 2022
14.84 Santa Cruz County Regional VMT Mitigation Program 20 Impact Report (SEIR) that permitted the purchase of carbon offsets from projects outside the County, including international projects, violated CEQA because the mitigation measure did not require that offsets meet AB 32 requirements, that greenhouse gas emission reductions be additional, and that the offsets originating outside California have greenhouse emissions programs equivalent to or stricter than California’s program.
Case 2: Petitioners vs County of San Diego
VMT banks and exchanges are presenting unique solutions to VMT mitigation. However, they also bring quite a few legal challenges with them in terms of implementation. One of these challenges is the use of carbon offsets. Recently, the County of San Diego was challenged over the use of carbon offsets to achieve GHG reduction goals in the County’s climate action plan.22 The court petition states that revised CAP (Cap-and-Trade Program) and General Plan Amendment (GPA) Procedures lack standards sufficient to ensure that offsets are real, enforceable, additional, and otherwise consistent with CEQA’s mitigation requirements. It also states that these procedures also fail to ensure that offset purchases will mitigate GHG emissions because they defer any judgment regarding the adequacy of a particular offset purchase until the issuance of a building permit. This could be an obstacle to creating VMT banks or exchange programs.
Case 3: Petitioners vs Governor’s Office of Planning and Research, California Natural Resources Agency, Office of Administrative Law
In 2019, the Governor’s Office of Planning and Research, California Natural Resources Agency, and Office of Law were challenged by the Two Hundred, an unincorporated association of civic leaders and additional individuals. Petitioners challenged five new regulations, one regulatory appendix, and two underground regulations. Essentially, petitioners argued that new plans increase new home costs, which pushes too many families of color far behind in their ability to access homeownership. It also mandates a VMT mileage quote for each driver, a quote which will arguably raise commute costs of lower and moderate-income workers who commute from outlying affordable home communities.23 If successful, as the case is still ongoing, this could affect the legality of VMT policy setting. 22 Superior Court of the State of California, Court Petition, https://www.biologicaldiversity.org/programs/urban/pdfs/San-Diego-CAP-Petition-forWrit-of-Mandate.pdf, accessed on April 11th, 2022 23 Superior Court of the State of California, Court Petition, 200-v-OPR-Complaint-12-18.pdf (thetwohundred.org), accessed on April 11th, 2022
14.85 Santa Cruz County Regional VMT Mitigation Program 21 Chapter 5: Non-legal Considerations
Research shows that there are other important considerations to take into account namely targeted structure, verification and additionality, geography, linkage between governments, equity, funding status, unwanted consequences This chapter will shed light on these considerations to establish a basis for fee-based VMT programs.
TARGETED STRUCTURE
A Fee-Based VMT Mitigation Program should only be imposed when a project can’t sufficiently or costeffectively mitigate its transportation impact. Unlike a typical TIM Fee Program that requires every development project to pay into it, a VMT Fee-Based Mitigation Program would only collect money from projects that cannot effectively mitigate their significant transportation impacts on their own. As a result, forecasting revenue may be more difficult given the need to predict a project’s location and timing, its land-use characteristics, and whether it will require mitigation.
VERIFICATION AND ADDITIONALITY
Agencies need to consider questions concerning both “additionality” and verifiable VMT reductions before participating in a banking regime. Additionality concerns the requirement under CEQA that VMT reductions would not have occurred absent funding from the bank. The verification ensures that a project’s anticipated reductions match the need generated by the development in question. It also makes sure that those anticipated reductions occur after implementation/construction. These two interrelated considerations are important both from the perspective that VMT reductions are quantifiable and realistic in the VMT estimating technique and that this is truly new mitigation rather than shifting money around. For specific proposed reductions, the public agency or the developer must demonstrate that reductions would not have occurred under the current plan but under this new project (additionality). Otherwise, the developer is responsible on generating further reductions. To track the additionality in the context of VMT mitigation banking/exchanges, two basic approaches can be taken24 in the phases of investment selection and implementation:
• Project-specific (pre-investment): The lead agency or bank/exchange program administrator verifies the project’s additionality before funding an individual mitigation project using available documented assessments, plans and/or funding resources of the applicable RTP(s). • Programmatic (post-investment on a regular programmatic basis): The bank/exchange program administrator identifies classes of investment such as “likely to be added” or “unlikely to be added” based on the applicable RTP before selection. To do so, the program administrator conducts a comprehensive review of fund transactions, VMT impacts, mitigation supported investments, and the relationship of the investment cohort to the relevant investment plans (i.e., applicable RTP) and funding sources regularly. The administrator shall verify the additionality of the investments relative to a baseline scenario for the same period. 24 Berkeley Law – Center for Law, Energy & The Environment, Implementing SB 743: Design Considerations for Vehicle Miles Traveled Mitigation Bank and Exchange Programs, August 2022.
14.86 Santa Cruz County Regional VMT Mitigation Program 22 For verification purposes, agencies could try to create an in-house smaller body to handle verifications at the regional level. In that case, agencies will likely need to increase their computations capabilities and modeling capacities as there will be a significant need for monitoring of any potential discrepancies between the forecasts. If agencies cannot conduct verification efforts in-house, they could contract third-party off-set verifiers.25 This may have an added benefit of possibly avoiding concerns about selfverification, such as improper influence, that could undermine public trust.
Table 2 below represents the type of assessment a program administrator could make and the associated evaluation checklist.
Table 2 Evaluation Checklist for Program Administrator
Documentation
Project
Project location/status within
RTP
Investment type
New construction/installation
Previously unfunded project
phase/stage
Increased capacity/reliability
Accelerated deployment
Additionality of VMT
reduction compared to
Project type/origin
Agency/third party
commitment to project
implementation/ownership
Implementation/investment
plan
Unprogrammed and in the unconstrained portion of the RTP Unprogrammed and in the constrained portion of the RTP
Programmed in the RTP
Already built
Not included in the RTP
Housing/density
Planning action
Figure 1 below depicts a conceptual framework for VMT mitigation and additionally assessment for agencies and the existing limitations.26
Figure 1 Sample VMT Mitigation Additionality Framework
25 Elkind, N.E., Lamm,T., Prather,E., Implementing SB 743 An Analysis of Vehicles Miles Traveled Banking and Exchange Frameworks, October 2018, U.C. Berkeley.
26 Ibid.
14.87 Santa Cruz County Regional VMT Mitigation Program 23 GEOGRAPHY
While addressing the duration of a mitigation mechanism matters, the geography dimension and the distance between impact and mitigation must not be disregarded. Reflecting geography in pricing structure is essential for bank/exchange jurisdictions with distinct high- and low-VMT zones. In such cases, the bank/exchange could apply an equal or less than 1 ratio for mitigation projects within the vicinity or community of an impact, while requiring a greater than 1 level of mitigation for projects with a greater distance between mitigation and impact generation.
One line of thinking is that since VMT is largely a regional phenomenon, it should be addressed regionally in terms of VMT mitigation options. There is potentially a transparent exchange between local and regional approaches to VMT. Local programs that reduce VMT could be used to offset regional level VMT generating projects. However, Offsite mitigation for example, while promising, might disproportionally increase VMT or harm accessibility in disadvantaged communities.
Another study conducted among agencies states that larger infrastructure investments are not considered attractive options for off-site mitigation, whereas in practice they prefer roadway improvements (e.g., roadway shoulder enhancement). One of the interviewees argued that incremental approach taken by the cities satisfies the public’s desire to see some return. 27 Mitigation banks or exchanges could also include measures to ensure that developers or agencies to first exhaust their onsite VMT mitigation options before authorizing their participation in the program unless they direct those measures to disadvantaged communities. Programs such as bike-sharing or micro-mobility in different communities might not generate the same value for every community. These communities need to be engaged in a meaningful as part of the process. Program designers should work with the communities to identify current mobility needs and historic disinvestments. Finally, program designers should set goals to develop accessible, affordable, reliable, and safe mobility options while safeguarding equitable distribution of economic opportunity. Regional demand management practices potentially cause some local VMT mitigation banks or exchanges to be overlooked for developing transit-oriented or disadvantaged communities. Small elements such as streetlights, paved pathways, improved walking experiences are key elements in developing these communities where they can accomplish significant VMT reductions at a much lower cost. They beautify the area and can encourage active transportation and transit ridership in these communities.
28 Overall, the micro-design features can have significant impact on mitigating VMT. Thus, factors such as accessibility, built environment, urban design features, and income must be considered for VMT while addressing geographical dimension.
LINKAGE BETWEEN GOVERNMENTS
The linkage between local and regional governments and agencies must be strengthened to create linkages between VMT impact nexus, project and plan-level funding streams, and administrative/implementation pathways. The continual development of the VMT body of knowledge through grants could also be managed at the state level.
In addition, transportation experts note that VMT estimation is still challenging, and margin of error is still very large. A study noted that some agencies are using more than one tool since local experts don’t 27 MINETA Transportation Institute, Safeguarding Equity in Off-Ste Vehicle Miles Traveled (VMT) Mitigation in California, 2021 28 Ogra,A., and Ndebele,R. The Role of 6Ds: Density, Diversity, Design, Destination, Distance, and Demand Management in Transit Oriented Development (TOD), Conference Paper, published October 2014, https://www.researchgate.net/publication/268813431
14.88 Santa Cruz County Regional VMT Mitigation Program 24 have confidence in the existing tools to estimate VMT. 29 Developing robust VMT estimation and evaluation tools should be prioritized and deployed to local governments for their use.
EQUITY
Some programs that are not well-designed may lead to equity issues – where mitigation is provided in an area already suffering from VMT when the source is in a distant suburb. In another scenario, while off-site mitigation is considered, an existing community adjacent to the development could expect an immediate mitigation effort since they are the ones being impacted. Off-site mitigation that safeguards equity does not necessarily alleviate community’s localized concerns as they might not be aligning with the community’s mobility needs. For instance, programs such as bike-sharing or micro-mobility in different communities might not generate the same value for disadvantaged communities.
One study on the subject found that VMT-efficient areas should be identified since they present the biggest opportunities for VMT mitigation.30 If a development site is in a VMT-inefficient area, it might be too difficult to have the best opportunities for mitigation in that region. This consideration aligns with some of the current practices as equity is a foundational aspect of VMT mitigation. For instance, the Bay Area's Metropolitan Transportation Commission has developed Community-Based Transportation Plans (CBTPs) that help identify specific project sites. San Diego’s “Climate Equity Index” is another tool that is used to address historical inequities suffered by communities of color. It is argued that racial equity is as challenging as geographical equity to address. Off-site mitigation strategies might not necessarily address social and historical injustices, and inequalities by communities of color. While transportation investments might benefit these communities, that may not necessarily address the impacts of VMT increase as a result of the new development. Displaced low-income households that need access to job centers in downtowns or city centers find an increase in their VMT due to long commute. These disadvantaged communities are experiencing higher crash rates, and limited access to essential services.
It is important to integrate affordable housing strategies into transit-oriented development, and systematically analyze the potential impacts of such development on low-income and minority communities. However, the access to transit does not necessarily result in mode-shift. Any access to transit should be reinforced and supported with urban design features such as bus lanes, strong, streetlevel walkability, trees, and so on.
The programs need to be carefully vetted to avoid the potential for disproportionate impacts on lowincome and minority communities. Benefits of Fee-Based VMT Mitigation Programs should also be distributed equitably. Generally, the bank or exchange must ensure that the program does not exacerbate equity concerns at the first level, and then, it should address existing equity concerns. The way to prioritize equity in a program design differs based on the local definitions of inequity and disadvantaged communities, which impacts public acceptance, political feasibility, and efficacy in return.
This ensures the program is compatible with local city plans or legislations as well as the state’s broader social values and objectives. Various factors such as geography, demography, and socioeconomics, shape VMT equity definition in this context. Table 3 below summarizes the criteria for the main categories of concern. Specifically, banks/exchanges may consider the following when prioritizing VMT equity:
29 Alexander, S.E., Alfonzo,M., Lee,K., Safegurding Equity in Off-Site Vehicle Miles Traveled (VMT) Mitigation in California, 2021. https://transweb.sjsu.edu/sites/default/files/2027-Alexander-Equity-Off-Site-VMT-Mitigation.pdf 30 Ibid.
14.89 Santa Cruz County Regional VMT Mitigation Program 25 • Lower-income communities
• Communities of color
• Lower transit access communities
• Rural and exurban communities
• Total amount of geographic distance between impacts and benefits Table 3 Categories for VMT Equity Concerns
Category Criteria
Transit and
transportation
Transit access, current VMT, safety including rates of serious injuries and fatalities, historical transportation investment, age and quality of infrastructure, and vehicle ownership rates Built environment Neighborhood walkability, access to open space, bicycle and pedestrian safety and accessibility, and proximity to employment and critical services Socioeconomic and
demographic
Income, age, employment, public health data, and housing burdens Environmental Air quality, water quality, and proximity to hazardous waste sites In the context of VMT mitigation, VMT inequity arises when there is an unequal distribution of benefits and costs between different areas. Off-site VMT mitigation programs are major concerns in this regard as off-site mitigation could occur so far from the location of the initial impact that the benefit is not received by the community. VMT mitigation banks and exchanges should determine which neighborhoods may merit prioritization, either by keeping more mitigation on-site or by ensuring that a set amount of off-site mitigation occurs within those neighborhoods.
Points at which an agency could consider prioritizing equities include, but are not limited to, the initial point a lead agency enters a project into the bank/exchange, during the project prioritization process, or as a discount or incentive in project selection. Similarly, bank/exchange program designers can incorporate equity into their design and implementation at several different points. They can build equity thresholds into a pre-approved set of projects, geographic limitations, or geographic prioritization for off-site mitigation. They can also create minimum equity requirements for all projects to ensure equity throughout the program’s implementation. Table 4 below presents mechanisms to be implemented by bank/exchange program designers before and during the program operation.
Additionally, administrative leaders can integrate community engagement throughout the decisionmaking process in various ways, such as requiring specific, measurable engagement metrics, to identify the options that best serve the needs of the jurisdiction(s). This can also be facilitated by a commitment to having a diverse representation in policy making through including at least one local community representative on panels or on the administrative management bodies management team itself. This can reduce the risk of unintended negative consequences for affected communities.
14.90 Santa Cruz County Regional VMT Mitigation Program 26 Table 4 VMT Mechanism before and during the Program Operation Stage of
the
Program
Mechanism
Before or at the
program entry
threshold
Limit the geographic range allowed for off-site mitigation Pre-approve a set of projects that adhere to equity standards Establish prerequisite equity standards for all projects to participant in the bank/exchange and qualify for mitigation credit
Create an equity threshold for project entry into the program During the program’s operation Prioritize projects that advance equity goals Create a point category for scoring projects and determining their eligibility for bank/exchange participation
Assign a greater weight to mitigation projects located in the areas of greatest concern
Set a minimum amount or percentage of funding
VMT MITIGATION FUNDING STATUS
Programmed Projects
An approved programming document, such as the Regional Transportation Improvement Program (RTIP), that lists a project or program as funded means that funds are or will be made available for that project. As a result, if a project with this level of funding commitment was suggested to mitigate VMT for another project, it would not be offering any new or extra benefits to offset the impact of VMT. The project is ineligible to be used to reduce VMT in this case. A scheduled project without full funding might be acceptable as mitigation, but this would require a strong justification to show why the project would not have advanced without the mitigation support.
Projects in a “Fiscally-Constrained” Portion of a Regional Transportation Plan A Regional Transportation Plan's section for fiscally constrained projects frequently does not have any short-term funding budgeted for the projects or services listed there. RTPs typically cover at least 20 years' worth of anticipated funding and projects. Consequently, throughout the planning period, a lot of projects are included in projected "phases". The impact of VMT may be mitigated in several ways by projects with this funding status, including by advancing the project from a later phase to deliver benefits earlier, ensuring funding certainty, and/or reducing the risk of unanticipated downturns in future funding. On the other hand, some projects included in the RTP's later phases for design or construction funding may have had development funds granted for earlier or completed phases, again indicating that there is a present or more significant commitment to providing funding for the project.
Therefore, to be used as VMT mitigation, projects or programs in the financially constrained RTP would need to individually present strong proof of VMT reduction over and beyond what was already committed for funding.
Projects in an “Unconstrained” Portion of a Regional Transportation Plan Projects or programs listed in the unconstrained portion of an RTP have no funding programmed or anticipated during the planning period covered by the Plan. These projects are, in principle, acknowledged as needs, but the estimated amount of funds that will likely be available throughout the
14.91 Santa Cruz County Regional VMT Mitigation Program 27 planning period is insufficient to cover their costs, as well as the investments needed for the projects in the budget-constrained section of the plan. Since the benefits would be in addition to those that are already committed, funded, or planned for funding, reviews projects from this component of the RTP to produce benefits to balance VMT impacts could be accelerated and therefore acceptable for VMT mitigation.
UNINTENDED CONSEQUENCES
Given the relative recent development of these programmatic approaches, the potential for unintended consequences exists. Care needs to be given to avoiding program designs that disincentivize good public policy or that do not create an appropriate balance between efficient VMT mitigation in terms of return on investment and community values. It is not easy to navigate between financial cost, political cost, and feasibility. Having an exchange program would lay the ground for the long-term market to track performances of different mitigation options and streamline fees at a regional scale.
Agencies should also be thorough in their VMT mitigation duration. If a roadway capacity investment is tied to LOS, the duration would last until additional traffic depreciates the LOS to what it was before the investment was implemented. If the mitigation is a program such as a transportation management organization, the duration could last in perpetuity, which would be very expensive. Neal Peacock’s paper provides examples of annual reporting mechanisms that demonstrate that transportation impact fees are being collected in sufficient volumes, year to year, to effectively fund projects.31 Research shows that the nexus methodologies between impacts and improvements and the successful use of these fee programs as mitigation under CEQA as discussed above vary by region.
OTHER CHALLENGES
Projects approved before SB743:
A challenge arises for those projects that rely on existing environmental documents, but where LOS analysis was used to approve the project. 32 As a result, some lead agencies are taking the position that previously relied-on mitigation measures are not feasible or enforceable. OPR provided guidance on when projects can rely on a prior environmental document that analyzed traffic impacts using LOS rather than VMT, finding that “an agency may use its discretion to determine that a VMT analysis is not required for later-prepared documents.”33 However, it is argued that VMT impacts are not new information and were known at the time. It can be argued that agencies were aware of VMT but did not choose to study and share those impacts. So far, courts have not yet had a chance to weigh on CEQA issues in this context of the project’s reliance on prior environmental documents that use a LOS analysis.
To avoid any challenges, VMT bank and exchange programs should rely on new environmental reports.
If not possible, demonstrating that the project falls below VMT thresholds or reviewing applied development policies to show findings that they would substantially mitigate the impact could be solutions.
31 Neil Peacock, The Potential for Regional Transportation Impact Mitigation Fee Programs and Mitigation Banks to Help Streamline the Implementation of SB 743, March 2017 32Grid Legal, VMT Impacts: Can Prior CEQA Documents Be Relied on That Did Not Study VMT Impacts? , https://www.gridlegal.com/post/vmtimpacts-prior-ceqa-documents, accessed on October 19th, 2022. 33 SB 743 Frequently Asked Questions, https://opr.ca.gov/ceqa/sb-743/faq.html#draft-docs, accessed on October 19th, 2022.
14.92 Santa Cruz County Regional VMT Mitigation Program 28 Slow Down on Home Building:
Adopting SB 743 arguably slowed down the amount of residential development and construction, especially the larger developments.34 For instance, Clovis County Council is moving forward with an allencompassing Environmental Impact Report (EIR) to take some of the law’s uncertainty out of the equation so that not every project is subject to preparing an EIR.35 Developers will be asked to fund an umbrella EIR, but questions arise about whether the city was helping developers make profits by paying for an umbrella EIR.
In addition, developers might be discouraged from building housing across the state if large mitigation fees are used to support public transportation projects. Another aspect of the problem is that retail development typically requires attracting customers who would drive to the shops. In the absence of truly exceptional transit service and service riders, mitigation efforts to reduce driving, say to a regional shopping center, would be counterproductive to the goals of the development.
Charging Developers a VMT Tax
San Diego Association of Governments (SANDAG)is considering taxing developers based on vehicle miles traveled by their tenants (an additional $10,000 - $22,000 per mile traveled). 36 As the revenue from gas tax shrinks due to electric and hybrid vehicles becoming more common, this could allow collecting revenue to achieve state and regional goals. A VMT tax would also encourage residential developments to be built close to job and activity centers. During the housing crisis, anything that increases the cost of housing could have adverse effects on the market and the public eye. A similar proposal faced opposition in other regions of the country. A proposal circulated to replace the 18.4 cents per gallon tax with a VMT tax in Washington D.C. was not successful.37 Proponents in California state that the state’s gas tax could be replaced by a “miles drive fee” of $0.05, even though the elimination of the gas tax is not guaranteed. However, opponents claim that this proposal penalizes low-income and working families who drive long distances to work. In addition, the VMT tax could singularly equate to or exceed the construction cost of a new home through its lifespan, which could go as high as $640,000 if the project is not close to a transit station.
34 GVWire, State’s VMT Law Driving Builders Away, Making Homes More Expensive, Say Valley Lawmakers, https://gvwire.com/2021/03/02/states-vmt-law-driving-builders-away-making-homes-more-expensive-say-valley-lawmakers/, accessed on April 11th, 2022. 35 GVWire, With State VMT Law Limiting Home Building, Clovis Takes Action, https://gvwire.com/2021/04/07/states-vehicle-miles-traveled-law-islimiting-home-building-city-of-clovis-takes-bold-action/, accessed on October 11th, 2022. 36 StreetBlog Cal, San Diego County Ponders a VMT Tax, with a Twist, San Diego County Ponders a VMT Tax, with a Twist – Streetsblog California,accessed on October 11th, 2022. 37 Powering California, ANALYSIS: Vehicle Miles Traveled Tax (VMT), https://poweringcalifornia.com/analysis-vehicle-miles-traveled-vmttax/,accessed on October 11th, 2022.
14.93 Santa Cruz County Regional VMT Mitigation Program 29 Chapter 6: Current Situation in California
In California, there is growing interest in considering mitigation projects that are less conventional, including affordable housing implementation, other land use options including transit-oriented development (TOD), TDM measures, mobility hubs, and micro-mobility options. There is also interest in considering mitigation projects that are already under development or programmed with the idea that either expediting their development or solidifying funding needs could be a basis for their inclusion in a VMT mitigation program. This is partly because agencies have difficulties identifying mitigation projects with a feasible return of investment (ROI), especially considering conventional options such as transit and active transportation options. Agencies believe in some locations the cost of conventional options may make VMT mitigation programs difficult to implement. In that sense, many agencies are taking an iterative approach. They are undertaking efforts to evaluate potential mitigation projects to be in included in the program as the first step towards viability rather than focusing on the format initially.
Table 5 includes the identified agencies as either planning to undertake a relevant study, having a relevant study ongoing, or identified as having a relevant program under development but the status is unknown, or completed.
Table 5 Current Situation in California
Agency VMT Mitigation
Program Format Status
Fresno COG TBD Ongoing, completion in 2023
Contra Costa Transportation Authority
(CCTA)
Pilot Hybrid
Exchange/In-Lieu Fee Draft Framework released in early 2023 City of Fresno Active Transportation
In-Lieu Impact Fee Ongoing, end date TBD
San Bernardino County Transportation
Authority Pilot VMT Bank Framework waiting Board of Directors approval Santa Cruz County and incorporated
Cities
TBD Beginning September 2022
City of San Diego Impact Fee Ongoing, end date TBD
City of Watsonville VMT Bank Pending implementation
City of Tracy VMT Bank Pending implementation
City of Salinas VMT Bank Pending implementation
City of Los Angeles Impact Fee Completed, understood to be implemented as part of the Westside Mobility Plan
City of Fremont TBD Ongoing, end date TBD
City of Lancaster VMT Mitigation Fee
Optional Program Pending, waiting for the council to adopt.
City of Concord Impact Fee/Bank Pending implementation
Santa Clara Valley Transportation
Authority (VTA) TBD Grant awarded; RFP dateunknown
San Luis Obispo Council of Governments
(SloCOG) TBD Grant awarded; RFP to bereleased in 2022
City/County Association of Governments
of San Mateo County (C/CAG) TBD Grant awarded; RFP dateunknown Town of Los Gatos Impact Fee Ongoing, end-date anticipated
14.94 Santa Cruz County Regional VMT Mitigation Program 30 Chapter 7: Key Takeaways
This chapter summarizes the key takeaways and detailed considerations for implementing agencies to successfully design and create fee-based VMT mitigation programs. • Agencies need to verify VMT reductions and additionality for projects before approving participation in the banking regime. The agencies can also try in-house verification upon availability of resources or can ask a thirds party off-set verifier. Any agency implementing a bank or exchange must demonstrate both a reasonable substantive relationship and financial proportionality between the proposed development and the fee or condition placed on it • Agencies should also be diligent in their VMT mitigation duration as the nexus between improvements and successful use of fees varies region by region o Bank arrangements that receive and pools funds from multiple projects should account for the delay between payment and deployment of funds as it measures the cost of VMT mitigation and negotiates with developers
o All models should also determine a comprehensive framework for the prioritization of individual mitigation projects, to ensure that reductions are achieved as quickly and efficiently as possible
• A VMT exchange might be simpler for developers, but it could also limit the usefulness of funds from smaller developments and be less politically agreeable to local communities o Offer more certainty for developers regarding the kinds and costs of appropriate mitigations needed to address cumulative VMT impacts
• New plans and programs might increase new home costs, which can push disadvantaged communities further behind in their ability to access homeownership o Significant equity issues may also arise if disadvantaged communities host developments but not beneficial mitigation projects
o Any lead agency will need to include rigorous backstops to ensure that disadvantaged communities are not negatively impacted by—and ideally can benefit from—the ability of developers to move mitigation off-site
• Implementing agencies should consider requiring or providing incentives for developers or lead agencies to demonstrate that on-site mitigation is not feasible before being permitted to undertake off-site measures
• VMT Banks and Exchanges comprehensively address VMT impacts across jurisdictional boundaries
• Geography plays an important role in VMT reduction impact assessment. According to the difference between the VMT impact and the mitigation strategy as well as the variation among low and high VMT zones, using different ratios for impact and mitigation relations in the pricing structure seems necessary.
• Incorporating equity in VMT banking is essential and challenging, particularly in the case of offsite mitigation programs. The benefits of fee-based mitigation strategies must carefully be distributed. In general, VMT bank identifies lower income, communities of color, rural areas, and low transit accessible zones as equity priority. However, the local definition of equity and
14.95 Santa Cruz County Regional VMT Mitigation Program 31 disadvantaged communities should be considered as well since it affects public acceptance and political feasibility. In addition to local equity considerations, each transportation project category comes with specific equity criteria to address while evaluating the VMT impacts and the effectiveness of mitigation strategies. Agencies can prioritize equity at various points, mainly before/at the beginning of a program or during the program’s operation. Depending on this, the mechanism of intervention varies (Table 4). Community engagement in the jurisdictional decision-making process supports equity by reducing the risk of unintended consequences on communities of concern.
• Local jurisdictions pay attention to projects and programs and their financial constraints in the RTP before using for VMT Mitigation.
PLACEHOLDER TITLE
14.96 Santa Cruz County Travel Demand Model (SCC TDM) Update August 8, 2023 Santa Cruz County Regional VMT Mitigation Program
Memorandum
To: Anais Schenk
County of Santa Cruz, Community Development & Infrastructure
From: Ayberk Kocatepe, Ph.D
Chris Gregerson, P.E., T.E., PTOE, PTP
Michael Schmitt, P.E., AICP CTP, PTP, RSP1
Re: Santa Cruz County Travel Demand Model (SCC TDM) Update Santa Cruz County Regional VMT Mitigation Program, Santa Cruz County
Date: August 8, 2023
This memorandum documents the process undertaken to update the Santa Cruz County Travel Demand Model (SCC TDM) for the purposes of performing VMT Mitigation analysis for projects selected as part of the Santa Cruz County Regional VMT Mitigation Program.
Model Overview
The Santa Cruz County Travel Demand Model is designed to forecast future travel patterns on both roadway and transit routes throughout Santa Cruz County (SCC). The model can be used to assess how changes in population, employment, demographics, and transportation infrastructure affect travel patterns within the county. The SCC Model is a four-step travel demand model based on the TransCAD platform. The SCC Model was developed to provide more detailed information on travel patterns within Santa Cruz County than could be accomplished by the tri-county regional travel demand model provided by the Association of Monterey Bay Area Governments (AMBAG).
The California Transportation Commission publishes and periodically updates guidelines for the development of long-range transportation plans that includes guidelines for regional travel demand modeling. The SCC Model follows these guidelines. These guidelines include sensitivity to the following policies/programs including:
▪ Land Use
▪ Geographic scale
▪ Sensitivity to mode
▪ Pricing
▪ Sensitivity to congestion
▪ Validation
▪ Documentation
The SCC Model is an enhanced four-step model. The four primary sub-models making up the four-step model process are:
1. Trip Generation. This initial step calculates person ends using trip generation rates established during model estimation and refined to Santa Cruz County. Truck trips are currently included in non-home based and are not estimated separately. The SCC TDM runs a series of complex steps to estimate daily trip productions and attractions by various trip purposes for each TAZ. The trip purposes are listed below:
a. Home-Based Work (HW)
14.97 Santa Cruz County Travel Demand Model (SCC TDM) Update August 8, 2023 Santa Cruz County Regional VMT Mitigation Program
b. Home-Based Other (HO)
c. Home-Based School, K-12 (HK)
d. Home-Based College (HC)
e. Home-Based Shopping (HS)
f. Work-Based Other (WO)
g. Other-Based Other (OO)
The production model uses several variables to generate trips such as the number of workers, household income, age, household size, and car availability. Trip productions for every TAZ in the model are compiled separately by each trip purpose. The attraction model uses employment categories for the HW trip purpose and employment categories and the number of students (K12 and University) for all other trip purposes. The attraction model estimates trip attractions to each TAZ by regression coefficients that vary by employment type. Trip attractions for every TAZ are compiled by each purpose and by each employment type based on these regression coefficients.
2. Trip Distribution. The second general step estimates how many trips travel from one zone to any other zone. The distribution is based on the number of trip ends generated in each of the two zones, and on factors that relate the likelihood of travel between any two zones to the travel time between the two zones such as distance, cost, and time, and varies by accessibility to passenger vehicles, transit, and walking or biking. This step also determines how many trips enter or leave the model area.
3. Mode Choice. This step uses demographics and the comparison of distance, time, cost, and access between modes to estimate the proportions of the total person trips using drive-alone or shared-ride passenger auto, transit, walk, or bike modes for travel between each pair of zones.
4. Trip Assignment. In this final step, vehicle trips and transit trips from one zone to another are assigned to specific travel routes between the zones. Congested travel information is used to influence each of the steps described above starting with vehicle availability for all models and starting with land use location for integrated land-use transportation models.
Methodology
The SCC TDM was most recently updated to contain the base year of 2019 and a future year of 2045. The land use updates were incorporated into the model by updating the information at the Traffic Analysis Zone (TAZ) level. There are 696 TAZs within the County, including 364 TAZs within the unincorporated parts of the County. In consultation with the SCCRTC and Santa Cruz County, the transportation analysis zone (TAZ) geography for the SCC Model is based on the AMBAG TAZ geography with revisions for Santa Cruz County. The land use updates included updating the households and population information in each TAZ, as well as the employment by category.
Socioeconomic and Employment Data
In order to ensure that SCC travel demand model accurately reflects the current conditions of Santa Cruz County, we gathered the latest information on various key factors. We obtained this data from the AMBAG travel demand model that was updated in 2022. By leveraging the insights provided by AMBAG, we were able to incorporate the most up-to-date details on population growth, land use patterns, and socio-economic factors into the Santa Cruz County travel demand model.
When updating the residential data within the model (households and population), socioeconomic data (SED) associated with each TAZ must also be updated. The SED in the SCC TDM provides information about the makeup of the households in each TAZ. There are several different variables in the model SED,
14.98 Santa Cruz County Travel Demand Model (SCC TDM) Update August 8, 2023 Santa Cruz County Regional VMT Mitigation Program
including the age of the residents, household size, household income, number of vehicles per household, number of workers per household, and the number of vehicles per worker. It should be noted that while the SCC TDM uses dwelling units as its input, there is no differentiation between single-family and multifamily residential in terms of trip generation and distribution.
To update the employment variables, we made modifications to reflect the accurate number of workers based on specific employment categories. These categories were established by AMBAG and were inherited in the 2022 model update. They were defined using the North American Industry Classification System (NAICS) codes, as outlined in Exhibit 1. During the migration process of incorporating these employment categories into the SCC model, we regrouped them into six overarching categories.
1. Agriculture
2. Construction
3. Industrial and Manufacturing
4. Retail
5. Service (White Collar, Food Services, and jobs not included in other categories)
6. Public Administration (Government, Health Care, and Educational jobs) Exhibit 1 – Land Use Categories in the AMBAG TDM
Category Description and NAICS codes
Agriculture Agriculture, Forestry, Fishing, and Hunting (11)* Construction Construction (23), Utilities (22), Transportation and Warehousing (48- 49), Administrative and Support and Waste Management and Remediation Services (56), Public Administration (92)*
Manufacturing and Mining Mining (21), Manufacturing (22, 31-33), Wholesale Wholesale Trave (42), Agriculture, Forestry, Fishing, and Hunting (11)* Retail Retail Trade (44-45), Agriculture, Forestry, Fishing, and Hunting (11)* Finance and Real Estate Information (51), Finance and Insurance (52), Real Estate Rental and Leasing (53), Professional, Scientific, and Technical Services (54), Management of Companies and Enterprises (55)
Education Educational Services (61), Public Administration (92)* Healthcare Health Care and Social Assistance (62)
Service Art, Entertainment, and Recreation (71), Accommodation and Food Service (72), and Other Services (81)
Public Public Administration (92)*
*Note: Some NAICS industry sectors have been divided up, based on business operations and transportation demand, across AMBAG sectors.
Calibration and Validation
Once the travel demand model was updated with the latest information, we proceeded with the validation process to ensure its accuracy and reliability. A crucial aspect of this validation process was the utilization of traffic counts to validate the model at the link level. By comparing the model's predicted traffic volumes with the actual observed counts, we could assess the model's performance and identify any discrepancies. Furthermore, the validation of the model encompassed the evaluation of traffic flows across screenlines, which consist of multiple roadways. This comprehensive approach aimed to capture the overall traffic patterns effectively. Our objective was to meet or surpass the validation guidelines set by Caltrans and the Federal Highway Administration. As part of the validation process, adjustments were
14.99 Santa Cruz County Travel Demand Model (SCC TDM) Update August 8, 2023 Santa Cruz County Regional VMT Mitigation Program
made to elements within the trip generation, trip distribution, and traffic assignment modules whenever necessary to ensure the model's accuracy and reliability.
Traffic counts (50 locations) used for the travel demand model update were gathered during late October and November 2022 (Appendix A). All 7-day-hour ADT counts (21 locations) were specifically collected as part of this project. Other 3-day-hour ADT counts (29 locations) were part of the 'Countywide Traffic Data Collection Program' efforts currently ongoing in the county. To enhance the accuracy of the model, the project team also used big data sources by accessing their AADT data for 44 locations (Appendix A). These counts were used for link-level calibration. Where applicable, these counts were also used in the cutline/screenline calibration.
The results of the model validation and comparison to best practice standards are shown in Exhibit 2 and Exhibit 3. The calibration results were within industry-accepted ranges for all measures for the daily validation exercise. This certifies that the model meets standard validation criteria.
To facilitate this validation, we performed other tests that provide valuable insights into the model's accuracy at different levels. These included the percentage of Root Mean Square Error (%RMSE) by facility type or volume groups and the Model/Count comparison by facility type or volume groups. We observed that the margin of error was slightly higher for the small-volume links (Appendix B-C). The limitations of travel demand models cause small-volume links to have a higher margin of error. These limitations include focusing on overall trends, variability in traffic patterns compared to high-volume links, sensitivity to model assumptions, and spatial resolution.
Travel demand models strive to represent overall travel patterns as accurately as possible. As long as the model behaves consistently and aligns with the larger travel patterns, the acceptable margin of error for small-volume links is deemed reasonable for practical purposes in transportation planning and analysis.
Based on Caltrans and Federal Highway Administration (FHWA) requirements, and tests we performed, the Santa Cruz County Travel Demand Model (TDM) has been determined to be statistically valid.
Exhibit 2 – Static Model Validation for 2019 Base Year Model Static Model Validation
Criteria Target Daily
Model/Count Ratio 0.90-1.10 1.09
Percent Within Caltrans Maximum Deviation > 75% 75.2%
Percent Root Mean Square Error < 40% 37%
Correlation Coefficient > 0.88 0.97
Exhibit 3 – Static Model Validation for 2019 Base Year Model (Screenline) Static Model Validation (Screenline)
Criteria Target Daily
Model/Count Ratio 0.90-1.10 1.08
Percent Within Caltrans Maximum Deviation > 75% 75.2%
Percent Root Mean Square Error < 40% 44%
Correlation Coefficient > 0.88 0.96
14.100
Appendix A
Traffic Count Locations
No Location Description No Location Description
1 Freedom Blvd S of Alta Vista Ave,N of Crestview Dr 27 Graham Hill Rd W of Mt. Hermon Rd 2 7th ave South of Tanner Tt, North of Harbor Oaks Ct 28 Freedom Blvd N of Buena Vista Dr 3 Main St NW of Riverside Dr, SE of Beach St 29 Riverside Dr E of Coward Rd 4 7th Ave South of Soqeul Ave, North of Bostwick Ln 30 San Andreas Rd S of Bonita Dr 5 E Cliff Dr E of 9th Ave Sw of Prospect St 31 17th Ave S of Brommer St 6 Brommer St W of 30th Ave, E of Darlene Dr 32 Brommer St W of 17th Ave 7 Soqeul Wharf Road S of Cabrillo Hwy, N of Clares St 33 Soquel Dr W of Rodeo Gulch Rd 8 Bay Dr S of Meder St, N of Nobel Dr 34 Portola Dr E of 24th Ave 9 Empire Grade W of Western Dr, E of Highview Dr 35 Portola Dr W of 41st Ave 10 Park Ave W of Wesley St, E of Washburn Ave 36 Park Ave N of Hwy 1 11 Rodriquez St W of Koopmans Ave, E of Jose Ave 37 Porter St S of Main St 12 Seabright Ave North of Windsor St, S of Broadway 38 Soquel Dr W of 41st Ave 13 Murray St W of Brook Ave, E of Pilkington Ave 39 Soquel Dr W of Porter St 14 Blackburn St NW od Riverside Dr, SE of Wildcatz Way 40 Hwy 9 N of Redwood Dr 15 S Green Valley Rd N of Kralj Dr, S of Oakridge St 41 Hwy 9 West of Main St 16 Cabrillo Hwy E of Park Avenue interchange after ramps 42 Hwy 9 S of Clear Creek Rd 17 E Cliff Dr W of 24th Ave, E of Coastview Dr 43 Hwy 9 S of Pool Dr 18 Airport Boulevard W of Hangar Way, N/E of Nielson St 44 Hwy 9 N of Lakeview Dr 19 W Beach St W of Rodriguez, E Walker St 45 Hwy 9 N of Graham Hill Rd 20 Graham Hill Rd W of Lockewood Ln, E of E Zayante Road 46 Hwy 9 S of Glen Arbor Rd SOUTH 21 Front St N of Laurel St, S of Cathcart St 47 Central Ave/SR 9 S of Big Basin Way/SR 236 22 Freedom Blvd E of Soquel Dr 48 Hwy 9 S of Bear Creek Rd 23 Sea Ridge Rd W of State Park Dr 49 Hwy 9 S of Graham Hill Rd 24 Soquel Dr W of State Park Dr 50 Central Ave/SR 9 N of Big Basin Way/SR 236 25 State Park Dr S of Soquel Dr
26 Gross Rd W of 41st Ave S:South, N:North, E:East, W:West
14.101
Locations of AADT Data gathered from Big Data sources
No Location Description No Location Description
1 41st Ave North of Portola Dr 24 Capitola Rd W of El Dorado Ave 2 Ramp Westbound - S of Cory St 25 7th Ave S of Mello Ln 3 SR-1 NB West Of Bay E of Capitola Mall Interchange, 26 Brommer St E of 7th Ave 4 Bonita Dr Freedom Blvd And Vista Del Mar Dr 27 Ocean St Soquel Ave - Broadway 5 Freedom Blvd East of Green Valley Rd 28 State Hwy 1 Between Morissey And Soquel 6 17th Ave S of Kinsley St 29 Mcgregor Dr E of Potbelly Beach Rd 7 30th Ave N Or Roland Dr 30 Rodriguez St Main St - W Lake Ave 8 Soquel Dr Between Capitola Ave And Rosedale Ave 31 S Green Valley Rd Lawrence Rd - Freedom Blvd 9 Soquel Dr Between Capitola Rd And 7th Ave 32 Hwy 1 E of 41st Ave Interchange 10 Soquel Dr E of Perimeter Rd, W of Haas Dr. 33 Hwy 1 E of 41st Ave Interchange 11 Mount Hermon Rd W of Lockewood Ln 34 Hwy 1 E of Park Ave 12 Laurel St East of Front St 35 State Hwy 1 Between Freedom Blvd And San Andreas Rd 13 High St Cl Se/High View - Western Dr 36 41st Ave 41st Ave Interchange 14 Bear Creek Rd N Flat St, S of Mountain St 37 41st Ave Sprr - Clares St 15 Water St N Branciforte Ave - Poplar Ave 38 Glenn Coolidge Dr Coolidge Dr North of High St 16 41st Ave N of Clares St 39 Airport Blvd Ross Ave - Roache Rd 17 Wharf Rd Cliff Dr - Capitola Rd 40 Main St W of Rodriguez St 18 Portola Dr E of Laurel Ave, S of Nova Dr 41 Freedom Blvd S of Altavista Ave 19 Capitola Rd W of 30th Ave 42 Bay St S of Meder St
20 Soquel Dr Between Mattison Ln And Rodeo Gulch Rd 43 State Hwy 1 E of Park Ave 21 Eaton St Between Lake Ave And Lago Ln 44 N Rodeo Beach N of Soquel Dr 22 Soquel Ave Between Capitola Rd And 7th Ave
23 Capitola Rd 7th Ave And 17th Ave S:South, N:North, E:East, W:West
14.102
Appendix B
Tests performed for all links
Model/Count by ADT Volume Groups
Link Volume M/C
> 50,000 1.09
25,000 - 49,999 1.18
10,000 - 24,999 1.04
5,000 - 9,999 1.05
2,500 - 4,999 1.28
1,000 - 2,499 1.39
< 1,000 1.42
RMSE by ADT Volume Groups
Link Volume %RMSE FHWA threshold Target
> 50,000 10% < 21% < 20%
25,000 - 49,999 20% < 22% < 25%
10,000 - 24,999 22% < 25% < 25%
5,000 - 9,999 36% < 29% < 45%
2,500 - 4,999 64% < 36% < 100%
1,000 - 2,499 92% < 47% < 100%
< 1,000 171% < 60% < 100%
Model/Count by Facility Type
Facility Type M/C
Other Freeways or Expressways 1.16
Ramp 1.00
Principal Arterial 1.10
Minor Arterial 1.03
Major Collector 0.96
Minor Collector 1.76
Local 1.21
RMSE by Facility Type
Facility Type %RMSE Target
Other Freeways or Expressways 22% <20%
Ramp 39% N/A
Principal Arterial 34% <35%
Minor Arterial 41% <45%
Major Collector 45% <100%
Minor Collector 76% <100%
Local 77% <100%
14.103
Appendix C
Tests performed for Screenlines
Model/Count by ADT Volume Groups
Link Volume M/C
> 50,000 N/A
25,000 - 49,999 1.26
10,000 - 24,999 1.14
5,000 - 9,999 0.94
2,500 - 4,999 1.23
1,000 - 2,499 0.86
< 1,000 1.23
RMSE by ADT Volume Groups
Link Volume %RMSE FHWA Threshold Target
> 50,000 N/A < 21% < 20%
25,000 - 49,999 28% < 22% < 25%
10,000 - 24,999 21% < 25% < 25%
5,000 - 9,999 28% < 29% < 45%
2,500 - 4,999 94% < 36% < 100%
1,000 - 2,499 65% < 47% < 100%
< 1,000 42% < 60% < 100%
Model/Count by Facility Type
Facility Type M/C
Other Freeways or Expressways 1.26
Principal Arterial 1.08
Minor Arterial 1.04
Major Collector 0.84
Local 0.96
RMSE by Facility Type
Facility Type %RMSE
Other Freeways or Expressways 28%
Principal Arterial 27%
Minor Arterial 77%
14.104
Regional VMT Mitigation Study
Regional VMT Mitigation Study
City of Santa Cruz City Council Meeting – September 24, 2024
14.105
Regional VMT Mitigation Study
Agenda
• Project Overview
• VMT/SB 743 Overview
• Fee-Based Mitigation Program Options
• Mitigation Project Types and Testing
• Project Testing Results
• Program Evaluation
• Findings
• Administration Recommendations
14.106
Regional VMT Mitigation Study
Project Overview
• After SB 743 implementation many projects were unable to mitigate • Projects not moving forward impacts economic opportunities • County applied for a grant with Watsonville to explore VMT Mitigation Program
• Provides additional feasible mitigation options for VMT impacts
14.107
Regional VMT Mitigation Study
SB 743 Overview
• SB 743 is CEQA Specific, Implemented July 1, 2020
• Basis for a “transportation significant impact” determination • Sustainability and GHG reduction by
• Denser infill development
• Reducing single occupancy vehicles
• Improved mass transit
• Most recent guidance is from December 2018
• VMT is the principal metric
14.108
Regional VMT Mitigation Study
SB 743 Overview: OPR VMT Thresholds
• Residential: > 15% less than average VMT per/capita
• Office: > 15% less than average VMT per/employee
• Retail: Net increase in total VMT for region
• Transportation: Net increase to VMT
• Neither statute or CEQA Guidelines include thresholds • “Substantial evidence” (Section 15384) as the basis for not following OPR
14.109
SB 743 Overview: Regional VMT Mitigation Study Measuring VMT
14.110
Regional VMT Mitigation Study
Understanding
• Image #2
Fee-Based VMT Programs
14.111
Regional VMT Mitigation Study
c
Fee-Based VMT Program Evaluation
14.112
Regional VMT Mitigation Study
Understanding
• Image #2
Fee Based Mitigation Programs: VMT Bank How VMT Banking Works
14.113
VMT Mitigation Project Types and Testing Regional VMT Mitigation Study
14.114
Regional VMT Mitigation Study
VMT Mitigation Project Types and Testing: Ranking
High VMT
Reduction per $ Identified mitigation solutions need to be financially viable and feasible Reliability of Other
Funding Sources Likelihood of other funding sources
Immediacy Constructable in a short timeline
Readiness No issues that may impede its implementation
Geographic
Distribution Consideration of project distribution across the region Transportation
Disadvantaged Provides mobility options to those with reduced car ownership Community Value
Alignment Supports ongoing planning efforts
Distribution of
Project Type Consideration of project types and modes in terms of distribution
14.115
Regional VMT Mitigation Study
VMT Mitigation Project Types and Testing: Project
Screening Overview
• Example sources of projects:
• SCCRTC Regional Transportation Plan (RTP)
• Active Transportation Plans (ATP)
• Draft Watsonville VMT Program
• Projects from Public Works Departments
• Santa Cruz Metro
• UCSC
• Affordable Housing Representatives
14.116
Regional VMT Mitigation Study
VMT Mitigation Project Types and Testing: Project
Screening Overview
• Projects screening criteria included:
• Project VMT reduction result in < $1,000/VMT reduced? • Feasible to construct/implement within 5 years?
• Does project meet additionality criteria?
• Is the project reasonably foreseeable?
14.117
Regional VMT Mitigation Study
VMT Mitigation Project Types and Testing: Project
Testing Summary
Project Type Projects Tested
Affordable Housing 3
Transit 8
Bike 19
TDM 3
Mobility Hub 2
More than projects 50 were considered, but 35 were evaluated
14.118
Regional VMT Mitigation Study
Findings
• VMT Banking would be the most appropriate initial program • Projects included in program average less than $1,000/VMT reduced • Unclear the magnitude as a funding source
• Considered low hanging fruit/low-cost projects
• Don’t expect will provide funding for large number of projects • Preliminary final report is complete
14.119
Regional VMT Mitigation Study
Administration Recommendation
• RTC oversees program of funds with new JPA between all jurisdictions to manage the program’s projects.
• JPA would consist of RTC’s Commission with ITAC as
advisory committee
• Program Maintenance Considerations:
• Annual administrative costs – paid for with a portion of fees • Legal structure and legal defense – through JPA and appointed councils
• Technical ability and managing updates – select new projects and measuring VMT 14.120
Regional VMT Mitigation Study
Next Steps
• City Council/Board of Supervisors meetings
• Provide information
• Solicit public input
• Continue the JPA conversation with the agencies
• Schedule public outreach event
• Finalize the recommended program document
• Bring back to Councils/Boards for consideration
14.121
Regional VMT Mitigation Study
Questions
14.122
City Council
AGENDA REPORT
DATE: 08/26/2024
AGENDA OF: 09/24/2024
DEPARTMENT: City Manager
SUBJECT: Collective of Results and Evidence-Based (CORE) Investments Update (CM)
RECOMMENDATION: Motion to:
1) Accept staff report on the status of the Collective of Results and Evidence-based (CORE) Investments Program Request for Proposals (RFP);
2) Direct staff to carve out any Council-prioritized services from competitive procurement; 3) Approve staff recommended funding Option 2, to distribute funding and initiate recommended awards; and
4) Direct staff to coordinate with the Human Services Department (HSD) to report back with recommended awards from the CORE RFP by November 19, 2024.
BACKGROUND: CORE Investments is a funding initiative designed to enhance the wellbeing of County residents through equitable and impactful programs. Managed by the Human Services Department (HSD) in partnership with the City of Santa Cruz (City), CORE Investments uses a collective impact model to support programs that benefit lower-income residents.
For FY 2026-28 (July 1, 2025 to June 30, 2028), a total of $5,958,853 is available for CORE Investments: $4,879,000 from the County and $1,080,000 from the City. Of this, $3,790,025 is allocated for competitive funding through the CORE RFP, while $1.5M is designated for three (3) Low Barrier Navigation Centers (shelters with supportive services), and a portion of the County’s funds will be used for prevention services in South County. The County’s Housing for Health Partnership (H4H) will manage the safe and affordable housing funding through a separate process, and the remaining funds, 15% of each jurisdiction’s contributions, or $668,828 ($544,328 County and $124,500 City), is set aside for elected officials to address emerging needs.
On April 30, 2024, the Board of Supervisors (Board) and City Council (Council) prioritized four (4) CORE Conditions:
1. Lifelong Learning and Education
15.1 2. Thriving Families
3. Healthy Environments
4. Safe, Affordable Housing and Shelter
They allocated $1.5M for affordable housing and shelter through the H4H, leaving $3,790,025 for distribution through the RFP process.
The CORE RFP was issued on June 3, 2024 with proposals due by August 2, 2024. A total of 100 proposals requesting $15,301,019 were received, significantly exceeding the available $3,790,025.
DISCUSSION: The total CORE Investments budget for FY 2026-27 and FY 2027-28 funding cycle is $5,958,853 per fiscal year, designated to the following: $3,790,025 towards the CORE Investments RFP, $1.5M to H4H for affordable housing and shelter, and prevention services, and $668,828 to be set aside for elected officials for unanticipated priorities.
The CORE Investments RFP was released on June 3, 2024, with a submission deadline of August 2, 2024, at 5:00 pm. Formal RFP documents were posted on the County General Services Department (GSD) procurement website, and additional supportive information and tools on HSD were also posted. ReviewR, an online platform used for the prior RFP, was used again for proposal submittals.
Amendments
Throughout the RFP process, four (4) amendments were made (see the attached CORE RFP Amendments):
First Amendment: Updated the RFP schedule and Appeal process to align with County procurement practices.
Second Amendment: Corrected technical issues in the Budget and Leveraging Templates. Third Amendment: Addressed technical fixes to some narrative information in the Leveraging Template.
Fourth Amendment: Clarified details in Question #14 on ReviewR.
These amendments enhanced transparency, improved applicant notification, and streamlined the appeal process.
15.2 Applicant Support
In partnership with HSD and the CORE Consultants, they provided extensive support to potential applicants that is outlined in the attached CORE RFP Training Schedule:
80 Individual Training and Technical Assistance Sessions: Offered to guide applicants through the RFP process.
Applicant Conference: Recorded and available online for later viewing. Question and Response Documents: Two documents addressing applicant queries. Virtual trainings: Two sessions on using ReviewR, plus additional individualized support. CORE Newsletter: Regular updates and reminders about training and assistance opportunities.
Support was provided in both English and Spanish to ensure accessibility.
CORE Proposals Received
A total of 100 proposals were submitted by 75 organizations, requesting $15,301,019 in funding across three (3) funding Tiers categorized by CORE Condition, including Impact Area. Most proposals, 58, were in Tier II, or medium-sized tier, with Thriving Families, 40, being the most popular CORE Condition, and finally, 13 organizations submitted two (2) or more proposals.
Details of the proposals are listed in the attached Proposals Received By CORE Conditions and List of Agencies.
Review Panel Update
The RFP’s three (3) CORE Conditions allowed HSD staff to assign proposals based on Tier, CORE Condition, and Impact Area. Over 65 panelists volunteered to review the proposals, representing a diverse cross-section of community members, including those with lived experience, County and City staff, and representatives from other jurisdictions. HSD provided training on the scoring matrix, and all panelists signed a conflict-of-interest policy.
Council Direction
Council direction in two (2) key areas is necessary for staff to return with final awards recommendations for Council approval. Direction is as follows:
1. Carve-Outs: Council must decide whether to exclude any specific services or programs from the competitive procurement.
2. Funding Distribution: With funding requests greatly exceeding available funds, the Council needs to provide guidance on allocating the CORE funding. Two (2) options are proposed:
Option 1: Distribute funds proportionally based on the amount requested by each CORE Condition and Tier.
Option 2: Distribute funds based on the number of proposals submitted in each category.
Staff recommends Option 2, which aligns with previous funding distributions by spreading the money to more programs in Tiers 2 and 3, maximizing funding distribution.
Funding Distribution
Since the CORE Investments program began, there has consistently been more demand for funding than available resources. Here’s a summary of the situation:
FY 2023-25 Funding Cycle (July 1, 2022 to June 30, 2025): In the previous RFP cycle, 128 proposals were received, requesting a total of $15,179,382. However, the total
15.3 budget was only $5,958,853. This means there were more than twice as many funding requests as there were funds available.
FY 2026-28 Funding Cycle (July 1, 2025 to June 30, 2028): 100 proposals have been submitted for the current RFP cycle, requesting $15,301,019. The available budget for this cycle is $3,790,000. This situation is even more extreme, with requests being more than four (4) times the amount of available funding.
The County and City recognize that many of the organizations seeking funding provide valuable services to the community. The large gap between funding requests and available resources highlights the need to align Council priorities with the final recommendations carefully.
To determine how to distribute the available CORE funds among the top-scoring proposals, staff is seeking input on the following guidelines for funding distribution. These guidelines are designed to help allocate funds fairly and effectively.
Funding Distribution Guidelines
Maximize Number of Proposals Funded: Aim to spread funding across as many proposals as possible.
Distribute Funding Across Tiers and CORE Conditions: Ensure funding is allocated to various tiers and CORE Conditions as prioritized.
Scoring Floor: Proposals will be evaluated based on the scoring matrix, with a minimum threshold set to ensure quality. HSD recommends a scoring floor of 80 for Tier I and II proposals and 60 for Tier III.
Unallocated Funds: Any remaining funds after the initial distribution will be added to the 15% set aside for emerging needs.
Funding Distribution Options
Refer to Funding Distribution Options for the breakdown of funding distribution options. Option 1: Fund each CORE Condition and Tier proportionally to the amount requested, allowing adjustments to ensure at least one (1) proposal per category is funded. This option is expected to fund between 16 and 36 proposals. It would allocate more resources to larger proposals, particularly in the Older and Dependent Adults category, which has the most proposals requesting $150,000 to $500,000.
Tier 1 Tier 2 Tier 3 Total
Lifelong Learning & Education
$500,000
1 to 2 apps
$272,947
1 to 5 apps
$25,000
1 app
$797,947
3 to 8 apps
Thriving Families: Children &
Youth
$655,138
1 to 3
$705,259
4 to 9
$25,847
1 to 2
$1,386,245
6 to 14
Thriving Families: Older &
Dependent Adults
$1,075,164
2 to 4
$306,324
2 to 5
$25,000
1 $1,406,488
4 to 10
Healthy Environments n/a $174,321
1 to 3
$25,000
1 $199,321
2 to 4
Total Cost $2,230,302 $1,458,851 $100,847 $3,790,000
Potential Proposals to Fund 4 to 9 8 to 22 4 to 5 16 to 36 Available funding represents just under 25% of the money requested by all CORE applicants. Option 1 proposes to fund each Tier and CORE Condition and Impact Area at about 25% of the requested funding.
15.4 The methodology would allow for adjustment to ensure that at least one (1) proposal in each category could be funded.
Option 2: Distribute funding based on the number of proposals submitted in each category, maximizing the number of funded proposals. This option would likely fund 22 to 40 proposals. It would allocate more resources to medium-sized proposals, particularly the Children and Youth category, which has the highest number of medium-sized proposals.
Tier 1 Tier 2 Tier 3 Total
Lifelong Learning & Education $500,000
1 to 2 apps
$245,900
1 to 4 apps
$50,000
2 apps
$795,900
4 to 8 apps
Thriving Families: Children &
Youth
$518,500
1 to 2 apps
$947,500
6 to 11 apps
$50,000
2 to 3 apps
$1,516,000
9 to 16 apps
Thriving Families: Older &
Dependent Adults
$594,300
1 to 2 apps
$492,700
3 to 7 apps
$50,000
2 apps
$1,137,000
6 to 11 apps
Healthy Environments n/a $316,100
2 to 4 apps
$25,000
1 app
$341,100
3 to 5 apps
Total Cost $1,612,800 $2,002,200 $175,000 $3,790,000
# of Potential Proposals to Fund 3 to 6 12 to 26 7 to 8 22 to 40 The methodology would allow for adjustment to ensure that at least 1 proposal in each category could be funded.
Next Steps
Once the panelists have completed their evaluations, the next steps will involve compiling scores, applying Board and Council directions, and informing applicants of their funding status.
This process ensures that all proposals are assessed thoroughly and fairly and that any appeals are handled appropriately. Below is a detailed timeline of the upcoming activities:
Review Panel Completion: Each review panel will finalize their evaluations within the next month.
Score Compilation: HSD will compile proposal scores and apply Board and Council directions.
Notification and Appeals: Applicants will be notified of proposed funding, with a 5-day period for appeals.
Final Recommendations: Staff will coordinate with HSD to present final award recommendations and any unallocated funds to the Board and Council by November 19, 2024.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This report is not subject to CEQA as it involves funding decisions and does not constitute a project under CEQA guidelines.
HEALTH IN ALL POLICIES (HiAP): The CORE Investments initiative aligns with the Health in All Policies (HiAP) principles by integrating health and equity considerations into its funding priorities. CORE focuses on areas such as lifelong learning, affordable housing, healthy environments, and thriving families, all critical determinants of public health. CORE Investments
15.5 supports a comprehensive approach to improving community health by funding programs that address these. The initiative emphasizes equitable access to resources, targeting support to lowerincome and underserved populations, directly contributing to reducing health disparities.
Additionally, CORE’s alignment with community values and feedback ensures that funded programs address immediate needs and promote long-term health and well-being, consistent with HiAP’s goal of embedding health considerations into policymaking across all sectors. This approach integrates health considerations into decision-making processes to enhance overall community well-being.
FISCAL IMPACT: Currently $4,878,853 County General Fund is allocated to CORE and is supplemented by $1,080,000 of City of Santa Cruz funds. This RFP assumes a continued minimum County General Fund contribution of $4,878,853 and $1,080,000 from the City of Santa Cruz. With the proposed recommendations at the existing level of total CORE funding of $5,958,853, $1,500,000 would be utilized for stable, affordable housing, and $668,828 would be available to be used at the discretion of the elected officials. Funding available through the competitive RFP process would be $3,790,025. The actions outlined in this report will not impact the General Fund.
Prepared By:
Larry Imwalle
Homelessness Response
Manager
Approved By:
Matt Huffaker
City Manager
ATTACHMENTS:
1. CORE RFP AMENDMENTS.PDF
2. CORE RFP TRAINING SCHEDULE.PDF
3. PROPOSALS RECEIVED BY CORE CONDITIONS.PDF
4. LIST OF AGENCIES.PDF
5. FUNDING DISTRIBUTION OPTIONS.PDF
15.6 COUNTY OF SANTA CRUZ
Purchasing Division
701 OCEAN STREET, SUITE 330, SANTA CRUZ, CA 95060-4073
ADDENDUM #1
Request for Proposal (RFP) #2024HSD01
FOR
Collective of Results and Evidence-based (CORE) Investments Funding Cycle Fiscal Year 2025-28 Issued June 27, 2024
This addendum (#1) is being issued to revise 2.2: RFP Process Schedule, Exhibit C: Protests and Appeals Procedures found in the RFP
1. Revised 2.2: RFP Process Schedule found on pages 4-5:
Activity Date
Advertise RFP – Sentinel & San Jose Mercury
News
6/3/24 & 6/10/24
Release RFP 6/3/24 by 5:00pm
Applicant Conference (virtual on Zoom) 6/21/24 (10 am-12 pm) Applicant Question Deadline 7/1/24 by 5:00 pm
Deadline for Submittals 8/2/24 by 5:00 pm
Online Portal Technical Assistance Session 6/26/24 (11:00 am-12 pm) https://bit.ly/CORE-RFP-Training-June26
Individualized Online Portal Support Offered Email:
[email protected]
1st Question and Response Posting 6/21/24 by 5:00 pm
2nd Question and Response Posting 7/8/24 by 5:00 pm
Training and TA Various dates offered sign up on
the CORE website:
www.santacruzhumanservices.org/Home/
FundingOpportunities/COREInvestments
Proposals Due Friday, 8/2/24 by 5:00 PM
Applicants informed if their Proposal is considered
incomplete or does not meet parameters
Tuesday, 8/13/24 by 5:00 pm
Panel Review August-October 2024
County Board and City Council status update September 2024 County Board and City Council receive
recommendations, approve, and finalize CORE
awards
November 2024
Contracts approved January 2025- May 2025
Attachment A - CORE Investments RFP Amendments
FY 2025-28 CORE Investments Procurement
15.7 Page 1 of 5
2. Revised- Exhibit C: PROTESTS AND APPEALS PROCEDURES found on Page 15 Protests and Appeals to the County General Services Director Protests and appeals in connection with this solicitation are to be submitted to the Santa Cruz County General Services Director, who will coordinate and consult as needed with the Santa Cruz County Human Services Director, City of Santa Cruz Manager and/or Assistant and jurisdictional legal counsel. The appeal process provided herein applies solely to decisions of the Department on this CORE RFP.
Organizations shall submit their protest and/or appeal in writing within five (5) working days from the date the notification of decision is emailed by the county. The Protest and/or appeals shall state the reason(s) for such action, stating all relevant facts, information, and evidence, and note as applicable, any of the following:
• A determination or interpretation is not in accord with the solicitation, • There was an error or abuse of discretion,
• The record includes inaccurate information, or
• A decision is not supported by the record.
New or supplemental information not included in the original submission will not be considered in the protest or appeal. No applicant shall have the right to protest and/or appeal a decision related to another organization’s submission.
Protests and appeals are preferred to be submitted by email to: [email protected] Or by U.S.P.S or other reliable mail carrier to:
General Services Department
Purchasing Division, Att: CORE RFP
701 Ocean Street, Suite 330
Santa Cruz, CA 95060
Upon receipt of an appeal and following consultation with those named above, the General Services Director shall issue a final, written decision within ten (10) working days after receipt of the protest via e-mail or written letter with an explanation of the Director’s determination.
Final Funding Decisions
At the public meetings finalizing CORE awards, held in November, the Board of Supervisors and City Council will adopt the final awards and come to a final decision on all CORE RFP award funding.
All other information remains the same.
The deadline for all questions regarding this RFP is 5:00 PM; Pacific time, July 1, 2024 Submit questions to [email protected]. No further questions will be accepted after this deadline.
RFP SUBMITTAL DEADLINE REMAINS UNCHANGED.
RFP DUE: August 2, 2024, by 5:00 PM, Pacific time. Proposals will be submitted through the online portal:
http://my.reviewr.com/site/core_investments_rfp2024
Kimberly Petersen,
Deputy Director Human Services Department
Email [email protected]
Attachment A - CORE Investments RFP Amendments
FY 2025-28 CORE Investments Procurement
15.8 Page 2 of 5
COUNTY OF SANTA CRUZ
General Services Department
Purchasing Division
701 OCEAN STREET, SUITE 330, SANTA CRUZ, CA 95060-4073
ADDENDUM #2
Request for Proposal (RFP) #2024HSD01
FOR
Collective of Results and Evidence-based (CORE) Investments Funding Cycle Fiscal Year 2025-28 Issued July 3, 2024
This addendum (#2) is being issued to revise the FY dates in Appendix F: Budget Template, Appendix G: Leveraging Template found in the RFP
1. Revised- FY dates in Appendix F: Budget Template found on Page 54 Link to Revised Budget Template FY25-26 v2.xlsx
2. Revised- FY dates in Appending G: Leveraging Template found on Page 59 Link to Revised Leveraging Template.xlsx
All other information remains the same.
The deadline for all questions regarding this RFP was Monday, July 01, 2024 by 5:00 PM; Pacific time. No further questions will be accepted after this deadline.
RFP SUBMITTAL DEADLINE REMAINS UNCHANGED.
RFP DUE: August 2, 2024, by 5:00 PM, Pacific time. Proposals will be submitted through the online portal:
http://my.reviewr.com/site/core_investments_rfp2024
Kimberly Petersen,
Deputy Director Human Services Department
Email [email protected]
Attachment A - CORE Investments RFP Amendments
FY 2025-28 CORE Investments Procurement
15.9 Page 3 of 5
COUNTY OF SANTA CRUZ
General Services Department
Purchasing Division
701 OCEAN STREET, SUITE 330, SANTA CRUZ, CA 95060-4073
ADDENDUM #3
Request for Proposal (RFP) #2024HSD01
FOR
Collective of Results and Evidence-based (CORE) Investments Funding Cycle Fiscal Year 2025-28 Issued July 10, 2024
This Addendum (#3) is being issued to revise the Leveraging Example, Notes/Instruction section, and the Narrative Description section in Appendix G: Leveraging Template found in the RFP
1. Revised- Leveraging Example, Notes/Instruction section, and the Narrative Description section in Appendix G:
Leveraging Template found on Page 59.
• Link to Revised Leveraging Template.xlsx
All other information remains the same.
The deadline for all questions regarding this RFP is 5:00 PM; Pacific time, July 1, 2024 Submit questions to [email protected]. No further questions will be accepted after this deadline.
RFP SUBMITTAL DEADLINE REMAINS UNCHANGED.
RFP DUE: August 2, 2024, by 5:00 PM, Pacific time. Proposals will be submitted through the online portal:
http://my.reviewr.com/site/core_investments_rfp2024
Kimberly Petersen,
Deputy Director Human Services Department
Email [email protected]
Attachment A - CORE Investments RFP Amendments
FY 2025-28 CORE Investments Procurement
15.10 Page 4 of 5
COUNTY OF SANTA CRUZ
General Services Department
Purchasing Division
701 OCEAN STREET, SUITE 330, SANTA CRUZ, CA 95060-4073
ADDENDUM #4
Request for Proposal (RFP) #2024HSD01
FOR
Collective of Results and Evidence-based (CORE) Investments Funding Cycle Fiscal Year 2025-28 Issued July 24, 2024
This addendum (#4) is being issued to provide notification of changes to the Proposal Online Reviewr Portal system, under question #14. These edits (in blue below) have changed the fields for people over 100% poverty from required to optional as shown below:
Less than 100% federal poverty level (FPL) *required*
Less than 100% federal poverty level (FPL) Percentage % 100%-200% FPL (optional answer)
100%-200% FPL Percentage %
Above 200% FPL (optional answer)
Above 200% FPL Percentage %
Total Percent Should be 100% (removed)
All other information remains the same.
The deadline for all questions regarding this RFP is 5:00 PM; Pacific time, July 1, 2024 Submit questions to [email protected]. No further questions will be accepted after this deadline.
RFP SUBMITTAL DEADLINE REMAINS UNCHANGED.
RFP DUE: August 2, 2024, by 5:00 PM, Pacific time. Proposals will be submitted through the online portal:
http://my.reviewr.com/site/core_investments_rfp2024
Kimberly Petersen,
Deputy Director Human Services Department
Email [email protected]
Attachment A - CORE Investments RFP Amendments
FY 2025-28 CORE Investments Procurement
15.11 Page 5 of 5
Attachment B – CORE Investments RFP Training & Technical Assistance Schedule FY 2025-28 CORE Investments Procurement
Date, Time
Fecha,
Hora
Type
Tipo
Bilingual
Bilingüe
Topic
Tema
Registration Link
Enlace de inscripción
Varies TA Session N Initial TA Sessions between June 17 – July 8
https://bit.ly/CORERFP-TA-Signup
6/6/24
3:30 – 5
Training
Capacitación
Y Developing a Theory of Change and
Logic Model With an Equity Lens
Desarrollando una teoría de cambio
y un modelo de lógica con un
enfoque hacia la equidad
https://bit.ly/CORERFP-Training-June6
6/13/24
2 – 5
Office Hours
Horas de
oficina
By
request
Si es
solicitado
Office Hours, by CORE Condition
• Thriving Families (2-2:45)
• Lifelong Learning & Education
(3-3:45)
• Healthy Environments (4-4:45)
Horas de oficina, por Condición de
CORE
• Familias Prósperas (2-2:45)
• Aprendizaje y Educación de Por
Vida (3-3:45)
• Ambientes Sanos (4-4:45)
Thriving Families //
Familias Prósperas
https://bit.ly/CORERFP-OH-June13-TF
Lifelong Learning &
Education //
Aprendizaje y
Educación de Por Vida
https://bit.ly/CORERFP-OH-June13-LLE
Healthy Environments
// Ambientes Sanos
https://bit.ly/CORERFP-OH-June13-HE
6/14/24
10 – 11:30
Training
Capacitación
Y Developing a Statement of Need &
Strengths
Desarrollando una declaración de
necesidad y fortalezas con un
enfoque hacia la equidad
https://bit.ly/CORERFP-Training-June14
6/18/24
1 – 3
Training
Capacitación
Y Developing Your Programmatic
Approach & Evaluation Strategy
Desarrollando su enfoque
programático y estrategia de
evaluación
https://bit.ly/CORERFP-Training-June18
6/21/24
10 – 12
Applicant
Conference
N Applicant Conference https://bit.ly/CORERFP-06-21-2024
15.12 Attachment B – CORE Investments RFP Training & Technical Assistance Schedule FY 2025-28 CORE Investments Procurement
Date, Time
Fecha,
Hora
Type
Tipo
Bilingual
Bilingüe
Topic
Tema
Registration Link
Enlace de inscripción
6/25/24
10 – 11:30
Training
Capacitación
Y Finding & Using Community
Indicators on DataShare and Other
Sources
Encontrando y utilizando datos a
nivel comunitario en DataShare y
otras Fuentes
https://bit.ly/CORERFP-Training-June25
6/28/24
11 – 12
Training
Capacitación
N How to Use the Online Portal for
CORE RFP Applications
https://bit.ly/CORERFP-Training-June26
7/2/24
12 – 3
Office Hours
Horas de
oficina
By
request
Si es
solicitado
Office Hours by CORE Condition
• Lifelong Learning & Education
(12-12:45)
• Healthy Environments (1-1:45)
• Thriving Families (2-2:45)
Horas de oficina, por Condición de
CORE
• Aprendizaje y Educación de Por
Vida (12-12:45)
• Ambientes Sanos (1-1:45)
• Familias Prósperas (2-2:45)
Lifelong Learning &
Education //
Aprendizaje y
Educación de Por Vida
https://bit.ly/CORERFP-OH-July2-LLE
Healthy Environments
// Ambientes Sanos
https://bit.ly/CORERFP-OH-July2-HE
Thriving Families //
Familias Prósperas
https://bit.ly/CORERFP-OH-July2-TF
7/9/24
10 – 12
Training
Capacitación
Y Preparing a Program Budget &
Budget Narrative
Preparando un presupuesto de
programa y narrativa del
presupuesto
https://bit.ly/CORERFP-Training-July9
7/12/24
10 – 12
Training
Capacitación
Y In Case You Missed It: Highlights
from Previous CORE RFP Trainings
Por si se lo perdió: Lo más
destacado de las capacitaciones
para la solicitud para propuestas
(RFP) de las Inversiones de CORE
https://bit.ly/CORERFP-Training-July12
15.13 Attachment C – Total CORE Investments Funds Requested, by CORE Condition and Tier FY 2025-28 CORE Investments Procurement
Summary of total funds requested and proposals received, by CORE Condition, Impact Area and Tier:
CORE Condition and Impact Area Totals
Tier I
($150,001-
$500,000)
Tier II
($25,001-
$150,000)
Tier III
($25,000 and
Under)
Total
100 Apps
$15,301,019
27 Apps
$8,906,289
58 Apps
$6,072,498
15 Apps
$322,232
Lifelong Learning & Education:
Equitable access to high-quality
education and learning
opportunities
21 Apps
$3,221,478
5 Apps
$1,920,699
12 Apps
$1,202,779
4 Apps
$98,000
Thriving Families: Children and
youth
40 Apps
$5,596,558
9 Apps
$2,644,929
25 Apps
$2,847,279
6 Apps
$104,350
Thriving Families: Older and
Dependent Adults
30 Apps
$5,678,283
13 Apps
$4,340,661
13 Apps
$1,242,740
4 Apps
$94,882
Healthy Environments: Safe,
affordable, accessible recreation
spaces
9 Apps
$804,700 n/a 8 Apps$779,700
1 App
$25,000
15.14 Attachment D – List of Agencies Who Submitted CORE Investments Proposals FY 2025-28 CORE Investments Procurement
The following is a list of CORE Investments RFP Proposals submitted by the August 2, 2024, deadline, by agency and program name, categorized by CORE Condition and Impact Area, and broken down by Tier within each CORE Condition / Impact Area:
Lifelong Learning & Education:
Equitable access to high-quality education and learning opportunities Tier I ($150,001-$500,000)
Agency Program
Boys & Girls Clubs of Santa Cruz County Project Learn
Digital NEST, Inc. Career Pathways
United Way of Santa Cruz County C2CSCC
Ventures Semillitas
Your Future is Our Business YFIOB Foster ED Career Exploration Project Tier II ($25,001-$150,000)
Agency Program
Arts Council Santa Cruz County Mariposa Arts
Coastal Watershed Council Watershed Rangers
Community Action Board of Santa Cruz
County, Inc.
Day Worker Center
Community Action Board of Santa Cruz
County, Inc.
Floreciendo en Comunidad
El Sistema Santa Cruz/Pajaro Valley El Sistema Santa Cruz/Pajaro Valley Santa Cruz Children's Museum of
Discovery
Santa Cruz Children's Museum of Discovery
Science Playdate in the Park/Cita de
Juegos Científicos en el Parque
Santa Cruz Mountains Trail Stewardship Stewardship Corps Santa Cruz Museum of Natural History Santa Cruz Museum of Natural History Santa Cruz Toddler Care Center Santa Cruz Toddler Care Center Save Our Shores Save Our Shores Junior Sanctuary Stewards Program
United Way of Santa Cruz County United Way of Santa Cruz County United 4 Youth Santa Cruz County
Walnut Avenue Family & Women's Center Early Education Center Tier III ($25,000 and Under)
Agency Program
Senderos Plaza Comunitaria: Aprendiendo a su
proprio ritmo / Learning at your own pace
Homeless Garden Project Educational Workforce Development and Job Search Skills Training for People
Experiencing Homelessness
Volunteer Center of Santa Cruz County Literacy Program
X Academy X Academy
15.15 Attachment D – List of Agencies Who Submitted CORE Investments Proposals FY 2025-28 CORE Investments Procurement
Thriving Families:
Increased resilience of children and youth
Tier I ($150,001-$500,000)
Agency Program
Community Bridges Family Resource Collective
Encompass Community Services Youth & Family Partners: Bridging Gaps in Services Awareness, Engagement and
Advocacy
Families In Transition - Santa Cruz Guaranteed Income Pilot: Project Cosecha' Housing Matters Childcare Navigation & Assistance for
Families Experiencing Homelessness
Pajaro Valley Prevention and Student
Assistance
Renforzando Familias-Reinforcing Families
SANTA CRUZ BARRIOS UNIDOS INC Barrios Unidos Youth Program Santa Cruz Community Health Centers Advancing Pediatric Health Equity:
Preparing for School Success
Second Harvest Food Bank Santa Cruz
County
Program Alimenta
United Way of Santa Cruz County United Way’s Santa Cruz County Youth Action Network
Tier II ($25,001-$150,000)
Agency Program
Advocacy-Inc Patient Rights Advocacy
Big Brothers Big Sisters Agency of Santa
Cruz County, Inc
Big Brothers Big Sisters Agency of Santa
Cruz County, Inc
Boys & Girls Clubs of Santa Cruz County SMART Moves: Youth Mental and Behavioral Health Support
Community Action Board of Santa Cruz
County, Inc.
Luna y Sol Familia Center
Community Action Board of Santa Cruz
County, Inc.
Rental Assistance Program
Community Action Board of Santa Cruz
County, Inc.
Youth Homeless Response Team
Community Action Board of Santa Cruz
County, Inc.
Davenport Resource Service Center
Community Health Trust of Pajaro Valley Community Health Trust of Pajaro Valley Court Appointed Special Advocates of
Santa Cruz County
Mentorship and Advocacy for Santa Cruz
County Foster Children
Family Service Agency Central Coast Suicide Prevention Services FoodWhat Incorporated FoodWhat Incorporated
Jacob's Heart Children's Cancer Support
Services
Jacob's Heart Children's Cancer Support
Services
15.16 Attachment D – List of Agencies Who Submitted CORE Investments Proposals FY 2025-28 CORE Investments Procurement
LATIN ADVOCACY NETWORK-LATINAN LATIN ADVOCACY NETWORK-LATINAN MENtors Driving Change for Boys, Men and
Dads
MENtors Driving Change for Boys, Men and
Dads
Monarch Services-Servicios Monarca Theraupetic Services for Children and Youth
Monarch Services-Servicios Monarca Salud y Monarca
Mountains 2 Sea Inc. Mountains 2 Sea
NAMI Santa Cruz County Mental Health Support for Thriving Youth Parents Center Rooted Support: Thriving Parents Create
Thriving Families
Paws Helping People DBA: UnChained Caines Teaching Compasion Positive Discipline Community Resources Less Stess More Joy with Positive Discipline Safe Families for Children Monterey Bay Safe Families for Children Monterey Bay Salud Para La Gente Health Equity & Resilience for Pajaro Youth Santa Cruz City Schools Family Engagement Initiative
Walnut Avenue Family & Women's Center Youth Violence Prevention Program Tier III ($25,000 and Under)
Agency Program
Girls Inc. of the Central Coast Embracing Leadership and Educational Goals
Girls Inc. of the Central Coast Making Healthy Choices
Girls Inc. of the Central Coast Education and Leadership Girls Inc. of the Central Coast Communication and Exploration Nourishing Generations Educational
Project
Starlight Elementary School Nutrition and
Culinary Education Program
Senderos Juventud saludable a través de la cultura
y artes / Healthy Youth Through Culture &
Arts
15.17 Attachment D – List of Agencies Who Submitted CORE Investments Proposals FY 2025-28 CORE Investments Procurement
Thriving Families:
Increased resilience among older and dependent adults
Tier I ($150,001-$500,000)
Agency Program
Community Bridges Elderday
Community Bridges Meals on Wheels for Santa Cruz County Dientes Community Dental Care Equitable Dental Care for Seniors Dignity Health Dominican Hospital The Senior and Dependent Adult Program Encompass Community Services Health Equity II
Grey Bears Healthy Food Program
Institute on Aging Elder Abuse Prevention Program
Institute on Aging Senior Injury Prevention Program
Institute on Aging Friendship Line
Mental Health Client Action Network Mental Health Client Action Network People First of Santa Cruz County The Village
Senior Legal Services Senior Legal Services
Senior Network Services Aging and Community
Tier II ($25,001-$150,000)
Agency Program
Santa Cruz Art League Ageless Arts Initiative
Senior Citizens Organization of the San
Lorenzo Valley
Highlands Park Senior and Community
Center
Vets4Vets Santa Cruz RESILIENCE BUILDING OF ELDERLY VETERANS Walnut Avenue Family & Women's Center Family Fortification Project Eat for the Earth Salud en tu Plato/Community Rx
Cabrillo Community College District Stroke & Disability Learning Center Community Action Board of Santa Cruz
County, Inc
Santa Cruz County Immigration Project
New Way Homes Housing Santa Cruz County
Family Service Agency of the Central Coast Family Service Agency of the Central Coast Acupuncturists Without Borders Colectivo CARE - Focus on Elders Program Volunteer Center of Santa Cruz County Empowered Aging
Teen Kitchen Project Teen Kitchen Project
NAMI Santa Cruz County NAMI Santa Cruz County
Tier III ($25,000 and Under)
Agency Program
Association of Faith Communities of Santa
Cruz County, Inc.
Mobile Shower Program
Seniors Council of Santa Cruz and San
Benito Counties
Project SCOUT
Urban Works Santa Cruz Urban Works Santa Cruz
Vista Center for the Blind and Visually Impaired Vision Loss Rehabilitation Program
15.18 Attachment D – List of Agencies Who Submitted CORE Investments Proposals FY 2025-28 CORE Investments Procurement
Healthy Environments:
Safe, affordable, accessible recreation spaces
Tier II ($25,001-$150,000)
Agency Program
Black Surf Santa Cruz Pop-Up Program (PUP) / Keep PUP and Prepare to Pop-Up Program (P2PUP)
Central Coast YMCA Healthy Family Homes
Coastal Watershed Council River Stewards Program
Farm Discovery at Live Earth Farm Discovery at Live Earth Friends of Santa Cruz County Parks DBA
County Park Friends
ParkRx Santa Cruz County (ParkRx SCC)
O'Neill Sea Odyssey O'Neill Sea Odyssey
Santa Cruz Lesbian and Gay Community
Center
The Diversity Center’s Health and
Wellbeing Initiative
Volunteer Center of Santa Cruz County YouthServe
Tier III ($25,000 and Under)
Agency Program
Volunteer Center of Santa Cruz County Healthy Connections
15.19 Attachment E – CORE Investments Funding Distribution Options FY 2025-28 CORE Investments Procurement
CORE Investments Funding Distribution Options
For the FYs 2025-28 CORE Investments funding cycle, $3,790,025 was allocated through an RFP process, to award CORE Investments proposals across approved Tiers, CORE Conditions and Impact Areas. A total of 100 proposals were received, representing $15,301,019 in CORE Investments funding requests.
With funding requests totaling 4 times more than the amount of funding available to awards proposals, County staff are presenting the following options for consideration for available funding distribution.
Option 1: Fund CORE Conditions and Tiers Proportionally by Funding Requested Option 1 would fund approximately 19 16 to 36 proposals. It would fund CORE Conditions and Tiers at 24.7% of the total amount of funding requested across submitted applications, or the proportion of CORE Funding versus the total amounts requested.
Tier 1 Tier 2 Tier 3 Total
Lifelong Learning & Education $500,000
1 to 2 apps
$272,947
1 to 5 apps
$25,000
1 app
$797,947
3 to 8 apps
Thriving Families: Children and
Youth
$655,138
1 to 3
$705,259
4 to 9
$25,847
1 to 2
$1,386,245
6 to 14
Thriving Families: Older and
Dependent Adults
$1,075,164
2 to 4
$306,324
2 to 5
$25,000
1 $1,406,488
4 to 10
Healthy Environments n/a $174,321
1 to 3
$25,000
1 $199,321
2 to 4
Total Cost
$2,206,051
$2,230,302
$1,504,133
$1,458,851
$79,816
$100,847 $3,790,000
# of Potential Proposals to Fund 4 to 9 8 to 22 4 to 5 16 to 36 Methodology
1. Totals all requests for funds in each Tier, CORE Condition, and Impact Area and determines recommended funding by dividing by 24.7% (The amount of available funds divided by requested funds)
2. Adjusts amounts in Tiers with a CORE Condition to ensure at least 1 proposal is funded in each Tier and Impact Area
15.20 Attachment E – CORE Investments Funding Distribution Options FY 2025-28 CORE Investments Procurement
Option 2: Fund CORE Conditions and Tiers Proportionally by Number of Proposals Submitted
Option 2 would fund approximately 22 to 40 proposals. It would fund CORE Conditions more proportionally to the number of proposals submitted in each category.
Tier 1 Tier 2 Tier 3 Total
Lifelong Learning & Education $500,000
1 to 2 apps
$245,900
1 to 4 apps
$50,000
2 apps
$795,900
4 to 8 apps
Thriving Families: Children and
Youth
$518,500
1 to 2 apps
$947,500
6 to 11 apps
$50,000
2 to 3 apps
$1,516,000
9 to 16 apps
Thriving Families: Older and
Dependent Adults
$594,300
1 to 2 apps
$492,700
3 to 7 apps
$50,000
2 apps
$1,137,000
6 to 11 apps
Healthy Environments n/a $316,100
2 to 4 apps
$25,000
1 app
$341,100
3 to 5 apps
Total Cost $1,612,800 $2,002,200 $175,000 $3,790,000
# of Potential Proposals to Fund 3 to 6 12 to 26 7 to 8 22 to 40 Methodology
1. Totals all proposals in each Tier, CORE Condition, and Impact Area and determines recommended funding by taking the percentage of all proposals in each tier and impact area and multiplying by the total funds ($3.79 million)
2. Within a CORE Condition move money out of Tier 3 into Tier 1 to ensure at least 1 proposal is in each Tier and Impact Area (if necessary)
3. Within a CORE Condition move money out of Tier 2 into Tier 1 to ensure at least 1 proposal is in each Tier and Impact Area (if necessary)
15.21 15.22
• Timeline
• RFP – Reminders
• RFP Updates
• Summary of Applications
• Request for SC Council (CN)
Direction
• BOS Action
• Recommended Actions
Agenda
15.23 Timeline
Next Steps:
1. Today - Staff summary of applications received, seek final direction
2. November 2024 - Recommended Awards
3. Begin Contracts
15.24 Included Feedback from Lessons Learned
$1.5M for Affordable Housing and Shelter
$3,790,025 available for RFP awards
$668,828 for unanticipated priorities following
awards
CORE RFP CORE RFP – –eminders Reminders
15.25 • Equitable access to high-quality
education & learning opportunities
Lifelong Learning & Education
• Increase resilience of older &
dependent adults
• Increase resilience of children & youth
Thriving Families
• Safe, affordable, accessible recreation
spaces
Healthy Environments
CORE RFP – Reminders: 3 CORE Conditions
15.26 RFP Update – Applicant Support
• Trainings (93 offerings, 324
participants, 123 unduplicated)
• Applicant Bidder’s Conference
• Group & individual training sessions
• Videos of formal trainings posted;
• CORE email responded to ongoing
15.27 RFP Update – Amendments & Schedule
Amendments
• Technical fixes
• RFP schedule adjustment -
sequence of appeals / awards
Schedule
• By Mid-Oct 2024
oApplicants notified of status
oAppeal period starts
• November 2024
oRecommended awards
brought to SC CN
15.28 Summary of Applications
CORE Condition and Impact Area
Tier I
($150,001-
$500,000)
Tier II
($25,001-
$150,000)
Tier III
($25,000 and
Under)
Lifelong Learning & Education: Equitable access to
high-quality education and learning opportunities
5 Apps
$1,920,699
12 Apps
$1,202,779
4 Apps
$98,000
Thriving Families: Children and youth 9 Apps
$2,644,929
25 Apps
$2,847,279
6 Apps
$104,350
Thriving Families: Older and Dependent Adults 13 Apps
$4,340,661
13 Apps
$1,242,740
4 Apps
$94,882
Healthy Environments: Safe, affordable, accessible
recreation spaces n/a 8 Apps$779,700
1 App
$25,000
Total Apps
21 Apps
$3,221,478
40 Apps
$5,596,558
30 Apps
$5,678,283
9 Apps
$804,700
Totals 27 Apps
$8,906,289
58 Apps
$6,072,498
15 Apps
$322,232
100 Apps
$15,301,019
15.29 Option 1
By $ requested
Option 2
By # of apps
Learning $797,947
3 to 8 apps
$795,900
4 to 8 apps
Children and Youth $1,386,245
6 to 14
$1,516,000
9 to 16 apps
Adults $1,406,488
4 to 10
$1,137,000
6 to 11 apps
Environment $199,321
2 to 4
$341,100
3 to 5 apps
CN Direction: Funding Distribution Options
Potential Proposals to Fund 16 to 36 22 to 40
Total Cost $3,790,000 $3,790,000
Staff Recommendation
15.30 CN Direction: Carve Out Considerations
Today – Carve out from competitive procurement
Already established:
15%* (or more =668K+) Flexibility post awards
SC CN prerogative to over-ride recommended awards
15.31 BOS passed the item
Direction for more analysis of leveraged funding
Board of Supervisors Action
15.32 Accept report on the status of the CORE RFP
Provide direction re funding distribution formula
Direct City Staff to coordinate with County HSD to carve out any prioritized service
Direct City Staff to coordinate with County HSD to report back with recommended awards on or before November
19, 2024
Recommended Actions
15.33 15.34