Santa Cruz City Council
September 30, 2025

CITY COUNCIL AGENDA
Updated September 26, 2025 – Item added to Closed Session Regular Meeting - September 30, 2025
Council Chambers
809 Center Street
Santa Cruz
12:00 P.M. CLOSED SESSION
1:45 P.M. ORAL COMMUNICATIONS, CONSENT, AND GENERAL BUSINESS Council meetings are hybrid, and may be viewed remotely, using any of the following sources:
 Click on Zoom link (no time delay): https://zoom.us/j/94684401344  Online at http://www.cityofsantacruz.com/government/city-council/council-meetings  Online at Watch – Community Television of Santa Cruz County  Comcast Channel 25
Or: Call any of the numbers below. If one is busy, try the next one.  1-833-548-0276 (Toll Free)
 1-833-548-0282 (Toll Free)
 1-877-853-5247 (Toll Free)
 1-669-900-9128
 Enter the meeting ID number: 946 8440 1344
 When prompted for a Participant ID, press #.
 Press *9 on your phone to “raise your hand” when the Mayor calls for public comment.  It will be your turn to speak when the Mayor calls on you. Press *6 to unmute yourself. The timer will then be set.

Correspondence to be included in the agenda packet must be received by 5:00 pm on Monday, September 29th
PLEASE NOTE:
 Council may take a break(s) as needed.
 Requests for extra speaking time on items other than Oral Communications must be made by 5:00 p.m. on Sunday, September 28th by emailing the Mayor and the City Clerk.

Approval will be confirmed via email.
[email protected] [email protected]
September 30, 2025 City Council 2
The City of Santa Cruz does not discriminate against persons with disabilities. Out of consideration for people with chemical sensitivities we ask that you attend fragrance free. Upon request, the agenda can be provided in a format to accommodate special needs. Additionally, if you wish to attend this public meeting and will require assistance such as an interpreter for American Sign Language, Spanish, or other special equipment, please call the City Clerk’s Department at 420-5030 at least five days in advance so that we can arrange for such special assistance, or email [email protected]. The CalRelay system number: 1-800-735-2922.

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

Agenda and Agenda Packet Materials: The City Council agenda and the complete agenda packet containing public records, which are not exempt from disclosure pursuant to the California Public Records Act, are available for review on the City’s website:
www.cityofsantacruz.com/government/city-council-meetings and at the Office of the City Clerk located at 809 Center Street, Room 8, Santa Cruz, California, during normal business hours.

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

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

Closed Session
12:00 PM
Statements of Disqualification

1. Conference with Legal Counsel – Liability Claims (Government Code §54956.95)
1) Claimant: Alane Williamson
2) Claimant: David W. Turner
3) Claimant: Habibeh Deyhim
4) Claimant: Sabrina Shewfelt
Claims against the City of Santa Cruz
Agenda updated to add the following item:

2. Conference with Legal Counsel – Anticipated Litigation (Government Code §54956.9(d)(4))
Initiation of litigation (two potential cases to be discussed).

September 30, 2025 City Council 3
Closed Session (continued)

3. Real Property Negotiations (Government Code §54956.8) Property: 1520 K1 Pacific
APN: N/A (Public Right of Way)
Owner: City of Santa Cruz
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Paul Cocking (dba Gabrielita Tamaleria)
Under Negotiation: Price, terms of payment, or both

4. Conference with Labor Negotiators (Government Code §54957.6) SEIU Temporary Employees
SEIU Service Employees
Mid Managers, OE3
Supervisors, OE3
Fire Management
Fire, IAFF
Police Management
Police Officers Association
Executives
City Negotiator - Sara De Leon

5. Public Employment (Government Code §54957)
City Attorney
September 30, 2025 City Council 4
City Council
1:45 PM
Call to Order
Roll Call
Oral Communications – Members of the public may address Council on matters not on the agenda, but within the jurisdiction of the Council. 30 minutes is allocated for Oral Communications. No extra time for groups will be granted.

Presentations

6. Mayoral Proclamation Declaring October 2025 as Domestic Violence Awareness Month

7. Mayoral Proclamation Declaring September 29th - October 5th as Week Without Driving Week

8. Fire Prevention Week: October 5—October 11, 2025
Presiding Officer's Announcements
Statements of Disqualification
Additions and Deletions
City Attorney Report on Closed Session
Council Meeting Calendar

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

September 30, 2025 City Council 5
Consent Agenda

10. Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA) LOCATION: Citywide
Motion to adopt a resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 Winter Storms.

11. Resolution Extending the Emergency Declaration in Connection with the December 2024 Municipal Wharf Emergency (CA/CM)
LOCATION: District 4
Motion to adopt a resolution extending by sixty days the Local Emergency Declaration in connection with the December 2024 Municipal Wharf emergency.

12. Minutes of the September 9, 2025 City Council Meeting (CC) LOCATION: None
Motion to approve as submitted.

13. Arts Commission Appointment (CC)
LOCATION: Citywide
Motion to approve Councilmember Brunner’s nomination of Mercedes Lewis to serve on the Arts Commission, with a term ending January 31, 2029.

14. Historic Preservation Commission Appointment (CC)
LOCATION: Citywide
Motion to approve Mayor Keeley's nomination of Stephanie McCormick to serve on the Historic Preservation Commission, with a term ending January 31, 2027.

September 30, 2025 City Council 6
Consent Agenda (continued)

15. Support Efforts to Strengthen Opposition to Offshore Oil Drilling (CN) LOCATION: Citywide
Motion to:
1) Support Santa Cruz County’s commitments to oppose the federal offshore oil drilling proposal by agreeing to join the local coordination effort; and
2) Direct staff to 1) return to City Council with a cooperative agreement or equivalent that defines the scope of work, terms and City involvement and 2) identify a funding source for the County requested Phase 1 contribution of $29,000 and the County requested Phase 2 contribution of $25,000.

16. Resolution Authorizing the City Manager, or Designee, to Grant Waivers to Tenants of City Lease Agreements (EDH)
LOCATION: Citywide
Motion to adopt a resolution authorizing the City Manager, or his designee, to grant waivers in an amount not to exceed $1,000 per fiscal year per tenant of City lease agreements.

17. Resolution Granting Consent to the County of Santa Cruz to Form the Santa Cruz Mountains Wine Improvement District (SCMWID) (EDH) LOCATION: Citywide
Motion to adopt a resolution granting consent to the County of Santa Cruz to form the SCMWID in the City of Santa Cruz.

18. Liability Claims Filed Against the City of Santa Cruz (FN) Motion to reject the liability claims of 1) Alane Williamson, 2) David W.

Turner, 3) Habibeh Deyhim, and deny application for leave to present late claim 4) Sabrina Shewfelt, based on staff recommendation.

September 30, 2025 City Council 7
Consent Agenda (continued)

19. Resolution Amending the City of Santa Cruz Compensation Plan for the Public Works Department (HR)
LOCATION: Citywide
Motion to adopt a resolution amending the Public Works Department’s Compensation Plan by correcting compensation range for Wastewater Facilities Lead Electrical/Instrumentation Technician classification.

20. Application and Project Management Support for Information Technology Systems (IT)
LOCATION: None
Motion to:
1) Approve a professional services agreement and scope of work with VantagePoint Business Solutions, LLC for application and project management support of critical information technology systems.

Authorize the City Manager to execute a contract in a form approved by the City Attorney. The Information Technology Director is hereby authorized to execute change orders within the approved project budget; and
2) Authorize the Information Technology Director to renew the contract for an additional two years under identical contractual terms and conditions at the end of the first contract term.

21. Contract Renewal with Hope Services, Inc. for the Resource Recovery Facility (PW)
LOCATION: District 6
Motion to authorize and direct the City Manager to renew an agreement with Hope Services, Inc. (Santa Cruz, CA) for recycling and litter control services at the City’s Resource Recovery Facility on Dimeo Lane.

September 30, 2025 City Council 8
Consent Agenda (continued)

22. Transfer within the Water Department’s Capital Investment Program for Fiscal Year 2025 Water Program Administration Expenses – Budget Adjustment (WT)
LOCATION: None
Motion to adopt a resolution to amend the Fiscal Year 2025 budget by transferring funds in the amount of $2,647,751 from the Water Department’s Capital Investment Program (CIP) project c701901, Water Program Administration, to various other Water Department CIP projects for the purpose of allocating actual program administration expenses to active Water Program CIP projects.

23. Resolution of Private Landowner Encroachment on Zayante Watershed Lands (WT)
LOCATION: County
Motion to approve property transfer from Assessor’s Parcel Number (APN) 093-011-59 to the City Water Department APN 093-011-29 and property transfer from City Water Department APN 093-011-29 to APN 093-011-59 to compensate for private landowner encroachment on City Water Department property.

24. Lockhart-Zayante Vegetation Treatment Project – Zayante Watershed Lands Landowner Agreement (WT)
LOCATION: County
Motion to ratify the Landowner Agreement with the Resource Conservation District of Santa Cruz County, executed by the City Manager, for the Lockhart-Zayante Vegetation Treatment Project.

September 30, 2025 City Council 9
Consent Agenda (continued)

25. Union/Locust Building Roof Replacement – Approval of Purchase Order, Exemption from Local Employment Requirements and CEQA, and Budget Adjustment (WT/LB)
LOCATION: District 4
Motion to:
1) Approve the issuance of a purchase order in the amount of $289,547 under the existing agreement with Waterproofing Technologies Inc. (Beachwood, OH) for roof restoration of the Union/Locust Building and authorize the Water Director and Library Director or their designee to approve change orders within the project budget;
2) Approve exemption from local employment requirements in Santa Cruz Municipal Code 3.10, Local Hiring – Public Works Contractors; 3) Adopt resolution amending the Fiscal Year 2026 budget in the amount of $116,000 to appropriate $116,000 from Water Enterprise Fund 711 for Capital Investment Program (CIP) project c701907, Facility and Infrastructure Improvements; and
4) Approve the California Environmental Quality Act (CEQA) determination contained in this Agenda Report. The Council’s action is exempt from CEQA review under the Class 1 categorical exemption of the California Code of Regulations Section 15301 for
repair/rehabilitation of existing facilities.

End Consent Agenda
September 30, 2025 City Council 10
General Business

26. Accept Modifications of San Lorenzo River Water Rights, Dedicate Instream Flows for North Coast Water Sources, Approve the Anadromous Salmonid Habitat Conservation Plan Project, and Authorize the City Manager to Sign Related State and Federal Endangered Species Act Permits (WT)
LOCATION: Citywide and County
Motion to:
1) Accept modifications of the City’s San Lorenzo River water rights, as described in the Santa Cruz Water Rights Project and in the State Water Resources Control Board order # WR 2025-0009 EXEC issued June 6, 2025;
2) Dedicate instream flows for North Coast water sources for the protection of special status aquatic species;
3) Approve the Anadromous Salmonid Habitat Conservation Plan project; and
4) Authorize the City Manager to sign the related federal Endangered Species Act Section 10(a)(1)(b) incidental take permit and the pending California Fish and Game Code Section 2081(b) incidental take permit.

27. Ordinance Amending Uncodified Ordinance No. 2020-27 Extending Temporary Use of Certain Adjacent Public Streets and Outdoor Areas for Eligible Businesses for Commercial Use on Private Property from July 1, 2026 to July 1, 2029 (EDH)
LOCATION: Citywide
Motion to introduce for publication an ordinance amending uncodified Ordinance No. 2020-27 extending temporary use of certain adjacent public streets and outdoor areas for eligible businesses for commercial use on private property from July 1, 2026 to July 1, 2029.

28. City Wildfire Resiliency Plan (FD)
LOCATION: Citywide
Receive a presentation on the City of Santa Cruz Wildfire Resiliency Plan.

Adjournment
September 30, 2025 City Council 11

INFORMATION ITEMS PREVIOUSLY DISTRIBUTED TO CITY COUNCILMEMBERS None issued.

MAYOR'S PROCLAMATIONS
ADDENDUM TO CITY COUNCIL AGENDA – SEPTEMBER 30, 2025

29. Proclaiming Saturday, October 18, 2025 as “Santa Cruz Band Review Day.”

30. Proclaiming the month of September 2025 as “Childhood Cancer Awareness Month” and encouraging all citizens to join in honoring Jacob’s Heart Children’s Cancer Support Services for its 27 years of outstanding support to our community and acknowledging its contributions to Childhood Cancer Awareness Month.

31. Proclaiming September 21, 2025 as “Sun Day” in celebration of the clean, renewable energy revolution that we are helping to bring about.

32. Proclaiming September 20, 2025 as “Wilem Banks Day” and encouraging all citizens to join in congratulating him for his achievement and recognizing his contributions to the sport and our community.

33. Proclaiming September 20, 2025 as “Alo Slebir Day” and encouraging all citizens to join in congratulating him for his achievement and recognizing his contributions to the sport and our community.

September 30, 2025 City Council 12
Advisory Body Appointments
The following positions are either currently vacant or the terms are due to expire.

Council will make appointments at a future meeting.

Board of Building and Fire Appeals One opening – at-large nomination.

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

Transportation and Public Works
Commission
One opening – appointed by
Councilmember Trigueiro.

Public Hearing
If, in the future, you wish to challenge in court any of the matters on this agenda for which a public hearing is to be conducted, you may be limited to raising only those issues which you (or someone else) raised orally at the public hearing or in written correspondence received by the City at or before the hearing.

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

NFPA Fire Prevention
Week 2025
Charge into Fire Safety :

Lithium-Ion Batteries in
Your Home
Tim Shields
Division Chief Prevention

8.1 The Legacy of
Fire Prevention
Week
• Marks the anniversary of the
Great Chicago fire of October 8-9,
1871
• Observed annually on the Sunday
through Saturday containing
October 9th anniversary of the
Chicago Fire
• October 5th-11th 2025

8.2 The Legacy of Fire
Prevention Week
• Founded in 1922
• Established by the National Fire
Protection Association (NFPA) to promote
fire safety awareness nationwide.
• Presidential Recognition
• Oldest public health observance in the
U.S., officially proclaimed annually by the
President since 1925.
• Century of Impact
• Over 100 years of educating millions of
Americans on critical fire safety and
prevention strategies.

8.3 2025 Theme:

Charge into Fire
Safety : Lithium-Ion
Batteries in Your
Home

8.4 Charge into Fire Safety :

Lithium-Ion Batteries in Your
Home
Buy Smart
Purchase only
batteries and devices
certified by nationally
recognized testing
laboratories like UL
or ETL.
- Look for
certification marks
- Avoid counterfeit
products
- Choose reputable
retailers
CHARGE Safe
Use manufacturerapproved chargers
on hard, nonflammable surfaces
away from escape
routes.
- Never overcharge
devices
- Avoid charging
overnight unattended
- Keep away from
heat sources
RECYCLE Right
Dispose of batteries
at designated
collection points;
never throw in
household trash or
recycling bins.
- Find local collection
sites
- Tape battery
terminals
- Handle damaged
batteries carefully

8.5 "From Hazard to Safety: Your
Actions Matter"
The Danger
- Damaged, overcharged, or counterfeit batteries
can rapidly overheat, creating intense fires that
spread quickly and produce toxic smoke.

The Solution
- Proper charging practices, certified equipment,
and safe storage dramatically reduce risk while
protecting your family and home.

8.6 Questions?
Tim Shields
Division Chief Prevention

8.7 Meeting Type
Holiday
Jewish Holiday
Regular Meeting
Special Meeting (will be added as scheduled)
Study Session (will be added as scheduled)
Budget Hearing
October 1/2
Courtyard Conf. Room Closed Session - Closed to the Public Council Chambers Council Regular Meeting - Open to the Public November 11
Courtyard Conf. Room Closed Session - Closed to the Public Council Chambers Council Regular Meeting - Open to the Public November 27
November 28
Courtyard Conf. Room Closed Session - Closed to the Public Council Chambers Council Regular Meeting - Open to the Public December 14/15
December 25
City Council Meeting Calendar for 2025
December 9
City Hall Closure - Thanksgiving Day
City Hall Closure - Day After Thanksgiving Day
December 23 Meeting Cancelled
City Hall Closure - Christmas Day
October 28
City Hall Closure - Veteran's Day (observed)
Hanukkah (City observed - sundown to sundown)
Yom Kippur (City observed - sundown to sundown)
November 18

9.1 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: City Attorney
SUBJECT: Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA) LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 Winter Storms.

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

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

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

10.1 At its September 10, 2024 regular meeting, the City Council received an update from the Director of Public Works on the City’s response to the 2022/2023 and 2023/2024 Winter Storms.

The City’s emergency response and recovery efforts remain ongoing and are expected to continue through Summer 2025, and potentially Summer 2026.

The attached resolution, if adopted by the City Council, would extend the 2022/2023 Winter Storms emergency declaration and 2023/2024 Winter Storms emergency declaration by an additional 60 days, to November 29, 2025.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under CEQA because it will not “cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment[.]” (Pub. Resources Code, § 21065.)
HEALTH IN ALL POLICIES (HiAP): This action is consistent with the three pillars of HiAP.

Specifically, the action has a nexus with public health in that the resolution is intended to help the City obtain reimbursement for recovery efforts along West Cliff Drive. Recovery efforts in this area will ensure accessible and safe biking, pedestrian, and recreational access for future public use and enjoyment.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: Actions taken by the City during a declared emergency are potentially recoverable from Cal OES (California Governor’s Office of Emergency Services) and FEMA (Federal Emergency Management Agency).

Prepared By:

Kaylen Anderson
Deputy City Attorney
Submitted By:

Tony Condotti
City Attorney
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

10.2 RESOLUTION NO. NS-30,XXX

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

THE LOCAL EMERGENCY DECLARATIONS IN CONNECTION WITH THE 2022/2023 WINTER STORMS AND 2023/2024 WINTER STORMS
WHEREAS, Government Code section 8630 authorizes the City Council or an official designated by ordinance to proclaim the existence of a local emergency; and WHEREAS, Santa Cruz Municipal Code section 2.20.030 empowers the City Manager, as the director of emergency services, to proclaim the existence or threatened existence of a local emergency when the City of Santa Cruz (“City”) is affected or likely to be affected by a public calamity, subject to confirmation by the City Council at the earliest practicable time; and WHEREAS, on December 30 and 31st, 2022, the City experienced an atmospheric river storm rain event, followed by another powerful storm event on January 4 and 5th, 2023 (the “2022/2023 Winter Storms”). As a result of the 2022/2023 Winter Storms, flooding, debris from trees, and mud impacted the San Lorenzo River and adjacent areas, including the Tannery area, San Lorenzo Park, and the beach. The San Lorenzo River reached 22.1 feet. Rainfall amounts exceeded 7 inches in the mountains over a 24-hour period. The 2022/2023 Winter Storms resulted in flooding, downed trees, major infrastructure damage, and impacts to persons experiencing homelessness; and
WHEREAS, the County of Santa Cruz proclaimed the existence of a local emergency in the County on January 3, 2023 in response to the 2022/2023 Winter Storms; and WHEREAS, in light of the 2022/2023 Winter Storms and pursuant to his authority as Emergency Services Director, on January 4, 2023, the City Manager declared the existence of a local emergency (the “2022/2023 Emergency Proclamation”). At its January 10, 2023 meeting, the City Council adopted Resolution No. NS-30,085 declaring the existence of a State of Emergency in connection with the 2022/2023 Winter Storms, confirming the 2022/2023 Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2022/2023 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,533 at its August 12, 2025 regular meeting, further extending the declaration of emergency by 60 days; and WHEREAS, a year after the 2022/2023 Winter Storms, on December 28 and 30th, 2023, the City of Santa Cruz experienced a large winter swell event involving significant rain and hazardous ocean conditions, causing an estimate of $2.5 million in damage along West Cliff Drive and the Santa Cruz Wharf, followed by atmospheric river storms throughout January and February 2024 (the “2023/2024 Winter Storms”). The 2023/2024 Winter Storms included significant rainfall on January 22, 2024 that contributed to flooding within the City and specifically to Cypress Point Apartments; and

10.3 RESOLUTION NO. NS-30,XXX
WHEREAS, on January 30, 2024, the County of Santa Cruz Board of Supervisors ratified the existence of a Local Emergency for the December 2023 Coastal Storms, as proclaimed by the County Administrative Officer as the Director of Emergency Services on January 3, 2024; and WHEREAS, in light of the 2023/2024 Winter Storms and pursuant to his authority as Emergency Services Director, on February 6, 2024, the City Manager declared the existence of a local emergency (the “2023/2024 Emergency Proclamation”). At its February 13, 2024 meeting, the City Council adopted Resolution No. NS-30,286 declaring the existence of a State of Emergency in connection with the 2023/2024 Winter Storms, confirming the 2023/2024 Winter Storms Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2023/2024 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,533 at its August 12, 2025 regular meeting, further extending the declaration of emergency by 60 days; and WHEREAS, at its September 10, 2024 regular meeting the City Council received an update from the Director of Public Works on the City’s response to the 2022/2023 and 2023/2024 Winter Storms. The City’s emergency response and recovery efforts remain ongoing and are expected to continue through Summer 2025, and potentially into Summer 2026.

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

A. That the City Council hereby declares that the local emergency declaration adopted at its January 10, 2023 regular meeting by Resolution No. NS-30,085, and extended on January 24, 2023 by Resolution No. NS-30,095, on March 14, 2023 by Resolution No.

NS-30,116, on May 9, 2023 by Resolution No. NS-30,145, on June 27, 2023 by Resolution No. NS-30,166, on August 22, 2023 by Resolution No. NS-30,187, on October 10, 2023 by Resolution No. NS-30,208, on November 28, 2023 by Resolution No. NS-30,239, on January 23, 2024 by Resolution No. NS-30,274, on March 12, 2024 by Resolution No. NS-30,296, on April 30, 2024 by Resolution No. NS-30,315, on June 25, 2024 by Resolution No. NS-30,349, on August 13, 2024 by Resolution No.

NS-30,362, on October 8, 2024 by Resolution No. NS-30,393, on December 10, 2024 by Resolution No. NS-30,414, on January 28, 2025 by Resolution No. NS-30,428, on March 25, 2025 by Resolution No. NS-30,452, on May 13, 2025 by Resolution No.

NS-30,479, on June 24, 2025 by Resolution No. NS-30,517, and on August 12, 2025 by Resolution No. NS-30,533, shall be extended an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and
B. That the City Council hereby declares that the local emergency declaration adopted at its February 13, 2024 regular meeting by Resolution No. NS-30,286, and extended on April 9, 2024 by Resolution No. NS-30,311, on April 30, 2024 by Resolution No. NS30,315, on June 25, 2024 by Resolution No. NS-30,349, on August 13, 2024 by Resolution No. NS-30,362, on October 8, 2024 by Resolution No. NS-30,393, on December 10, 2024 by Resolution No. NS-30,414, on January 28, 2025 by Resolution

10.4 RESOLUTION NO. NS-30,XXX
No. NS-30,428, on March 25, 2025 by Resolution No. NS-30,452, on May 13, 2025 by Resolution No. NS-30,479, on June 24, 2025 by Resolution No. NS-30,517, and on August 12, 2025 by Resolution No. NS-30,533, shall be extended an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and
C. This Resolution shall remain in full force and effect and shall thereafter terminate on the sixtieth (60th) day after its adoption, unless earlier terminated or further extended by subsequent City Council action.

PASSED AND ADOPTED this 30th day of September 2025 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

10.5 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: City Attorney/City Manager
SUBJECT: Resolution Extending the Emergency Declaration in Connection with the December 2024 Municipal Wharf Emergency (CA/CM)
LOCATION: District 4
RECOMMENDATION: Motion to adopt a resolution extending by sixty days the Local Emergency Declaration in connection with the December 2024 Municipal Wharf emergency.

BACKGROUND: On December 23, 2024, at approximately 12:45 p.m., approximately 180 ft. at the southernmost end of the Santa Cruz Municipal Wharf collapsed into the ocean following a historic wave event. The collapsed section, which had been damaged in the 2023/2024 Winter Storms, was under construction for repairs at the time of the collapse. As a result of the damage, the Wharf, Cowell Beach, and Main Beach were temporarily closed out of concerns for public safety. On December 24, 2024, the City Manager issued a “Proclamation of Existence of Local Emergency.” The City Manager re-issued the Proclamation of Existence of Local Emergency on December 31, 2024, and January 7, 2025.

On June 6 - 8, 2025, the City, in coordination with the United States Coast Guard and Power Engineering Construction Company, conducted operations to remove heavy equipment and debris from the sea floor adjacent to the Wharf. The City’s debris cleanup efforts continued through Summer 2025. Wharf repairs from this storm event have not yet been completed.

DISCUSSION: Government Code section 8630 authorizes a governing body of a city or an official designated by ordinance to proclaim the existence of a local emergency. Santa Cruz Municipal Code section 2.20.030 empowers the Director of Emergency Services to proclaim the existence or threatened existence of a local emergency when the City is affected or likely to be affected by a public calamity or disaster, subject to confirmation by the City Council at the “earliest practicable time.” During the existence of such emergency, the Director of Emergency Services is also authorized, pursuant to Section 2.20.040(1), to “[m]ake and issue rules and regulations on matters reasonably related to the protection of life and property as affected by such emergency,” also subject to confirmation by the City Council “at the earliest practicable time.”
In light of the circumstances described above, the City Manager declared the existence of a local emergency in the City of Santa Cruz on December 24, 2024, and declared the continued

11.1 existence of a local emergency on December 31, 2024, and January 7, 2025. The City Council ratified the emergency declaration by Resolution No. NS-30,423 at its January 14, 2025 regular meeting.

The attached resolution, if adopted by the City Council, would extend the emergency declaration related to the December 2024 Wharf emergency by an additional 60 days, to November 29, 2025.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under CEQA because it will not “cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.” (Pub. Resources Code, § 21065.)
HEALTH IN ALL POLICIES (HiAP): This action is consistent with the three pillars of HiAP.

Specifically, the pillars of public health and sustainability in that the resolution is intended to aid the City in clean up and recovery efforts to protect the environment and public health and safety along the Wharf and City beaches.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: None.

Prepared By:

Kaylen Anderson
Deputy City Attorney
Submitted By:

Tony Condotti
City Attorney
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

11.2 RESOLUTION NO. NS-30,XXX

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

THE LOCAL EMERGENCY DECLARATION IN CONNECTION WITH
THE DECEMBER 2024 WHARF EMERGENCY
WHEREAS, Government Code section 8630 authorizes the City Council or an official designated by ordinance to proclaim the existence of a local emergency; and WHEREAS, Santa Cruz Municipal Code section 2.20.030 empowers the City Manager, as the director of emergency services, to proclaim the existence or threatened existence of a local emergency when the City of Santa Cruz (“City”) is affected or likely to be affected by a public calamity, subject to confirmation by the City Council at the earliest practicable time; and WHEREAS, on December 23, 2024, at approximately 12:45 p.m., the City experienced a high surf event causing approximately 180 feet of a section of the Santa Cruz Municipal Wharf (the “Wharf”) to collapse into the ocean; and
WHEREAS, the City temporarily closed the remaining portions of the Wharf, Cowell Beach, and Main Beach to ensure the safety of the public. The Wharf remained closed for nearly two weeks, significantly impacting small businesses; and WHEREAS, damage to the Wharf is significant and is estimated at over $18 million and as a result, the City’s emergency response to the December 2024 Wharf Emergency is ongoing as City staff continues to assess the damage to the Wharf and impact of the debris from the Wharf; and
WHEREAS, on June 6, 7, and 8, 2025, the City coordinated with the United States Coast Guard and Power Engineering Construction Company to remove heavy equipment and debris from the sea floor adjacent to the Wharf, which remained in the ocean and posed a potential threat to the shoreline and vessels on the water until their removal; and WHEREAS, debris from the Wharf remained along the California coastline, requiring continued cleanup efforts at impacted sites through Summer 2025, including the Santa Cruz Harbor and Corcoran Lagoon; and
WHEREAS, as a result of the incident at the Wharf, the City Manager, as the director of emergency services, declared the existence of a local emergency on December 24, 2024, and declared the continued existence of a local emergency on December 31, 2024, and January 7, 2025; and

11.3 RESOLUTION NO. NS-30,XXX
WHEREAS, at its January 14, 2025 meeting, the City Council adopted Resolution No.

NS-30,423 declaring the existence of a State of Emergency in connection with the December 2024 Wharf Emergency, confirming the December 24, 2024, December 31, 2024, and January 7, 2025 Emergency Proclamations by the City Manager, as the director of emergency services; and
WHEREAS, on February 14, 2025, Gavin Newsom, Governor of the State of California, proclaimed the existence of a state of emergency in the County of Santa Cruz due to the December 2024 winter storm that resulted in damage to the Wharf, further highlighting the significant impact of the storm and resulting damage.

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

A. That the City Council hereby declares that the local emergency declaration adopted at its January 14, 2025 regular meeting by Resolution No. NS-30,423, and extended on March 11, 2025 by Resolution No. NS-30,447, on April 22, 2025 by Resolution No.

NS-30,460, on June 10, 2025 by Resolution No. NS-30,504, on June 24, 2025 by Resolution No. NS-30,518, and on August 12, 2025 by Resolution No. NS-30,532, shall be extended an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and B. This Resolution shall remain in full force and effect and shall thereafter terminate on the sixtieth (60th) day after its adoption, unless earlier terminated or further extended by subsequent City Council action.

PASSED AND ADOPTED this 30th day of September 2025 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

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

MINUTES OF A CITY COUNCIL MEETING
September 9, 2025
12:30 PM
Mayor Keeley opened the City Council Closed Session at 12:31 p.m. in a public meeting via Zoom and in Council Chambers, for the purpose of announcing the agenda, and receiving public testimony.

Roll Call

Present: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

Statements of Disqualification – None.

Public Comment
Mayor Keeley opened the public comment period at 12:32 p.m. There were no speakers. Mayor Keeley closed the public comment period at 12:33 p.m., at which time the meeting was closed to the public and Council adjourned to the Courtyard Conference Room.

12.1 September 9, 2025 CITY COUNCIL MINUTES 8038
Closed Session

1. Conference With Legal Counsel – Liability Claims (Government Code §54956.95) 1) Claimant: Kathryn Capaldo
2) Claimant: Gabrielle Dekock
Claims against the City of Santa Cruz
Council received a status report, took up under agenda item 12, and no reportable action was taken.

2. Conference with Legal Counsel - Existing Litigation (Government Code §54956.9(d)(1))
Purdue Pharma L.P., et al
(United States Bankruptcy Court Southern District of New York Chapter 11 Case No. 19-23649 RDD)
Council received a status report, and no reportable action was taken.

3. Conference with Legal Counsel – Anticipated Litigation (Government Code §54956.9(d)(4))
Initiation of litigation (one potential case to be discussed) This item was not discussed.

4. Real Property Negotiations (Government Code §54956.8) Property: 1070 River Street
APN: 008-661-18
Owner: City of Santa Cruz
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Arts Council Santa Cruz County Under Negotiation: Price, terms of payment, or both
Council received a status report, and no reportable action was taken.

12.2 September 9, 2025 CITY COUNCIL MINUTES 8039
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
September 9, 2025
1:30 PM
Call to Order – Mayor Keeley called the meeting to order at 1:31 p.m. in Council Chambers.

Roll Call

Present: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, Assistant City Manager M. Templeton, Assistant City Attorney C. Bronson, Deputy City Manager/Director of Economic Development and Housing B. Lipscomb, Director of Water H.

Luckenbach, Director of Parks and Recreation T. Elliot, Chief of Fire R.

Oatey, Director of Finance E. Cabell, Chief of Police B. Escalante (via Zoom), Director of Planning and Community Development L. Butler, Director of Public Works N. Nguyen, Principal Management Analyst M.

Albert, Economic Development Manager R. Unitt, Parks Superintendent M. Godsy, Senior Parks Planner N. Downing, Senior Planner R. Zhou, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B.

Bush.

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

Oral Communications
At 1:33 p.m. Mayor Keeley opened Oral Communications for members of the public who wished to speak regarding items not listed on the City Council agenda.

James Ewing-Whitman spoke regarding the Board of Supervisors meeting.

Bradley Snyder spoke regarding why he voted for Robert F. Kennedy Jr. and the potential cause of the autism spectrum.

12.3 September 9, 2025 CITY COUNCIL MINUTES 8040
Oral Communications (continued)
Dana Wagner spoke regarding Meals on Wheels and provided Council with data for the FY 2024.

Garrett spoke regarding healthcare in Santa Cruz, stating it is not as good as it is “over the hill.”
John Roskelley spoke regarding the status of his job.

Unidentified person spoke regarding the initial offer for the SEIU 521 contract.

Arden spoke regarding the SEIU 521 contract and the physical violence she has experienced as an employee at the Downtown Library.

Rene Belling spoke regarding the SEIU contract negotiations and the proposed Cost-of-Living Adjustment.

Michael Spadafore spoke regarding the Murray Street Bridge and expressed doubts with the amount of work hours Public Works cited at the previous meeting.

Hemet Vaidya spoke regarding the Bethany Curve Bridge, stating the project was not properly noticed and requested the project be put on hold.

Megan Dawson spoke regarding the mural art on the Bethany Curve Bridge, and requested the project be paused.

Dorinda Parker spoke regarding the Bethany Curve Bridge, requested the project be paused, and provided alternatives to graffiti abatement.

Jean Crawford spoke regarding the Bethany Curve Bridge, stating the project was not properly noticed, and requested the project be placed on hold and reagendized for Council’s consideration.

Unidentified person spoke regarding Pacific Avenue and making it pedestrianfriendly.

Carrie Koscielak spoke regarding SEIU 521 contract negotiations.

Patrice Boyle spoke regarding the construction on the Murray Street Bridge, and requested to be provided more updates.

Melissa Huggins spoke regarding the SEIU contract negotiations and the proposed Cost-of-Living Adjustment.

At 2:07 p.m. Mayor Keeley closed Oral Communications.

12.4 September 9, 2025 CITY COUNCIL MINUTES 8041
Presentations

5. Mayoral Proclamation Declaring September 2025 as Childhood Cancer Awareness Month
Vice Mayor Kalantari-Johnson read from and presented a proclamation to Kimberly Berrelleza with Jacob’s Heart declaring September as Childhood Cancer Awareness Month.

6. National Emergency Preparedness Month
Chief of Fire R. Oatey and Principal Management Analyst M. Albert gave a presentation on National Emergency Preparedness Month.

Presiding Officer's Announcements
Statements of Disqualification – None.

Additions and Deletions – None.

City Attorney Report on Closed Session – See page 8038 for the report.

Council Meeting Calendar

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

Consent Agenda
Councilmember O’Hara made a comment on item 13.

Director of Water H. Luckenbach responded to Council questions regarding item 19.

Vice Mayor Kalantari-Johnson made a comment on items 13, 16, and 17.

Councilmember Newsome made a comment regarding item 17.

Councilmember Brunner made a comment on item 16.

Councilmember Trigueiro made a comment regarding items 13, 14, and 16.

12.5 September 9, 2025 CITY COUNCIL MINUTES 8042
Consent Agenda (continued)
Mayor Keeley opened the public comment period. The following people spoke:

Unidentified person spoke regarding items 8, 17, and 18.

Unidentified person spoke regarding item 13.

Garrett spoke regarding item 19.

Bradley Snyder spoke regarding item 15.

Mayor Keeley closed the public comment period.

MOTION: Councilmember Golder moved, seconded by Councilmember Trigueiro, to approve the Consent Agenda.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

8. Minutes of the August 26, 2025 City Council Meeting (CC) LOCATION: None
Motion carried to approve as submitted.

9. Resolution Amending the 2025 Council Meeting Calendar (CC) LOCATION: Citywide
Resolution No. NS-30,547 was adopted amending Resolution No. NS-30,435 to revise the 2025 Council meeting calendar and cancel the October 14, 2025 regular meeting.

12.6 September 9, 2025 CITY COUNCIL MINUTES 8043
Consent Agenda (continued)

10. Designation of Councilmember O’Hara as the Voting Delegate for the Annual League of California Cities (LOCC) Conference (CN)
LOCATION: Citywide
Motion carried to designate Councilmember O’Hara as the voting delegate for the Annual League of California Cities Conference General Assembly in Long Beach October 8-10, 2025.

11. Authorize the Purchase of Equipment for the Santa Cruz Fire Department with Fire Public Safety Impact Fee Funds – Budget Adjustment (FD) LOCATION: Citywide
Motion carried to:
 Adopt Resolution No. NS-30,548 amending the FY 2026 budget to transfer funds from the Public Safety Impact Fee Fund 217, in the amount of $49,048, to the General Fund budget and add appropriations to purchase equipment for the Santa Cruz Fire Department (SCFD);
 Direct staff to purchase five (5) high rise packs with Public Safety Impact Fee funds through a cooperative purchasing agreement with L.N. Curtis in the total amount of $18,202.04;
 Direct staff to purchase fire suppression hoses to allow for the minimum outfitting compliment of the recently acquired reserve Type 3 Wildland Fire Engine (E3138) with Public Safety Impact Fee funds through a cooperative purchasing agreement with L.N. Curtis in the total amount of $8,085.28;  Direct staff to purchase fifteen (15) refurbished Self Contained Breathing Apparatus (SCBA) to outfit E3138, frontline Type 6 Wildland Fire Engine (E3144), and various chief vehicles for the department training program using Public Safety Impact Fee funds through a sole source vendor purchase with Dalmatian Fire Equipment in the total amount of $18,388.61; and  Direct staff to purchase various wildland firefighting tools for E3138 from multiple vendors in the amount of $4,372.44.

12.7 September 9, 2025 CITY COUNCIL MINUTES 8044
Consent Agenda (continued)

12. Liability Claims Filed Against the City of Santa Cruz (FN) Motion carried to reject the liability claims of 1) Kathryn Capaldo, and 2) Gabrielle Dekock, based on staff recommendation.

13. Memorial Request Honoring Former Mayor Mike Rotkin (PR) LOCATION: District 3
Motion carried to approve the installation of a memorial plaque at West Cliff above “Its Beach” in honor of Former Mayor Mike Rotkin.

14. Appointment of Two (2) Ex Officio Members to the Sister Cities Committee (PR) LOCATION: Citywide
Motion carried to approve limited term appointments of two (2) ex officio members to serve on the Sister Cities Committee.

15. Wildfire Prevention Grant – Budget Adjustment (PR)
LOCATION: District 1
Motion carried to:
 Authorize the Parks and Recreation and Fire Departments to apply for CAL FIRE Wildfire Prevention grant funds for the Santa Cruz Regional 911 Emergency Operations Center (Netcom) – Wildfire Risk Reduction Project (g3026XX) and, if awarded:
 Adopt Resolution No. NS-30,549 amending the FY 2026 revenue and expenditure budget in the amount of $315,819 for project g3026XX;  Appropriate awarded funds into the above referenced project; and  Direct the City Manager or his designee to negotiate, execute, enter into, and deliver any necessary contracts, agreements, documents and amendments required to implement the project, in a form to be approved by the City Attorney.

12.8 September 9, 2025 CITY COUNCIL MINUTES 8045
Consent Agenda (continued)

16. Measure Q Expenditure Plan and Status Update (PR)
LOCATION: Citywide
Motion carried to approve and adopt the proposed expenditure plan for City of Santa Cruz Measure Q allocation.

17. Monterey Bay Sanctuary Scenic Trail (Rail Trail) Segment 7 Phase 2 Project (c401413) – Notice of Completion (PW)
LOCATION: Districts 3 and 4
Motion carried to accept the work of Anderson Pacific Engineering Construction, Inc. (Santa Clara, CA) as completed per plans and specifications and authorize the filing of the Notice of Completion for the Monterey Bay Sanctuary Scenic Trail (Rail Trail) Segment 7 Phase 2 Project (c401413).

18. Award of Contract to MKN CPM, LLC. for On-Call Construction Management Services (WT)
LOCATION: None
Motion carried authorizing the City Manager to execute an agreement with MKN CPM, LLC. (San Jose, CA) for On-Call Construction Management Services in a form to be approved by the City Attorney and authorizing the Water Director to execute future contract amendments that do not exceed the formal bid limit.

19. Financial Planning Services for Water Rates (WT)
LOCATION: None
Motion carried to approve a contract with Bartle Wells Associates (Berkeley, CA) in a not-to-exceed amount of $199,550 for financial planning and cost-ofservice analysis for water rates.

End Consent Agenda

12.9 September 9, 2025 CITY COUNCIL MINUTES 8046
Consent Public Hearings
Mayor Keeley opened the public comment period. The following people spoke:

Garret spoke regarding item 20.

Unidentified person spoke regarding items 20 and 21.

Mayor Keeley closed the public comment period.

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

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

20. Second Reading and Final Adoption of Ordinance No. 2025-18 to Amend Municipal Code Chapter 24.04.160 to Extend the Active Life of Commercial Permits from Calendar Year 2019 through January 1, 2030 (EDH/PL) LOCATION: Citywide
Motion carried to adopt Ordinance No. 2025-18 amending Municipal Code Chapter 24.04.160 to extend the active life of commercial permits from calendar year 2019 through December 31, 2026 to January 1, 2030.

12.10 September 9, 2025 CITY COUNCIL MINUTES 8047
Consent Public Hearings (continued)

21. Second Reading and Final Adoption of Ordinance No. 2025-19 to Amend Title 18 of the Municipal Code to Align the Energy Reach Code for Major Renovations and Additions to Existing Single-Family Homes with the 2025 California Building Code Cycle (PL/CM)
LOCATION: Citywide
Motion carried to adopt Ordinance No. 2025-19 amending Municipal Code Title 18 – Buildings and Construction, amending Chapter 18.15 to modify local amendments to Title 24, Part 6 of the California Code of Regulations (California Energy Code), aligning the energy reach code for renovations and additions to existing single-family homes with the 2025 California Building Code Cycle.

CEQA determination: These amendments are consistent with the Negative Declaration approved for the City of Santa Cruz 2030 Climate Action Plan adopted by City Council on September 13, 2022. The ordinance is also exempt from CEQA under the general rule, 15061(b)(3) and per CEQA Guidelines Section 15308, Class 8, Actions by Regulatory Agencies for Protection of Natural Resources.

General Business

22. Resolution of Intention to Establish the Midtown Santa Cruz Business Improvement District (EDH)
LOCATION: Districts 1 and 2
Economic Development Manager R. Unitt gave a presentation and responded to Council questions.

Kristin Lowell, with Kristin Lowell, Inc., responded to Council questions.

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

Kay Tollini
Bradley Snyder
James Ewing-Whitman
Sonia McMoran
Dyane
Mayor Keeley closed the public comment period.

12.11 September 9, 2025 CITY COUNCIL MINUTES 8048
General Business (continued)

22. Resolution of Intention to Establish the Midtown Santa Cruz Business Improvement District (EDH) LOCATION: Districts 1 and 2 (continued) MOTION: Councilmember Brunner moved, seconded by Councilmember Trigueiro, to adopt Resolution No. NS-30,550 a Resolution of Intention to Establish the Midtown Santa Cruz Business Improvement District and Levy Assessments for Calendar Year 2026 in the Midtown Santa Cruz Business Improvement District.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

23. San Lorenzo Park Redesign Final Report (PR)
LOCATION: District 1
Superintendent of Parks M. Godsy introduced the item and responded to Council questions.

Senior Parks Planner N. Downing gave a presentation and responded to Council questions.

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

Sasha Morgan
Unidentified person
Unidentified person
Kimberly Finley
Brad Snyder
Unidentified person
Lynda Marin
Garrett
Erica Snyvich
Unidentified person
Laurie Egan
Mayor Keeley closed the public comment period.

12.12 September 9, 2025 CITY COUNCIL MINUTES 8049
General Business (continued)

23. San Lorenzo Park Redesign Final Report (PR) LOCATION: District 1 (continued) MOTION: Councilmember Trigueiro moved, seconded by Councilmember O’Hara, to:
1) Accept the San Lorenzo Park Redesign Final Report;
2) Adopt a finding of categorical exemption pursuant to sections 15262 (Feasibility and Planning Studies), 15306 (Information Collection), and 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;
3) Direct staff to evaluate a potential agreement to dedicate the Riverlands portion of San Lorenzo Park to Indigenous peoples as a living cultural landscape, in a form and scope determined through close consultation with local Tribal partners and consistent with the August 2025 San Lorenzo Park Conceptual Redesign Final Report and applicable grant, flood, and environmental requirements. Staff shall continue engagement with Tribal partners throughout this process and compensate their consultation using available project funds; and
4) Return to City Council within six months with a recommended policy to compensate Tribal partners for consultation on other City projects and ensure alignment with the City’s work on an Equitable Engagement Policy.

FRIENDLY AMENDMENT: Vice Mayor Kalantari-Johnson requested to amend #4 as follows:
4) Return to City Council within six months with a recommended policy that outlines parameters and the framework for to compensation of Tribal partners for consultation on other City projects and ensure alignment with the City’s work on an Equitable Engagement Policy. Councilmembers Trigueiro and O’Hara accepted.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

Council took a break at 4:29 p.m. and returned to the dais at 5:04 p.m.

12.13 September 9, 2025 CITY COUNCIL MINUTES 8050
Roll Call

Present: Councilmembers Trigueiro, Brunner (arrived at 5:11 p.m.), Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

Absent: None.

Public Hearing

24. 1811/1815/1819 Mission Street: CP25-0002 (APN 004-124-31, -32, -34) Appeal of the Planning Commission Approval of a Residential Demolition Authorization Permit, Lot Line Adjustment, Design Permit, and Density Bonus Request to Demolish Three Residential Dwelling Units, Combine Three Lots into One Lot, and Construct a Six-story Mixed Use Building with 67 Residential Units and Ground Floor Commercial Area on Property Located in the C-C (Community Commercial) Zone District and within the Mission Street Urban Design Plan Area. Environmental Review: Categorical Exemption 15305, Minor Alterations in Land Use Limitations and Categorical Exemption 15332, In-Fill Development Projects. Owner: Stanford@Water Development LLC. (PL)
LOCATION: District 3
Senior Planner R. Zhou gave a presentation and responded to Council questions.

Appellant Bruce Thomas gave a presentation.

The property owner spoke in opposition to the appeal.

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

David Carlson
Craig Nevlin
Joe Hutson
Dana Rayfield
Joanne Hutson
Kerri Johnson
Elizabeth Lowry
Bradley Snyder
Andrea Hutson
Unidentified person
Mayor Keeley closed the public comment period.

Appellant Bruce Thomas spoke.

12.14 September 9, 2025 CITY COUNCIL MINUTES 8051
Public Hearing (continued)

24. 1811/1815/1819 Mission Street: CP25-0002 (APN 004-124-31, -32, -34) (PL) LOCATION: District 3 (continued)
MOTION: Vice Mayor Kalantari-Johnson moved, seconded by Councilmember O’Hara, to:
 Adopt Resolution No. NS-30,551 denying the appeal thereby upholding the Planning Commission’s acknowledgement of the environmental determination (Categorical Exemption Section 15305, Class 5 and Categorical Exemption Section 15332, Class 32) and approval of the Residential Demolition Authorization Permit, Lot Line Adjustment, Design Permit, and Density Bonus request, based on the findings listed in the draft Resolution and the Conditions of Approval attached as Exhibit “A,”; and  Direct staff to increase parking enforcement for the next 3—6 months and explore adjustments to parking restrictions on Dufour Street, with particular attention to reducing double parking. Staff shall assess whether compliance improves during this period and meet with Dufour neighbor representatives as part of the evaluation.

Director of Public Works N. Nguyen responded to Council questions.

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

FRIENDLY AMENDMENT: Councilmember O’Hara requested to add direction to staff to work with the Council Ad Hoc Housing Subcommittee to evaluate ways in which the City may have greater collaboration over architectural styles, building design, and site design for proposed development, with particular attention given to the early stages of the development review process when there is a greater likelihood of design changes being incorporated. Staff should include prior time-sensitive Council direction on housing and objective standards in this direction (City Council Public Hearings 8/12/2025, 6/24/2025, 5/15/2025), discuss with the Subcommittee this calendar year, and report back in the first quarter of 2026 with policy recommendations. Vice Mayor Kalantari-Johnson accepted.

12.15 September 9, 2025 CITY COUNCIL MINUTES 8052
Public Hearing (continued)

24. 1811/1815/1819 Mission Street: CP25-0002 (APN 004-124-31, -32, -34) (PL) LOCATION: District 3 (continued)
ACTION: The motion carried with the following vote.

AYES: Councilmembers Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: Councilmember Trigueiro.

ABSENT: None.

DISQUALIFIED: None.

Staff direction:

Councilmember O’Hara requested staff to look into the City’s ability to limit delivery hours and truck sizes.

Adjournment – Councilmember Golder moved, seconded by Councilmember Trigueiro, to adjourn. By consensus City Council adjourned at 6:47 p.m.

Respectfully Submitted:

Julia Wood, Deputy City Clerk Administrator
Attest:

Bonnie Bush, City Clerk Administrator
Approved:

Fred Keeley, Mayor

12.16 City Council

AGENDA REPORT
DATE: 09/09/2025
AGENDA OF: 09/30/2025
DEPARTMENT: City Clerk
SUBJECT: Arts Commission Appointment (CC)
LOCATION: Citywide
RECOMMENDATION: Motion to approve Councilmember Brunner’s nomination of Mercedes Lewis to serve on the Arts Commission, with a term ending January 31, 2029.

BACKGROUND: The Arts Commission is comprised of members who have been nominated by each Councilmember. When a new Councilmember is elected, or if there is a vacancy for any reason, new commissioners must be nominated.

DISCUSSION: Due to the resignation of Councilmember Brunner’s previous appointee, there is a vacancy on the commission. Councilmember Brunner has nominated Mercedes Lewis to serve on the commission for the duration of the term ending January 31, 2029, eligible for reappointment.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: Not applicable. Does not require CEQA review as it does not meet the definition of a Project under CEQA as it does not have a potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.

HEALTH IN ALL POLICIES (HiAP): This is an administrative process and is not directly related to Health in All Policies.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: No impact.

13.1 Prepared By:

Bonnie Bush
City Clerk
Submitted By:

Michelle Templeton
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. MERCEDES LEWIS APPLICATION.PDF

13.2 13.3

13.4 1. Why are you interested in this position? What particular skills would you bring to the Commission/Committee/Board?
I’m committed to cultivating a vibrant and inclusive arts community in Santa Cruz—one that enhances the lives of residents and inspires visitors by celebrating creativity, cultural diversity, and innovation.

With extensive experience in arts administration, including public relations, community engagement, public art, and communications, I specialize in building the infrastructure and resources necessary for creative ecosystems to thrive. My work empowers artists and organizations to drive innovation, support the creative economy, and foster meaningful connections that enrich the broader community.

My background also includes experience in public art administration, encompassing RFP development, grant writing, DEI initiatives, arts advocacy, and cross-cultural collaboration.

These skills enable me to actively contribute to the Commission’s mission of strengthening Santa Cruz’s arts ecosystem and creating opportunities for sustainable artistic growth.

2. What types of diverse interests/experiences would you bring to the Commission/Committee/Board?
I bring a rich international perspective on the arts and culture industries, shaped by my experiences living in South Africa, the United Kingdom, and the United States. This global background has deepened my understanding of inclusivity, cultural representation, and the inner workings of creative industries.

My professional experience spans both performative and visual arts, with a strong emphasis on equity, sustainability, and accessibility. I prioritize relationship-building as a cornerstone of my work, fostering meaningful connections and partnerships that empower communities and support creatives.

Notable contributions include my involvement in the Ebb and Flow River Arts Festival, Central Coast Creative Corps, the Tannery Arts Center and Santa Cruz County’s Open Studios Art Tour.

As a member of the Lana K. Weeks cohort, I contributed to securing over $2 million in unrestricted funding for arts initiatives. I’m also part of the planning committee for the upcoming Santa Cruz Art Week 2026, led by MK Contemporary.

These experiences, coupled with my ability to collaborate across institutions and age groups, illustrate how the arts can intersect with entrepreneurship, address societal challenges, and inspire innovation. My multidisciplinary background and commitment to inclusivity equip me to bring a thoughtful, impactful approach to the Commission’s mission.

3. List community/volunteer activities with which you have been involved in the last five (5) years.
● Executive Board Member for Visit Santa Cruz County
● Museum of Art and History Board Member
● Planning Committee for Santa Cruz Art Week 2026

13.5 City Council

AGENDA REPORT
DATE: 09/16/2025
AGENDA OF: 09/30/2025
DEPARTMENT: City Clerk
SUBJECT: Historic Preservation Commission Appointment (CC) LOCATION: Citywide
RECOMMENDATION: Motion to approve Mayor Keeley's nomination of Stephanie McCormick to serve on the Historic Preservation Commission, with a term ending January 31, 2027.

BACKGROUND: The Historic Preservation Commission is comprised of members who have been nominated by each member of the Council. When a new Councilmember or Mayor is elected, or if there is a vacancy for any reason, new commissioners must be nominated.

DISCUSSION: Due to the resignation of Mayor Keeley's previous appointee, there is a vacancy on the commission. Mayor Keeley has nominated Stephanie McCormick to serve on the commission for the duration of the term ending January 31, 2027, eligible for reappointment.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: Not applicable. Does not require CEQA review as it does not meet the definition of a Project under CEQA as it does not have a potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.

HEALTH IN ALL POLICIES (HiAP): This is an administrative process and is not directly related to Health in All Policies.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: No impact.

Prepared By:

Bonnie Bush
City Clerk
Submitted By:

Michelle Templeton
Assistant City Manager
Approved By:

Matt Huffaker
City Manager

14.1 ATTACHMENTS:

1. STEPHANIE MCCORMICK APPLICATION.PDF

14.2 14.3

14.4 City Council

AGENDA REPORT
DATE: 09/10/2025
AGENDA OF: 09/30/2025
DEPARTMENT: City Council
SUBJECT: Support Efforts to Strengthen Opposition to Offshore Oil Drilling (CN) LOCATION: Citywide
RECOMMENDATION: Motion to:
1) Support Santa Cruz County’s commitments to oppose the federal offshore oil drilling proposal by agreeing to join the local coordination effort; and
2) Direct staff to 1) return to City Council with a cooperative agreement or equivalent that defines the scope of work, terms and City involvement and 2) identify a funding source for the County requested Phase 1 contribution of $29,000 and the County requested Phase 2 contribution of $25,000.

BACKGROUND: In the 1980s, the City of Santa Cruz along with Santa Cruz and Monterey Counties helped form the Central Coast Outer Continental Shelf (OCS) Regional Studies Program to coordinate science, policy and public engagement on OCS proposals, strengthening the case that drilling threatened coastal economies and resources. This effort was successful in preventing several federal proposals to open oil and gas drilling in the OCS and led to the establishment of several marine sanctuaries including the Monterey Bay National Marine Sanctuary.

The current federal administration is attempting to overturn successful protections of our local marine environment. In early 2025, the U.S. Department of Interior’s Five-Year OCS Oil and Gas Leasing Program indicated the intention of offering new areas of the California Coast to the offshore drilling industry, even within the boundaries of National Marine Sanctuaries.

On June 10, 2025, the City Council unanimously adopted a resolution confirming the City’s commitment to prohibiting offshore drilling in the Monterey Bay National Marine Sanctuary and directed the Mayor to send a letter opposing the proposed 11th National OCS Oil and Gas Leasing Program (Program). In doing so, the City joined numerous local and state governments in opposing the latest federal effort to allow oil drilling in environmentally sensitive ocean areas.

The County of Santa Cruz Board of Supervisors (Board) also opposed the federal proposal and, on June 22, 2025, the Board approved launching an anti-offshore oil drilling local coordination

15.1 effort among local communities in California to oppose the proposed offshore oil drilling program, calling for multi-jurisdictional support of this effort.

DISCUSSION: In order to preserve these long-standing protections, the County has requested the City join them to re-invigorate the local and state coordinated efforts in opposition of the federal Program. Santa Cruz County is leading a two-phase effort to strengthen opposition to offshore oil drilling in Santa Cruz County by forming a Local Government OCS Coordination Program.

For Phase 1, the County has hired Richard Charter as the coordinator of the intergovernmental effort to oppose the federal Program. Mr. Charter has been coordinating opposition to offshore oil drilling both statewide and nationally since 1980.

In Phase 2, Save our Shores will be hired to work with Mr. Charter and collaborate with local jurisdictions and stakeholders to support any policy work needed. The County is requesting participation and financial support from other cities in Santa Cruz County to support the activities of developing and implementing a Local Government OCS Coordination Program.

In keeping with and building upon the City’s strong support to oppose the 1980’s federal effort to initiate oil drilling along the California coast and around Monterey, it is important that the City once again participate in local coordination against the federal OCS leasing proposal.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:

The proposed Council actions are not “projects” under CEQA because they do not meet all requirements set out in Pub. Resources Code § 21065.

HEALTH IN ALL POLICIES (HiAP): Joining the local coordination effort to oppose OCS oil drilling aligns with HiAP’s Sustainability pillar in that it will support the City’s ongoing efforts to fight climate change, protect our coastal resources, promote clean air, safe and clean beaches, help sustain the health of our marine life and generally protect the City’s environment.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: Yes

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: Yes FISCAL IMPACT DESCRIPTION: This particular action does not impact the General Fund.

If Council approves this recommendation, staff will identify a potential funding source for the cooperative agreement, or its equivalent. When the cooperative agreement is brought to City Council, a budget adjustment for the allocation of $29,000 from the General Fund for the Phase 1 County led Local Government OCS Coordination Program coordination will be brought before the Council for consideration. This $29,000 would help fund Mr. Charter’s coordinator role.

Phase 2 work to be completed by Save our Shores would require the City Council to approve an additional contribution of $25,000 from the City, included in the aforementioned budget adjustment.

15.2 Submitted By:

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

None.

15.3 City Council

AGENDA REPORT
DATE: 09/09/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Economic Development and Housing
SUBJECT: Resolution Authorizing the City Manager, or Designee, to Grant Waivers to Tenants of City Lease Agreements (EDH)
LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution authorizing the City Manager, or his designee, to grant waivers in an amount not to exceed $1,000 per fiscal year per tenant of City lease agreements.

BACKGROUND: The City has approximately 70-80 lease and license agreements with tenants and collects rental revenue on approximately 50 of these properties throughout the County of Santa Cruz. These are leased or licensed for commercial, residential, or non-profit uses. Of these leasable properties, most are occupied or are scheduled for occupancy by tenants and subject to a variety of lease durations, rent amounts, and other terms and conditions. Leases are prepared in a form approved by the City Attorney and approved by City Council. Economic Development and Housing (EDH) staff manage the agreements for these properties and the rental revenue goes into the General Fund and accounts of various departments, including EDH, Parks & Recreation and Public Works.

Due to the broad variety of properties and each individual use case, circumstances sometimes arise that provoke requests for waivers of fees and penalties. Such instances are difficult to anticipate and the City’s prompt response as the Landlord is essential to minimize business or operational impacts to tenants. Unless otherwise allowed per the terms of an agreement, requests for rent waivers are brought to City Council as Closed Session items for approval—an effort that often results in more administrative cost than the waiver itself.

DISCUSSION: Granting authority to the City Manager, or designee, to approve waivers of late charges and interest in an amount not to exceed $1,000 per fiscal year, per tenant, will streamline the review process. Staff will be able to provide a timely response to tenant requests, helping them with their financial security. Additionally, the expedited process will reduce the burden of staff time spent on common requests. In general, staff has recommended waivers of late charges and/or interest for tenants who have their first late payment, a death or major illness of the tenant or tenant family member, or when the City cannot verify the submittal date.

16.1 In a typical year, staff receives approximately ten requests for waivers of late charges and interest. These are evaluated on a case-by-case basis and those with merit are brought to City Council for consideration and approval. The amount of requests may vary, but requests often range from $5.00 to $1,000.00 each. For many of these, the administrative cost of staff time required to consider, process, and address requests, including preparing City Council briefings or reports, exceeds any benefit from collecting the fee or charge. With the authority to make a decision, the City as the Landlord could provide more timely responses to tenants and more efficiently manage staff capacity and public resources.

For any waiver request, EDH staff will consult with appropriate departments. Each request will be tracked to ensure the total approved requests do not exceed the threshold per fiscal year. Staff will also track requests over a span of fiscal years to analyze trends. Any cumulative waiver requests exceeding $1,000 per fiscal year, per tenant, will be brought to City Council for consideration. Additionally, at the end of each fiscal year, staff will summarize the waivers granted by the City Manager, or designee, to City Council as an FYI. An FYI will also be issued, should approved aggregate of waivers exceed $10,000 before the end of any fiscal year.

The above process excludes any rent waiver requests due to mandated Wharf closures. Until a targeted policy is finalize to manage business impacts from public safety closures of the Wharf, these requests will continue to be brought to City Council as a collective item for all applicable tenants.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:

The proposed Council action is not a “project” under CEQA because no direct or indirect physical change to the environment is anticipated by this Council action.

HEALTH IN ALL POLICIES (HiAP): The proposed action will allow the City Manager, or designee, to efficiently and effectively grant waivers of late charges and interest. This will promote sustainability with tenants by giving them financial security, which may be recognized as a social determinant of health.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: Yes

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: Rent revenues from commercial, residential, and nonprofit lease agreements are collected in several funds, including the General Fund (Fund 101), Wharf Fund (Fund 104), Kiosk Maintenance (Fund 123), City Public Trust Fund (Fund 130), Economic Development Trust Fund (Fund 136), Affordable Housing Trust Fund (Fund 279), Successor Agency (Fund 281), General Capital Improvement Projects (Fund 311), Wharf Tenant Capital Improvement Contribution (Fund 319), Refuse (Fund 731), and Parking (Fund 741).

Granting waivers would reduce the revenue collected in varying funds, depending on the approved waiver. Staff estimate the total of approved requests per fiscal year to be less than $10,000 per fiscal year based on historical data; costs, which would largely be offset by labor savings.

16.2 These waivers are not new impacts to the varying funds. Instead of the waivers being brought to City Council as multiple Closed Session items, they will be brought to City Council in a summary as an FYI.

Prepared By:

Jennifer Shelton
Principal Management
Analyst
Submitted By:

Bonnie Lipscomb
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

16.3 RESOLUTION NO. NS-XX,XXX

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

THE CITY MANAGER, OR HIS DESIGNEE, TO GRANT WAIVERS IN AN AMOUNT NOT TO EXCEED ONE THOUSAND DOLLARS ($1,000) PER FISCAL YEAR PER TENANT OF

CITY LEASE AGREEMENTS
WHEREAS, the City of Santa Cruz collects rental revenue on approximately 50 commercial, residential and non-profit properties; and
WHEREAS, a majority of these properties are either currently occupied by tenants or are scheduled to be occupied with varying lease durations, rent amounts, and other terms and conditions; and
WHEREAS, staff is often asked to approve rent waivers to tenants for various reasons; and WHEREAS, requests for rent waivers are currently brought to the City Council as Closed Session items for approval; and
WHEREAS, it is in the City’s interest to expedite the consideration of rent waivers to provide financial security to tenants; and
WHEREAS, granting authority to the City Manager, or designee, to exercise reasonable discretion in considering and approving requests for rent waivers in an amount not to exceed $1,000 per fiscal year, per tenant, will expedite the review process; and WHEREAS, waivers exceeding one thousand dollars ($1,000) per fiscal year, per tenant, will be brought to the City Council for consideration; and WHEREAS, City staff is requested to issue an Informational Report (FYI) to the City Council corresponding with any waivers granted by the City Manager each fiscal year; and WHEREAS, the City Council finds that this Resolution is not a “project” under California Environmental Quality Act (“CEQA”). Alternatively, if this Resolution is considered a “project” under CEQA, any action taken as a result of this Resolution would be exempt from CEQA under California Code of Regulations, Title 14, Division 6, Chapter 3, Article 18, Section 15061(b)(3) (common sense exemption).

16.4 RESOLUTION NO. NS-XX,XXX
2 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz as follows:

1. The foregoing recitals are true and correct.

2. The City Manager or his designee, is authorized to consider and grant waivers to tenants based on good cause in an amount not to exceed $1,000 per fiscal year per tenant of City Lease Agreements.

3. This resolution shall take effect immediately upon its adoption.

PASSED AND ADOPTED this 30th day of September, 2025, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

16.5 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Economic Development and Housing
SUBJECT: Resolution Granting Consent to the County of Santa Cruz to Form the Santa Cruz Mountains Wine Improvement District (SCMWID) (EDH) LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution granting consent to the County of Santa Cruz to form the SCMWID in the City of Santa Cruz.

BACKGROUND: The County of Santa Cruz (County) is working with the Santa Cruz Mountains Winegrowers Association (SCMWA) to form the SCMWID pursuant to the Property and Business Improvement District Law of 1994 (94 Law). The County requested the inclusion of the City of Santa Cruz in the SCMWID by a resolution requesting consent. The County resolution requesting consent is attached to this report.

The 94 Law allows for the formation of multi-jurisdictional districts, with consent of the included jurisdictions being granted to one “lead” jurisdiction. The County requested consent to act as the lead jurisdiction in the formation of the SCMWID, as shown in the Management District Plan. Adopting a resolution granting consent to the County will give the County authority to include the City of Santa Cruz in the proposed SCMWID. To form the SCMWID, the County will follow the formation proceedings specified in the 94 Law, including accepting petitions, adopting a resolution declaring its intention to form the SCMWID, holding a public meeting and public hearing, and adopting a resolution establishing the SCMWID.

DISCUSSION: Wine Improvement Districts are an evolution of the traditional Business Improvement District (BID). BIDs allow business owners to organize their efforts to increase sales and promotional efforts. Business owners within the district fund a BID, and those funds are used to provide services that the businesses desire and benefit the businesses within the BID.

BID benefits:
 They are customized to fit the needs of each destination;  They allow for a wide range of services, including: marketing programs, business promotion activities, and infrastructure improvements;
 They are designed, created, and governed by those who will pay the assessment; and  They provide a stable funding source for business promotion.

17.1 In California, BIDs are primarily formed pursuant to the 94 Law. This law allows for the creation of a special benefit assessment district to raise funds within a specific geographic area.

The key difference between BIDs and other special benefit assessment districts is that funds raised are returned to the private non-profit corporation governing the BID.

The SCMWA represents the wineries beginning just south of San Francisco and spanning the mountain range between the San Francisco Bay and the Pacific Ocean, south to the Monterey Bay. Mountain terrain, marine influence, varied micro-climates, and distinctive soils combine to produce ideal conditions for high quality winegrowing. The association consists of more than 70 wineries, most of them family-run, working to promote the unique aspects of the Santa Cruz Mountain wines and region. The small size of the wineries in this region allows for greater attention to detail and a hand-crafted wine quality that maximizes the potential of the grapes grown here. Of the approximately 15 wineries within the City limits, over half have signed a petition in favor of forming the SCMWID or have confirmed their support to participating in the SCMWID.

MANAGEMENT DISTRICT PLAN
The Management District Plan includes the proposed boundary of the SCMWID, a service plan, budget, and a proposed means of governance. The SCMWID will include all wineries, existing and in the future, located generally within the boundaries of the cities of Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville, the towns of Los Gatos, Portola Valley, and Woodside, and portions of the unincorporated areas of the Counties of Santa Cruz, Santa Clara, and San Mateo.

The annual assessment rate is one percent (1%) of gross direct to consumer sales revenue on winery sales. Beginning in the second year of the SCMWID term, the assessment rate may be increased by the Owners’ Association. The maximum increase or decrease in a year shall be no more than one-half of one percent (0.5%). The annual assessment rate is capped at a maximum rate of two percent (2%) of gross direct to consumer sales revenue on winery sales in the fiveyear term. If the assessment rate is increased, it may subsequently be decreased but shall not be decreased below a minimum of one percent (1%) of gross direct to consumer sales revenue on winery sales.

Based on the benefit received, assessments will not be collected on wholesale transactions, sales made outside of the state of California, or sales made pursuant to contracts executed prior to November 1, 2025, or whenever the SCMWID commences (whichever is later). Revenue generated from the SCMWID is intended only to fund programs and services for assessed wineries, all of which are located in California. Sales made outside of the state of California are not subject to assessment due to a lack of benefit. Assessment dollars will not be spent on any programs or activities to benefit individual wineries outside of the state of California.

Assessment dollars may be spent outside of California to elevate the reputation of the Santa Cruz Mountains as a premier winery destination with the desired outcome of increased in-person visitation to wineries paying the assessment.

The proposed SCMWID will have a five (5) year term, beginning November 1, 2025, or as soon as possible thereafter, and ending five (5) years from its start date. The assessment will be implemented beginning November 1, 2025, or as soon as the term commences. Once per year, beginning on the anniversary of SCMWID formation, there will be a thirty (30) day period in

17.2 which winery owners collectively or individually paying fifty percent (50%) or more of the assessment may protest and begin proceedings to terminate the SCMWID.

The County or a third-party collection agency shall be responsible for collecting the assessment on a quarterly basis from each assessed winery. The County or a third-party collection agency shall forward the assessments to the SCMWA, which will have the responsibility of managing SCMWID programs as provided in the Management District Plan. The County or a third-party collection agency shall be paid a fee equal to two percent (2%) of the amount of assessment collected to cover its costs of collection and administration.

SCMWID ESTABLISHMENT PROCESS
August 5, 2025 RESOLUTION OF INTENTION HEARING (COMPLETED) Upon the submission of a written petition, signed by the winery owners in the proposed SCMWID who will pay more than fifty percent (50%) of the assessments proposed to be levied, the Board of Supervisors (Board) may initiate proceedings to establish the SCMWID by the adoption of a resolution expressing its intention to establish the SCMWID.

Petition Status: Petitions in favor of SCMWID formation were submitted by 43 assessed wineries, which represent 57.36% of the total SCMWID assessment. This majority petition allows the Board to initiate proceedings for SCMWID formation at the August 5, 2025, meeting.

August 5, 2025 RESOLUTION REQUESTING CONSENT (COMPLETED) Upon adoption of the Resolution of Intention, Santa Cruz County must request consent from all jurisdictions to be included in the proposed SCMWID. Consent must be received from the jurisdictions prior to the final public hearing for their jurisdiction to be included in the established SCMWID.

No later than August 9, 2025 NOTICE (COMPLETED)
The 94 Law requires the County to mail written notice to the owners of all wineries proposed to be assessed within the SCMWID. Mailing the notice begins a mandatory forty-five (45) day period in which assessed winery owners may protest SCMWID formation.

September 9, 2025 PUBLIC MEETING (COMPLETED)
Allow public testimony on the formation of the SCMWID and levy of assessments. No Board action required.

October 21, 2025 FINAL PUBLIC HEARING
If written protests are received from the owners of wineries in the proposed SCMWID which will pay fifty percent (50%) or more of the assessments proposed to be levied, and protests are not withdrawn so as to reduce the protests to less than fifty percent (50%), no further proceedings to levy the proposed assessment shall be taken for a period of one (1) year from the date of the finding of a majority protest by the Board.

If the Board, following the public hearing, decides to establish the proposed SCMWID, the Board shall adopt a resolution of formation.

17.3 CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under CEQA because it does not have the potential to cause a physical change in the environment directly or indirectly.

HEALTH IN ALL POLICIES (HiAP): The SCMWID aligns with the equity goals of HiAP by establishing a district that promotes all wineries throughout the Santa Cruz Mountains region.

The assessment formula helps level the playing field for wineries of all sizes so they can contribute to the SCMWID based on their size and performance and receive equal benefit of the marketing and brand awareness and business improvement and special projects available only to assessed wineries. The SCMWID also creates a unified and sustainable organization to improve advocacy of the wineries as a collective to support the industry’s continued growth.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: There is no immediate fiscal impact. The City will not be involved in the administration of the SCMWID. Since the SCMWID programs are intended to increase visitation to the County, there may ultimately be an increase in sales tax collections over time.

Prepared By:

Rebecca Unitt
Economic Development
Manager
Submitted By:

Bonnie Lipscomb
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION GRANTING CONSENT.DOCX

2. COUNTY RESOLUTION NO. 159-2025 REQUESTING CONSENT.PDF

3. MANAGEMENT DISTRICT PLAN.PDF

17.4 RESOLUTION NO. NS-30,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ GRANTING

CONSENT TO THE COUNTY OF SANTA CRUZ TO FORM THE SANTA CRUZ

MOUNTAINS WINE IMPROVEMENT DISTRICT
WHEREAS, the County of Santa Cruz (County) is beginning the process to form the Santa Cruz Mountains Wine Improvement District (SCMWID) pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq., for the benefit of driving increased business sales directly to assessed wineries; and WHEREAS, the proposed SCMWID includes all wineries, existing and in the future, located generally within the boundaries of the cities of Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville; the towns of Los Gatos, Portola Valley, and Woodside; and portions of the unincorporated areas of the Counties of Santa Cruz, Santa Clara and San Mateo; and WHEREAS, the County Board of Supervisors requested consent to form the SCMWID in the City of Santa Cruz with adoption of County Resolution No. 159-2025 dated August 5, 2025; NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Santa Cruz as follows:
1) The above recitals are true and correct.
2) The County is hereby granted consent to include the City of Santa Cruz in the SCMWID, for the formation of the SCMWID and future renewals.
3) The Clerk of the City of Santa Cruz is hereby directed to transmit a certified copy of this Resolution to the Clerk of the County.
4) Staff is directed to take related implementing actions, including but not limited to updating and publishing the Master Fee Schedule and Planning and Community Development Fee Schedule to reflect the contents of this Resolution. 5) This Resolution is effective upon its adoption.

PASSED AND ADOPTED this 30th day of September, 2025 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

17.6 1
RESOLUTION NO. 159-2025

RESOLUTION OF THE SANTA CRUZ COUNTY BOARD OF SUPERVISORS

REQUESTING CONSENT OF THE CITIES OF SANTA CRUZ, SARATOGA, SCOTTS VALLEY, CAPITOLA, AND WATSONVILLE; THE TOWNS OF LOS GATOS, PORTOLA VALLEY AND WOODSIDE; AND THE COUNTIES OF

SANTA CLARA AND SAN MATEO TO FORM THE SANTA CRUZ

MOUNTAINS WINE IMPROVEMENT DISTRICT
WHEREAS, the Board of Supervisors of the County of Santa Cruz desires to begin proceedings to form the Santa Cruz Mountains Wine Improvement District (SCMWID); and
WHEREAS, winery owners have requested that the Board form the SCMWID; and WHEREAS, a portion of the territory proposed to be included in the SCMWID lies within the boundaries of the cities of Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville (cities); the towns of Los Gatos, Portola Valley, and Woodside (towns); and portions of the unincorporated areas of the counties of Santa Clara and San Mateo (counties), as shown on the map attached hereto as Exhibit A and incorporated herein by such attachment; and
WHEREAS, the area of the cities, towns, and counties which lies within the boundaries of the proposed SCMWID will, in the opinion of the Board, benefit from the improvements and activities, and the purpose sought to be accomplished by the work can best be accomplished by a single comprehensive scheme of work;

NOW, THEREFORE, BE IT RESOLVED BY THE SANTA CRUZ COUNTY BOARD OF SUPERVISORS THAT:

Section 1: The above recitals are true and correct.

Section 2: Consent of the cities, towns, and counties through their respective City Councils, Town Councils and Boards of Supervisors, is hereby requested to form the SCMWID, and to grant to the Santa Cruz County Board of Supervisors jurisdiction for all the purposes in connection with creation, operation, and future renewals of the proposed SCMWID.

Section 3: The Clerk of the Board is hereby directed to transmit a certified copy of this Resolution to the City Clerk of the cities of Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville; to the Town Clerk of the towns of Los Gatos, Portola Valley, and Woodside; and to the County Clerk of the counties of Santa Clara and San Mateo.

PASSED AND ADOPTED by the Board of Supervisors of the County of Santa Cruz, State of California, this 5th day of August, 2025, by the following vote:

Docusign Envelope ID: 379CD258-E7AD-4838-B4E6-F4983EFB31E3 Adopted 8/5/2025 Board of Supervisors
DOC-2025-627 27.c
Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.7 2
AYES: Supervisors Koenig, De Serpa, Cummings, Martinez and Hernandez NOES: None
ABSENT: None
ABSTAIN: None
______________________________
Felipe Hernandez
Chair of the Board
ATTEST: ___________________________
Juliette Rezzato
Clerk of the Board
APPROVED AS TO FORM:
______________________________
Jason M. Heath
Office of the County Counsel
Docusign Envelope ID: 379CD258-E7AD-4838-B4E6-F4983EFB31E3 Resolution 159-2025
Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5 8/6/2025
8/6/2025

17.8 3
Exhibit A: SCMWID Boundary Map
Docusign Envelope ID: 379CD258-E7AD-4838-B4E6-F4983EFB31E3 Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.9 Certificate Of Completion
Envelope Id: 379CD258-E7AD-4838-B4E6-F4983EFB31E3 Status: Completed Subject: Complete with Docusign: Resolution Requesting Consent SCMWID.pdf Source Envelope:

Document Pages: 3 Signatures: 1 Envelope Originator:

Certificate Pages: 4 Initials: 0 Peter Detlefs
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
701 Ocean Street
Santa Cruz, CA 95060
[email protected]
IP Address: 76.209.242.199
Record Tracking
Status: Original
7/11/2025 12:12:56 PM
Holder: Peter Detlefs
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: FedRamp
Storage Appliance Status: Connected Pool: County of Santa Cruz Location: Docusign Signer Events Signature Timestamp
Jason M. Heath
[email protected]
County Counsel
County of Santa Cruz
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 63.194.190.100
Sent: 7/11/2025 12:13:27 PM
Viewed: 7/11/2025 12:46:38 PM
Signed: 7/11/2025 12:47:29 PM
Electronic Record and Signature Disclosure:

Accepted: 7/11/2025 12:46:38 PM
ID: ea3475d9-678d-4b7b-b7e7-d291d83c0054
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 7/11/2025 12:13:27 PM
Certified Delivered Security Checked 7/11/2025 12:46:38 PM Signing Complete Security Checked 7/11/2025 12:47:29 PM Completed Security Checked 7/11/2025 12:47:29 PM
Payment Events Status Timestamps
Electronic Record and Signature Disclosure
Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.10 ELECTRONIC RECORD AND SIGNATURE DISCLOSURE
From time to time, County of Santa Cruz (we, us or Company) may be required by law to provide to you certain written notices or disclosures. Described below are the terms and conditions for providing to you such notices and disclosures electronically through the DocuSign system. Please read the information below carefully and thoroughly, and if you can access this information electronically to your satisfaction and agree to this Electronic Record and Signature Disclosure (ERSD), please confirm your agreement by selecting the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

Getting paper copies
At any time, you may request from us a paper copy of any record provided or made available electronically to you by us. You will have the ability to download and print documents we send to you through the DocuSign system during and immediately after the signing session and, if you elect to create a DocuSign account, you may access the documents for a limited period of time (usually 30 days) after such documents are first sent to you. After such time, if you wish for us to send you paper copies of any such documents from our office to you, you will be charged a $0.00 per-page fee. You may request delivery of such paper copies from us by following the procedure described below.

Withdrawing your consent
If you decide to receive notices and disclosures from us electronically, you may at any time change your mind and tell us that thereafter you want to receive required notices and disclosures only in paper format. How you must inform us of your decision to receive future notices and disclosure in paper format and withdraw your consent to receive notices and disclosures electronically is described below.

Consequences of changing your mind
If you elect to receive required notices and disclosures only in paper format, it will slow the speed at which we can complete certain steps in transactions with you and delivering services to you because we will need first to send the required notices or disclosures to you in paper format, and then wait until we receive back from you your acknowledgment of your receipt of such paper notices or disclosures. Further, you will no longer be able to use the DocuSign system to receive required notices and consents electronically from us or to sign electronically documents from us.

All notices and disclosures will be sent to you electronically Electronic Record and Signature Disclosure created on: 2/28/2022 5:23:37 PM Parties agreed to: Jason M. Heath
Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.11 Unless you tell us otherwise in accordance with the procedures described herein, we will provide electronically to you through the DocuSign system all required notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you during the course of our relationship with you. To reduce the chance of you inadvertently not receiving any notice or disclosure, we prefer to provide all of the required notices and disclosures to you by the same method and to the same address that you have given us. Thus, you can receive all the disclosures and notices electronically or in paper format through the paper mail delivery system. If you do not agree with this process, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us.

How to contact County of Santa Cruz:

You may contact us to let us know of your changes as to how we may contact you electronically, to request paper copies of certain information from us, and to withdraw your prior consent to receive notices and disclosures electronically as follows:

To contact us by email send messages to: [email protected] To advise County of Santa Cruz of your new email address To let us know of a change in your email address where we should send notices and disclosures electronically to you, you must send an email message to us at [email protected] and in the body of such request you must state: your previous email address, your new email address. We do not require any other information from you to change your email address.

If you created a DocuSign account, you may update it with your new email address through your account preferences.

To request paper copies from County of Santa Cruz
To request delivery from us of paper copies of the notices and disclosures previously provided by us to you electronically, you must send us an email to [email protected] and in the body of such request you must state your email address, full name, mailing address, and telephone number. We will bill you for any fees at that time, if any.

To withdraw your consent with County of Santa Cruz
To inform us that you no longer wish to receive future notices and disclosures in electronic format you may:

Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.12 i. decline to sign a document from within your signing session, and on the subsequent page, select the check-box indicating you wish to withdraw your consent, or you may; ii. send us an email to [email protected] and in the body of such request you must state your email, full name, mailing address, and telephone number. We do not need any other information from you to withdraw consent.. The consequences of your withdrawing consent for online documents will be that transactions may take a longer time to process..

Required hardware and software
The minimum system requirements for using the DocuSign system may change over time. The current system requirements are found here: https://support.docusign.com/guides/signer-guidesigning-system-requirements.

Acknowledging your access and consent to receive and sign documents electronically To confirm to us that you can access this information electronically, which will be similar to other electronic notices and disclosures that we will provide to you, please confirm that you have read this ERSD, and (i) that you are able to print on paper or electronically save this ERSD for your future reference and access; or (ii) that you are able to email this ERSD to an email address where you will be able to print on paper or save it for your future reference and access. Further, if you consent to receiving notices and disclosures exclusively in electronic format as described herein, then select the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

By selecting the check-box next to ‘I agree to use electronic records and signatures’, you confirm that:
 You can access and read this Electronic Record and Signature Disclosure; and  You can print on paper this Electronic Record and Signature Disclosure, or save or send this Electronic Record and Disclosure to a location where you can print it, for future reference and access; and
 Until or unless you notify County of Santa Cruz as described above, you consent to receive exclusively through electronic means all notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you by County of Santa Cruz during the course of your relationship with County of Santa Cruz.

Docusign Envelope ID: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5

17.13 Certificate Of Completion
Envelope Id: 0E3885AE-3042-4ABB-8613-48F9E4D04FE5 Status: Completed Subject: Complete with Docusign: Resolution 159-2025 requesting consent to form the Santa Cruz Mountains...

Source Envelope:

Document Pages: 7 Signatures: 2 Envelope Originator:

Certificate Pages: 5 Initials: 0 Elizabeth Padilla
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US &
Canada)
Stamps: 1 701 Ocean Street
Santa Cruz, CA 95060
[email protected]
IP Address: 63.194.190.100
Record Tracking
Status: Original
8/6/2025 2:55:29 PM
Holder: Elizabeth Padilla
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: FedRamp
Storage Appliance Status: Connected Pool: County of Santa Cruz Location: Docusign Signer Events Signature Timestamp
Felipe Hernandez
[email protected]
Security Level: Email, Account Authentication
(None)
Signature Adoption: Uploaded Signature Image
Using IP Address: 63.194.190.100
Sent: 8/6/2025 3:05:24 PM
Viewed: 8/6/2025 3:06:11 PM
Signed: 8/6/2025 3:06:36 PM
Electronic Record and Signature Disclosure:

Accepted: 7/17/2023 11:30:46 AM
ID: 2a2f0d4d-8f3b-4197-9c0c-4b7e9be9c82a
Juliette Rezzato
[email protected]
Chief Deputy Clerk of the Board of Supervisors
County of Santa Cruz
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 63.194.190.100
Sent: 8/6/2025 3:06:37 PM
Viewed: 8/6/2025 3:26:15 PM
Signed: 8/6/2025 3:26:29 PM
Electronic Record and Signature Disclosure:

Accepted: 5/11/2022 7:47:21 AM
ID: 050883f5-a40c-4427-bdbd-fa282a697a25
CBD eSignature
[email protected]
County of Santa Cruz
Security Level: Email, Account Authentication
(None)
Using IP Address: 63.194.190.100
Sent: 8/6/2025 3:26:30 PM
Viewed: 8/6/2025 4:01:51 PM
Signed: 8/6/2025 4:02:21 PM
Freeform Signing
Electronic Record and Signature Disclosure:

Accepted: 6/20/2024 3:08:48 PM
ID: 4b7794de-1393-406f-a9a3-56a92d4b90d7
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp

17.14 Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Peter Detlefs
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 8/6/2025 4:02:22 PM
Electronic Record and Signature Disclosure:

Accepted: 9/14/2023 11:24:46 AM
ID: 6a1b5ac8-5182-4b62-bb5f-250ad59f17f2
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 8/6/2025 3:05:24 PM
Certified Delivered Security Checked 8/6/2025 4:01:51 PM Signing Complete Security Checked 8/6/2025 4:02:21 PM
Completed Security Checked 8/6/2025 4:02:22 PM
Payment Events Status Timestamps
Electronic Record and Signature Disclosure

17.15 ELECTRONIC RECORD AND SIGNATURE DISCLOSURE
From time to time, County of Santa Cruz (we, us or Company) may be required by law to provide to you certain written notices or disclosures. Described below are the terms and conditions for providing to you such notices and disclosures electronically through the DocuSign system. Please read the information below carefully and thoroughly, and if you can access this information electronically to your satisfaction and agree to this Electronic Record and Signature Disclosure (ERSD), please confirm your agreement by selecting the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

Getting paper copies
At any time, you may request from us a paper copy of any record provided or made available electronically to you by us. You will have the ability to download and print documents we send to you through the DocuSign system during and immediately after the signing session and, if you elect to create a DocuSign account, you may access the documents for a limited period of time (usually 30 days) after such documents are first sent to you. After such time, if you wish for us to send you paper copies of any such documents from our office to you, you will be charged a $0.00 per-page fee. You may request delivery of such paper copies from us by following the procedure described below.

Withdrawing your consent
If you decide to receive notices and disclosures from us electronically, you may at any time change your mind and tell us that thereafter you want to receive required notices and disclosures only in paper format. How you must inform us of your decision to receive future notices and disclosure in paper format and withdraw your consent to receive notices and disclosures electronically is described below.

Consequences of changing your mind
If you elect to receive required notices and disclosures only in paper format, it will slow the speed at which we can complete certain steps in transactions with you and delivering services to you because we will need first to send the required notices or disclosures to you in paper format, and then wait until we receive back from you your acknowledgment of your receipt of such paper notices or disclosures. Further, you will no longer be able to use the DocuSign system to receive required notices and consents electronically from us or to sign electronically documents from us.

All notices and disclosures will be sent to you electronically Electronic Record and Signature Disclosure created on: 2/28/2022 5:23:37 PM Parties agreed to: Felipe Hernandez, Juliette Rezzato, CBD eSignature, Peter Detlefs

17.16 Unless you tell us otherwise in accordance with the procedures described herein, we will provide electronically to you through the DocuSign system all required notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you during the course of our relationship with you. To reduce the chance of you inadvertently not receiving any notice or disclosure, we prefer to provide all of the required notices and disclosures to you by the same method and to the same address that you have given us. Thus, you can receive all the disclosures and notices electronically or in paper format through the paper mail delivery system. If you do not agree with this process, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us.

How to contact County of Santa Cruz:

You may contact us to let us know of your changes as to how we may contact you electronically, to request paper copies of certain information from us, and to withdraw your prior consent to receive notices and disclosures electronically as follows:

To contact us by email send messages to: [email protected] To advise County of Santa Cruz of your new email address To let us know of a change in your email address where we should send notices and disclosures electronically to you, you must send an email message to us at [email protected] and in the body of such request you must state: your previous email address, your new email address. We do not require any other information from you to change your email address.

If you created a DocuSign account, you may update it with your new email address through your account preferences.

To request paper copies from County of Santa Cruz
To request delivery from us of paper copies of the notices and disclosures previously provided by us to you electronically, you must send us an email to [email protected] and in the body of such request you must state your email address, full name, mailing address, and telephone number. We will bill you for any fees at that time, if any.

To withdraw your consent with County of Santa Cruz
To inform us that you no longer wish to receive future notices and disclosures in electronic format you may:

17.17 i. decline to sign a document from within your signing session, and on the subsequent page, select the check-box indicating you wish to withdraw your consent, or you may; ii. send us an email to [email protected] and in the body of such request you must state your email, full name, mailing address, and telephone number. We do not need any other information from you to withdraw consent.. The consequences of your withdrawing consent for online documents will be that transactions may take a longer time to process..

Required hardware and software
The minimum system requirements for using the DocuSign system may change over time. The current system requirements are found here: https://support.docusign.com/guides/signer-guidesigning-system-requirements.

Acknowledging your access and consent to receive and sign documents electronically To confirm to us that you can access this information electronically, which will be similar to other electronic notices and disclosures that we will provide to you, please confirm that you have read this ERSD, and (i) that you are able to print on paper or electronically save this ERSD for your future reference and access; or (ii) that you are able to email this ERSD to an email address where you will be able to print on paper or save it for your future reference and access. Further, if you consent to receiving notices and disclosures exclusively in electronic format as described herein, then select the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

By selecting the check-box next to ‘I agree to use electronic records and signatures’, you confirm that:
 You can access and read this Electronic Record and Signature Disclosure; and  You can print on paper this Electronic Record and Signature Disclosure, or save or send this Electronic Record and Disclosure to a location where you can print it, for future reference and access; and
 Until or unless you notify County of Santa Cruz as described above, you consent to receive exclusively through electronic means all notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you by County of Santa Cruz during the course of your relationship with County of Santa Cruz.

17.18 2025-2030

SANTA CRUZ MOUNTAINS WINE IMPROVEMENT DISTRICT

MANAGEMENT DISTRICT PLAN
May 20, 2025 Prepared pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code Section 36600 et seq.

17.19 Contents
I. OVERVIEW ........................................................................................................................................3 II. BACKGROUND ................................................................................................................................5 III. BOUNDARY.......................................................................................................................................6 IV. ASSESSMENT BUDGET AND SERVICES................................................................................8 A. Annual Service Plan............................................................................................................ 8 B. Annual Budget .................................................................................................................. 10 C. California Constitutional Compliance .............................................................................. 11 D. Assessment........................................................................................................................ 12 E. Overdue Charges and Interest........................................................................................... 13 F. Time and Manner for Collecting Assessments................................................................. 14 V. GOVERNANCE...............................................................................................................................15 A. Owners’ Association......................................................................................................... 15 B. Brown Act and California Public Records Act Compliance ............................................ 15 C. Annual Report................................................................................................................... 15 APPENDIX 1 – LAW....................................................................................................................................16 APPENDIX 2 – ASSESSED WINERIES* ...............................................................................................28 Prepared by
Civitas
(800)999-7781
www.civitasadvisors.com

17.20 SCMWID Management District Plan 3
May 20, 2025
I. OVERVIEW
Developed by wineries in the Santa Cruz Mountains and by the Santa Cruz Mountains Winegrowers Association (SCMWA), the Santa Cruz Mountains Wine Improvement District (SCMWID) is an assessment district proposed to provide specific benefits to payors, by funding marketing & brand awareness and business improvement & special projects efforts for assessed wineries. This approach has been used successfully in other wine regions throughout the country to provide the benefit of driving increased sales revenue directly to payors.

Location: The SCMWID includes all wineries, existing and in the future, located generally within the boundaries of the cities of Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville, the towns of Los Gatos, Portola Valley, and Woodside, and portions of the unincorporated areas of the Counties of Santa Cruz, Santa Clara, and San Mateo.

A detailed boundary description and a boundary map are included in Section III of this Management District Plan (Plan).

Services: The SCMWID is designed to provide specific benefits directly to payors by increasing winery sales and revenue therefrom. Marketing, brand awareness, business improvement, and special projects efforts will promote assessed wineries in the SCMWID to increase winery sales revenue.

Budget: The total SCMWID annual assessment budget for the initial year of its five (5) year operation is anticipated to be approximately $575,000. A similar budget is expected to apply to subsequent years, but this budget is expected to fluctuate as sales do, as wineries open and close, and if the assessment rate is increased or decreased pursuant to this Management District Plan (Plan).

Cost: The annual assessment rate is one percent (1%) of gross direct to consumer sales revenue on winery sales. Beginning in the second year of the SCMWID term, the assessment rate may be increased by the Owners’ Association to a maximum rate of two percent (2%) of gross direct to consumer sales revenue on winery sales. The maximum increase or decrease in a year shall be no more than one-half of one percent (0.5%). If the assessment rate is increased, it may subsequently be decreased but shall not be decreased below a minimum of one percent (1%) of gross direct to consumer sales revenue on winery sales.

Based on the benefit received, assessments will not be collected on wholesale, purchases made outside of the state of California, or purchases made pursuant to contracts executed prior to November 1, 2025. Revenue generated from the SCMWID is intended only to provide programs and services for assessed wineries, all of which are located in California. Sales made outside of the state of California are not subject to assessment due to a lack of benefit. Assessment dollars will not be spent on any programs or activities to benefit individual wineries outside of the state of California.

Assessment dollars may be spent outside of California to elevate the notoriety of the Santa Cruz Mountains as a premier winery destination with the desired outcome of increased in-person visitation to wineries paying the assessment.

17.21 SCMWID Management District Plan 4
May 20, 2025
Collection: The County of Santa Cruz (County) or a third-party collection agency shall be responsible for collecting the assessment on a quarterly basis (including any delinquencies, overdue charges and interest) from each assessed winery located in the boundaries of the SCMWID. The County or a third-party collection agency shall take all reasonable efforts to collect the assessments from each assessed winery.

Duration: The SCMWID will have a five (5) year life, beginning on November 1, 2025, or as soon as possible thereafter, and ending five (5) years from its start date. After five (5) years, the SCMWID may be renewed pursuant to the Property and Business Improvement District Law of 1994, Streets and Highways Code section 36600 et seq. (94 Law) if winery owners support continuing the SCMWID programs.

Management: The SCMWA shall serve as the Owners’ Association to provide improvements and activities for the SCMWID. The Owners’ Association is charged with managing funds and implementing programs in accordance with this Plan, and must provide annual reports to the County.

17.22 SCMWID Management District Plan 5
May 20, 2025
II. BACKGROUND
Wine Improvement Districts (WIDs) are an evolution of the traditional Business Improvement District (BID). BIDs utilize the efficiencies of private sector operation in the market-based promotion of business districts. BIDs allow business owners to organize their efforts to increase sales and promotional efforts. Business owners within the district fund a BID, and those funds are used to provide services that the businesses desire and benefit the businesses within the district.

Business Improvement District services may include, but are not limited to:
➢ Marketing of the District
➢ Business Promotion Activities
➢ Infrastructure Improvements
In California, BIDs are formed pursuant to the 94 Law. This law allows for the creation of special benefit assessment districts to raise funds within a specific geographic area. The key difference between BIDs and other special benefit assessment districts is that funds raised are managed by the private non-profit corporation governing the district.

There are many benefits to Business Improvement Districts:
➢ Funds cannot be diverted for other government programs; ➢ Services are customized to fit the needs of each district; ➢ They allow for a wide range of services, including those listed above; ➢ Business Improvement Districts are designed, created and governed by those who will pay the assessment; and
➢ They provide a stable funding source for business promotion.

The 94 Law is provided in Appendix 1 of this document.

17.23 SCMWID Management District Plan 6
May 20, 2025
III. BOUNDARY
The SCMWID includes all wineries, existing and in the future, located generally within the boundaries of the cities Santa Cruz, Saratoga, Scotts Valley, Capitola, and Watsonville, the towns of Los Gatos, Portola Valley, and Woodside, and portions of the unincorporated areas of the Counties of Santa Cruz, Santa Clara, and San Mateo. Specifically, the boundaries of the SCMWID are as follows:

Starting at the intersection of State Route 84 and State Route 1, the boundaries proceed south along the State Route 1 until intersecting the AVA boundaries at 122°16'44" W, 37°6'16" N. It follows the boundaries of the AVA boundaries until intersecting the City of Santa Cruz where it goes south along the city boundary line until intersecting with the county line of Santa Cruz County.

It proceeds along the county line until intersecting with State Route 1 where it heads north until intersecting State Route 152. It follows along State Route 152 until 121°41'38" W, 36°59'29" N where it starts to follow the AVA boundary line heading north. When it intersects with the city limits of San Jose it goes south and west around the city limits, until continuing northwest along the AVA lines.

When it intersects with Cinnabar Hills Road at 121°49'7" W, 37°10'28" N. It follows Cinnabar Hills Road and joins Bertram Road where it continues north mering with Almaden Road and continuing to head north. Upon intersecting with the city limits of San Jose and proceeding northwest until intersecting with W Valley Freeway and heading northwest along the W Valley Freeway until intersecting with the boundary line for the city of Campbell and heading south-west until rejoining the boundary for San Jose and heading west. It jumps and continues west when intersecting with the City of Cupertino. At 122°4’21" W, 37°18'2" N the boundary line joins the AVA and follows the AVA northwest. It avoids all areas that are in the city of Cupertino and heads northwest.

At 122°5'17" W, 37°19'41" N it begins to follow the boundaries of the city of Cupertino again, heading north until merging with Interstate 280 and heading north west along the line. Upon intersecting the city of Palo Alto it follows the city boundary line south and around until the coordinates of 122°12'6" W, 37°21'30" N, where the boundaries follow the AVA boundaries heading north until intersecting Alpine Road, where it proceeds north east. When intersecting with Golden Oak Drive it heads west until turning into Peak Lane and heading south at the intersection of Peak Lane and Cervantes Road and heading east on Cervantes Road.

At the intersection with Westridge Drive it heads south until intersecting with Portola Road. It travels along Portola Road north west until turning southwest at the intersection of Wayside Road. Once Wayside Road intersects with the AVA boundaries it turns and following the AVA boundaries north.

Once it intersects with Woodside Road and Interstate 280 the boundaries head north along Woodside Road until intersecting with Fernside Street where it heads north west along the city boundary line for Redwood City. At 122°16'46" W, 37°27'37" N, it stops following Redwood City's boundary line and proceeds southwest along the boundary line for the city of Woodside. Once it intersects with Interstate 280 it proceeds north west along the interstate until intersecting with State Route 92 where it heads west along the highway until reuniting with the AVA boundaries and proceeding southwest along the AVA boundary line to the starting point.

The term “winery” as used herein means: A business, primarily used for the retail marketing and sales of wine and related goods, open to all settings at which wine and related goods can be sold, including but not limited to: publicly available settings, by appointment only reservations, or private and exclusive tastings. The term wine tasting facility includes, but is not limited to, vineyard locations with

17.24 SCMWID Management District Plan 7
May 20, 2025
onsite tastings and hospitality and retail rooms on site at producing wineries, which must be agricultural facilities used for the processing (fermentation when combined with any two of the following: crushing, pressing, aging, blending or bottling) of wine grapes into wine or the refermenting of still wine into sparkling wine, as well as stand-alone tasting rooms in commercial areas.

All wine tasting facilities must possess a Type 02 Department of Alcohol Beverage Control license or a Type 17 (Beer and Wine Wholesaler) and Type 20 (Off-Sale Beer and Wine) License combination.

A complete listing of assessed wineries within the SCMWID can be found in Appendix 2. A map of the SCMWID boundaries is shown below.

17.25 SCMWID Management District Plan 8
May 20, 2025
IV. ASSESSMENT BUDGET AND SERVICES
A. Annual Service Plan
Assessment funds will be spent to provide specific benefits conferred or privileges granted directly to the payors that are not provided to those not charged, and which do not exceed the reasonable cost to the County of conferring the benefits or granting the privileges. The privileges and services provided with the SCMWID funds are marketing & brand awareness and business improvement & special projects efforts available only to assessed wineries.

A service plan assessment budget has been developed to deliver services that benefit the assessed wineries. A detailed annual assessment budget will be developed and approved by the SCMWA. The chart below illustrates the initial annual assessment budget allocations. The total initial assessment budget is estimated to be $575,000.

Although actual revenues will fluctuate due to market conditions, the proportional allocations of the assessment budget shall remain the same. However, the County and the SCMWA Board shall have the authority to adjust budget allocations between the categories by no more than fifteen percent (15%) of the total budget per year. A description of the proposed improvements and activities for the initial year of operation is below. The same activities are proposed for subsequent years. In the event of a legal challenge against the SCMWID, any and all assessment funds may be used for the costs of defending the SCMWID. In the first year of operation, the costs of creating the SCMWID may be repaid by deducting repayment funds proportionally from budget categories. Repayment costs shall not exceed $75,000.

Each budget category includes all costs related to providing that service. For example, the marketing & brand awareness budget includes the cost of staff time dedicated to overseeing and implementing the marketing & brand awareness program. Staff time dedicated purely to administrative tasks is allocated to the administration & operations portion of the budget. The costs of an individual staff Marketing & Brand
Awareness, 55%,
$316,250
Business Improvement
& Special Projects, 10%,
$57,500
Administration
& Operations,
23%, $132,250
Contingency / Reserve, 10%,
$57,500
Collection Fee, 2%,
$11,500
Initial Annual Assessment Budget - $575,000

17.26 SCMWID Management District Plan 9
May 20, 2025
member may be allocated to multiple budget categories. The staffing levels necessary to provide the services below will be determined by the SCMWA on an as-needed basis.

Marketing & Brand Awareness
A marketing & brand awareness program will promote the SCMWID as a premium winegrowing region and as a leader in the global wine community. The marketing & brand awareness program will have a central theme of promoting the SCMWID as a desirable place to experience Santa Cruz Mountains wineries, and as a desirable area to purchase wines and other estate produced products.

The program has the goal of increasing demand for visitation to the winegrowing region, retail sales, affinity for SCMWID grapes and wines, and recognition at and for assessed wineries, and may include but is not limited to the following activities:
• Advertising – across any and all media channels to promote assessed wineries on a local, regional or national level, including but not limited to: digital, print, television, radio and strategic brand partnerships;
• Media Relations – Promoting assessed wineries through development of media relations strategies, including but not limited to: media familiarization tours, proactive media pitching and influencer relations;
• Digital Marketing – Utilizing paid, earned and owned social media to increase awareness of and engagement with assessed wineries;
• Events – Developing and executing special events that attract potential customers to assessed wineries, enhancing community engagement and visibility; • Trade & Industry Engagement – Ensuring representatives are provided the opportunity to attend trade shows, meetings, industry conferences, road shows, and events to promote assessed wineries; Create programs that engage key trade and industry influencers with the Santa Cruz Mountains;
• Print Collateral – Preparing and producing collateral, promotional materials such as brochures, flyers and maps for assessed wineries;
• Brand Enhancement – Brand development initiatives to increase awareness and demand for assessed wineries;
• Consumer Analytics – Identify and leverage consumer demographic, geographic and psychographic data to target messaging that markets Santa Cruz Mountains as a premier, unique wine destination to attract customers to assessed wineries; and • Wine Club Signups – Promote wine club membership for assessed wineries to build customer loyalty and enhance the SCMWID brand.

Business Improvement & Special Projects
The business improvement & special projects program will seek to attract and retain wineries within the SCMWID, and fund special projects designed to promote and benefit the assessed wineries. This program aims to cultivate a thriving wine community by fostering collaboration among producers and enhancing the region’s appeal as a premier destination. Through targeted initiatives, the program will empower wineries to innovate and grow their businesses sustainably. The business improvement & special projects programs may include, but is not limited to:
• Customer Engagement Projects – Develop and execute special projects that drive customer engagement with assessed wineries to increase sales;
• Signage Program – Coordinate local signage for the Santa Cruz Mountains wine region; • Training Programs – Provide training and resources for assessed wineries focused on sales, hospitality, marketing, media relations, and operational best practices to enhance staff effectiveness;

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• Educational Programs – Create educational programs for assessed wineries with the goal of increasing visitation, sales, and brand value;
• Market Research and Evaluation – Conduct comprehensive market research, fund awareness and best practice studies, and maintain a robust district database to evaluate the SCMWID’s visibility and operational success among target market segments; • Guest Communication Support – Assist assessed wineries with the development of guest communications and point-of-sale materials to enhance customer interactions; • Advocacy – Advocate for business-friendly policies that facilitate capital investment and growth opportunities throughout the SCMWID; and
• Liaison Support – Designate personnel who will serve as a liaison between winery owners and government agencies to facilitate growth and business development on assessed wineries.

Administration & Operations
The administration & operations portion of the budget shall be utilized for administrative staffing costs, office costs, advocacy, and other general administrative costs such as insurance, legal, and accounting fees.

Contingency / Reserve
The budget includes a contingency line item to account for lower than anticipated assessments. If there are contingency funds collected, they may be held in a reserve fund or utilized for other programs, administration or renewal costs at the discretion of the Owners’ Association. Policies relating to contributions to the reserve fund, the target amount of the reserve fund, and expenditure of monies from the reserve fund shall be set by the Owners’ Association. Contingency/reserve funds may be spent on SCMWID programs or administrative and renewal costs in such proportions as determined by the Owners’ Association.

Collection Fee
The County or a third-party collection agency shall be paid a fee up to two percent (2%) of the amount of assessment collected to cover its costs of collection and administration.

B. Annual Budget
The total five (5) year assessment budget is projected at approximately $575,000 annually, or approximately $4,887,500 through 2030 if maximum assessment rate increases are adopted. This amount may fluctuate as winery sales do, as wineries open and close, and if the assessment rate is increased or decreased pursuant to this Plan.

The annual assessment rate is one percent (1%) of gross direct to consumer sales revenue on winery sales. Beginning in the second year of the SCMWID term, the assessment rate may be increased by the Owners’ Association to a maximum rate of two percent (2%) of gross direct to consumer sales revenue on winery sales. The maximum increase or decrease in a year shall be no more than one-half of one percent (0.5%). If the assessment rate is increased, it may subsequently be decreased but shall not be decreased below a minimum of one percent (1%) of gross direct to consumer sales revenue on winery sales.

The table below demonstrates the estimated maximum budget with the assumption that assessment rate will be increased at the earliest opportunity, as it is a required disclosure, it is not the anticipated course of action. Alternate courses of action may be taken in regard to implementing the assessment rate increase other than what is demonstrated in the chart below, within the parameters of this Plan.

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Estimated Annual Budget if Maximum Assessment Rates are Adopted C. California Constitutional Compliance
The SCMWID assessment is not a property-based assessment subject to the requirements of Proposition 218. Courts have found Proposition 218 limited the term ‘assessments’ to levies on real property.1 Rather, the SCMWID assessment is a business-based assessment, and is subject to Proposition 26. Pursuant to Proposition 26 all levies are a tax unless they fit one of seven exceptions.

Two of these exceptions apply to the SCMWID, a “specific benefit” and a “specific government service.” Both require that the costs of benefits or services do not exceed the reasonable costs to the County of conferring the benefits or providing the services.

1. Specific Benefit
Proposition 26 requires that assessment funds be expended on, “a specific benefit conferred or privilege granted directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of conferring the benefit or granting the privilege.”2 The services in this Plan are designed to provide targeted benefits directly to assessed wineries, and are intended only to provide benefits and services directly to those wineries paying the assessment. These services are tailored not to serve the general public, businesses in general, or parcels of land, but rather to serve the specific wineries within the SCMWID. The activities described in this Plan are specifically targeted to increase sales for assessed wineries within the boundaries of the SCMWID, and are narrowly tailored. SCMWID funds will be used exclusively to provide the specific benefit of increased winery sales revenue directly to the assessees. Assessment funds shall not be used to feature non-assessed wineries in SCMWID programs, or to directly generate sales for non-assessed wineries. The activities paid for from assessment revenues are business services constituting and providing specific benefits to the assessed wineries.

The assessment imposed by this SCMWID is for a specific benefit conferred directly to the payors that is not provided to those not charged. The specific benefit conferred directly to the payors is an increase in winery sales revenue. The specific benefit of an increase in sales revenue for assessed wineries will be provided only to wineries paying the district assessment, with marketing, brand awareness, business improvement, and special projects efforts promoting wineries paying the SCMWID assessment. The marketing & brand awareness and business improvement & special projects efforts programs will be designed to increase sales revenue at each assessed winery. Because 1 Howard Jarvis Taxpayers Association v. City of San Diego (1999) 72 Cal App. 4th 230 2 Cal. Const. art XIII C § 1(e)(1)
Year
Marketing &
Brand
Awareness
Business
Improvement
& Special
Projects
Administration
& Operations
Contingency/
Reserve
Collection
Fee
Total
2025-2026 $316,250 $57,500 $132,250 $57,500 $11,500 $575,000 2026-2027 $474,375 $86,250 $198,375 $86,250 $17,250 $862,500 2027-2028 $632,500 $115,000 $264,500 $115,000 $23,000 $1,150,000 2028-2029 $632,500 $115,000 $264,500 $115,000 $23,000 $1,150,000 2029-2030 $632,500 $115,000 $264,500 $115,000 $23,000 $1,150,000 Total $2,688,125 $488,750 $1,124,125 $488,750 $97,750 $4,887,500

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they are necessary to provide the marketing & brand awareness and business improvement & special projects efforts that specifically benefit the assessed wineries, the administration and contingency services also provide the specific benefit of increased sales revenue to the wineries.

Although the SCMWID, in providing specific benefits to payors, may produce incidental benefits to non-paying businesses, the incidental benefit does not preclude the services from being considered a specific benefit. The legislature has found that, “A specific benefit is not excluded from classification as a ‘specific benefit’ merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the payor as a consequence of providing the specific benefit to the payor.” 3 2. Specific Government Service
The assessment may also be utilized to provide, “a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.” 4 The legislature has
recognized that marketing and promotions services like those to be provided by the SCMWID are government services within the meaning of Proposition 265. Further, the legislature has determined that “a specific government service is not excluded from classification as a ‘specific government service’ merely because an indirect benefit to a nonpayor occurs incidentally and without cost to the payor as a consequence of providing the specific government service to the payor.” 6 3. Reasonable Cost
SCMWID services will be implemented carefully to ensure they do not exceed the reasonable cost of such services. The full amount assessed will be used to provide the services described herein. Funds will be managed by the SCMWA and reports submitted on an annual basis to the County. Only assessed wineries will be featured in marketing materials, receive sales leads generated from SCMWIDfunded activities, be featured in advertising campaigns, and benefit from other SCMWID-funded services. The assessed winery list (Appendix 2) was compiled from records provided by each jurisdiction and complies with the requirements of the 94 Law. Pursuant to Streets and Highways Code Section 36615, the County Board of Supervisors’ (Board of Supervisors) determination of ownership is final and conclusive, with no obligation to obtain other information. Non-assessed wineries will not receive these, nor any other, SCMWID-funded services and benefits.

The SCMWID -funded programs are targeted directly to benefit assessed wineries. SCMWID funds shall only be spent to benefit the assessed wineries, and shall not be spent on that portion of any program which directly generates incidental sales for non-assessed wineries.

D. Assessment
The annual assessment rate is one percent (1%) of gross direct to consumer sales revenue on winery sales. Beginning in the second year of the SCMWID term, the assessment rate may be increased by the Owners’ Association to a maximum rate of two percent (2%) of gross direct to consumer sales revenue on winery sales. The maximum increase or decrease in a year shall be no more than one-half of one percent (0.5%). If the assessment rate is increased, it may subsequently be decreased but shall not be decreased below a minimum of one percent (1%) of gross direct to consumer sales revenue on winery sales.
3 Government Code § 53758(a)
4 Cal. Const. art XIII C § 1(e)(2)
5 Government Code § 53758(b)
6 Government Code § 53758(b)

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Based on the benefit received, assessments will not be collected on wholesale, purchases made outside of the state of California or purchases made pursuant to contracts executed prior to November 1, 2025. Revenue generated from the SCMWID is intended only to provide programs and services for assessed wineries, all of which are located in California. Sales made outside of the state of California are not subject to assessment due to a lack of benefit. Assessment dollars will not be spent on any programs or activities to benefit individual wineries outside of the state of California. Assessment dollars may be spent outside of California to elevate the notoriety of the Santa Cruz Mountains as a premier winery destination with the desired outcome of increased in-person visitation to wineries paying the assessment.

The assessment was calculated based on the total cost of the activities to be provided for the benefit of the wineries within the SCMWID with costs allocated based on the proportional benefit conferred to each winery. Activities funded by the SCMWID are specifically targeted to increase winery sales revenue at assessed wineries. All winery sales do not represent the same benefit to the payors. For example, a higher priced winery sale is of greater benefit than a lower priced winery sale because the assessee derives greater revenue. To account for this benefit differential and to make sure the benefits are proportional, an assessment formula based on a percentage of revenue has been selected. The proposed formula accurately reflects greater benefit to assessed wineries with higher priced winery sales.

The term “gross direct to consumer sales revenue” as used herein means: all direct-to-consumer (DTC) sales of wine, wine club shipments (whether shipped or picked up), tasting room sales, merchandise, food, revenue from orders placed via telemarketing, telephone, online, email, whether carried out at the time of purchase, shipped or picked up at a later date (pre-sales). “Gross direct to consumer sales revenue” shall not include any sales made outside of the state of California.

The assessment is levied upon and a direct obligation of the assessed winery. However, the assessed winery may, at its discretion, pass the assessment on to customers. The amount of assessment, if passed on to each customer, shall be disclosed in advance and separately stated from the amount charged and any other applicable taxes, and each customer shall receive a receipt for payment from the business. If the SCMWID assessment is identified separately it shall be disclosed as the “SCMWID Assessment.” The assessment is imposed solely upon, and is the sole obligation of the assessed winery even if it is passed on to customers. The California Department of Tax and Fee Administration (CDTFA) issued a written opinion that state sales tax applies to the revenue generated from business improvement district (BID) assessments on items where state sales tax is levied. In light of CDTFA’s opinion, businesses that pay both state sales tax and SCMWID assessments on sales are advised to collect sales tax on the assessment revenue.

Bonds shall not be issued.

E. Overdue Charges and Interest
The SCMWID shall reimburse the County or third-party collection agency for any costs associated with collecting unpaid assessments.

1. Original Delinquency
Any winery that fails to remit any assessment imposed by this Plan within the time required shall pay an overdue charge of ten percent (10%) of the amount of the assessment in addition to the assessment.

2. Continued Delinquency

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Any winery that fails to remit any delinquent remittance on or before a period of thirty (30) days following the date on which the remittance first became delinquent shall pay a second delinquency overdue charge of ten percent (10%) of the assessment in addition to the assessment and the ten percent (10%) overdue charge first imposed.

3. Fraud
If the County or third-party collection agency determines that the nonpayment of any remittance due under this article is due to fraud, an overdue charge of twenty-five percent (25%) of the amount of the assessment shall be added thereto in addition to the overdue charges stated in subsections one (1) and two (2) of this section.

4. Interest
In addition to the overdue charges imposed, any winery who fails to remit any assessment imposed by this section shall pay interest at the rate of one-quarter of one percent (0.25%) per month or fraction thereof on the amount of the assessment, exclusive of overdue charges, from the date on which the remittance first became delinquent until paid.

F. Time and Manner for Collecting Assessments
The SCMWID assessment will be implemented beginning November 1, 2025 or as soon as possible thereafter, and ending five (5) years from its start date. The County or a third-party collection agency will be responsible for collecting the assessment on a quarterly basis (including any delinquencies, overdue charges and interest) from each winery located in each jurisdiction within the SCMWID. The County or a third-party collection agency shall take all reasonable efforts to collect the assessments from each winery. The County or a third-party collection agency shall forward the assessments collected to the Owners’ Association.

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V. GOVERNANCE
A. Owners’ Association
The Board of Supervisors, through adoption of this Plan, has the right, pursuant to Streets and Highways Code §36651, to identify the body that shall implement the proposed program, which shall be the Owners’ Association of the SCMWID as defined in Streets and Highways Code §36612. The Board of Supervisors has determined that SCMWA shall serve as the Owners’ Association for the SCMWID.

B. Brown Act and California Public Records Act Compliance An Owners’ Association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. The Owners’ Association is, however, subject to government regulations relating to transparency, namely the Ralph M. Brown Act and the California Public Records Act. These regulations are designed to promote public accountability. The Owners’ Association acts as a legislative body under the Ralph M. Brown Act (Government Code §54950 et seq.). Thus, meetings of the SCMWA Board and certain committees must be held in compliance with the public notice and other requirements of the Brown Act.

Accordingly, the Owners’ Association shall publicly report any action taken and the vote or abstention on that action of each member present for the action. The Owners’ Association is also subject to the record keeping and disclosure requirements of the California Public Records Act.

C. Annual Report
The SCMWA shall present an annual report at the end of each year of operation to the Board of Supervisors pursuant to Streets and Highways Code §36650 (see Appendix 1). The annual report shall include:
• Any proposed changes in the boundaries of the improvement district or in any benefit zones or classification of businesses within the district.
• The improvements and activities to be provided for that fiscal year. • An estimate of the cost of providing the improvements and the activities for that fiscal year. • The method and basis of levying the assessment in sufficient detail to allow each business owner to estimate the amount of the assessment to be levied against his or her business for that fiscal year.
• The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year.
• The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.

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APPENDIX 1 – LAW
CURRENT THROUGH ALL LEGISLATION OF THE 2024 REGULAR AND SPECIAL SESSIONS

STREETS AND HIGHWAYS CODE
DIVISION 18. PARKING
PART 7. PROPERTY AND BUSINESS IMPROVEMENT DISTRICT LAW OF 1994 CHAPTER 1. General Provisions
ARTICLE 1. Declarations
36600. Citation of part

This part shall be known and may be cited as the “Property and Business Improvement District Law of 1994.” 36601. Legislative findings and declarations; Legislative guidance

The Legislature finds and declares all of the following:
(a) Businesses located and operating within business districts in some of this state’s communities are economically disadvantaged, are underutilized, and are unable to attract customers due to inadequate facilities, services, and activities in the business districts. (b) It is in the public interest to promote the economic revitalization and physical maintenance of business districts in order to create jobs, attract new businesses, and prevent the erosion of the business districts. (c) It is of particular local benefit to allow business districts to fund business related improvements, maintenance, and activities through the levy of assessments upon the businesses or real property that receive benefits from those improvements.
(d) Assessments levied for the purpose of conferring special benefit upon the real property or a specific benefit upon the businesses in a business district are not taxes for the general benefit of a city, even if property, businesses, or persons not assessed receive incidental or collateral effects that benefit them. (e) Property and business improvement districts formed throughout this state have conferred special benefits upon properties and businesses within their districts and have made those properties and businesses more useful by providing the following benefits:
(1) Crime reduction. A study by the Rand Corporation has confirmed a 12-percent reduction in the incidence of robbery and an 8-percent reduction in the total incidence of violent crimes within the 30 districts studied.
(2) Job creation.
(3) Business attraction.
(4) Business retention.
(5) Economic growth.
(6) New investments.
(f) With the dissolution of redevelopment agencies throughout the state, property and business improvement districts have become even more important tools with which communities can combat blight, promote economic opportunities, and create a clean and safe environment. (g) Since the enactment of this act, the people of California have adopted Proposition 218, which added Article XIII D to the Constitution in order to place certain requirements and restrictions on the formation of, and activities, expenditures, and assessments by property-based districts. Article XIII D of the Constitution provides that property-based districts may only levy assessments for special benefits. (h) The act amending this section is intended to provide the Legislature’s guidance with regard to this act, its interaction with the provisions of Article XIII D of the Constitution, and the determination of special benefits in property-based districts.
(1) The lack of legislative guidance has resulted in uncertainty and inconsistent application of this act, which discourages the use of assessments to fund needed improvements, maintenance, and activities in property-based districts, contributing to blight and other underutilization of property. (2) Activities undertaken for the purpose of conferring special benefits upon property to be assessed inherently produce incidental or collateral effects that benefit property or persons not assessed. Therefore, for special benefits to exist as a separate and distinct category from general benefits, the incidental or collateral effects of those special benefits are inherently part of those

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special benefits. The mere fact that special benefits produce incidental or collateral effects that benefit property or persons not assessed does not convert any portion of those special benefits or their incidental or collateral effects into general benefits. (3) It is of the utmost importance that property-based districts created under this act have clarity regarding restrictions on assessments they may levy and the proper determination of special benefits. Legislative clarity with regard to this act will provide districts with clear instructions and courts with legislative intent regarding restrictions on property-based assessments, and the manner in which special benefits should be determined.
36602. Purpose of part

The purpose of this part is to supplement previously enacted provisions of law that authorize cities to levy assessments within property and business improvement districts, to ensure that those assessments conform to all constitutional requirements and are determined and assessed in accordance with the guidance set forth in this act.

This part does not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. 36603. Preemption of authority or charter city to adopt ordinances levying assessments

Nothing in this part is intended to preempt the authority of a charter city to adopt ordinances providing for a different method of levying assessments for similar or additional purposes from those set forth in this part. A property and business improvement district created pursuant to this part is expressly exempt from the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931 (Division 4 (commencing with Section 2800)).
36603.5. Part prevails over conflicting provisions

Any provision of this part that conflicts with any other provision of law shall prevail over the other provision of law, as to districts created under this part.
36604. Severability

This part is intended to be construed liberally and, if any provision is held invalid, the remaining provisions shall remain in full force and effect. Assessments levied under this part are not special taxes.

ARTICLE 2. Definitions
36606. “Activities”

“Activities” means, but is not limited to, all of the following that benefit businesses or real property in the district:
(a) Promotion of public events.
(b) Furnishing of music in any public place.
(c) Promotion of tourism within the district.
(d) Marketing and economic development, including retail retention and recruitment. (e) Providing security, sanitation, graffiti removal, street and sidewalk cleaning, and other municipal services supplemental to those normally provided by the municipality. (f) Other services provided for the purpose of conferring special benefit upon assessed real property or specific benefits upon assessed businesses located in the district. 36606.5. “Assessment”

“Assessment” means a levy for the purpose of acquiring, constructing, installing, or maintaining improvements and providing activities that will provide certain benefits to properties or businesses located within a property and business improvement district.
36607. “Business”

“Business” means all types of businesses and includes financial institutions and professions.

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36608. “City”

“City” means a city, county, city and county, or an agency or entity created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, the public member agencies of which includes only cities, counties, or a city and county, or the State of California. 36609. “City council”

“City council” means the city council of a city or the board of supervisors of a county, or the agency, commission, or board created pursuant to a joint powers agreement and which is a city within the meaning of this part. 36609.4. “Clerk”

“Clerk” means the clerk of the legislative body.
36609.5. “General benefit”

“General benefit” means, for purposes of a property-based district, any benefit that is not a “special benefit” as defined in Section 36615.5.
36610. “Improvement”

“Improvement” means the acquisition, construction, installation, or maintenance of any tangible property with an estimated useful life of five years or more including, but not limited to, the following:
(a) Parking facilities.
(b) Benches, booths, kiosks, display cases, pedestrian shelters and signs. (c) Trash receptacles and public restrooms.
(d) Lighting and heating facilities.
(e) Decorations.
(f) Parks.
(g) Fountains.
(h) Planting areas.
(i) Closing, opening, widening, or narrowing of existing streets. (j) Facilities or equipment, or both, to enhance security of persons and property within the district. (k) Ramps, sidewalks, plazas, and pedestrian malls.
(l) Rehabilitation or removal of existing structures.
36611. “Management district plan”; “Plan”

“Management district plan” or “plan” means a proposal as defined in Section 36622. 36612. “Owners’ association”

“Owners’ association” means a private nonprofit entity that is under contract with a city to administer or implement improvements, maintenance, and activities specified in the management district plan. An owners’ association may be an existing nonprofit entity or a newly formed nonprofit entity. An owners’ association is a private entity and may not be considered a public entity for any purpose, nor may its board members or staff be considered to be public officials for any purpose. Notwithstanding this section, an owners’ association shall comply with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), at all times when matters within the subject matter of the district are heard, discussed, or deliberated, and with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code), for all records relating to activities of the district. 36614. “Property”

“Property” means real property situated within a district.

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36614.5. “Property and business improvement district”; “District”

“Property and business improvement district,” or “district,” means a property and business improvement district established pursuant to this part.
36614.6. “Property-based assessment”

“Property-based assessment” means any assessment made pursuant to this part upon real property. 36614.7. “Property-based district”

“Property-based district” means any district in which a city levies a property-based assessment. 36615. “Property owner”; “Business owner”; “Owner”

“Property owner” means any person shown as the owner of land on the last equalized assessment roll or otherwise known to be the owner of land by the city council. “Business owner” means any person recognized by the city as the owner of the business. “Owner” means either a business owner or a property owner. The city council has no obligation to obtain other information as to the ownership of land or businesses, and its determination of ownership shall be final and conclusive for the purposes of this part. Wherever this part requires the signature of the property owner, the signature of the authorized agent of the property owner shall be sufficient. Wherever this part requires the signature of the business owner, the signature of the authorized agent of the business owner shall be sufficient. 36615.5. “Special benefit”

(a) “Special benefit” means, for purposes of a property-based district, a particular and distinct benefit over and above general benefits conferred on real property located in a district or to the public at large. Special benefit includes incidental or collateral effects that arise from the improvements, maintenance, or activities of property-based districts even if those incidental or collateral effects benefit property or persons not assessed. Special benefit excludes general enhancement of property value. (b) “Special benefit” also includes, for purposes of a property-based district, a particular and distinct benefit provided directly to each assessed parcel within the district. Merely because parcels throughout an assessment district share the same special benefits does not make the benefits general. 36616. “Tenant”

“Tenant” means an occupant pursuant to a lease of commercial space or a dwelling unit, other than an owner.

ARTICLE 3. Prior Law
36617. Alternate method of financing certain improvements and activities; Effect on other provisions

This part provides an alternative method of financing certain improvements and activities. The provisions of this part shall not affect or limit any other provisions of law authorizing or providing for the furnishing of improvements or activities or the raising of revenue for these purposes. Every improvement area established pursuant to the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500) of this division) is valid and effective and is unaffected by this part.

CHAPTER 2. Establishment
36620. Establishment of property and business improvement district

A property and business improvement district may be established as provided in this chapter. 36620.5. Requirement of consent of city council

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A county may not form a district within the territorial jurisdiction of a city without the consent of the city council of that city. A city may not form a district within the unincorporated territory of a county without the consent of the board of supervisors of that county. A city may not form a district within the territorial jurisdiction of another city without the consent of the city council of the other city. 36621. Initiation of proceedings; Petition of property or business owners in proposed district

(a) Upon the submission of a written petition, signed by the property or business owners in the proposed district who will pay more than 50 percent of the assessments proposed to be levied, the city council may initiate proceedings to form a district by the adoption of a resolution expressing its intention to form a district. The amount of assessment attributable to property or a business owned by the same property or business owner that is in excess of 40 percent of the amount of all assessments proposed to be levied, shall not be included in determining whether the petition is signed by property or business owners who will pay more than 50 percent of the total amount of assessments proposed to be levied. (b) The petition of property or business owners required under subdivision (a) shall include a summary of the management district plan. That summary shall include all of the following:
(1) A map showing the boundaries of the district.
(2) Information specifying where the complete management district plan can be obtained. (3) Information specifying that the complete management district plan shall be furnished upon request.
(c) The resolution of intention described in subdivision (a) shall contain all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property or businesses within the district, a statement as to whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements do not need to be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities, and the location and extent of the proposed district. (2) A time and place for a public hearing on the establishment of the property and business improvement district and the levy of assessments, which shall be consistent with the requirements of Section 36623.
36622. Contents of management district plan

The management district plan shall include, but is not limited to, all of the following:
(a) If the assessment will be levied on property, a map of the district in sufficient detail to locate each parcel of property and, if businesses are to be assessed, each business within the district. If the assessment will be levied on businesses, a map that identifies the district boundaries in sufficient detail to allow a business owner to reasonably determine whether a business is located within the district boundaries. If the assessment will be levied on property and businesses, a map of the district in sufficient detail to locate each parcel of property and to allow a business owner to reasonably determine whether a business is located within the district boundaries.
(b) The name of the proposed district.
(c) A description of the boundaries of the district, including the boundaries of benefit zones, proposed for establishment or extension in a manner sufficient to identify the affected property and businesses included, which may be made by reference to any plan or map that is on file with the clerk. The boundaries of a proposed property assessment district shall not overlap with the boundaries of another existing property assessment district created pursuant to this part. This part does not prohibit the boundaries of a district created pursuant to this part to overlap with other assessment districts established pursuant to other provisions of law, including, but not limited to, the Parking and Business Improvement Area Law of 1989 (Part 6 (commencing with Section 36500)). This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with another business assessment district created pursuant to this part. This part does not prohibit the boundaries of a business assessment district created pursuant to this part to overlap with a property assessment district created pursuant to this part. (d) The improvements, maintenance, and activities proposed for each year of operation of the district and the estimated cost thereof. If the improvements, maintenance, and activities proposed for each year of operation are the same, a description of the first year’s proposed improvements, maintenance, and activities

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and a statement that the same improvements, maintenance, and activities are proposed for subsequent years shall satisfy the requirements of this subdivision.
(e) The total annual amount proposed to be expended for improvements, maintenance, or activities, and debt service in each year of operation of the district. If the assessment is levied on businesses, this amount may be estimated based upon the assessment rate. If the total annual amount proposed to be expended in each year of operation of the district is not significantly different, the amount proposed to be expended in the initial year and a statement that a similar amount applies to subsequent years shall satisfy the requirements of this subdivision.
(f) The proposed source or sources of financing, including the proposed method and basis of levying the assessment in sufficient detail to allow each property or business owner to calculate the amount of the assessment to be levied against their property or business. The plan also shall state whether bonds will be issued to finance improvements.
(g) The time and manner of collecting the assessments.
(h) The specific number of years in which assessments will be levied. In a new district, the maximum number of years shall be five. Upon renewal, a district shall have a term not to exceed 10 years.

Notwithstanding these limitations, a district created pursuant to this part to finance capital improvements with bonds may levy assessments until the maximum maturity of the bonds. The management district plan may set forth specific increases in assessments for each year of operation of the district. (i) The proposed time for implementation and completion of the management district plan. (j) Any proposed rules and regulations to be applicable to the district. (k)
(1) A list of the properties or businesses to be assessed, including the assessor’s parcel numbers for properties to be assessed, and a statement of the method or methods by which the expenses of a district will be imposed upon benefited real property or businesses, in proportion to the benefit received by the property or business, to defray the cost thereof. (2) In a property-based district, the proportionate special benefit derived by each identified parcel shall be determined exclusively in relationship to the entirety of the capital cost of a public improvement, the maintenance and operation expenses of a public improvement, or the cost of the activities. An assessment shall not be imposed on any parcel that exceeds the reasonable cost of the proportional special benefit conferred on that parcel. Only special benefits are assessable, and a property-based district shall separate the general benefits, if any, from the special benefits conferred on a parcel. Parcels within a property-based district that are owned or used by any city, public agency, the State of California, or the United States shall not be exempt from assessment unless the governmental entity can demonstrate by clear and convincing evidence that those publicly owned parcels in fact receive no special benefit. The value of any incidental, secondary, or collateral effects that arise from the improvements, maintenance, or activities of a propertybased district and that benefit property or persons not assessed shall not be deducted from the entirety of the cost of any special benefit or affect the proportionate special benefit derived by each identified parcel.
(3) In a property-based district, properties throughout the district may share the same special benefits. In a district with boundaries that define which parcels are to receive improvements, maintenance, or activities over and above those services provided by the city, the improvements, maintenance, or activities themselves may constitute a special benefit. The city may impose assessments that are less than the proportional special benefit conferred, but shall not impose assessments that exceed the reasonable costs of the proportional special benefit conferred. Because one or more parcels pay less than the special benefit conferred does not necessarily mean that other parcels are assessed more than the reasonable cost of their special benefit. (l) In a property-based district, a detailed engineer’s report prepared by a registered professional engineer certified by the State of California supporting all assessments contemplated by the management district plan.
(m) Any other item or matter required to be incorporated therein by the city council. 36623. Procedure to levy assessment

(a) If a city council proposes to levy a new or increased property assessment, the notice and protest and hearing procedure shall comply with Section 53753 of the Government Code. (b) If a city council proposes to levy a new or increased business assessment, the notice and protest and hearing procedure shall comply with Section 54954.6 of the Government Code, except that notice shall be

17.39 SCMWID Management District Plan 22
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mailed to the owners of the businesses proposed to be assessed. A protest may be made orally or in writing by any interested person. Every written protest shall be filed with the clerk at or before the time fixed for the public hearing. The city council may waive any irregularity in the form or content of any written protest. A written protest may be withdrawn in writing at any time before the conclusion of the public hearing. Each written protest shall contain a description of the business in which the person subscribing the protest is interested sufficient to identify the business and, if a person subscribing is not shown on the official records of the city as the owner of the business, the protest shall contain or be accompanied by written evidence that the person subscribing is the owner of the business or the authorized representative. A written protest that does not comply with this section shall not be counted in determining a majority protest.

If written protests are received from the owners or authorized representatives of businesses in the proposed district that will pay 50 percent or more of the assessments proposed to be levied and protests are not withdrawn so as to reduce the protests to less than 50 percent, no further proceedings to levy the proposed assessment against such businesses, as contained in the resolution of intention, shall be taken for a period of one year from the date of the finding of a majority protest by the city council. (c) If a city council proposes to conduct a single proceeding to levy both a new or increased property assessment and a new or increased business assessment, the notice and protest and hearing procedure for the property assessment shall comply with subdivision (a), and the notice and protest and hearing procedure for the business assessment shall comply with subdivision (b). If a majority protest is received from either the property or business owners, that respective portion of the assessment shall not be levied. The remaining portion of the assessment may be levied unless the improvement or other special benefit was proposed to be funded by assessing both property and business owners. 36624. Changes to proposed assessments

At the conclusion of the public hearing to establish the district, the city council may adopt, revise, change, reduce, or modify the proposed assessment or the type or types of improvements, maintenance, and activities to be funded with the revenues from the assessments. Proposed assessments may only be revised by reducing any or all of them. At the public hearing, the city council may only make changes in, to, or from the boundaries of the proposed property and business improvement district that will exclude territory that will not benefit from the proposed improvements, maintenance, and activities. Any modifications, revisions, reductions, or changes to the proposed assessment district shall be reflected in the notice and map recorded pursuant to Section 36627. 36625. Resolution of formation

(a) If the city council, following the public hearing, decides to establish a proposed property and business improvement district, the city council shall adopt a resolution of formation that shall include, but is not limited to, all of the following:
(1) A brief description of the proposed improvements, maintenance, and activities, the amount of the proposed assessment, a statement as to whether the assessment will be levied on property, businesses, or both within the district, a statement on whether bonds will be issued, and a description of the exterior boundaries of the proposed district, which may be made by reference to any plan or map that is on file with the clerk. The descriptions and statements need not be detailed and shall be sufficient if they enable an owner to generally identify the nature and extent of the improvements, maintenance, and activities and the location and extent of the proposed district. (2) The number, date of adoption, and title of the resolution of intention. (3) The time and place where the public hearing was held concerning the establishment of the district.
(4) A determination regarding any protests received. The city shall not establish the district or levy assessments if a majority protest was received.
(5) A statement that the properties, businesses, or properties and businesses in the district established by the resolution shall be subject to any amendments to this part. (6) A statement that the improvements, maintenance, and activities to be conferred on businesses and properties in the district will be funded by the levy of the assessments. The revenue from the levy of assessments within a district shall not be used to provide improvements, maintenance, or activities outside the district or for any purpose other than the purposes specified in the resolution of intention, as modified by the city council at the hearing concerning establishment of the district.

Notwithstanding the foregoing, improvements and activities that must be provided outside the

17.40 SCMWID Management District Plan 23
May 20, 2025
district boundaries to create a special or specific benefit to the assessed parcels or businesses may be provided, but shall be limited to marketing or signage pointing to the district. (7) A finding that the property or businesses within the area of the property and business improvement district will be benefited by the improvements, maintenance, and activities funded by the proposed assessments, and, for a property-based district, that property within the district will receive a special benefit.
(8) In a property-based district, the total amount of all special benefits to be conferred on the properties within the property-based district.
(b) The adoption of the resolution of formation and, if required, recordation of the notice and map pursuant to Section 36627 shall constitute the levy of an assessment in each of the fiscal years referred to in the management district plan.
36627. Notice and assessment diagram

Following adoption of the resolution establishing district assessments on properties pursuant to Section 36625, the clerk shall record a notice and an assessment diagram pursuant to Section 3114. No other provision of Division 4.5 (commencing with Section 3100) applies to an assessment district created pursuant to this part. 36628. Establishment of separate benefit zones within district; Categories of businesses

The city council may establish one or more separate benefit zones within the district based upon the degree of benefit derived from the improvements or activities to be provided within the benefit zone and may impose a different assessment within each benefit zone. If the assessment is to be levied on businesses, the city council may also define categories of businesses based upon the degree of benefit that each will derive from the improvements or activities to be provided within the district and may impose a different assessment or rate of assessment on each category of business, or on each category of business within each zone. 36628.5. Assessments on businesses or property owners

The city council may levy assessments on businesses or on property owners, or a combination of the two, pursuant to this part. The city council shall structure the assessments in whatever manner it determines corresponds with the distribution of benefits from the proposed improvements, maintenance, and activities, provided that any propertybased assessment conforms with the requirements set forth in paragraph (2) of subdivision (k) of Section 36622. 36629. Provisions and procedures applicable to benefit zones and business categories

All provisions of this part applicable to the establishment, modification, or disestablishment of a property and business improvement district apply to the establishment, modification, or disestablishment of benefit zones or categories of business. The city council shall, to establish, modify, or disestablish a benefit zone or category of business, follow the procedure to establish, modify, or disestablish a property and business improvement district. 36630. Expiration of district; Creation of new district

If a property and business improvement district expires due to the time limit set pursuant to subdivision (h) of Section 36622, a new management district plan may be created and the district may be renewed pursuant to this part.

CHAPTER 3. Assessments
36631. Time and manner of collection of assessments; Delinquent payments

The collection of the assessments levied pursuant to this part shall be made at the time and in the manner set forth by the city council in the resolution levying the assessment. Assessments levied on real property may be collected at the same time and in the same manner as for the ad valorem property tax, and may provide for the same lien priority and penalties for delinquent payment. All delinquent payments for assessments levied pursuant to this part may be charged interest and penalties.

17.41 SCMWID Management District Plan 24
May 20, 2025
36632. Assessments to be based on estimated benefit; Classification of real property and businesses; Exclusion of residential and agricultural property

(a) The assessments levied on real property pursuant to this part shall be levied on the basis of the estimated benefit to the real property within the property and business improvement district. The city council may classify properties for purposes of determining the benefit to property of the improvements and activities provided pursuant to this part.
(b) Assessments levied on businesses pursuant to this part shall be levied on the basis of the estimated benefit to the businesses within the property and business improvement district. The city council may classify businesses for purposes of determining the benefit to the businesses of the improvements and activities provided pursuant to this part.
(c) Properties zoned solely for residential use, or that are zoned for agricultural use, are conclusively presumed not to benefit from the improvements and service funded through these assessments, and shall not be subject to any assessment pursuant to this part. 36633. Time for contesting validity of assessment

The validity of an assessment levied under this part shall not be contested in an action or proceeding unless the action or proceeding is commenced within 30 days after the resolution levying the assessment is adopted pursuant to Section 36625. An appeal from a final judgment in an action or proceeding shall be perfected within 30 days after the entry of judgment.
36634. Service contracts authorized to establish levels of city services

The city council may execute baseline service contracts that would establish levels of city services that would continue after a property and business improvement district has been formed. 36635. Request to modify management district plan

The owners’ association may, at any time, request that the city council modify the management district plan. Any modification of the management district plan shall be made pursuant to this chapter. 36636. Modification of plan by resolution after public hearing; Adoption of resolution of intention

(a) Upon the written request of the owners’ association, the city council may modify the management district plan after conducting one public hearing on the proposed modifications. The city council may modify the improvements and activities to be funded with the revenue derived from the levy of the assessments by adopting a resolution determining to make the modifications after holding a public hearing on the proposed modifications. If the modification includes the levy of a new or increased assessment, the city council shall comply with Section 36623. Notice of all other public hearings pursuant to this section shall comply with both of the following:
(1) The resolution of intention shall be published in a newspaper of general circulation in the city once at least seven days before the public hearing.
(2) A complete copy of the resolution of intention shall be mailed by first class mail, at least 10 days before the public hearing, to each business owner or property owner affected by the proposed modification.
(b) The city council shall adopt a resolution of intention which states the proposed modification prior to the public hearing required by this section. The public hearing shall be held not more than 90 days after the adoption of the resolution of intention.
36637. Reflection of modification in notices recorded and maps

Any subsequent modification of the resolution shall be reflected in subsequent notices and maps recorded pursuant to Division 4.5 (commencing with Section 3100), in a manner consistent with the provisions of Section 36627. 36638. Assessment as government imposed fee on Civ C § 1770 transaction [Operative July 1, 2024]

17.42 SCMWID Management District Plan 25
May 20, 2025
(a) A business assessment pursuant to this part is a fee imposed by a government on the transaction for purposes of paragraph (29) of subdivision (a) of Section 1770 of the Civil Code. (b) This section shall become operative on July 1, 2024.

CHAPTER 3.5. Financing
36640. Bonds authorized; Procedure; Restriction on reduction or termination of assessments

(a) The city council may, by resolution, determine and declare that bonds shall be issued to finance the estimated cost of some or all of the proposed improvements described in the resolution of formation adopted pursuant to Section 36625, if the resolution of formation adopted pursuant to that section provides for the issuance of bonds, under the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500)) or in conjunction with Marks-Roos Local Bond Pooling Act of 1985 (Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code). Either act, as the case may be, shall govern the proceedings relating to the issuance of bonds, although proceedings under the Bond Act of 1915 may be modified by the city council as necessary to accommodate assessments levied upon business pursuant to this part. (b) The resolution adopted pursuant to subdivision (a) shall generally describe the proposed improvements specified in the resolution of formation adopted pursuant to Section 36625, set forth the estimated cost of those improvements, specify the number of annual installments and the fiscal years during which they are to be collected. The amount of debt service to retire the bonds shall not exceed the amount of revenue estimated to be raised from assessments over 30 years.
(c) Notwithstanding any other provision of this part, assessments levied to pay the principal and interest on any bond issued pursuant to this section shall not be reduced or terminated if doing so would interfere with the timely retirement of the debt.

CHAPTER 4. Governance
36650. Report by owners’ association; Approval or modification by city council

(a) The owners’ association shall cause to be prepared a report for each fiscal year, except the first year, for which assessments are to be levied and collected to pay the costs of the improvements, maintenance, and activities described in the report. The owners’ association’s first report shall be due after the first year of operation of the district. The report may propose changes, including, but not limited to, the boundaries of the property and business improvement district or any benefit zones within the district, the basis and method of levying the assessments, and any changes in the classification of property, including any categories of business, if a classification is used.
(b) The report shall be filed with the clerk and shall refer to the property and business improvement district by name, specify the fiscal year to which the report applies, and, with respect to that fiscal year, shall contain all of the following information:
(1) Any proposed changes in the boundaries of the property and business improvement district or in any benefit zones or classification of property or businesses within the district. (2) The improvements, maintenance, and activities to be provided for that fiscal year. (3) An estimate of the cost of providing the improvements, maintenance, and activities for that fiscal year.
(4) The method and basis of levying the assessment in sufficient detail to allow each real property or business owner, as appropriate, to estimate the amount of the assessment to be levied against his or her property or business for that fiscal year.
(5) The estimated amount of any surplus or deficit revenues to be carried over from a previous fiscal year.
(6) The estimated amount of any contributions to be made from sources other than assessments levied pursuant to this part.
(c) The city council may approve the report as filed by the owners’ association or may modify any particular contained in the report and approve it as modified. Any modification shall be made pursuant to Sections 36635 and 36636.

The city council shall not approve a change in the basis and method of levying assessments that would impair an authorized or executed contract to be paid from the revenues derived from the levy of

17.43 SCMWID Management District Plan 26
May 20, 2025
assessments, including any commitment to pay principal and interest on any bonds issued on behalf of the district.
36651. Designation of owners’ association to provide improvements, maintenance, and activities

The management district plan may, but is not required to, state that an owners’ association will provide the improvements, maintenance, and activities described in the management district plan. If the management district plan designates an owners’ association, the city shall contract with the designated nonprofit corporation to provide services.

CHAPTER 5. Renewal
36660. Renewal of district; Transfer or refund of remaining revenues; District term limit

(a) Any district previously established whose term has expired, or will expire, may be renewed by following the procedures for establishment as provided in this chapter. (b) Upon renewal, any remaining revenues derived from the levy of assessments, or any revenues derived from the sale of assets acquired with the revenues, shall be transferred to the renewed district. If the renewed district includes additional parcels or businesses not included in the prior district, the remaining revenues shall be spent to benefit only the parcels or businesses in the prior district. If the renewed district does not include parcels or businesses included in the prior district, the remaining revenues attributable to these parcels shall be refunded to the owners of these parcels or businesses. (c) Upon renewal, a district shall have a term not to exceed 10 years, or, if the district is authorized to issue bonds, until the maximum maturity of those bonds. There is no requirement that the boundaries, assessments, improvements, or activities of a renewed district be the same as the original or prior district.

CHAPTER 6. Disestablishment
36670. Circumstances permitting disestablishment of district; Procedure

(a) Any district established or extended pursuant to the provisions of this part, where there is no indebtedness, outstanding and unpaid, incurred to accomplish any of the purposes of the district, may be disestablished by resolution by the city council in either of the following circumstances:
(1) If the city council finds there has been misappropriation of funds, malfeasance, or a violation of law in connection with the management of the district, it shall notice a hearing on disestablishment.
(2) During the operation of the district, there shall be a 30-day period each year in which assessees may request disestablishment of the district. The first such period shall begin one year after the date of establishment of the district and shall continue for 30 days. The next such 30-day period shall begin two years after the date of the establishment of the district. Each successive year of operation of the district shall have such a 30-day period. Upon the written petition of the owners or authorized representatives of real property or the owners or authorized representatives of businesses in the district who pay 50 percent or more of the assessments levied, the city council shall pass a resolution of intention to disestablish the district. The city council shall notice a hearing on disestablishment.
(b) The city council shall adopt a resolution of intention to disestablish the district prior to the public hearing required by this section. The resolution shall state the reason for the disestablishment, shall state the time and place of the public hearing, and shall contain a proposal to dispose of any assets acquired with the revenues of the assessments levied within the property and business improvement district. The notice of the hearing on disestablishment required by this section shall be given by mail to the property owner of each parcel or to the owner of each business subject to assessment in the district, as appropriate. The city shall conduct the public hearing not less than 30 days after mailing the notice to the property or business owners. The public hearing shall be held not more than 60 days after the adoption of the resolution of intention.
36671. Refund of remaining revenues upon disestablishment or expiration without renewal of district; Calculation of refund; Use of outstanding revenue collected after disestablishment of district

17.44 SCMWID Management District Plan 27
May 20, 2025
(a) Upon the disestablishment or expiration without renewal of a district, any remaining revenues, after all outstanding debts are paid, derived from the levy of assessments, or derived from the sale of assets acquired with the revenues, or from bond reserve or construction funds, shall be refunded to the owners of the property or businesses then located and operating within the district in which assessments were levied by applying the same method and basis that was used to calculate the assessments levied in the fiscal year in which the district is disestablished or expires. All outstanding assessment revenue collected after disestablishment shall be spent on improvements and activities specified in the management district plan. (b) If the disestablishment occurs before an assessment is levied for the fiscal year, the method and basis that was used to calculate the assessments levied in the immediate prior fiscal year shall be used to calculate the amount of any refund.

17.45 SCMWID Management District Plan 28
May 20, 2025
APPENDIX 2 – ASSESSED WINERIES*
Owner Name Business Name Address City, State,
Zip
Doon To Earth 10 Parade St., Suite
B
Aptos CA
95003
Armitage Wines 105 C Post Office
Dr
Aptos CA
95003
Salamandre Wine Cellars
L-Pship
108 Don Carlos Dr Aptos CA
95003
Saison Winery (Formerly
Partage)
11025 Alba Rd Ben Lomond
CA 95005
Sandar And Hem Wines 111 Corte Madera
Rd
Portola Valley
CA 94028
Kissed By An Angel
Wines
1210 Mount
Hermon Road
Scotts Valley
CA 95066
Left Bend Winery 12536 Spring
Blossom Ct.

Saratoga CA
95070
Maison Areion 140 Sunrise Drive Woodside CA
94062
Roudon-Smith Winery 14572 Big Basin
Way, Suite A
Saratoga CA
95070
Regan Vineyards &
Winery
1610 Green Valley
Rd
Corralitos CA
95076
La Vida Bella Vineyard 1624 Chardonnay
Ridge Rd
Aptos CA
95003
Ridge Vineyards 17100 Montebello
Rd
Cupertino CA
95014
Kings Mountain
Vineyards
187 Kings
Mountain Road
Woodside CA
94062
Lexington Wine
Co./Thomas Fogarty
Winery & Vineyards
19501 Skyline Blvd Woodside CA
94062
Mccarthy Family Estate
Vineyards
20108 Foster Road Los Gatos CA
95033
Birichino 204 Church Street Santa Cruz CA
95060
Gali Vineyards 21 W. Main St. Los Gatos CA
95030
Sante Arcangeli Family
Wines
216-A Stage Road Pescadero CA
94060
Domaine Eden 23000 Congress
Springs Rd
Saratoga CA
95070
Silver Mountain Vineyards 269 Silver
Mountain Dr
Los Gatos CA
95033
Santa Cruz Mountain
Vineyard
334 Ingalls St Suite
A
Santa Cruz CA
95060

17.46 SCMWID Management District Plan 29
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Equinox 334 Ingalls St, Unit
C
Santa Cruz CA
95060
Aptos Vineyard 400 Belle Monti
Avenue
Aptos CA
95003
Alfaro Family Vineyards
& Winery
420 Hames Road Corralitos CA
95076
Wargin Wines 5015 Soquel Dr Soquel CA
95073
Clos De La Tech 535 Eastview Way Woodside CA
94062
Windy Oaks Estate
Vineyards & Winery
550 Hazel Dell Rd Corralitos CA
95076
Neely Wine 555 Portola Road Portola Valley
CA 94028
Ferrari Ranch Wines 65 Magnifico Vita
Lane
Corralitos CA
95076
Charmant Vineyards 800 Larsen Road Aptos CA
95003
3P Winery L.L.C. 3P Winery 3490 Soquel San
Jose Rd
Soquel CA
95073
Alamitos Winery 23505 Alamitos Rd San Jose CA
95120
Amy Dilly Preaseau and
Jacques Noel Preaseau
Valley Vista Vineyards 110 Valley View
Rd
Watsonville
CA 95076
Anatum Winery Broaddus, Christopher
James
371 Falcon View
Terr
Watsonville
CA 95076
Aptos Creek Vineyard Aptos Creek Vineyard 520 Nisene
Meadows Ct
Aptos CA
95003
Aptos Vineyard Aptos Vineyard, LLC 105 Post Office Dr
Ste C
Aptos CA
95003-3953
Aptos Vineyard, LLC Aptos Vineyard 369 Silver
Mountain Dr
Los Gatos CA
95033
Armitage Wines Corp. Armitage Wines Corp 705 Canham Rd Scotts Valley CA 95066
Arpent, LLC Birichino 825 Walnut Ave Santa Cruz CA
95060
Bargetto's Santa Cruz
Winery, Inc.

Bargetto 3535 N Main St Soquel CA
95073
Beauregard Vineyards
LLC/Partage Wine Co. LLC
Beauregard
Vineyards/Partage Wine
Co. LLC
10 Pine Flat Rd Santa Cruz CA
95060
Beauregard, Andre Jacques West Cliff Wines 704 Soquel Ave Ste B
Santa Cruz CA
95062-2333
Bhoomanchi Vineyards LLC Bhoomanchi Vineyards 369 Silver Mountain Dr
Los Gatos CA
95033

17.47 SCMWID Management District Plan 30
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Big Basin Vineyards Big Basin Vineyards LLC 525 Pacific Ave Santa Cruz CA 95060-7175
Big Basin Vineyards LLC Big Basin Vineyards 830 Memory Ln Boulder Creek CA
95006
Bottle Jack Wines Ritchey Iv, John Lloyd 328 Ingalls St D Santa Cruz CA 95060-5882
Brooks, Thomas Edwin Tom Brooks Winery 90 Country Estates Dr
Santa Cruz CA
95060-9776
Brosseau Wines LLC First Growth Wine
Company
22090 Mt Eden
Road
Saratoga CA
95070
Bruce Cantz Four Gates Winery 503 Happy Valley
Rd
Santa Cruz CA
95065
Charmant 800 Larsen Road Aptos CA
95003
Christopher Broaddus Anatum 375 Falcon View
Ter
Watsonville
CA 95076
Clos De La Tech LLC Clos De La Tech 1000 Fern Hollow
Rd
La Honda CA
94020
Clos Tita Winery Estrada, David S 4 Kendall Ln Santa Cruz CA 95066
Coastal Range Vineyards Coastal Range Vineyards,
Inc.
420 Lost Pear Way
A 24X36 Structure
Santa Cruz CA
95065-9725
Coastal Range Vineyards,
Inc.

Inversion Wines 75 Mt Hermon Rd Scotts Valley,
CA 95066
Corralitos Ridge Vineyards
Corporation/Private Vine
Wines, LLC
Corralitios Ridge
Winery
815 Almar Ave
Unit H
Santa Cruz CA
95060
Craig, Anthony Sonnet Wine Cellars 369 Silver
Mountain Dr
Los Gatos CA
95033
David Bruce Winery, Inc. David Bruce Winery 21439 Bear Creek Rd
Los Gatos CA
95033
David Lee Moulton Burrell Schoolvineyards 24060 Summit Rd Los Gatos CA 95033
Dee Vine Wines Dee Vine Wines 34 Big Tree Wy Woodside CA 94062-3775
Devincenzi Cellars LLC/A
& A Los Gatos Winery LLC
24572 Hutchinson
Rd
Los Gatos CA
95033
Donald E. Naumann Naumann Vineyards 16505 Montebello
Rd
Cupertino CA
95014
Dorsa Management
Company, LLC
La Rusticana D'Orsa 15680 Kennedy Rd Los Gatos CA
95032
Equinox Jackson, Barry Cook 427 Swift St # C Santa Cruz CA 95062
Everett Family Farm LLC Everett Family Farm, LLC 2119 Old San Jose Rd
Soquel CA
95073

17.48 SCMWID Management District Plan 31
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Farm Day Family Winery,
LLC
Farm Day Family Winery,
LLC
18157 Wagner Rd Los Gatos CA
95032-6619
Fernwood Cellars, Inc. Fernwood Cellars, Inc. 7137 Redwood Retreat Rd
Gilroy CA
95020
Florez Wines J. G. Jelks Wines L.L.C. 2487 Freedom
Blvd Unit 3
Watsonville
CA 95076-
1049
Full Circle Wines LLC Full Circle Wines 7090 Mcadams Ln Felton CA 95018-9454
Gali Vineyards, Inc. Gali Vineyards 362 Old Smith Rd Watsonville CA 95076
Garage Winemaker LLC Baccarossa 19620 Redberry Dr Los Gatos CA 95303
Garrod Trust Cooper-Garrod Vineyards 22645 Garrod Rd Saratoga CA 95070
Ghost Oaks Winery Inc. El Vaquero Winery 18 Hangar Way
Unit C
Watsonville
CA 95076
Ghost Oaks Winery, Inc. El Vaquero Winery 2901 Freedom
Blvd
Corralitos CA
95076
Gliessman, Stephen Richard Condors Hope Ranch 144 De La Costa Ave
Santa Cruz CA
95060
Green Earth Zayante Green Earth Liangs Inc 420 Old Mount Rd Felton CA 95018
Griffin Hill Vineyards, LLC 18035 Skyline Blvd Los Gatos CA 95033
Hallcrest Vineyards, Inc. Hallcrest Vineyards 379 Felton Empire Rd
Felton CA
95018
Hartmann, Robert Frank Las Nietas Vineyard 335 Via Concha Aptos CA 95003-5604
Heart O The Mountain Heart O The Mountain
LLC
705 Canham Rd Scotts Valley
CA 95066-
2729
Henry M. And Linda J.

Mchenry
Mchenry Vineyard 6821 Bonny Doon
Rd
Santa Cruz CA
95060
Hicks, Alan Ainsley Ainsley Family Vineyard 2805 Pleasant Valley Rd
Aptos CA
95003-9785
Hillcrest Winery Rexford Winery 429 Ingalls St Santa Cruz CA 95060
Hoffacker, Bernhard Joseph Portola Hills Vineyard 801 La Honda Rd Woodside CA 94062-4808
Hovis, Linda Closs Linda Vista Wines 118 Via Novella Aptos CA 95003
Hwy 9 Winery, LLC Hwy 9 Winery 120 Gail Dr Felton CA
95018-9631

17.49 SCMWID Management District Plan 32
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Integrity Wines, Lp, Integrity
Wines, LLC, Gp/Reya
Cellars, LLC
12 Hands Winery/Reya
Cellars
135 Aviation Way
Ste
16 Watsonville
CA 95062
J. Edward Muns Muns Vineyard 25600 Loma Prieta
Ave
Los Gatos CA
95033
James & Margaret A. Alberti Alberti Vineyard 106 Richardson Rd Santa Cruz CA 95065
James D. Ross And Jenny N.

Ross
Rosscienda Vineyard 1172 Redwood
Heights Rd Bldg
Aptos CA
95003
James, Kathleen Ann Charles Usher 24110 Congress
Springs Rd
Saratoga CA
95070-9706
Jeffrey M. Barranti J.M. Barranti Vineyards 24842 Skyland Rd Los Gatos CA 95033
John D. Benedetti Sante Arcangeli Family
Wines
23 Blake Ave Corralitos CA
95076
John Lloyd Ritchey Iv Bottle Jack Cellars 1088 La Madrona Dr
Santa Cruz CA
95060
Kathryn Kennedy Winery Kathryn Kennedy Winery 13180 Pierce Rd Saratoga CA 95070
Kennedy Hill Associates
LLC
Kennedy Hill Associates
LLC
15050 Kennedy Rd Los Gatos CA
95032
King, David James People's Beverage
Company, The
1214 Fair Ave Santa Cruz CA
95060-5838
Kingston Family Vineyards
LLC
Kingston Family
Vineyards
520 La Mesa Dr Portola Valley
CA 94028
Kissed By An Angel Wines,
LLC
Kissed By An Angel
Wines
2535 7Th Ave Unit
4 Santa Cruz CA
95062
Kissed By An Angel Wines,
LLC
Kissed By An Angel
Wines, LLC
75 Mt Hermon Rd Scotts Valley,
CA 95066
La Barbera Family Winery
LLC
Labarbera Family Winery 6591 Woodcliff Ct San Jose CA
95120-4551
La Madrona Vineyard And
Winery
1851 La Madrona
Dr
Santa Cruz CA
95060
La Magnifico Vita, LLC Ferrari Ranch Wines 65 Magnifico Vita Ln
Watsonville
CA 95076-
0385
La Vida Bella Vineyard, LLC La Vida Bella Vineyard 44 Oak Tree Ln Aptos CA 95003
Lago Lomita Vineyards, LLC Lago Lomita Vineyards,
LLC
25200 Loma Prieta
Ave
Los Gatos CA
95033
Lester Company, LLC Lester Estate Wines 1950 Pleasant
Valley Rd
Aptos CA
95003
Lexington Hills LLC Lexington Hills 19802 Old Santa
Cruz
Hwy
Los Gatos CA
95033

17.50 SCMWID Management District Plan 33
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Little Ridge Vineyards, LLC Little Ridge Vineyard 153 Las Colinas Rd Corralitos CA 95076
Lokteff Winery & Vineyards,
LLC
Wrights Station Vineyard
& Winery
24250 Loma Prieta
Ave
Los Gatos CA
95033
Loma Prieta Winery L.L.C. Loma Prieta Winery 26985 Loma Prieta Way
Los Gatos CA
95033
Los Altos Vineyards, LLC. Byington 21850 Bear Creek
Rd
Los Gatos CA
95030
Lost Cellars, LLC Unwritten Wines 70 Tripp Ct Woodside CA 94062-4232
M E V Corporation Mount Eden Vineyards 23000 Congress
Springs Rd
Saratoga CA
95070
M.E.V. Corporation Mount Eden Vineyards 22020 Mount
Eden Rd
Saratoga CA
95070
Madson Wines LLC Madson Wines 328 Ingalls St Ste
G
Santa Cruz CA
95060
Margins Wine Cubby Margins Wine LLC 402 Ingalls St Ste
18 Santa Cruz CA
95060-5800
Margins Wine LLC Margins Wine 2487 Freedom
Blvd
Unit 3
Watsonville
CA 95076
Martella LLC/Thomas
Fogarty Winery, LLC
Martella Wines/Thomas
Fogarty Winery
5937 Alpine Rd Portola
Valley CA
94028
Martin Ranch Winery, Inc. Martin Ranch 6675 Redwood
Retreat Rd
Gilroy CA
95020
Mayo, Keegan Keoni Mayo Cellars 1008 Cayuga St Santa Cruz CA 95062-2422
Michael & Lynne
Muccigrosso
Muccigrosso
Vineyards
21450 Bear Creek
Rd
Los Gatos CA
95033
Michael V. & Lois E. Sones Sones Cellars 334 B Ingalls St Ste B
Santa Cruz CA
95060
Mindego Ridge Winery 9645 Alpine Rd La Honda CA
94020
Mja Vineyards LLC Mja Vineyard 328 Ingalls St Santa Cruz CA 95060
Monte Roble Vineyards
LLC/Silver Mountain
Vineyards
Left Bend/Silver
Mountain Vineyard
369 Silver
Mountain
Dr
Los Gatos CA
95033
Nazario Ranch Vineyards
LLC
Nazario Ranch Vineyards 22484 Eden Valley
Ct
Saratoga CA
95070-9757
Neely Wines 575 Portola Rd Portola Valley
CA 94028

17.51 SCMWID Management District Plan 34
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Nicholson Vineyards
Winery,
Inc.

Nicholson Vineyards
Winery,
Inc.
2800 Pleasant
Valley
Rd
Aptos CA
95003
Nicolas Vonderheyden (Gp)
-
Chaine D'Or Vineyards,
Limited
Partnership
Chaine D'Or Vineyards 140 Sunrise Dr Woodside CA
94062
Old Oak Vineyard, Inc. House Family Winery 13330 Old Oak Way
Saratoga CA
95070
Overshine Wine Co Overshine Cellars, LLC 103 Stockton Ave Capitola CA 95010
P &Amp; M Staiger Staiger, Marjorie 1300 Hopkins
Gulch Rd
Boulder Creek
CA 95006
Pacific Rim Marketing Pacific Rim Marketing Inc 1306 Via Tornasol Aptos CA 95003-5654
Partage Wine Co. LLC Partage Wine 346 N Santa Cruz
Ave
Los Gatos CA
95030-7243
Patland Estate Vineyards
LLC
Patland Estate Vineyards 110 Madera Ct Los Gatos CA
95032-5720
Patrick James And Molly
Claire Surgalski
16252 Niles Rd Los Gatos CA
95033
Pelio Vineyard, LLC Pelio Vineyard 14573 Big Basin
Way
Saratoga CA
95070
Peter Serventi Serventi Ranch 65 Litchfield Ln Watsonville CA 95076
Peter Thibodeau Thibodeau Vineyard 431 Coyote Ridge
Rd
Aptos CA
95003
Phil & Peggy Crews Pelican Ranch
Winery
2364 Bean Creek
Rd Dr
Scotts Valley
CA 95066
Picchetti Winery Inc Picchetti Winery Inc 13100 Montebello Rd
Cupertino CA
95014
Pleasant Valley Vineyards Handley, Cathy Lynn 600 Pleasant Vly Rd
Aptos CA
95003
Private Vine Wines Private Vine Wines, LLC 815 Almar Ave Unit H
Santa Cruz CA
95060-5873
Prolific Vines Vineyard LLC Prolific Vines 165 Happy Acres Rd
Los Gatos CA
95032-5704
R And W Pursuits LLC R & W Vineyards 15060 Montebello
Rd
Cupertino CA
95014
Rachael Henrichsen 1120 17Th Ave
Bldg
Rear
Santa Cruz CA
95062
Radonich Bros Vineyards
LLC
Radonich Bros Vineyards
LLC
25205 Apple Hill
Rd
Los Gatos CA
95033-9719

17.52 SCMWID Management District Plan 35
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Raffaelli Vineyards, LLC Raffaelli Vineyards 3357 Chardonnay Rd
Soquel CA
95073
Randal Lee West And Larae
West
Freedom Wineworks 2321 Freedom
Blvd
Watsonville
CA 95076
Ratka, Michael Patrick Split Barrel Cider 285 Allen Rd Woodside CA 94062-4401
Redwood Ridge Estate LLC Redwood Ridge Estate 21435 Summit Rd Los Gatos CA 95033-8400
Regan Vineyards Winery,
LLC
Regan Vineyards Winery,
LLC
1772 Seascape
Blvd
Aptos CA
95003-5864
Rhys Vineyards, LLC Rhys Vineyards 11715 Skyline Blvd Los Gatos CA 95033
Richard & Mary Kay Alfaro Alfaro Family Farm
& Vineyards
496 Hames Rd Corralitos CA
95076
Ridge Vineyards, Inc. Ridge Vineyards, Inc. 18100 Montebello Rd
Cupertino CA
95014
Robert J. Goldspink Granite Ridge
Vineyard
895 Granite Ridge
Dr
Santa Cruz CA
95065
Robert's Ranch Vineyards,
Inc.

Robert’s Ranch Vineyards,
Inc.
875 Roberts Rd Ben Lomond
CA 95005
Roy S. Fellom And Roy E.

Fellom
Fellom Ranch
Vineyards
17075 Montebello
Rd
Cupertino CA
95014
Russian Ridge Winery LLC Russian Ridge Winery 20245 Skyline Blvd Woodside CA 94062-3729
Saison 346 N Santa Cruz
Ave
Los Gatos CA
95030
Santa Cruz Cider Company Santa Cruz Cider
Company LLC
65 Hanger Wy C Watsonville
CA 95076-
2476
Santa Cruz Mountain
Vineyard LLC
Santa Cruz
Mountain Vineyard
334 A Ingalls St Santa Cruz CA
95060
Santa Cruz Vineyards Santa Cruz Vineyards LPship2300 Jarvis Rd Santa Cruz CA 95065
Sante Arcangeli Family
Wines
Sante Arcangeli Family
Wines LLC
154 Aptos Village
Way C1
Aptos CA
95003
Sante Arcangeli Family
Wines LLC
Sante Arcangeli Family
Wines
79 North St Pescadero CA
94060
Savannah-Chanelle
Vineyards, Inc.
23600 Congress
Springs Rd
Saratoga CA
95070
Schroeder Schroeder &Amp;
Deits LLC
Los Gatos Wines 19135 Overlook
Rd
Los Gatos CA
95030-4115
Scotts Valley Winery, LLC Scotts Valley Winery 2364 Bean Creek Rd
Scotts Valley
CA 95066
Silver Mountain Vineyards Silver Mountain Vineyards 328 Ingalls St D Santa Cruz CA 95060-5882

17.53 SCMWID Management District Plan 36
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Sonnet 69 Silver Mountain
Dr
Los Gatos CA
95033
Soquel Vineyards 8063 Glen Haven
Rd
Soquel CA
95073
Spanish Ranch Winery, LLC Spanish Ranch
Winery
24000 Spanish
Ranch Rd
Los Gatos CA
95033
Steelhead Engineering, Inc. 1850 Day Valley
Rd
Aptos CA
95003
Stockwell Cellars, Inc. Stockwell Cellars 1100 Fair Ave Bldg A
Santa Cruz CA
95060
Storrs Winery & Vineyard,
Ltd.
1560 Pleasant
Valley Rd
Aptos CA
95003
Storrs Winery & Vineyard,
Ltd.

Storrs Winery 303 Potrero St Ste
35,8
Santa Cruz CA
95060
Strategy Partners
International
Windy Oaks Estate 380 Sweetwood
Way
Corralitos CA
95076
Sunridge Wines LLC Sunridge Wines LLC 433 Sunridge Dr Scotts Valley CA 95066-
4938
Tanuki Cider Honda, Robert Satoshi 334 Ingalls St # B Santa Cruz CA 95060-5880
Testarossa Vineyards, LLC Testarossa
Vineyards
300 College Ave Los Gatos CA
95030
The Mountain Winery 14831 Pierce Road Saratoga
The Ragavan Family 2000
Living Trust
Valencia Wineries 45 Valencia Ct Portola Valley
CA 94028-
7923
The Schaadt Wine Group,
LLC
Regale Winery And
Vineyards
24040 Summit Rd Los Gatos CA
95033
Tmr Cellars LLC Tmr Cellars, LLC 416 Bahr Dr Ben Lomond CA 95005-
9643
Tomaino, Kathryn,
Vidovich,
John, Michael & Mary Jane
Vidovich Vineyards 18101 Montebello
Rd
Cupertino CA
95014
Us Grant 2300 Jarvis Rd Santa Cruz CA
95065
Walsh Wine LLC Ser 13 Mesa Way Watsonville
CA 95076-
9656
Walsh Wine LLC Ser 427 C Swift St Santa Cruz CA
95060
Wargin Wines Wargin Wines LLC 5015 Soquel Dr Soquel CA
95073

17.54 SCMWID Management District Plan 37
May 20, 2025
Owner Name Business Name Address City, State,
Zip
Wolff And Father Wines Wolff, Leonard Frank 514 Calabasas Rd Watsonville CA 95076-
0412
Woodside Farm Vineyard
LLC
Woodside Farm Vineyard 1 Vintage Ct Woodside CA
94062
Workman, Michael Lee Weener'S Leap Cellars 14918 Three Oaks Ct
Saratoga CA
95070-5500
*The list was developed with the most reliable information provided; however, the list may contain discrepancies. This list shall include any future to-be opened businesses. Any business that may have been missed in this list, but is still within the boundaries of the SCMWID, shall also be subject to assessment.

17.55 City Council

AGENDA REPORT
DATE: 09/03/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Finance
SUBJECT: Liability Claims Filed Against the City of Santa Cruz (FN) RECOMMENDATION: Motion to reject the liability claims of 1) Alane Williamson, 2) David W. Turner, 3) Habibeh Deyhim, and deny application for leave to present late claim 4) Sabrina Shewfelt, based on staff recommendation.

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

1. Claimant: Alane Williamson
Date of occurrence: 3/4/2025
Date of claim: 8/11/2025
Amount of claim: Unspecified
Claimant seeks damages for injuries resulting from an alleged trip and fall on a sidewalk in unincorporated Santa Cruz County.

Represented by Legal Counsel

2. Claimant: David W. Turner
Date of occurrence: 8/27/2025
Date of claim: 8/28/2025
Amount of claim: Unspecified
Claimant seeks damages related to alleged violations of his civil rights.

Self-Represented

18.1 3. Claimant: Habibeh Deyhim
Date of occurrence: 3/9/2025
Date of claim: 9/8/2025
Amount of claim: Unspecified
Claimant seeks damages for injuries resulting from an alleged bicycle accident at a roundabout.

Represented by Legal Counsel
II. Denial of application for leave to present late claim:

4. Applicant: Sabrina Shewfelt
Date of Occurrence: 8/30/2024
Date of application requesting leave to present late claim: 8/26/2025 Claimant seeks approval of application for leave to present late claim to the City of Santa Cruz related to an alleged trip and fall.

Represented by Legal Counsel
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: N/A HEALTH IN ALL POLICIES (HiAP): N/A
FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: No fiscal impact.

Prepared By:

Ross Brandon
Risk & Safety Manager
Submitted By:

Elizabeth Cabell
Finance Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

None.

18.2 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Human Resources
SUBJECT: Resolution Amending the City of Santa Cruz Compensation Plan for the Public Works Department (HR)
LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution amending the Public Works Department’s Compensation Plan by correcting compensation range for Wastewater Facilities Lead Electrical/Instrumentation Technician classification.

BACKGROUND: The Wastewater Facilities Electrical Instrumentation series was previously approved for a 10% compensation increase on November 9, 2024, by Resolution No. NS-30,400.

However, the Wastewater Facilities Lead Electrical/Instrumentation classification did not receive this increase due to an administrative error resulting in a step in the series being inadvertently overlooked.

DISCUSSION: To correct the administrative error, the classification of Wastewater Facilities Lead Electrical/Instrumentation Technician salary requires a ten percent (10%) adjustment from the previous salary range of $39.9173 - $56.1577. The corrected salary range is $43.9038 - $61.7769. Since existing budgeted positions have been vacant there is no additional pay required.

The salary range in the City’s pay schedule needs to be amended through a resolution adopted by Council.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: Not applicable
HEALTH IN ALL POLICIES (HiAP): This action supports both the equity and sustainability pillars of HiAP. Correcting the salary range ensures equity within the classification series and supports recruitment and retention of skilled wastewater staff, which is critical to protecting public health and maintaining reliable environmental services.

19.1 FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: Yes

3. The recommendation creates an on-going expenditure commitment: Yes FISCAL IMPACT DESCRIPTION: Additional appropriations to account for the cost of this compensation change will be brought to City Council in the FY 2026 midyear budget adjustment in February, 2026.

Prepared By:

Swati Goel
HR Manager
Submitted By:

Sara De Leon
HR Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

19.2 RESOLUTION NO. NS-XX,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ AMENDING THE COMPENSATION PLANS AND THE FY2026 BUDGET FOR THE PUBLIC WORKS

DEPARTMENT
WHEREAS, staff has recommended certain modifications to the Compensation Plan to correct an administrative error.

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

That the City of Santa Cruz Compensation Plan be modified to:

Activity Classification No. and Title Salary (New Compensation changes)
Change Salary of
Classification
254 – Wastewater Facilities
Lead
Electrical/Instrumentation
Technician (1.0 FTE)
From: $6,919/mo - $9,734/mo
To : $7,265/mo - $10,221/mo
PASSED AND ADOPTED this 30th day of September 2025, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

19.3 City Council

AGENDA REPORT
DATE: 09/10/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Information Technology
SUBJECT: Application and Project Management Support for Information Technology Systems (IT)
LOCATION: None
RECOMMENDATION: Motion to:
1) Approve a professional services agreement and scope of work with VantagePoint Business Solutions, LLC for application and project management support of critical information technology systems. Authorize the City Manager to execute a contract in a form approved by the City Attorney. The Information Technology Director is hereby authorized to execute change orders within the approved project budget; and
2) Authorize the Information Technology Director to renew the contract for an additional two years under identical contractual terms and conditions at the end of the first contract term.

BACKGROUND: The Information Technology (IT) Department is actively managing various application-related projects, strategically emphasizing the streamlining of the City’s technology landscape and the reduction of dependence on legacy applications. To address this, the department collaborates with professional services partners and leverages advanced knowledge of the City's unique application landscape.

These collaborations have proven particularly advantageous, enhancing the department's ability to provide targeted and effective support as needed. This support includes project management and assistance for applications serving key City systems such as:
 Utility billing
 Financial management
 Human resources management
 Permitting and licensing
 Asset management
 Document management
 Time management

20.1 This strategic approach plays a crucial role in maintaining the operational sustainability of the City's technology systems, minimizing downtime, disruption, and risk.

DISCUSSION: Recognizing the ongoing need for additional operational and project management support through professional services, the IT Department sought to secure the most qualified vendor. To ensure a thorough selection process, staff initiated a competitive Request for Proposals (RFP). The objective of this evaluation was twofold: to identify a vendor capable of meeting the specific requirements of the City and to offer a competitive cost proposition.

Following a comprehensive evaluation, VantagePoint Business Solutions, LLC emerged as the most qualified vendor. Their selection was based on a combination of demonstrated expertise in addressing the City's unique requirements and providing a cost-effective solution. The competitive RFP was instrumental in thoroughly evaluating potential partners, emphasizing the importance of delivering exceptional value.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This is not a project under CEQA.

HEALTH IN ALL POLICIES (HiAP): The City’s engagement with VantagePoint Business Solutions, LLC advances Health in All Policies (HiAP) by modernizing the software solutions residents and employees rely on daily. These improvements increase efficiency, expand digital access, and make essential services easier to use online, strengthening both equity and community well-being. The project also supports the 2022 Climate Action Plan by:
 Updating software to deliver modern, reliable online services.  Reducing trips by residents and City vehicles through expanded digital options.  Supporting technology solutions for hybrid work options.

By streamlining systems such as permitting, licensing, utility services, and payments, the City ensures that residents can more easily access services while reducing environmental impacts and promoting digital inclusion.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: The agreement duration with VantagePoint spans three years, with the option to renew for an additional two years under identical contractual terms and conditions. The total expense for support services during Fiscal Years (FY) 2026, 2027, and 2028 is not to exceed $820,300. This cost will be allocated between the Information Technology Department's professional and technical services budget (1251-52199), the Capital Improvement Plan Project Fund (c152002), and the Capital Improvement Plan Project Fund (c152301). The latter fund has been established for the Enterprise Resource Planning (ERP) Replacement Project, which began in FY 2025.

20.2 Fiscal
Year Resource
Hourly
Rate
Total
Hours
Total Amount (Not to
Exceed)
Senior Solutions Architect $200 1000 FY26
Solution Consultant $185 30
$205,500
Senior Solutions Architect $200 1500 FY27
Solution Consultant $185 40
$307,400
Senior Solutions Architect $200 1500 FY28
Solution Consultant $185 40
$307,400
Prepared By:

Jackie Trumbull
Program Analyst II
Submitted By:

Ken Morgan
Director of IT
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. 2025-09-10 VANTAGEPOINT BUSINESS SOLUTIONS LLC APPLICATION SUPPORT SERVICES PSA FINAL.PDF

20.3 City of Santa Cruz Application and Project Support October 2025 Page 1
Professional Services Agreement With

VANTAGEPOINT BUSINESS SOUTIONS, LLC
For APPLICATION AND PROJECT SUPPORT
THIS PROFESSIONAL SERVICES AGREEMENT (“Agreement”) for professional services is made by and between the City of Santa Cruz (“City”) and VANTAGEPOINT BUSINESS SOUTIONS, LLC (“Consultant”) (each is referred to individually as a “Party” and collectively, as the “Parties”) as of October 1st, 2025 (the “Effective Date”).

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

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

SECTION 2: RESPONSIBILITIES OF CONSULTANT
All services performed by Consultant, or under Consultant’s direction, shall be rendered in accordance with the generally accepted practices, and to the standards of, Consultant's profession. Consultant represents and agrees that Consultant: (i) is fully experienced and properly qualified to perform the work and services provided for herein, (ii) has the financial capability required for the performance of the work and services, and (iii) is properly equipped and organized to perform the work and services in a competent, timely, and workmanlike/professional manner, in accordance with the requirements of this Agreement. All services performed by Consultant pursuant to this Agreement shall conform to the specifications of the applicable Scope of Work for a period of ninety (90) days from the date of final acceptance by the City.

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

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

Consultant shall meet with Michael Schmidt, IT Assistant Director of the City’s Information Technology Department, hereinafter called " IT Assistant Director", or other designated and authorized City personnel, and/ or third parties as necessary, on all matters connected with carrying out Consultant’s services described in Exhibit A.

Such meetings shall be held at the request of either Party. Consultant shall obtain City’s review and acceptance of completed work monthly, or at other intervals as may be mutually agreed upon during the term of this Agreement.

Review or acceptance of Consultant’s work by City or its designee shall not relieve Consultant from responsibility for errors and omissions in Consultant’s work.

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

20.4 City of Santa Cruz Application and Project Support October 2025 Page 2
The IT Assistant Director may authorize a City staff person to serve as their representative with respect to this Agreement. Consultant’s work shall be reviewed at such intervals as may be mutually agreed upon between the Parties. The City will be the sole judge of acceptable work, provided that such approval will not be unreasonably withheld or delayed. If the work is not acceptable, City will inform Consultant of the changes or revisions necessary to secure acceptance.

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

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

Variations from the budget for each task which are justified by statements indicating personnel time expended and submittal of a revised budget are only allowed with prior written City approval; however, in no event shall the total fee charged for the Scope of Work set forth in Exhibit A exceed the Total Not to Exceed Amounts provided in the Exhibit B Fee Schedule without advance written City authorization in the form of an amendment or change order.

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

All invoices shall contain the following affidavit signed by Consultant (if individual) or by an authorized representative of Consultant (if Consultant is an entity):
“[I] or [As an authorized representative of Consultant, I] hereby certify that the charge of (Insert invoice amount) as summarized above and shown in detail on the attachments is in accordance with the terms of the Agreement by and between the City of Santa Cruz and (Insert Party Name) dated (Insert Agreement Date), and has not been previously paid." This Agreement is contingent upon the appropriation of sufficient funding by the City for the Scope of Work covered by this Agreement. If funding is reduced or deleted for the Scope of Work covered by this Agreement, the City has the option without penalty or liability to either terminate this Agreement or to offer an amendment to this Agreement indicating any reduced amount.

SECTION 5: TRAVEL REIMBURSEMENT POLICY
The City agrees to reimburse Consultant and Consultant’s employee(s) for only authorized travel expenses, as indicated by a mark below, and according to the City’s Travel Reimbursement Policy. It is expected that all travel expenses incurred by Consultant while conducting activities on behalf of the City will be at reasonable rates and that Consultant and Consultant’s employee(s) will exercise prudence in incurring these expenses. ☒ Meals: Meals are reimbursed at the current GSA Meals & Incidental per diem rate by county (www.gsa.gov/travel). The City does not reimburse for actual costs for meals. Reimbursement is based solely on per diem rates. Do not submit meal receipts.
• Travel before 8:00am qualifies for breakfast reimbursement. • Travel between 8:00am – 1:30pm qualifies for lunch reimbursement. • Travel between 1:30pm – 7:00pm (or later) qualifies for dinner reimbursement.

20.5 City of Santa Cruz Application and Project Support October 2025 Page 3
• Days between hotel stays and days starting before 8am and ending after 7pm, qualify for the full GSA Meals & Incidental per diem rate.
☒ Ground Transportation: Ground transportation is reimbursable when it is for travel between the Consultant’s place of business, an airport, or Santa Cruz hotel, as applicable, to the City work location.

1. Reasonable fees for taxis, shuttles, buses, trains, light rail, ride hailing services (Uber, Lyft or other), and similar modes of transportation will be reimbursed. Receipts are required for reimbursement.

2. When using vehicles owned by Consultant or Consultant’s employer:
• Mileage will be reimbursed at the current IRS mileage rate. • Evidence of automobile liability insurance meeting the City’s requirements must be provided. • Maps showing starting point, City work location, and total miles are required for reimbursement.

3. Use of car rentals are reimbursable when:
• Travel is necessary from an airport to the City work location. • The rental reservation is made as far in advance as is practical and the lowest possible price is obtained. • Insurance coverage is included, and the car is returned with a full tank of gas. • The smallest vehicle necessary is rented.
• Parking expenses are included in the GSA Meals & Incidental per diem rate. The City will not pay additionally for parking expenses.
• Receipts are required for reimbursement.
☒ Airfare: Airfare is reimbursable when the Consultant’s place of business, or Consultant’s employee’s home, is more than 250 miles away from Santa Cruz.
• Airfare must be lowest available coach class fare. Flights may be non-stop. • Airfare must be booked as far in advance as is practical. • Fees for one piece of checked luggage (and any equipment necessary for the work being done) will be reimbursed.
• Extra charges for seat assignments, refundable tickets, travel insurance/protection, and similar fees are not reimbursable.
• If the City cancels the need for travel and the ticket cannot be changed or refunded, the ticket cost will be reimbursable.
• Receipts are required for reimbursement.
☒ Lodging: Lodging is reimbursable when the Consultant must work on site for two or more consecutive days and the Consultant’s place of business or personal residence, is more than 60 miles away from Santa Cruz. • Lodging is reimbursed up to the current GSA rate by county (www.gsa.gov/travel). • Costs for hotel rooms above this rate are the responsibility of the traveler. • Receipts are required for reimbursement.

General Rule

1. Travel expenses not listed or checked above will not be reimbursed.

2. Travel reimbursements are paid after the completion of travel. There are no travel advances.

3. Exceptions to any of the above requirements require advance written permission from the IT Assistant Director or City’s designated agent contracting with the Consultant.

4. Tips and gratuities will not be reimbursed.

5. Alcoholic beverage purchases will not be reimbursed.

6. Consultants will exercise prudence in incurring reimbursable expenses.

7. The City of Santa Cruz has the sole discretion to deny any reimbursement request the City has determined to be excessive or an inappropriate use of public funds.

20.6 City of Santa Cruz Application and Project Support October 2025 Page 4
SECTION 6: CHANGES IN WORK
City may negotiate changes to the Scope of Work. No changes to the Scope of Work shall be made without the prior written agreement between City and Consultant. Any change requiring compensation in excess of the sum specified in Exhibit B shall be approved in advance in writing by the City. Only City’s authorized representative(s) is authorized to approve changes to this Agreement on behalf of City.

SECTION 7: TERM AND SCHEDULE
The term of this Agreement shall be for three years and commence on the Effective Date of this Agreement and terminate on October 1st, 2028. At the option of the City, this Agreement may be renewed for up to two (2) additional years under the same contractual terms and conditions by letter agreement.

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

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

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

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

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

Consultant may terminate this Agreement for cause if the City fails to cure a material default in performance of its obligations under this Agreement within a period of 30 calendar days (or such longer period agreed to by the Consultant), from the date of the Consultant’s written termination notice specifying the default in performance.

Consultant must provide a written notice of termination to the City not less than 60 calendar days of the effective termination date.

Upon notice of termination by either the City or Consultant, the Consultant will immediately act to not incur any additional obligations, costs or expenses, except as may be reasonably necessary to terminate its activities. The City’s only obligation to the Consultant will be just and equitable payment for services authorized by, and received to the satisfaction of, the City up to and including the effective date of termination less any amounts withheld. All finished or unfinished work or documents procured or produced under the Agreement will become property of the City upon the termination date. In the event of Consultant’s failure to perform pursuant to the Agreement, the City reserves the right to obtain services elsewhere and Consultant will be liable for the difference between the prices set forth in the terminated Agreement and the actual cost to the City. If the City decides to obtain services elsewhere, the City shall provide Consultant with a written estimate of the increased costs the City reasonably expects to incur as a result. Upon receiving such estimate from the City, the Consultant shall have ten (10) business days to provide a written response. A senior executive from each Party shall consult and negotiate to reach a solution. If an amicable

20.7 City of Santa Cruz Application and Project Support October 2025 Page 5
solution cannot be reached between the Parties within fifteen (15) days from Consultant’s response to the City, it will be referred to Dispute Resolution pursuant to Section 14, subsection 18 of this Agreement. Termination of the Agreement pursuant to this paragraph shall not relieve the Consultant of any liability to City for additional costs, expenses, or damages sustained by City due to failure of the Consultant to perform pursuant to the Agreement. City may withhold any payments to Consultant for the purpose of set-off until such time as the exact amount of damages due City from Consultant is determined. After the effective date of termination, Consultant will have no further claims against the City under the Agreement. No other compensation will be payable for anticipated profit on unperformed services.

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

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

In the event this Agreement involves the performance of design professional services by Consultant, Consultant’s officers, employees, agents, or subcontractors, Consultant’s costs to defend Indemnitees shall not exceed the Consultant’s proportionate percentage of fault per Civil Code §2782.8. This section shall survive the termination or expiration of this Agreement.
, IN NO EVENT OR CIRCUMSTANCE SHALL CONSULTANT’S TOTAL AGGREGATE LIABILITY TO

THE CITY, WHETHER ARISING OUT OF OR RELATING TO THIS AGREEMENT FOR ANY CAUSE OR

CLAIM WHATSOEVER, AND REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT,

TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY), OR OTHERWISE, EXCEED TWO TIMES

THE CUMULATIVE AMOUNT PAID TO CONSULTANT BY THE CITY UNDER THAT SCOPE OF WORK WHICH GAVE RISE TO, OR UNDER WHICH THE CLAIM HAS ARISEN. THE FOREGOING CAP IS AN

AGGREGATE FOR ALL CLAIMS AND SHALL NOT BE INCREASED BY MULTIPLE CLAIMS SUBJECT TO THE SAME, OVERLAPPING, OR ENTIRELY SEPARATE LOOKBACK PERIODS. THIS LIMITATION ON LIABILTY SHALL NOT APPLY TO CONSULTANT’S INDEMNITY OBLIGATIONS HEREUNDER, OR CONSULTANT’S FRAUD, WILLFUL MISCONDUCT, OR VIOLATION OF LAW (WHETHER NEGLIGENT OR WILLFUL). EXCEPT FOR CONSULTANT’S INDEMNIFICATION OBLIGATIONS HEREIN, AND EXCEPT FOR LIABILITY CAUSED BY A PARTY’S FRAUD, WILLFUL MISCONDUCT, OR VIOLATION

OF LAW (WHETHER NEGLIGENT OR WILLFUL), IN NO EVENT OR CIRCUMSTANCE SHALL EITHER

PARTY BE LIABLE FOR ANY LOST PROFITS, LOST REVENUES, LOST DATA OR INDIRECT,

INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES WHETHER IN AN

ACTION, IN CONTRACT OR TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

20.8 City of Santa Cruz Application and Project Support October 2025 Page 6
SECTION 11: EQUAL EMPLOYMENT OPPORTUNITY/NON-DISCRIMINATION POLICIES City’s policies promote a working environment free from abusive conduct, discrimination, harassment, and retaliation; and require equal opportunity in employment for all regardless of race, religious creed (including religious dress and grooming practices), color, national origin (including language use restrictions), ancestry, religion, disability (mental and physical), medical condition, sex, gender (including gender identity and gender expression), physical characteristics, marital status, age, sexual orientation, genetic information (including family health history and genetic test results), organizational affiliation, and military or veteran status, or any other consideration made unlawful by local, State or Federal law. City requires Consultant to comply with all applicable Federal and State and local equal employment opportunity laws and regulations, and Consultant is responsible for ensuring that effective policies and procedures concerning the prevention of abusive conduct, discrimination, harassment, and retaliation exist in Consultant’s business organization. The City’s current Equal Employment Opportunity and Non-Discrimination policies to which this Section applies may be viewed at http://www.codepublishing.com/CA/SantaCruz/?SantaCruz09/SantaCruz0983.html and http://www.cityofsantacruz.com/home/showdocument?id=59192.

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

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

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

SECTION 14: MISCELLANEOUS PROVISIONS

1. Project Manager/Key Staff. The IT Assistant Director reserves the right to evaluate and confer with Consultant regarding the project manager or other key staff assigned by Consultant to perform the work under this Agreement.

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

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

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

20.9 City of Santa Cruz Application and Project Support October 2025 Page 7
In the event that Consultant or any employee, agent, or subcontractor of Consultant providing services under this Agreement is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS as an employee of City, Consultant shall indemnify, defend, and hold harmless City for the payment of any employee and/or employer contributions for PERS benefits on behalf of Consultant or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.

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

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

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

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

7. Conflicts of Interest. Consultant agrees to comply with conflict of interest lawsin performing the work and services under this Agreement. Consultant covenants (on behalf of Consultant and Consultant’s employees, agents, representatives, and subcontractors) that there is no direct or indirect interest, financial or otherwise, which would conflict in any manner or degree with the performance of services required under this Agreement. Consultant acknowledges and agrees to comply with applicable provisions of conflict of interest law and regulations, including the CA Political Reform Act, (Gov’t. Code §§1090, 87100), Levine Act (Gov’t. Code §84308), and the City’s conflict of interest code. Consultant will immediately advise City if Consultant learns of a conflicting financial interest of Consultant during the term of this Agreement.

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

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

Consultant’s final deliverables shall comply with Section 508 (29 U.S.C. Section 794d) accessibility requirements, as applicable. Notwithstanding any other provision of this Agreement to the contrary, Consultant shall retain the

20.10 City of Santa Cruz Application and Project Support October 2025 Page 8
rights in any pre-existing standard drawing details, designs, specifications, databases, computer software, proprietary information, documents, templates, and any other property owned by Consultant on the date of this Agreement or developed outside of this Agreement.

9. Intellectual Property and Indemnity.
a. Consultant represents to City that, to the best of Consultant’s knowledge, any Intellectual Property (including but not limited to: patent, patent application, trade secret, copyright and any applications or right to apply for registration, computer software programs or applications, tangible or intangible proprietary information, or any other intellectual property right) in connection with any services and/or products related to this Agreement does not violate or infringe upon any Intellectual Property rights of any other person or entity. b. To the fullest extent permitted by law, Consultant agrees to indemnify, defend, and hold harmless City, its officials, officers, employees, and agents, from any and all claims, demands, actions, liabilities, damages, or expenses (including reasonable attorneys’ fees and costs) arising out of a claim of infringement, actual or alleged, direct or contributory, of any Intellectual Property rights in any way related to Consultant’s performance under this Agreement or to the City’s authorized intended or actual use of Consultant’s product or service under this Agreement. This provision shall survive termination or expiration of this Agreement. c. If any product or service becomes, or in the Consultant’s opinion is likely to become, the subject of a claim of infringement, the Consultant shall, at its sole expense: (i) provide the City the right to continue using the product or service; or (ii) replace or modify the product or service so that it becomes non-infringing; or (iii) if none of the foregoing alternatives are possible even after Consultant’s commercially reasonable efforts, in addition to other available legal remedies, City will have the right to return the product or service and receive a full or partial refund of an amount equal to the value of the returned product or service, less the unpaid portion of the purchase price and any other amounts, which may be due to the Consultant. City shall have the right to retrieve its data and proprietary information at no charge prior to any return of the product or termination of service.

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

20.11 City of Santa Cruz Application and Project Support October 2025 Page 9
access, notifying City as soon as possible of any incident of unauthorized access to City Data and Confidential Information, or any other breach in Consultant’s security that materially affects City or end users; and be responsible for ensuring compliance by its officers, employees, agents, and subcontractors with the confidentiality provisions hereof. Should confidential and/or legally protected City Data be divulged to unauthorized third parties, Consultant shall comply with all applicable federal and state laws and regulations, including but not limited to California Civil Code sections 1798.29 and 1798.82 at Consultant’s sole expense if Consultant was the cause of the breach. Consultant shall not charge City for any expenses associated with Consultant’s compliance with these obligations.

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

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

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

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

14. Licensure. Consultant agrees that Consultant, its subcontractors and/or agents (if any) has/have complied with all applicable federal, state, and local licensing requirements and agrees to provide proof of a current City of Santa Cruz Business Tax Certificate if:
• Consultant, its subcontractor(s) and agent(s) or its business is/are located in the City of Santa Cruz;

20.12 City of Santa Cruz Application and Project Support October 2025 Page 10
• Will perform actual work in the City of Santa Cruz for 6 or more days annually; or • Will use company vehicles to deliver within the City of Santa Cruz for 6 or more days annually.

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

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

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

20.13 City of Santa Cruz Application and Project Support October 2025 Page 11
pursuant to Labor Code section 1725.5 [with limited exceptions from this requirement for bid purposes only under Labor Code section 1771.1(a)].

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

18. Dispute Resolution. The Parties agree to attempt in good faith to resolve through negotiation any dispute, claim or controversy arising out of or relating to this Agreement. Either party may initiate negotiations by providing written notice in letter form to the other party, setting forth the subject of the dispute and the relief requested.

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

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

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

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

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

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

20.14 City of Santa Cruz Application and Project Support October 2025 Page 12

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

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

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

To CITY:

Information Technology
Michael Schmidt
809 Center Street, Room 8
Santa Cruz, CA, 95060
[email protected]
831-420-5003
To CONSULTANT:

VantagePoint Business Solutions, LLC
Greg Wright
16410 Waxmyrtle Road
Alpharetta, GA 30004
[email protected]
770-354-3997
The Parties must provide notice of any changes to the above information in writing at least ten (10) business days before the change is effective.

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

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

20.15 City of Santa Cruz Application and Project Support October 2025 Page 13
Approved As To Form:

By: _____________________________ Date: __________________ Stephanie Hall, Office of the City Attorney

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

CONSULTANT
By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ By: _____________________________ Date: __________________ Printed: ___________________________ Title: __________________ 9/10/25

20.16 City of Santa Cruz Application and Project Support October 2025 Page 14
EXHIBIT A: SCOPE OF WORK
The Scope of Work entails the provision of ad hoc support services for application and project-related support to the City of Santa Cruz Information Technology Department. Assistance will be delivered on an hourly rate basis, rather than by project, covering various applications and interfaces. Interactions are scheduled during regular business hours, with the possibility of occasional off-hours support as necessary, which will be mutually agreed upon in writing by both Parties. The scope of work is not confined to the specifics outlined below, and its evolution into project-oriented tasks will be determined by the needs articulated by the City of Santa Cruz.

Services will be performed remotely, unless agreed to otherwise by both Parties. Should the Consultant be required to be onsite, the City of Santa Cruz agrees to reimburse the Consultant as per rates described in Section 5: Travel Reimbursement Policy. The City of Santa Cruz will provide the Consultant with timely remote access to the necessary systems and applications of the City.

Details for the support of various applications are outlined but not limited to the following support needs below:

Eden Enterprise Resource Planning Application Support:
• Offer ad hoc support and enhancement services as requested. • Address recurring processes for HR data from Eden to AD and AD data to Eden. • Assist with loading position data from xlsx into Eden. • Provide ad hoc support during Calendar Year-End as required. • Address ad hoc needs for UB enhancements and reports.

Tyler Cashiering Application Upgrade:
• Provide ad hoc support for the upgrade of Tyler Cashiering and respond to interface issues. • Address ad hoc interface support for Eden to Cashiering, CRW TrakIT to Eden, etc.

CRW TrakIT Land Use Management Application Support:
• Offer ad hoc support for Tech Fee and enhancements.
• Conduct ad hoc data cleansing, including extraction and evaluation of data quality for master data fixes.

Hylands – OnBase Document Management Application Support and Upgrade:
• Provide ad hoc support for the Public Request Module.

Gasboy (EKOS) Application Support:
• Offer ad hoc support and enhancements.
• Beacon and AMI Integrations:
• Provide ad hoc support and enhancements.

MyCity of Santa Cruz Application Support:
• Address ad hoc interface support and enhancements.

20.17 City of Santa Cruz Application and Project Support October 2025 Page 15
General IT Support:
• Assist City IT with ad hoc support for various applications and interfaces.

AIMS Parking Application Support and Upgrade:
• Implement AIMS upgrade as needed.
• Implement LPR solution as needed.
• Provide ad hoc support for current AIMS.
• Provide ad hoc support for upgraded AIMS and LPR.

Tyler Enterprise Permitting and Licensing (EPL)
• Data Mapping/Conversion from TrakIT to Tyler EPL
• Data Cleanup assistance
• Cashiering migration to next generation system (Can/AM Teller and Workday) Data Migration Support
• Support the efforts to move from Tyler Eden and Cashiering to Workday and Can/AM Teller Cityworks Computerized Maintenance Management System (CMMS) Application Implementation:
• Implement Cityworks and address ad hoc needs for migrating remaining departments (Fleet and Wharf) from CMMS.

20.18 City of Santa Cruz Application and Project Support October 2025 Page 16
EXHIBIT B: FEE SCHEDULE
Fiscal
Year Resource
Hourly
Rate
Total
Hours Total Not to Exceed Amount
FY26 Senior Solutions Architect $200 1000 $205,500 Solution Consultant $185 30 FY27 Senior Solutions Architect $200 1500 $307,400 Solution Consultant $185 40 FY28 Senior Solutions Architect $200 1500 $307,400 Solution Consultant $185 40 All fees and actual business expenses incurred will be billed to the City twice a month. The City will pay thirty (30) days after receipt of a correct and undisputed invoice.

20.19 City of Santa Cruz Application and Project Support October 2025 Page 17
EXHIBIT C: INSURANCE REQUIREMENTS
Consultant shall procure and maintain insurance against claims for injuries to persons or damages to property and otherwise which may arise from or in connection with the performance of the work under this Agreement and the results of that work by Consultant, its agents, representatives, employees, or subcontractors.

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

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

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

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

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

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

20.20 City of Santa Cruz Application and Project Support October 2025 Page 18
(Not required if Consultant provides written verification it has no employees) - If Consultant has no employees, Consultant shall complete and sign a Workers’ Compensation Exemption Declaration and Release of Liability.
• For Data Security and Privacy Liability

1. Consultant shall maintain one or more insurance policies - Privacy, Technology and Data Security Liability, Cyber Liability, or Technology Professional Liability Insurance coverage in the amount of $3,000,000 per occurrence or claim, $3,000,000 aggregate.

Coverage shall be sufficiently broad to respond to the duties and obligations undertaken by Consultant in this contract.

2. The policy(ies) shall include coverage for claims involving security breach, system failure, data recovery, business interruption, cyber extortion, social engineering, infringement of intellectual property, including but not limited to infringement of copyright, trademark, trade dress, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, and alteration of electronic information.

3. The policy(ies) shall provide coverage for breach response costs as well as regulatory fines and penalties as well as credit monitoring expenses with limits sufficient to respond to these obligations.

4. The policy(ies) shall include, or be endorsed to include, property damage liability coverage for damage to, alteration of, loss of, or destruction of electronic data and/or information “property” of the City in the care, custody, or control of the Consultant.

C. OTHER INSURANCE PROVISIONS
The insurance policies are to comply with the following provisions:
• ADDITIONAL INSURED STATUS
The City, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds on the CGL with respect to liability arising out of work or operations performed by or on behalf of Consultant including materials, parts, or equipment furnished in connection with such work or operations, products and completed operations. General liability coverage will be provided in the form of an endorsement to Consultant’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used). • PRIMARY COVERAGE
For any claims related to this Agreement, Consultant’s and all subcontractor’s insurance coverage will be primary and non-contributory as respects the City, its officers, officials, employees, agents, and volunteers.

Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of Consultant’s and all subcontractor’s insurance and will not contribute with it. • NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
• WAIVER OF SUBROGATION
Consultant hereby grants to the City a waiver of any right to subrogation, except as otherwise not applicable, which any insurer of said Consultant may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. Consultant agrees to obtain any endorsement that may be necessary to effectuate this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.
• EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
Consultant may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but not limited to, primary and noncontributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The

20.21 City of Santa Cruz Application and Project Support October 2025 Page 19
excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Consultant’s primary and excess liability policies are exhausted.
• SELF-INSURED RETENTIONS (SIR)
Self-insured retentions must be declared to and approved by the City. City may require Consultant to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City.
• ACCEPTABILITY OF INSURERS
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A: VII, unless otherwise acceptable to the City.
• CLAIMS MADE POLICIES
If any of the required policies provide coverage on a claims-made basis:

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

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

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

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

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

20.22 City Council

AGENDA REPORT
DATE: 09/10/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Public Works
SUBJECT: Contract Renewal with Hope Services, Inc. for the Resource Recovery Facility (PW)
LOCATION: District 6
RECOMMENDATION: Motion to authorize and direct the City Manager to renew an agreement with Hope Services, Inc. (Santa Cruz, CA) for recycling and litter control services at the City’s Resource Recovery Facility on Dimeo Lane.

BACKGROUND: For the last twenty-five years, Hope Services, Inc. a local rehabilitationtraining program has provided employment to developmentally disabled workers through an annual contract with the City Resource Recovery Facility (RRF) on Dimeo Lane. Under the terms of this agreement, on average, eight Hope Services workers help sort recycled materials being processed on the City’s single-stream sorting line and help to control litter in and around the RRF.

DISCUSSION: The Hope Services contract enables the City to meet its recycling and diversion objectives by providing supplementary staffing for the sorting equipment the City operates at the RRF. This enables regular City recycling staff to perform a growing list of more specialized duties, such as baler operation, oil and oil filter recycling, operation of loaders and forklifts, and packing and documenting electronic waste. This contract also provides City workers’ time to sort more difficult materials and reduce contaminants from recycled materials, thereby maximizing sales revenues.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This is not a project under CEQA.

HEALTH IN ALL POLICIES (HiAP): This action is consistent with the City’s HiAP initiative by supporting community connection, partnering with Hope Services to promote equity, inclusion, and wellness by integrating support services and outreach that address the root cause of health disparities and enhances overall community wellbeing.

21.1 FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: Funding for this contract is included in the adopted FY 2026 Refuse Fund budget and is a total cost of $258,000.00. There is no impact to the General Fund.

Prepared By:

Eleazar Mejinez
Resource Recovery Supervisor
Submitted By:

Nathan Nguyen, P.E.

Director of Public Works
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. HOPE SERVICES PROPOSED CONTRACT.PDF

21.2 1
Proposed
Agreement Between
City of Santa Cruz
and HOPE Services for Recycling and Litter Control Services 2025-2026
This agreement is entered into this 1 day of__July__2025, by the City of Santa Cruz, a Municipal Corporation, and HOPE Services, Inc., a California non-profit Corporation whose address is
220 Lincoln Street, Santa Cruz 95060 (hereinafter referred to as "Contractor").

Recitals
WHEREAS: The City of Santa Cruz is in need of services to provide assistance processing assorted recyclable materials at the 605 Dimeo Lane Resource Recovery Facility, and people with disabilities.

WHEREAS: Contractor is willing to provide such services for the purposes set forth herein on the terms and conditions set forth below. In consideration of the mutual covenants herein set forth for the above named project, it is agreed to as follows:

A. DUTIES OF THE CONTRACTOR: The Contractor shall provide the following services:

1. Definitions:

Client: A HOPE Services worker that has a developmental disability or is a person that is in another referral program with the Department of Rehabilitation.

Production Worker: A person working on the recycling line that is not a client. This person could be a Substitute Job Coach or a hired non-client worker who works the same work

21.3 2
shift as a HOPE client.

Job Coach:
behaviors, m
scheduled to work on the Recycle Work Crew, sorting 50% of the time.

2. Recycle Work Crew
HOPE intends to provide 2 crews with a minimum of 6 clients and 2 Job Coach each day.

HOPE Job Coaches are scheduled to work ½ of their time sorting on the recycling line and ½ of their time coaching clients and handling client relations. be assessed for job preferences and suitability for potential inclusion on the recycle line. There is no additional cost to the City for this additional work service.

Work Crew Schedule:
7 hours each day; (9:00 a.m. 4:00 p.m.), with two (2) ten-minute breaks and one unpaid 30-minute lunch period for a total of 6.5 hours working.

Monday Friday

Work Crew Duties will include: Separating recyclable items, general clean-up and litter control.

As dictated by the program and facility design, crewmembers may be shifted into other specific jobs that are mutually agreed upon.

Litter Control specifics:
a.) Duties will include: Patrol the approximate 1.5 miles of roads and byways of the Resource Recovery Facility to control plastic bags, litter and other refuse. Litter will implements. A map will be provided for our crew of the areas to be targeted. b.) The City of Santa Cruz will provide all equipment, special clothing, rain gear, safety vests, safety cones and the pick up of filled litterbags. c. Hazardous materials or objects over 30 pounds will be flagged for City of Santa Cruz handling.
d.) The City of Santa Cruz will provide safety training on litter control for HOPE Services Job Coaches and HOPE Services workers and daily direction for work start points.
e.) As dictated by the program and facility design, crewmembers may be shifted into

21.4 3
other specific jobs upon mutual agreement.

B. COMPENSATION

1. Compensation to be paid to Contractor includes, and the Contractor shall be liable for, all taxes, raises, assessment and other charges levied by any government agency on, or because of, the services performed hereunder.

2. Compensation rates:

Daily Rate:
$497.25 daily rate per crew

C. All services performed shall be in compliance with all applicable laws, including, without limitations, those relating to health and safety, licensing, prevailing wages and the like.

D. In performance of the services described herein, the Contractor, its agents, officers, and employees shall be independent contractors of the City of Santa Cruz shall not be treated or considered employees of the City of Santa Cruz.

E. Contractor shall have full and exclusive liability for the payment of any and all taxes and contributions for unemployment insurance retirement benefits, life insurance, pensions, annuities and similar benefits which may now or hereafter be imposed by law with respect to persons employed by the Contractor for performance of service under this agreement.

F. GENERAL PROVISIONS:

1. Workmanship and Supervision. In performance pursuant to this Agreement, Contractor shall provide the highest quality workmanship available. All work shall be performed by personnel directly employed and supervised by the Contractor. Contractor shall provide management and technical supervision as required to implement the work.

2. Equipment and Labor. Contractor shall use and furnish, unless otherwise indicated herein, at its own expense, all labor necessary for the satisfactory performance of the work set forth in this Agreement. City of Santa Cruz to provide all recycle equipment and the following safety equipment for Contractor's recycle crew workers: gloves, earplugs, and safety eye wear. City of Santa Cruz will also provide sufficient space for lockers and a worker break area.

21.5 4

3. Holidays. The following days are statutory holidays on which Contractor shall not be obligated to perform any service:

Annual Picnic
Additionally, HOPE Services Workers will be required to work only until 11:30am on the day of the HOPE Services Annual Picnic unless other agreements are made previous to the date, which is yet to be announced.

4. Security
regulations, including but not limited to:

a. All employees of Contractor will have identification materials in the possession of the Job Coaches.

b. Contractor shall follow and modify as necessary an
Illness and Injury Prevention Program (I.I.P.P.)

G. HOLD HARMLESS: All Officers, agents, employees, subcontractors, their agents, officers, and employees who are hired by Contractor to perform pursuant to this Agreement, shall be deemed officers, agents, employees and subcontractors of Contractor. Contractor shall indemnify, defend, save, and hold harmless, the City of Santa Cruz, its officers, agents and employees from any and all law suits, damages, liability, claims or costs of any nature whatsoever arising out of, or resulting from, either directly or indirectly, the performance of this Agreement to the maximum extent allowed by law.

H. INSURANCE: Contractor shall secure, maintain in full force and effect, and bear the costs of complete Workers' Compensation Insurance, in accordance with the Labor Code, for the duration of the Agreement, and shall furnish to the City of Santa Cruz, prior to the execution of the Agreement, a Certificate of Insurance which meets the requirements of the Labor Code. The City of Santa Cruz, or any of its officers or employees, will not be responsible for any claims or law suits or equity occasioned by the failure of Contractor to comply with the provisions of this Paragraph.

Independence Day
Labor Day
Thanksgiving Day
Day After Thanksgiving
Christmas Eve Day
Christmas Day
New Year's Day
Martin Luther King, Jr. Day
President's Day
Memorial Day

21.6 5
Contractor shall maintain in force public liability and property damage insurance, ample in amount to cover all awards of judgments for any death, injury, loss or damage arising out of the performance of the work by Contractor.

Business, Auto and Public Liability Insurance shall be in the amount of not less than One Million Dollars and No Cent ($1,000,000.00) for injuries, including accidental death, to any one person, and subject to the same limit for each person in an amount not less than One Million Dollars and No Cent ($1,000,000.00) per occurrence.

Contractor shall file with the City of Santa Cruz, prior to execution of the Agreement, a Certificate of Insurance issued by the insurance carrier certifying that the stipulated insurance policies are in effect and that thirty (30) days written notice will be given to the City of Santa Cruz prior to cancellation or reduction in coverage thereof. The City of Santa Cruz, its officers, employees, and agents shall be named as additional insureds under the policies.

The City of Santa Cruz, its agents, officers, and/or employees shall not be liable or responsible for any accident, loss or damage as a result of the work in the Agreement or costs of expense in law or equity arising out of damages to property or personal injury by reason of or in the course of performing Contractor's responsibilities under this Agreement.

I. PAYMENT TERMS: Total compensation depends on the total number of days approved and worked and shall be paid to Contractor bi-monthly, payable on or before the fifteenth and thirtieth day of the month following the month service is performed.

Contractor shall submit all invoices per City of Santa Cruz accounts payable schedule. City of Santa Cruz agrees to pay Contractor according to the payment schedule in this contract for each day approved and worked during the term of the Agreement as total compensation for all services rendered herein. Payment for all services contained in this Agreement is for all labor services, supervision, quality assurance and performance. Contractor agrees to perform all service herein in a workmanlike manner.

J. GENERAL: No member, officer, or employee of City of Santa Cruz, during his or her tenure, or for one (1) year thereafter, shall have any interest, direct or indirect, in this Agreement or the proceeds thereof and Contractor agrees not to allow, permit, grant, transfer or otherwise do anything which will result in such member, officer, or employee of the City of Santa Cruz from having such interest.

K. LAW GOVERNING: This Agreement shall be governed by the laws of the State of California. Any suit brought by either party against the other arising out of the

21.7 6
performance of this Agreement shall be filed and maintained in the Superior Municipal Court for the County of Santa Cruz.

L. MODIFICATION OF AGREEMENT: This Agreement may be modified only by a written amendment signed by both parties hereto. A thirty (30) day written notice will be provided in the event of an increase or decrease in average crew number.

M. ASSIGNABILITY: Contractor shall not assign or transfer any interest in this Agreement nor the performance of any of Contractor's obligations hereunder, without the prior written consent of City of Santa Cruz, and any attempt by Contractor to so assign this Agreement or any rights, duties or obligations arising hereunder shall be void and of no effect.

N. ENTIRE AGREEMENT: This Agreement represents the entire understanding of the parties as to these matters, contained herein. No prior oral or written under-standing shall be of any force or effect with respect to these matters covered hereunder.

O. CIVIL RIGHTS COMPLIANCE: Contractor must be in compliance with the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, which prohibits employment discrimination on the basis of race, color, religion, sex, national origin, or age. In addition, Contractor will not discriminate in employment on the basis of physical handicap or sexual orientation. This requirement shall apply (but not be limited) to: recruitment, employment, promotion, demotion, transfer, compensation, training and termination. Contractor should also maintain an affirmative action plan to ensure that applicants are employed and that employees are treated during employment without regard to sex their race, color, religion, sex national origin, age, physical handicap or sexual orientation. In the event of the Contractor's noncompliance with this clause, Contractor may be declared ineligible for further contracts with the City of Santa Cruz.

P. CANCELLATION: Notwithstanding any other provisions of this Agreement to the contrary, this Agreement may be terminated at any time by either party upon thirty (30) days written notice as follows:

Contractor: Regional Manager of Vocational Services
Hope Services
Heather Perez, (831) 600- 1512/Cell 650-703-6309
220 Lincoln Street
Santa Cruz, CA., 95060

21.8 7
City of Santa Cruz: Public Works Director
City of Santa Cruz
809 Center Street, Room 201
Santa Cruz. CA. 95060
Q. TERM: This Agreement shall be for the period of twelve (12) consecutive calendar months, commencing on the 1st day of July 2025 and ending on the last day of June 2026, unless otherwise terminated, as provided herein.

In Witness Whereof, the parties hereto have executed this Agreement on the date first above written in the City of Santa Cruz, California.

City of Santa Cruz: City of Santa Cruz,
809 Center Street
Santa Cruz, CA. 95060
By: _______________
Matt Huffaker
City Manager
Contractor: Hope Services, a private, non-profit
corporation
By: ________________
Hope Vinay Behl
Approved as to Form: __________________________ Date: _________________ City Attorney rev. 01/28//25
9/9/25
Anthony Condotti,

21.9 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Water
SUBJECT: Budget Transfer within the Water Department’s Capital Investment Program for Fiscal Year 2025 Water Program Administration Expenses – Budget Adjustment (WT)
LOCATION: None
RECOMMENDATION: Motion to adopt a resolution to amend the Fiscal Year 2025 budget by transferring funds in the amount of $2,647,751 from the Water Department’s Capital Investment Program (CIP) project c701901, Water Program Administration, to various other Water Department CIP projects for the purpose of allocating actual program administration expenses to active Water Program CIP projects.

BACKGROUND: On June 28, 2022, Council approved the renewal of a five-year Master Services Agreement (MSA) with HDR Engineering, Inc. (HDR) for Program Management services; the Water Department is entering the fourth year of this five-year agreement. Program Management is the coordinated management of multiple and/or large CIP projects, and services vary widely based on the types of projects and needs of their owners. Typical these services include staff augmentation, administrative tools, process development, software tools and applications, technical reviews, and financial, legal, and permitting support.

The MSA is organized into discrete tasks, listed below. Each fiscal year, the Water Department collaborates with HDR to develop a Service Order estimating the tasks to be completed within that fiscal year for specific tasks and projects.
 Task 1-Program Mobilization: Establish the primary elements of program management including needs assessment, staffing, and development of program and risk management plans. (This task is complete.)
 Task 2-Design Management: Manage or support the management of study and design activities performed by others.
 Task 3-Program Administration: Implement program structures, policies, and systems, such as risk management, quality assurance, and program budget/controls.

22.1  Task 4-Planning and Preliminary Engineering: HDR is authorized to perform planning and preliminary engineering work, they are not authorized to perform design work.  Task 5-Construction Management: Provide constructability reviews, construction oversight, inspection, and commissioning.
 Task 6-Program Support Services: Assist with ancillary project requirements such as California Environmental Quality Act (CEQA), right of way, surveying, geotechnical, and development of grant or loan applications or other proposals for project funding.

Work within Tasks 2, 4, 5, and 6 is project-specific and such work is charged directly to the appropriate CIP project during the fiscal year. However, Task 3 work includes tasks that are broad in nature and apply to all active CIP projects. For example, implementation of policies, development of budgets, and coordinated scheduling are activities that apply to all capital projects. Expenses for such activities are initially charged to a general CIP project, c701901 Water Program Administration, and at the end of each fiscal year, through a budget adjustment, these expenses are allocated amongst the Water Program CIP projects proportional to those project’s estimated costs. The intent is to charge larger projects for a larger share of the fee. The assumption is that larger cost projects require more administrative support and will make greater use of the protocols, procedures and quality controls. The formula below has been used since Fiscal Year 2019:

Total
Project
Estimate
% of Active
Program
Projects
Share of FY
Admin Fee
Project 1.1 $10M =$10M/$25M =40% of $2M
Project 1.2 $15M =$15M/$25M =60% of $2M
Total Active Program Projects $25M
Total Current FY Water Admin Fee $2M
DISCUSSION: During Fiscal Year 2025, HDR Program Administration Fees totaled $2,647,751 which supported 20 active projects. These fees have ranged from $1,600,000 to $3,300,000 annually since Fiscal Year 2019.

The attached budget adjustment and journal entry request will transfer the Fiscal Year 2025 actual expenses along with the associated budget appropriation to the 20 active HDR supported projects. Allocation of these expenses to specific projects allows the City to track these costs appropriately as project-related capital expenses and, in some cases, to seek reimbursement from outside funding sources.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under the California Environmental Quality Act (CEQA). An activity undertaken, supported, or authorized by a public agency is a “project” subject to CEQA only if it “may cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.” (Pub.

Resources Code, § 21065.) The budget adjustment requested is not a “project” under CEQA because it does not have the potential to cause physical change in the environment directly or indirectly.

22.2 HEALTH IN ALL POLICIES (HiAP): This Budget Adjustment and Journal Entry support two HiAP pillars: sustainability and public health. Some Program Management services can be reimbursed through grants and loans if they are applied to specific CIP projects. This supports the Water Department’s financial sustainability in funding a large and complex CIP to improve infrastructure integrity and system reliability that will preserve and secure reliable water supplies for long-term public health.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: Yes

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: Funds are available in Water’s CIP project, c701901 Water Program Administration.

Prepared By:

Malissa Kaping
Principal Management
Analyst
Submitted By:

Heidi Luckenbach
Water Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. BUDGET ADJUSTMENT.PDF

22.3 City of Santa Cruz

BUDGET ADJUSTMENT REQUEST
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NET: $

REQUESTED BY DEPARTMENT HEAD

APPROVAL

BUDGET/ACCOUNTING
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FINANCE DIRECTOR

APPROVAL

CITYMANAGER

APPROVAL
5HVR

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$02817
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TOTAL EXPENDITURE

TOTALREVENUE
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 Clear Form
2025
08/28/2025
Transfer Budget and Actuals for FY 2025 Water Program Admin Fees from CIP project c701901 to the 20 active CIP projects supported by this work.
0 SEE ATTACHED
0 0
Malissa Kaping
2025.08.28
15:47:50 -07'00'
Heidi
Luckenbach
Digitally signed by
Heidi Luckenbach
Date: 2025.09.02
15:59:17 -07'00'
Digitally signed
by Emily Burton
Date: 2025.09.11
'16:04:52 -07'00
Elizabet
h Cabell
Digitally signed by
Elizabeth Cabell
Date: 2025.09.11
16:58:05 -07'00' 22.4
FY25 Water Program Admin Fee BA and JE
Project Number GL Number Project Name FY25 BA Amount FY25 JE Amount c700025-100-2020-0 711-70-91-7152-57302 GHWTP Facilities Improvement Project 721,366 (721,366) c701501-100-2020-0 711-70-91-7152-57302 GHWTP CC Tanks Replacement 187,712 (187,712) c701505-100-2020-0 711-70-91-7153-57302 University Tank 4 Rehab/Replacement 28,964 (28,964) c701606-100-2020-0 711-70-91-7153-57302 NCD I/O Replacement Project 388,455 (388,455) c701609-100-2020-0 711-70-91-7153-57302 ASR Planning 21,421 (21,421) c701611-100-2020-0 711-70-91-7153-57302 Recycled Water Feasibility Study 4,742 (4,742) c701705-100-2020-0 711-70-91-7153-57302 Water Supply Augmentation 780,852 (780,852) c701903-100-2020-0 711-70-91-7151-57302 Tait Diversion Rehab/Replacement 39,218 (39,218) c702002-100-2020-0 711-70-91-7153-57302 Brackney Landslide Area Pipeline Risk Reduction 68,212 (68,212) c702101-100-2020-0 711-70-91-7153-57302 Beltz 8 & 12 Design with Beltz 12 Upgrades 26,779 (26,779) c702103-100-2020-0 711-70-91-7153-57302 ASR - Santa Margararita GW Basin 630 (630) c702105-100-2020-0 711-70-91-7153-57302 Newell Crk. Pipeline Felton/Graham Hill 120,087 (120,087) c702201-100-2020-0 711-70-95-7152-57302 GHWTP SCADA Radio System Replacement 1,274 (1,274) c702202-100-2020-0 711-70-91-7159-57901 CMMS Software Replacement for Water Dept 2,871 (2,871) c702203-100-2020-0 711-70-91-7152-57302 Beltz 12 Ammonia Removal 11,009 (11,009) c702205-100-2020-0 711-70-91-7151-57302 Intertie 1 - Santa Cruz-Scotts Valley 53,097 (53,097) c702304-100-2020-0 711-70-91-7159-57302 Branciforte Streambank Restoration 4,528 (4,528) c702305-100-2020-0 711-70-91-7152-57302 Beltz WTP Upgrades 144,790 (144,790) c702502-100-2020-0 711-70-91-7152-57302 Beltz WTP Filter Replacement 6,397 (6,397) c702503-100-2020-0 711-70-91-7153-57302 Beltz 8 Upgrades for Aquifer Strg-Recvry 35,347 (35,347) c701901-100-2020-0 711-70-91-7159-57302 Water Program Administration (2,647,751) 2,647,751 NET TRANSFER $ - $ -

22.5 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Water
SUBJECT: Resolution of Private Landowner Encroachment on Zayante Watershed Lands (WT)
LOCATION: County
RECOMMENDATION: Motion to approve property transfer from Assessor’s Parcel Number (APN) 093-011-59 to the City Water Department APN 093-011-29 and property transfer from City Water Department APN 093-011-29 to APN 093-011-59 to compensate for private landowner encroachment on City Water Department property.

BACKGROUND: The City of Santa Cruz owns over 800 acres of property in the Zayante watershed at the formerly proposed Zayante Dam site. While the dam was never constructed, this property continues to be maintained for drinking water source protection purposes. In 2023, while developing a new shaded fuel break along Fern Ridge Road in Zayante, staff discovered that the owners of APN 093-011-59 (Landowners) had built a fence, retaining wall, water tank, and pipeline(s) on approximately 4,611 square feet of adjacent City property. Consistent with past practice, staff asked the Landowners to cease further encroachment and consulted with the City Attorney on options for resolution.

DISCUSSION: The City and Landowners have agreed that the Landowners would, at their own expense, perform a survey, lot line adjustment and title work necessary to perform a 2:1 land swap that ensures protection of the City’s land values and allows them to keep their improvements in place. As a result, the City will receive 9,222 square feet of land in exchange for the loss of the 4,611 square feet affected by the encroachment, thereby increasing the City’s land holdings for drinking water source protection purposes in the Zayante watershed (for more information, see attached Survey).

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed action is subject to a Class 25 (14 CCR § 15325) categorical exemption which applies to the transfers of ownership of interests in land in order to preserve open space, habitat or historical resources.

HEALTH IN ALL POLICIES (HiAP): This project aligns with the public health and sustainability pillars of the City’s HiAP initiative by supporting the Water Department’s work to

23.1 protect drinking water sources, enhance functioning habitat, and preserve sites of high ecological value within our drinking water watersheds.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: There is no impact on the General Fund resulting from this action. This project will be completed at the expense of the neighboring landowner.

Prepared By:

Chris Berry
Watershed Compliance
Manager
Submitted By:

Heidi Luckenbach
Water Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

2. OLSON ENCROACHMENT SURVEY.PDF

23.2 RESOLUTION NO. NS-XX,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ APPROVING PROPERTY TRANSFER FROM APN 093-011-59 IN RESOLUTION OF NEIGHBOR ENCROACHMENT ON APN 093-011-29
WHEREAS, the City Water Department endeavors preserve and protect its watershed lands for the purposes of drinking water source protection and for the overall benefit of natural resources; and
WHEREAS, the City Water Department recently because aware that a neighboring property has built unauthorized improvements on said watershed lands; and WHEREAS; the neighboring property owners have agreed to a 2:1 exchange of their property in exchange for encroachment on City Water Department property; WHEREAS, all survey, title and other future work related to this transfer will be performed at the neighbors’ expense;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz that the City Council approves the Water Department’s acceptance of a 9,222 square feet of property transferred from APN 093-011-59 and the transfer of 4,611 square feet of property from APN 093-011-29 to APN 093-011-59 in exchange for resolution of encroachment on APN 093- 011-29.

PASSED AND ADOPTED this 30th day of September, 2025, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

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

23.3 23.4
City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Water
SUBJECT: Lockhart-Zayante Vegetation Treatment Project – Zayante Watershed Lands Landowner Agreement (WT)
LOCATION: County
RECOMMENDATION: Motion to ratify the Landowner Agreement with the Resource Conservation District of Santa Cruz County, executed by the City Manager, for the LockhartZayante Vegetation Treatment Project.

BACKGROUND: The City of Santa Cruz owns over 800 acres of property in the Zayante watershed at the formerly-proposed Zayante Dam site. While the dam was never constructed, the City continues to maintain the property for drinking water source protection purposes. Fire prevention and preparedness are critical areas of focus in the City’s management of this property.

This property also plays a pivotal role in regional emergency response: neighbors on Weston Road may utilize the City’s road system for egress, and fire response agencies may require access to the property in the event of wildfire.

The Resource Conservation District of Santa Cruz County (RCD), with support from a CalFire Wildfire Prevention Grant, is currently implementing a significant fuel break project (LockhartZayante Vegetation Treatment Project) that will:
 Improve emergency access and evacuation routes for residents;  Enhance firefighter access and suppression capabilities;  Reduce the risk to life, property, and infrastructure from wildfire; and  Lower the potential for high-intensity wildfire behavior and carbon emissions by reducing accumulated fuels.

Project information can be found here: https://www.rcdsantacruz.org/item/212. Additionally, a project site map is attached.

DISCUSSION: This project is consistent with City goals for drinking water source protection.

Given the significant support of CalFire and the RCD, this is a good opportunity to improve fuel and access conditions on the City’s property at minimal expense to the City. A landowner agreement spelling out the general project scope and responsibilities for the RCD and City is required in order to complete the leg of the project that crosses City property and connects the

24.1 beginning of the fuel break at Mount Hermon Road to its termination at Zayante Road. The City Attorney and Risk offices have reviewed the agreement and determined that it is adequately protective of City interests.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:

Project-specific analysis for this work was performed by the RCD as the lead agency under the California Vegetation Treatment Program (CalVTP) Programmatic Environmental Impact Report (EIR) completed by the California Board of Forestry. A Notice of Determination was issued on August 21, 2024. More information on this EIR and project-specific analysis can be found at the links below:
 https://bof.fire.ca.gov/projects-and-programs/calvtp-homepage-and-storymap/  https://ceqanet.lci.ca.gov/2019012052/98
 https://tinyurl.com/Zayante-fuel-break
HEALTH IN ALL POLICIES (HiAP): This project aligns well with the City’s HiAP pillars by generally supporting environmental and public health, increasing resilience to climate change, protecting our drinking water sources, and other benefits to both City operations as well as to other stakeholders in our drinking water source watersheds. Furthermore, this project is aligned with the HiAP equity pillar by utilizing grants for implementation rather than being supported by water rates.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: There is no impact to the General Fund as a result of this action. This project will be fully funded by a CalFire Wildfire Prevention Grant.

Prepared By:

Chris Berry
Watershed Compliance
Manager
Submitted By:

Heidi Luckenbach
Water Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. MAP.PDF

2. LANDOWNER AGREEMENT.PDF

24.2 24.3
1 RESOURCE CONSERVATION DISTRICT

OF SANTA CRUZ COUNTY

AGREEMENT
This Agreement (“Agreement”) is made and entered into by and between the Resource Conservation District of Santa Cruz County ("RCD") and City of Santa Cruz (“Landowner”) on August 25, 2025, (individually, a “Party” and collectively, the “Parties”).

RECITALS
A. Landowner owns the Property located in Felton, California, APN #074-012-07 and #093-051- 47, more particularly described in Exhibit A (the “Property”).

B. The RCD's mission is to help people protect, conserve and restore natural resources through information, education and technical assistance programs.

C. The RCD has received or will receive grant funding from CalFire Wildfire Prevention Grant #5GA21110 (the “Funding Agency”).

D. The RCD and Landowner mutually desire to pursue the project (“Project”) described in Exhibit B which entails tree trimming and vegetation clearance to create a fire break.

E. Any further maintenance of the project area after implementation, as described in Exhibit C Operations and Maintenance, is the responsibility of Landowner.

F. Landowner has agreed to grant the right of access to the RCD over and through the area depicted in Exhibit D to the RCD, its designated employees, agents, or anyone authorized to perform tasks on their behalf (“RCD Parties”) for the purposes set forth in this Agreement.

G. The Project is subject to the Grant Conditions attached hereto as Exhibit E.

NOW, THEREFORE, in consideration of the mutual promises, covenants, terms and conditions hereinafter contained, the parties hereby agree as follows:

1. Recitals; Exhibits.

The Recitals set forth at the beginning of this Agreement are deemed incorporated herein, and the parties hereto represent they are true, complete and correct. This Agreement shall be read in conjunction with the following exhibits which are incorporated herein by this reference:

Exhibit A Legal Description of the Property
Exhibit B Project Description
Exhibit C Operations and Maintenance
Exhibit D Access Area
Exhibit E Grant Conditions
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.4 2
Exhibit F RCD Insurance

2. Authorization to Pursue Project.

Landowner hereby authorizes the RCD Parties, at the sole cost and expense of the RCD, to:
• Enter the Access Area for purposes related to this Agreement; • Retain consultants to prepare plans and specifications for the Project; • Apply for permits;
• Investigate and report to applicable regulatory or Funding Agencies information relating to the Project, including GPS coordinates; Project maps; Project designs; photo documentation (before, during and after); permits, monitoring and test results; • If permits are issued and funding secured by the RCD, retain contractors or qualified persons to implement and construct the Project.
• Monitor the Project
• Use, publish, or display any results of the work or conservation effort entailed in the Project.
• Conduct before, during and after tours of the Project, subject to approval of the Landowner as to date and time.

3. Grant of Access.

Landowner hereby grants to the RCD Parties the right of access during the Term, as defined below, for the purpose of entering the portion of the Property depicted on Exhibit D (“Access Area”) for the following purposes: project planning, implementation, funder site visit, and postconstruction monitoring.

The “Access Term” commences on the date this agreement is executed and shall continue for 3 years following project implementation completion as required by the Funding Agencies, permitting agencies or defined in the Grant Conditions relating to the Project. Following project implementation, RCD and partners will contact Landowner to coordinate entry.

The Access Term may be extended by mutual agreement of the Parties.

4. Right To Terminate.
(a) Upon completion of project specifications, the RCD shall provide Landowner with a copy of the proposed plans and specifications for the work, and Landowner shall have fifteen (15) days to approve said plans and specifications. If Landowner does not object to the plans and specifications within said fifteen (15) days, Landowner shall be deemed to have approved said plans and specifications. If Landowner does object, Landowner and the RCD agree to meet and confer to explore if the basis for the objection can be removed or eliminated. If, after meeting and conferring, Landowner still objects, the Landowner can terminate this Agreement. After approval of the plans and specifications, Landowner agrees that it authorizes the RCD to proceed with the Project, including implementation, monitoring and closeout, subject to the RCD’s right Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.5 3
of termination paragraph (b) below. If the specifications change substantively, the Landowner must be promptly notified and given the opportunity to object to the new specifications. (b) The RCD may in its sole discretion, terminate this Agreement if permits are not issued; if funding is inadequate; if bids received exceed available funding; if desired outcomes cannot be reasonably achieved; if Grant Conditions or permit requirements cannot reasonably be satisfied; or for other good cause. If, however, the RCD awards a construction contract for the implementation of the Work, the RCD agrees to complete the construction work subject to available funding or restore the Project site to its original condition.

5. Construction work.

RCD represents and warrants that for any work exceeding $25,000, RCD shall secure payment and performance bonds for the work. Additionally, RCD represents and warrants that to the extent work performed on landowner property is considered a “public work” (construction, alteration, demolition, or repair work) pursuant and subject to Labor Code section 1720 et seq., RCD shall make sure that each Contractor shall conform to any and all prevailing wage requirements applicable to such work/and or services under this Agreement and any contract for such will include requirements to pay prevailing wages. RCD shall make sure that the project complies with all public work requirements. RCD agrees to indemnify, defend and hold harmless the Landowner and its officials, officers, employees, and agents from and against any and all claims, liabilities, losses, costs, expenses, attorney’s fees, damages, expenses, fines, financial consequences, interest, and penalties, of any kind or nature, arising from or relating to any failure (or alleged failure) of the Contractor and any sub to pay prevailing wages or to otherwise comply with the requirements of prevailing wage law relating to a public work.

6. Insurance.

The RCD shall maintain general liability insurance covering bodily injury, personal injury, and property damage, with limits of no less than One million dollars ($1,000,000) per occurrence and Two million dollars ($2,000,000) in aggregate.

The RCD’s contractor caries general liability insurance with limits of no less than one million dollars ($1,000,000) per occurrence and two million dollars ($2,000,000) in aggregate and workers’ compensation insurance as required by law. The RCD’s contractor carries an umbrella liability policy of Five million dollars ($5,000,000) and a second excess liability policy of Five million dollars ($5,000,000). As to the contractor’s general liability policy, the RCD has required that the contractor name the Landowner and their respective officials, officers, and employees as additional insureds on its policy of insurance.

7. Defense and Indemnification.

Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.6 4
RCD agrees, to the fullest extent permitted by law, to indemnify, defend, and hold harmless the Landowner, its officials, officers, and employees (collectively, “Indemnitees”) from and against any and all liability, claim, action, loss, injury, damage, judgment, or expense, including attorneys’ fees and costs (“Losses”) to the extent caused by or resulting from the negligence, recklessness, or willful misconduct of RCD, its officers, employees, agents, contractors, or subcontractors in any way related to this Agreement. RCD’s duty to indemnify and hold harmless Indemnitees shall not apply to the extent such Losses are caused by the sole or active negligence or willful misconduct of Indemnitees. RCD’s obligation to defend shall arise regardless of any claim or assertion that Indemnitees caused or contributed to the Losses. This section shall survive the termination or expiration of this Agreement.

8. No Lien.

RCD shall not permit or suffer any mechanic’s or materialman’s lien of any kind or nature to be enforced against Landowner property for any work done or materials furnished thereon related to this Agreement.

9. Cooperation.

Each Party agrees to cooperate fully with the other Party and to execute and deliver such further documents, certificates, agreements and instruments and to take such other actions as may be reasonably requested by the other Party to carry out the intent and purposes of this Agreement.

10. Entire Agreement; Amendments.

This Agreement and all exhibits referred to in this Agreement constitute the final, complete, and exclusive statement of the terms of the Agreement between the parties relating to the Project and supersedes all prior and contemporaneous understandings or agreements of the parties. Neither party has been induced to enter into this Agreement by, and neither party is relying on, any representation or warranty outside those expressly set forth in this Agreement. This Agreement may be amended by an Agreement in writing signed by both the Landowner and the RCD.

11. Dispute Resolution.
(a) Mediation. The RCD and Landowner agree to mediate any dispute or claim arising between them out of this Agreement before resorting to arbitration. The mediation fees shall be divided equally between the parties.
(b) Arbitration. Any dispute or claim in law or equity arising out of this Agreement which is not settled through mediation shall be decided by neutral binding arbitration in accordance with Part III, Title 9, of the California Code of Civil Procedure (commencing with Section 1280), and not by court action except as provided by California law for judicial review of arbitration proceedings. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The parties shall have the right to discovery in accordance with Code of Civil Procedure Section 1283.05. Whenever possible, the arbitrator shall be a retired Superior Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.7 5
or Appellate Court Judge or Justice, or someone of equivalent knowledge and experience and the arbitration proceeding shall take place in Santa Cruz County. The filing of a judicial action to enable the recording of a notice of pending action, for order of attachment, receivership, injunction, or other provisional remedy, shall not constitute a waiver of the right to arbitrate under this provision.

12. Nondiscrimination.

During the performance of this Grant Agreement, the neither party shall not unlawfully discriminate, harass, or allow harassment against any employee or applicant for employment because of sex (gender), sexual orientation, race, color, ancestry, religion, creed, national origin (including language use restriction), pregnancy, physical disability (including HIV and AIDS), mental disability, medical condition (cancer/genetic characteristics), age (over 40), marital status, and denial of medical and family care leave or pregnancy disability leave. Both parties shall ensure that the evaluation and treatment of their employees and applicants for employment are free from such discrimination and harassment. Both parties shall comply with the applicable provisions of the California Fair Employment and Housing Act (Gov. Code §12990.) and the applicable regulations promulgated there under (Cal. Code Regs., tit. 2, § 11000 et seq.). The applicable regulations of the Fair Employment and Housing Commission implementing the California Fair Employment and Housing Act are incorporated into this Agreement by reference.

12. General Provisions.
(a) Reasonableness and Good Faith. Whenever this Agreement requires any party to give its consent or approval to any action on the part of the other, such consent or approval shall not be unreasonably withheld or delayed.
(b) Information. The parties agree to provide all information necessary for the compliance with this Agreement.
(c) Adverse Circumstances. The parties shall promptly inform each other of any circumstances that interfere or threaten to interfere with the successful implementation of this Agreement.
(d) Partial Invalidity. If a court or arbitrator of competent jurisdiction holds any Agreement clause to be invalid or unenforceable in whole or in part for any reason, the validity and enforceability of the remaining clauses, or portions of them, shall not be affected.

(e) Time is of the Essence. Time is of the essence of this Agreement and each of its provisions.
(f) Open Records. All books and records of either party relating to the project shall be open to inspection and audit upon reasonable notice for any purpose related to this Agreement.

Both parties are public agencies and subject to the requirements of the Public Records Act.

Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.8 6
(g) Further Documents. At any time and from time to time during the term of this Agreement as well as following completion of the Project, each party shall execute and deliver (and acknowledge before a notary public where necessary) such documents as the other party may reasonably request or as are necessary to carry out and give effect to the purposes and intent of this Agreement.
(h) Modification and Waiver. This Agreement is not subject to modification except in writing signed by the Parties and any attempted modification not in compliance with this requirement shall be void. Waiver by any party of any portion of this Agreement shall not constitute a waiver of the same or any other portion hereof.
(i) Counterpart; Electronic Signatures. This Agreement may be signed in Counterpart.

Each party agrees that this Agreement and any other documents to be delivered in connection herewith may be electronically signed, and that any electronic signatures appearing on this Agreement or such other documents are the same as handwritten signatures for the purposes of validity, enforceability, and admissibility.
(j) No Agency or Partnership. This Agreement shall not be construed as making either party an agent, partner or joint venture of the other party. (k) Governing Law and Venue. This Agreement shall be deemed to be made under, and shall be governed by and construed in accordance with the laws of the State of California. (l) Notices. All notices, demands or requests from one Party to another may be personally delivered, sent by facsimile, sent by recognized overnight delivery service, sent by mail, certified or registered, postage prepaid, return receipt requested, or by electronic mail, to the persons at the addresses set forth below. Notice shall be deemed given five (5) days after deposit in the United States mail. All notices must be give concurrently via email.

Parties may from time to time specify an alternate address in writing and it shall be effective at the time of personal delivery, facsimile transmission, mailing or electronic mailing.

CITY
Chris Berry
c/o City of Santa Cruz, Water Department
212 Locust St.

Santa Cruz, CA 95060
[email protected]
RCD of Santa Cruz County
820 Bay Avenue, Suite 136
Capitola, CA 95010
[email protected]
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.9 7
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.

RCD LANDOWNER

RESOURCE CONSERVATION DISTRICT

OF SANTA CRUZ COUNTY
Date Date
Lisa Lurie, Executive Director Signature
820 Bay Avenue, Suite 136
Street Address
Capitola, CA 95010
City, State, Zip
Email: [email protected]
E-mail Address
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F 8/26/2025
[email protected]
809 Center Street
Santa Cruz, CA 95060
8/26/2025

24.10 8
Exhibit A
Legal Description of Landowner’s Property, APN 074-012-07 and 093-051-47 APN 074-012-07
APN 093-051-47
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.11 9
Exhibit B
Project Description
Resource Conservation District of Santa Cruz County’s (RCDSCC) Forest Health and Fire Resiliency program partners with local land managers and other stakeholders to strengthen forest and ecosystem health by proactively restoring forests, improving ecosystem resiliency, while minimizing the loss of forest carbon from large, intense wildfires.

Project Description:

The Lockhart shaded fuel break will help protect multiple communities throughout the Santa Cruz County wildland urban interface (WUI) from the effects of wildfire by creating a strategic, roadside shaded fuel break. This project will improve ingress/egress route safety in the event of wildfire and allow firefighters to access the area more easily. It will also reduce greenhouse gas emissions by reducing intensity and duration of a wildfire. This project will create defensible space around the high fire risk communities of Felton, Mount Hermon and Scotts Valley and will stretch from Graham Hill Road on the southern boundary of the Land Trust of Santa Cruz County’s Randall Morgan Sandhills Preserve and extend along the ridgetop to the west side of the Lockhart Gulch drainage and tie into Weston Road to the north. Treatments on City of Santa Cruz Railroad Grade will expand the project further north and tie in with Zayante Road.

Project Objectives:

The objectives of the project are to: (1) reduce the potential for loss of human life and property and damage to infrastructure and public improvements from wildfire, (2) increase the ability of CAL FIRE and other emergency responders to suppress wildfires and evacuate people during a wildfire. Reducing tree densities and fuel loads will also have ecological benefits as plant communities along the central coast of California have developed with frequent, low to moderate intensity wildfire and other disturbance regimes. Elimination of fire from the landscape has decreased species diversity over time while increasing wildfire hazards in parallel. Fuels reduction activities act as fire surrogates and promote habitat mosaics and heterogeneity of successional phases.

Project Specifications:

Project specifications will be outlined in detail in the construction bid document. General shaded fuel break treatments include removal of small trees, removing dead, dying and hazardous trees, tree pruning treatments, and clearing of dense ladder fuels and other woody understory vegetation. Project area is up to 25 feet on either side of the forest road. No trenching will be undertaken.

Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.12 10
Exhibit C
Operations and Maintenance
The Resource Conservation District of Santa Cruz County has CEQA approval for this project through the California Vegetation Treatment Program (CalVTP) Lockhart Zayante Project Specific Analysis #2023-039.

CEQA Document: https://bof.fire.ca.gov/media/buhfrlsv/lockhart-zayante-psaaddm_complete.pdf (“PSA”) If the Landowner intends to utilize the CEQA compliance of the Lockhart Zayante Project Specific Analysis #2023-039 for future implementation or maintenance activities, they must consult with the RCD before any implementation or maintenance occurs and adhere to conditions of the PSA.

As forests are alive and vegetation regrows, collaborating landowners are encouraged to maintain the benefits of the shaded fuel break in forested settings through activities such as:
• Removal of regenerating basal sprouts from cut trees
• Removal of newly established invasive species
• Reducing the ladder fuels that connect the understory to tree canopy • Maintaining spacing of 10-20 feet between large vegetation, including trees • Maintaining roadway access by removing vegetation and trees that may fall and block the roadway
If any perceived maintenance or management needs arise in the project areas, or if the project is not functioning adequately, RCDSCC will be available to consult with the landowner to evaluate maintenance and/or adaptive management needs and develop recommendations for addressing those needs. If additional funding is needed to complete maintenance activities, RCDSCC will be available to work with the landowner to seek funding or in-kind support from collaborating agencies to support planning and implementation associated with that work.

Landowner Initial ______
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.13 11
Exhibit D
Diagram of Access Area
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.14 12
Exhibit E
Grant Conditions 5GA21110
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.15 13
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.16 14
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.17 15
Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

24.18 16
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EXHIBIT F: INSURANCE TO BE PROVIDED BY RCD
Prior to entering into this Agreement, the RCD will maintain and comply with the Insurance Requirements as set forth below.

RCD will insure the City of Santa Cruz (“City”) against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work described in the contract documents. The insurance coverages required shall not in any way limit the liability of the RCD.

1. Certificate Requirements
The City will be issued a Certificate of Insurance (a Memorandum of Understanding will not be accepted) with the following minimum requirements:
• Certificate(s) will show current policy number(s) and effective dates, • Coverage and policy limits will meet, or exceed, requirements below, • The Certificate Holder will be City of Santa Cruz, Risk Management, 1200 Pacific Ave., Suite 290, Santa Cruz, CA 95060,
• Certificate will be signed by an authorized representative, • An endorsement will be provided to show the City, its officers, officials, employees, agents, and volunteers as additional insureds.

2. Minimum Scope and Limits of Insurance
RCD shall acknowledge that the insurance coverage and policy limits set forth in this section constitute the minimum amount of coverage required. If RCD maintains broader insurance coverage and/or higher limits than the minimums shown below, the City requires and shall be entitled to the broader insurance coverage and/or higher limits maintained by Contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City.

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

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• AUTOMOBILE LIABILITY:

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

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

3. Other Insurance Provisions
• ADDITIONAL INSURED STATUS
The City, its officers, officials, employees, agents, and volunteers are to be covered as additional insureds on the CGL and automobile insurance policies with respect to liability arising out of work or operations performed by or on behalf of the RCD including materials, parts, or equipment furnished in connection with such work or operations. General liability coverage will be provided in the form of an endorsement to the RCD’s insurance at least as broad as ISO Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10 CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 (if a later edition is used). • PRIMARY COVERAGE
For any claims related to this Agreement, RCD’s insurance coverage will be primary insurance as respects the City, its officers, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents, or volunteers will be excess of RCD’s insurance and will not contribute with it.
• NOTICE OF CANCELLATION
Each insurance policy required above shall state that the coverage shall not be canceled, except with notice to the City.
• WAIVER OF SUBROGATION
RCD grants to the City a waiver of any right to subrogation which any insurer of said Contractor may acquire against the City by virtue of the payment of any loss, including attorney’s fees under such insurance. RCD agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.
• EXCESS LIABILITY/UMBRELLA INSURANCE POLICIES
RCD may use excess liability/umbrella policies to meet the required liability limits on the condition that they provide all of the insurance coverages required herein, including, but Docusign Envelope ID: 3531B285-4AE7-454B-AE64-69CF4B237F4F

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not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The excess liability/umbrella insurance policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying CGL insurance. No insurance policies maintained by the additional insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the RCD’s primary and excess liability policies are exhausted. • DURATION OF COVERAGE
CGL & Excess Liability/Umbrella policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Such Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.
• SELF-INSURED RETENTIONS
Self-insured retentions must be declared to and approved by the City. City may require RCD to purchase coverage with a lower retention or provide proof of ability to pay losses and related expenses. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City.
• ACCEPTABILITY OF INSURERS
Insurance is to be placed with insurers with a current A.M. Best’s rating of no less than A:VII, unless otherwise acceptable to the City.
• SUBCONTRACTORS
RCD shall include their subcontractor(s) as additional insured(s) under the policies or shall furnish separate certificates and endorsements for each subcontractor. RCD shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and RCD shall ensure that City, its officers, officials, employees, and agents are named as additional insureds on insurance required from its subcontractor(s). • VERIFICATION OF COVERAGE
RCD will furnish the City with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL, and automobile policies listing all policy endorsements to be approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning will not waive the RCD’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

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24.29 City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Water/Library
SUBJECT: Union/Locust Building Roof Replacement – Approval of Purchase Order, Exemption from Local Employment Requirements and CEQA, and Budget Adjustment (WT/LB)
LOCATION: District 4
RECOMMENDATION: Motion to:
1) Approve the issuance of a purchase order in the amount of $289,547 under the existing agreement with Waterproofing Technologies Inc (Beachwood, OH) for roof restoration of the Union/Locust Building and authorize the Water Director and Library Director or their designee to approve change orders within the project budget;
2) Approve exemption from local employment requirements in Santa Cruz Municipal Code 3.10, Local Hiring – Public Works Contractors;
3) Adopt resolution amending the Fiscal Year 2026 budget in the amount of $116,000 to appropriate $116,000 from Water Enterprise Fund 711 for Capital Investment Program (CIP) project c701907, Facility and Infrastructure Improvements; and 4) Approve the California Environmental Quality Act (CEQA) determination contained in this Agenda Report. The Council’s action is exempt from CEQA review under the Class 1 categorical exemption of the California Code of Regulations Section 15301 for repair/rehabilitation of existing facilities.

BACKGROUND: The Union/Locust Building has been occupied by the Water Department and Library Headquarters since 2008 after the City purchased the building and made significant building improvements. The improvements included upgrades to obtain LEED accreditation, which included installation of a photovoltaic system and specialized roofing materials on the flat roof to control heat. During the last 17 years, Public Works Facilities staff have patched the roof in many locations to deter leaks. A roof inspection conducted in July 2025 identified significant repairs needed.

Costs related to the repairs and maintenance for the building are split 60% (Library) and 40% (Water) based on the square footage occupied. On September 4, 2025, the Library Joint Powers

25.1 Authority Board approved a budget adjustment in the amount of $158,400 to fund the Library’s portion of the base-bid cost of the restoration work. Additional funds for its portion of any contingency work is available in the Library’s existing FY2026 budget.

DISCUSSION: As recommended by the Public Works Facilities Maintenance Supervisor, the roof would be restored using a Tremco SI 100 maintenance coating system. This is a reinforced, multi-layer system that offers a durable and energy-efficient alternative to a full roof replacement. Work will include removing roof blisters and mole runs, pressure washing, application of Tremco coating, adding granules to create walkways in most trafficked areas of the roof, restoration of the roof patio, and installation of a yellow molded grated walkway. The materials are covered by a ten-year warranty. The work is subject to prevailing wage and apprenticeship requirements per California Labor Code.

Section 3.08.170 of the Municipal Ordinance allows the City to buy from cooperative purchasing agreements when it is in the best interest of the City to do so. The roof restoration quote is from an Omnia Partners cooperative purchasing agreement, Contract #R230404. The City is one of over 640,000 members of Omnia Partners (formerly National IPA and U.S. Communities). The collective buying power of this national purchasing cooperative provides savings and advantageous contract terms through volume purchasing and avoids significant staff time by utilizing an existing contract.

Section 3.10 of the Santa Cruz Municipal Code, Local Hiring – Public Works Contractors, requires that Contractors “make a good-faith effort …to employ qualified individuals who are…Santa Cruz County residents” and to “make a good faith effort to employ apprentices.” Section 3.10.080 allows an exemption when “the work is of a highly specialized nature.” The installation of the maintenance coating system is not a standard roof replacement, and the work requires the use of highly specialized equipment and experienced labor. Therefore, staff is recommending exemption from local employment requirements. The contract will, however, maintain the requirements for apprentice hiring.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is exempt from CEQA under California Code of Regulations (CCR) Section 15301 – Class 1 categorical exemption because the Council action is intended for the restoration or rehabilitation of deteriorated structures to meet current standards of public health and safety (14 CCR § 15301 (d)). The project will restore the deteriorated roof of a public office building. Furthermore, none of the applicable exclusion to the use of a categorical exemption under CCR 15300.2 – Exceptions apply to this work. The project does not involve cumulative impacts from the same type of project in the same place, significant effects due to unusual circumstances, damage to scenic resources within a scenic highway, location on a hazardous waste site, or substantial adverse change to a historic resource.

HEALTH IN ALL POLICIES (HiAP): This project aligns with the Sustainability pillar of the City’s HiAP initiative by restoring a degraded roof with durable and long-term performance materials that will provide insulation, energy efficiency, and reduced maintenance for Public Works staff.

25.2 FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: Yes

3. The recommendation creates an ongoing expenditure commitment: No FISCAL IMPACT DESCRIPTION: The attached budget adjustment will appropriate $116,000 from Water Enterprise Fund 711 for CIP project c701907, Facility and Infrastructure Improvements, for 40% of the project costs including 10% contingency. Existing funds are available for the Library’s share of costs.

Prepared By:

Malissa Kaping
Principal Management
Analyst
Submitted By:

Heidi Luckenbach
Water Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. QUOTE.PDF

2. BUDGET ADJUSTMENT.PDF

25.3 City of Santa Cruz
Municipal Utilities Project
212 Locust St.

Santa Cruz CA 95060
Cost Estimate # 5067395

25.4 Date: 7/16/2025
CITY OF SANTA CRUZ: MUNICIPAL UTILITIES
Dear Dan Himan,
The following is our proposal for the City of Santa Cruz located at 212 Locust St. Santa Cruz CA 95060

PROPOSED SCOPE OF WORK
*NOTE* Solar panels must be shut off prior to beginning work* - Perform daily safety Audit
- Set up safety equipment necessary for work being performed - Tear off and remove all blisters and mole runs in the existing foam roof - Repair all areas using spray foam to create an even work surface , shave down as needed - Pressure wash entire roof
- Prep all work surfaces for coating application
- Apply Tremco SI 100 to entire roof , Reinforcing all penetrations - Apply Tremco SI 100 with granules to create walkpads in most trafficked areas of roof - Clean and dispose of all job related debris
* Alphaguard MTS patio roof restoration
- Prep work surfaces for coating application
- Apply AG MTS base coat to entire patio roof as to Tremco spec , Fully reinforced with permafab - Apply AG MTS Top coat to entire patio roof , per Tremco spec - Install 80LF Yellow Molded Grated Walkways
- Clean and dispose of all job related debris
PROPOSED FEES:

Total Project Cost: ……………………………………………………………………. $263,224.80 Very Truly Yours,
WEATHERPROOFING TECHNOLOGIES, INC.

Leo Jacobs
Leo Jacobs - Construction Manager
cc: Salah Salem - Tremco
Dave Groshans – WTI

25.5 The preceding scope of work assumes the following:
 Work shall be performed during normal working hours on weekdays.  Work will be performed at one time, under one contract.  Mitigation of hazardous materials, such as lead and asbestos has not been included in this cost estimate.  Project will be executed with prevailing wages
 DIR License #1000000766
 Project excludes permits for City of Santa Cruz

COST ESTIMATE AGREEMENT
This cost estimate is an offer by WTI to provide the Scope of Work set forth above to the Customer on the terms and conditions set forth herein and in WTI’s standard terms and conditions (a copy of which may be obtained at http://www.tremcoroofing.com/fileshare/terms/TandCWTI.pdf), which are hereby incorporated by reference (together, the “Terms and Conditions”). The Terms and Conditions will govern the Work to the exclusion of any other or different terms, including in any customer purchase order, unless otherwise expressly agreed in writing pursuant to a Master Agreement or similar contract with Customer signed by an authorized representative of WTI. Any Performance and Payment Bonds issued for associated repair work are limited to performance of the repairs and one year warranty on such repairs. Bonds, if issued, do not apply to the TremCare extended service agreement. Please confirm your acceptance by return e-mail to the representative identified below. Upon receipt of acceptance, WTI will process your order and promptly begin the Scope of work.

25.6 25.7
WEATHERPROOFING TECHNOLOGIES, INC.

CPN CONTRACT # R230404-CA-320795
Effective Date: 11/01/2023

CONFIDENTIAL
Name CITY OF SANTA CRUZ
Description MUNICIPAL UTILITIES-RESTORE
Quote # 5067395
Date 7/7/2025
Line Item # Description Unit of Measure Unit Price Quantity Project Amount 56 Labor Rate for Roofer (AG SI Mobilization and
Demobilization) Hour $ 173.26 40 $ 6,930.40
56 Labor Rate for Roofer (AG MTS Mobilization and
Demobilization) Hour $ 173.26 10 $ 1,732.60
VA94
Two component, high performance, one part moisture
triggered, polyurethane coating system with fiberglass
reinforcement
SF $ 15.33 350 $ 5,365.50
VA98 One Part, Silicon Roof Coating SF $ 10.21 16,590 $ 169,383.90 VA211 Installer (Walkway) Hour $ 187.11 10 $ 1,871.10
SUBTOTAL $ 185,283.50
VA121 Multiplier for roofs less than 20,000 square feet % 15% $ 185,283.50 $ 27,792.53 47g Difficult access or fall restriction; surcharge % 0.15 $ 185,283.50 $ 27,792.53 VA208 Building/Construction Manager Hour $ 218.76 20 $ 4,375.20 48d Multiplier/factor to be applied to the R.S. Means costs. % 93% $ 9,737.15 $ 9,055.55

NON DISCOUNTED MATERIAL
FG264415 FG MOLDED GRATING YLW 1"-3' X 10' EA $ 746.00 8 $ 5,968.00 FG710120 FG F CLIP FOR 1" DEEP MOLDED GRATING EA $ 29.05 32 $ 929.60 FG790053 FG RUBBER CONNECTOR 2.0 EA $ 10.20 96 $ 979.20 FREIGHT PREPAID & ADD: N/A
SUBTOTAL $ 262,176.10
57b Performance and payment bond - bonding rate
(percent of project) % 0.40% $ 1,048.70
TOTAL PROJECT COST $ 263,224.80
*The pricing contained in this proposal is based in part on sitespecific conditions and unique circumstances presented on each individual project as per Contract #R230404.

This price is valid for 60 days. After that time, project conditions are subject to reassessment.

25.8 Unit Detail Report
Prepared By: Anna Wang WTI
5067395-CITY OF SANTA CRUZ-MUNICIPAL UTILITIES-RESTORE
Year 2025 Quarter 2
Date: 07/07/2025
Cost Estimate Report
LineNumber Description Quantity Unit Total Incl. O&P Ext. Total Incl. O&P Division 01 General Requirements
015416500100 Forklift crew, all-terrain forklift, 45' lift, 35' reach, 9000 lb. capacity, 1.00 Week $9,737.15 $9,737.15 weekly use
Division 01 General Requirements Subtotal $9,737.15

0.00% $0.00
Subtotal
General Contractor's Markup on Subs
$9,737.15
Subtotal $9,737.15
General Conditions 0.00% $0.00
Subtotal $9,737.15
General Contractor's Overhead and Profit 0.00%
Grand Total $9,737.15
$0.00
1 25.9
City of Santa Cruz

BUDGET ADJUSTMENT REQUEST
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 Clear Form
2026
09/02/2025
New appropriation of $116,000 from Water Enterprise Fund 711 for the Union/Locust Building Roof Restoration. 0 711-70-91-7159-57302 c701907-100-2020-0 Facility and Infrastructure Improvements 116,000 116,000
-116,000
Malissa Kaping
2025.09.02
11:15:41 -07'00'
Heidi
Luckenbach
Digitally signed by
Heidi Luckenbach
Date: 2025.09.02
15:56:05 -07'00'
Digitally signed
by Emily Burton
Date: 2025.09.11
'16:05:15 -07'00
Elizabet
h Cabell
Digitally signed by
Elizabeth Cabell
Date: 2025.09.11
16:58:35 -07'00' 25.10
City Council

AGENDA REPORT
DATE: 09/11/2025
AGENDA OF: 09/30/2025
DEPARTMENT: Water
SUBJECT: Accept Modifications of San Lorenzo River Water Rights, Dedicate Instream Flows for North Coast Water Sources, Approve the Anadromous Salmonid Habitat Conservation Plan Project, and Authorize the City Manager to Sign Related State and Federal Endangered Species Act Permits (WT)
LOCATION: Citywide and County
RECOMMENDATION: Motion to:
1) Accept modifications of the City’s San Lorenzo River water rights, as described in the Santa Cruz Water Rights Project and in the State Water Resources Control Board order # WR 2025- 0009 EXEC issued June 6, 2025;
2) Dedicate instream flows for North Coast water sources for the protection of special status aquatic species;
3) Approve the Anadromous Salmonid Habitat Conservation Plan project; and 4) Authorize the City Manager to sign the related federal Endangered Species Act Section 10(a)(1)(b) incidental take permit and the pending California Fish and Game Code Section 2081(b) incidental take permit.

BACKGROUND: Central Coast California steelhead trout were listed as threatened under the Federal Endangered Species Act (FESA) in 1997, and under the California Endangered Species Act (CESA), steelhead trout were also listed as threatened in 1998. Similarly, coho salmon were listed as endangered under the Federal Endangered Species Act in 1997 and as endangered under the California Endangered Species Act in 2004. Water operations, including diversions and flow alterations, among others, can degrade or even destroy critical habitat for coho salmon and steelhead trout by reducing streamflow, increasing water temperatures, and disrupting spawning and rearing areas essential for their survival. Permits under CESA and FESA are both necessary to legally authorize these and related activities, ensuring that any impacts to the species are minimized and mitigated while supporting their recovery.

26.1 A Habitat Conservation Plan (HCP) provides a framework for obtaining a permit under both CESA and FESA by outlining measures to avoid, minimize, and mitigate the impacts of activities on endangered species and their habitats. To obtain the permit, the HCP must be developed in consultation with the relevant wildlife agencies (California Department of Fish and Wildlife for CESA and the National Marine Fisheries Service for FESA), detailing the conservation strategies and actions that will be implemented by the permitted agency. This is a complex undertaking, one that the City has been working on for over two decades through the development of the Anadromous Salmonid Habitat Conservation Plan (ASHCP). The ASHCP specifically addresses activities that may unintentionally affect coho salmon and steelhead trout.

For FESA, obtaining a Section 10 permit is a key part of this process. The Section 10 permit, issued by the National Marine Fisheries Service (NMFS), authorizes incidental take (harm or disturbance) of endangered species during lawful activities, provided that the HCP demonstrates efforts to mitigate and minimize impacts on the species. The Section 10 permit effectively ensures that the City’s operations are compliant with FESA. The HCP also addresses CESA compliance in California, and a Fish and Game Code Section 2081 permit, similar to the Section 10 permit, will be issued to ensure compliance by the end of the calendar year.

To implement the ASHCP and ensure ongoing water supply reliability for the City’s customers, significant changes to the City’s water rights are required, particularly adding flexibility to the location of water diversions and broadening the places of use of the water. These amendments incorporate improvements to instream flows that are essential for the survival of these fish species while also providing the operational flexibility needed to implement the ASHCP while maintaining long-term water supply reliability and supporting sustainable regional water resource management.

These efforts are not pursued in isolation: the ASHCP, modifications to water rights, and supply augmentation strategies are interdependent components of a unified strategy. Together, they reflect the City’s commitment to securing long-term water reliability while protecting environmental resources—each element reinforcing and enabling the success of the others.

DISCUSSION: The following sections summarize the elements of the recommendation and requested Council action.

WATER RIGHTS MODIFICATIONS FOR SAN LORENZO RIVER AND NORTH COAST

STREAMS
The City of Santa Cruz holds two types of water rights: appropriative and pre-1914. The City’s appropriative rights cover diversions on the San Lorenzo River and Newell Creek, whereas the pre-1914 rights are held for the north coast sources, including Reggiardo, Laguna, and Majors creeks, as well as Liddell Spring.

Water rights, whether appropriative or pre-1914, primarily govern the legal allocation and use of water resources for beneficial purposes, such as municipal, agricultural, or industrial use. These rights do not specifically address the environmental impacts that water diversion or use may have on endangered species or their habitats, such as coho salmon or steelhead trout. While water rights dictate who has the legal entitlement to divert water and under what conditions, they do not consider the ecological needs of species protected under CESA or FESA. Water rights may not take into account the minimum stream flows required to maintain fish habitat, water

26.2 temperature, or migration corridors critical to the survival of these species. The proposed changes to the City’s water rights address these concerns, as described and detailed in the ASHCP, while simultaneously supporting the City’s efforts to ensure regional water supply reliability. These changes were described in the Santa Cruz Water Rights Project which was approved by the City Council in December 2021 and is responsive to the associated resolutions (NS-29,908 and NS-29,909).

The amendments to the San Lorenzo River appropriative water rights were approved by the State Water Resources Control Board (SWRCB) on June 6, 2025. As the City’s pre-1914 North Coast water rights are not generally subject to the same SWRCB regulatory authority as the City’s San Lorenzo rights, the City needs to dedicate portions of the North Coast rights to instream flow purposes as well.

See the following link for more information on the Santa Cruz Water Rights Project:
https://www.cityofsantacruz.com/government/city-departments/water/water-rights-4231

ANADROMOUS SALMONID HABITAT CONSERVATION PLAN AND PERMIT

APPROVALS
City staff have worked closely with the NMFS, and other partners, in the development of the ASHCP. The ASHCP project involved a robust evaluation of coho salmon and steelhead trout recovery needs, effects of the City’s water and flood control operations, and actions necessary to minimize and fully mitigate the effects of those activities on these species and their habitat.

Covered activities in the ASHCP include operations, maintenance, and rehabilitation of water supply, water system facilities, and municipal facilities; City lands management; and monitoring.

Recently, the NMFS approved the ASHCP and issued the City the Section 10(a)(1)(b) permit (Incidental Take Permit or ITP) for 30 years, providing certainty for water and flood control operations. A Fish and Game Code Section 2081 incidental take permit from the California Department of Fish and Game is expected by year-end. Both permits are crucial for the City’s long-term operations. Council must approve the ASHCP to conclude the CEQA review process.

See the following link for more information on the ASHCP and to view FESA Section 10(a)(1)(b) permit:
https://www.cityofsantacruz.com/government/city-departments/water/habitat-conservation-plan CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:

Council certified the Santa Cruz Water Rights Project (SCWRP) Final Environmental Impact Report and approved the SCWRP project in December 2021.

Council adopted the ASHCP Final Mitigated Negative Declaration and the ASHCP Mitigation Monitoring and Reporting Program (MMRP) in January 2024; however, implementation of the MMRP was made conditional upon future approval of the ASHCP project. Upon today’s recommended action by Council to approve the ASHCP project, a Notice of Determination will be filed with the Santa Cruz County Clerk and California State Clearinghouse and implementation of the ASHCP and MMRP will begin.

Additionally, a Final Environmental Assessment of the ASHCP was completed under the National Environmental Policy Act (NEPA) by the National Marine Fisheries Service in May 2025 that resulted in a Finding of No Significant Impact.

26.3 HEALTH IN ALL POLICIES (HiAP): The City of Santa Cruz Water Department’s water rights changes and the ASHCP both advance a Health in All Policies (HiAP) approach by integrating ecological, community, and public health considerations into water management.

Specifically:
 Water rights changes: By adjusting diversion practices to improve instream flows, the City helps sustain healthy river ecosystems, which in turn protect drinking water quality, support climate resilience, and enhance recreational and cultural values tied to community well-being.
 ASHCP: By restoring and protecting salmonid habitat, the plan improves watershed health, which benefits biodiversity, stabilizes ecosystems, and ensures long-term sustainable water supplies—all of which are core determinants of community health.

Together, these efforts show how water management decisions are being aligned with HiAP principles: recognizing that environmental stewardship, reliable water supply, and healthy ecosystems directly support the health, safety, and quality of life of the community.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: There are adequate funds in the Water Department’s Fiscal Year 2026 operating budget in the Habitat Conservation Programs Project (o700803).

Funds to support implementation of the ASHCP beyond Fiscal Year 2026 are and will be included in the Water Department’s current and ongoing Long Range Financial Plans.

Prepared By:

Chris Berry
Watershed Compliance
Manager
Submitted By:

Heidi Luckenbach
Water Director
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. WATER RIGHTS ORDER # WR 2025-0009 EXEC.PDF

2. RESOLUTION.DOCX

26.4 State Water Resources Control Board
In Reply Refer to:

KMG: A004017 et al.

Heidi Luckenbach, Water Director
City of Santa Cruz
212 Locust St., Suite C
Santa Cruz, CA 95060
Email: [email protected]
Dear Ms. Luckenbach:

ORDER APPROVING PETITIONS FOR CHANGE AND EXTENSION OF TIME AND AMENDED WATER RIGHT LICENSES 1553, 7200, AND 9847 (APPLICATIONS 4017, 5215, AND 17913) AND PERMITS 16123 AND 16601 (APPLICATIONS 22318 AND 23710) OF THE CITY OF SANTA CRUZ IN SANTA CRUZ COUNTY
The City of Santa Cruz’s petitions for change and extension of time have been approved and the requested changes have been incorporated in the enclosed amended water right Licenses 1553, 7200, and 9847 and Permits 16123 and 16601. The previous versions of the water rights have been superseded by the present versions. Please note that some mandatory license and permit terms have been updated and/or added from those that were included in the previous version of the licenses and permits. Also, due to changes in format, the amended water rights may have different term numbering than the original rights. Please make sure that you have reviewed the amended water rights and understand your obligations.

If you have any questions regarding this matter, please contact Kate Gaffney at [email protected]. Written correspondence or inquiries should be addressed as follows: State Water Resources Control Board, Division of Water Rights, Attn: Kate Gaffney, P.O. Box 2000, Sacramento, CA, 95812-2000.

Sincerely,
Jian Ling, Program Manager
Petition, Licensing and Registration Section
Division of Water Rights
Enclosures – Order and Amended Water Right Licenses 1553, 7200, and 9847 and Permits 16123 and 16601
JUN 06 2025
ORIGINAL SIGNED BY:

26.5 Heidi Luckenbach, Water Director - 2 -
City of Santa Cruz
cc: Chris Berry
City of Santa Cruz
[email protected]
Paula Whealen
Wagner & Bonsignore Consulting Civil Engineers
[email protected]
Jessie Maxfield
California Department of Fish and Wildlife
Bay Delta Region
[email protected]
John Kunkel
Interim General Manager
San Lorenzo Valley Water District
[email protected]
David Kossack
San Andreas Land Conservancy
[email protected]
Ryan Bezerra
BKS Law Firm
[email protected]
JUN 06 2025

26.6 STATE OF CALIFORNIA

CALIFORNIA ENVIRONMENTAL PROTECTION AGENCY

STATE WATER RESOURCES CONTROL BOARD

DIVISION OF WATER RIGHTS
ORDER WR 2025-0009 EXEC
In the Matter of Petitions for Change for Water Right Licenses 1553, 7200, and 9847 (Applications 4017, 5215, and 17913) and Permits 16123 and 16601 (Applications 22318 and 23710) and Petitions for Extension of Time for Permits 16123 and 16601 City of Santa Cruz

ORDER APPROVING PETITIONS FOR CHANGE AND EXTENSION OF TIME,

ISSUING AMENDED LICENSES AND PERMITS, AND CANCELING PROTEST SOURCE: San Lorenzo River
COUNTY: Santa Cruz
BY THE EXECUTIVE DIRECTOR:

1.0 INTRODUCTION
In December 2006, the City of Santa Cruz (City) filed petitions for change for water right License 9847 (Application 17913) and water right Permits 16123 and 16601 (Applications 22318 and 23710, respectively), as well as petitions for extension of time for Permits 16123 and 16601, with the State Water Resources Control Board (State Water Board), Division of Water Rights (Division). The Division originally issued public notice of the petitions on October 8, 2008. Following discussions with Division staff, on January 29, 2019, the City filed revised petitions for change for License 9874 and Permits 16123 and 16601, revised petitions for extension of time for Permits 16123 and 16601, and new petitions for change for Licenses 1553 and 7200 (Applications 4017 and 5215, respectively). The City amended its petitions on August 5, 2020, and subsequently amended all of its previously filed petitions in their entirety on January 6, 2021. This Order addresses the City’s January 6, 2021 petitions for change and extension of time.

With the change petitions, the City has requested changes in points of diversion, method of diversion, purposes of use, and places of use of its licenses and permits to improve the reliability and operational flexibility of the City’s water supply system. The

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Permits 16123 and 16601
City of Santa Cruz
City has also requested to add flow requirements to its water rights that it negotiated in 2007 with the California Department of Fish and Wildlife (CDFW) and National Marine Fisheries Service (NMFS). In addition, the City has requested the State Water Board approve a time extension through December 31, 2043 to complete beneficial use under Permits 16123 and 16601.

2.0 BACKGROUND OF THE CITY’S WATER SUPPLY AND WATER RIGHTS

2.1 The City’s Water Supply
The City’s water supply system currently draws mainly from surface water sources, including Loch Lomond Reservoir on Newell Creek which is tributary to San Lorenzo River thence Monterey Bay, two diversions on the mainstem San Lorenzo River (the Felton Diversion in Felton and the Tait Street Diversion Facilities in Santa Cruz), and diversions from four other streams that are tributary to the Pacific Ocean (Laguna Creek, Reggiardo Creek, Liddell Spring, and Majors Creek). These surface water sources provide about 95 percent of the City’s annual supply. Loch Lomond Reservoir, with a licensed capacity of approximately 8,624 acre-feet (af), was constructed to meet dry-season water demand and provide a backup supply during winter storms when the water quality at the Tait Street or Felton Diversions is problematic due to turbidity issues. During the dry season, the City supplements its surface water supply with limited production from groundwater wells in the Santa Cruz Mid-County Groundwater Basin (Basin No. 3-027) in unincorporated Santa Cruz County. The City does not have an imported water supply from outside the region.

2.2 The City’s Water Rights
The City’s water rights include both pre-1914 and post-1914 appropriations. The City’s pre-1914 water rights include points of diversion on Liddell Spring, Laguna Creek, Majors Creek, and Reggiardo Creek,
1 in the unincorporated Bonny Doon area of
northern Santa Cruz County. Water from the pre-1914 rights is used for municipal purposes year-round and the diversions have not previously been subject to bypass requirements. Since 2007, however, the City’s diversions under its pre-1914 rights have been subject to multiple agreements with CDFW regarding minimum bypass flows.

The City’s post-1914 appropriations include three water right licenses and two water right permits. The City’s Licenses 1553 and 7200 allow diversions from the Tait Street Diversion Facilities, which include a dam and four sub-surface diversion wells on the San Lorenzo River, and License 9847 allows diversions to storage in Loch Lomond Reservoir from Newell Creek. The City’s Permits 16123 and 16601 allow diversions 1 The City has pre-1914 water right claims documented with Statements of Diversion and Use S002043, S002042, S002044, and S008610.

26.8 Licenses 1553, 7200, and 9847 Page 3 of 28
Permits 16123 and 16601
City of Santa Cruz
from the Felton Diversion on the San Lorenzo River to storage in Loch Lomond Reservoir.

Locations of the City’s current diversion and storage facilities • Loch Lomond Reservoir is formed by Newell Creek Dam located on Newell Creek located as follows: California Coordinate System of 1983, Zone 3, North 1,863,850 feet and East 6,102,950 feet, being within the NW¼ of SW¼ of Section 34, T9S, R2W, MDB&M
• The Tait Street Diversion Facilities are located on the San Lorenzo River as follows:
a. Diversion Dam: California Coordinate System of 1983, Zone 3, North 1,822,800 feet and East 6,114,450 feet, being within the SE¼ of NW¼ of projected Section 12, T11S, R2W, MDB&M
b. Well No. 1: California Coordinate System of 1983, Zone 3, North 1,822,992 feet and East 6,114,627 feet, being within the NE¼ of NW ¼ of projected Section 12, T11S, R2W, MDB&M
c. Well No. 2: California Coordinate System of 1983, Zone 3, North 1,823,057 feet and East 6,114,826 feet, being within the NE¼ of NW¼ of projected Section 12, T11S, R2W, MDB&M
d. Well No. 3: California Coordinate System of 1983, Zone 3, North 1,823,218 feet and East 6,114,695 feet, being within the NE¼ of NW¼ of projected Section 12, T11S, R2W, MDB&M
e. Well No. 4: California Coordinate System of 1983, Zone 3, North 1,822,953 feet and East 6,114,494 feet, being within the NE¼ of NW¼ of projected Section 12, T11S, R2W, MDB&M
• The Felton Diversion is located on the San Lorenzo River, California Coordinate System of 1983, Zone 3, North 1,842,916 feet and East 6,102,739 feet, being within the NE¼ of SW¼ of Section 22, T10S, R2W, MDB&M
Summaries of the City’s Licenses and Permits
License 1553 (Application 4017)
License 1553 has a priority of June 9, 1924, and allows direct diversion of both surface flow from the San Lorenzo River at the Tait Street Diversion Facilities including the Tait Street Diversion Dam and sub-surface flow from Tait Street Diversion Well Nos. 1, 2, 3, and 4. Up to 6.2 cubic feet per second (cfs) of water can be diverted collectively from all points of diversion from January 1 to December 31. Water can be used for municipal and domestic uses within the City, and an area east of the City that is bounded on the west by the eastern boundary of the City, on the south by Monterey Bay, on the east by

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Permits 16123 and 16601
City of Santa Cruz
the eastern line of 41st Avenue and a line from the intersection of the eastern line of 41st Avenue with the southern line of the Santa Cruz-Watsonville Highway at a right angle to said southern line of Santa Cruz -Watsonville Highway extending to the north boundary of Section 9, T11S, R1W, MDB&M; and bounded on the north by the north boundary of Sections 8 and 9, T11S, R1W, MDB&M; as shown on the map filed with the State Water Board.

License 7200 (Application 5215)
License 7200 has a priority of September 20, 1926, and allows direct diversion of both surface flow from the San Lorenzo River at the Tait Street Diversion Dam and subsurface flow from Tait Street Diversion Well Nos. 2, 3, and 4. Up to 6 cfs of water can be diverted collectively from all points of diversion from January 1 to December 31. Water can be used for municipal and domestic uses within the boundaries of the City as shown on the map filed with the State Water Board.

License 9847 (Application 17913)
License 9847 has a priority of December 12, 1957, and allows diversion of water to storage in Loch Lomond Reservoir at Newell Creek Dam on Newell Creek. Up to 5,600 acre-feet per annum (afa) can be collected to storage from September 1 of each year through July 1 of the succeeding year. The maximum withdrawal in any one year cannot exceed 3,200 af and the City has the right to hold up to 8,624 af in storage in Loch Lomond Reservoir. Water can be used for municipal, domestic, industrial, recreational and fire protection uses at Loch Lomond Reservoir and in the San Lorenzo Basin, including Upper San Lorenzo Valley, Scotts Valley, and the City, being within portions of Township 8S, 9S, 10S, and 11S, Range 1W, 2W, and 3W, MDB&M, as shown on the map filed with the State Water Board.

Diversions under License 9847 are subject to an agreement entered into between the Santa Cruz County Flood Control and Water Conservation District and the California Department of Fish and Game (now CDFW), received by the State Water Board on September 15, 1958.

Permit 16123 (Application 22318)
Permit 16123 has a priority of October 20, 1965, and allows diversion of water to offstream storage from the Felton Diversion on the San Lorenzo River to Loch Lomond Reservoir. Up to 3,000 afa can be collected to storage from about September 1 of each year to about June 1 of the succeeding year. The maximum rate of diversion to offstream storage cannot exceed 3,500 gallons per minute (gpm). Water can be used for municipal purposes within the City’s water service area within Township 10S and 11S, Range 1W, 2W, and 3W, MDB&M.

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Permits 16123 and 16601
City of Santa Cruz
Complete application of the water to the proposed use was to be made by December 31, 2006.

Permit 16601 (Application 23710)
Permit 16601 has a priority of March 1, 1971, and allows diversion of water to offstream storage from the Felton Diversion on the San Lorenzo River to Loch Lomond Reservoir.

Up to 3,000 afa can be collected to storage from October 1 of each year to June 1 of the succeeding year. The maximum rate of diversion to offstream storage under Permit 16601 and Permit 16123 is limited to a combined maximum of 20 cfs. The total combined quantity of water diverted under Permits 16601 and 16123 cannot exceed 3,000 afa. Water can be used for municipal purposes within the City’s water service area within Township 10S and 11S, Range 1W, 2W, and 3W, MDB&M.

Complete application of the water to the proposed use was to be made by December 31, 2006.

Bypass requirements in Permits 16123 and 16601
Permits 16123 and 16601 contain flow bypass requirements which were developed as part of the City’s drought response activities in 1977. The current bypass requirements are as follows:

Permit 16123 bypass requirements:

Permittee shall bypass 10 cfs or the natural flow, whichever is less, from September 1 through September 30; and 20 cfs or the natural flow, whichever is less, from October 1 through May 31 for the preservation of fish and wildlife.

Permit 16601 bypass requirements:

For the protection of fish, no diversion shall be made during the month of October which depletes the flow of the stream to less than 25 cfs nor to less than 20 cfs during the period November 1 to the succeeding May 31. No water shall be diverted until permittee has installed in the stream immediately below its point of diversion a staff gage, or other device satisfactory to the State Water Board, showing the water levels which correspond to the above-mentioned flows in cubic feet per second. As a condition of continuing diversion, said measuring device shall be properly maintained.

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Permits 16123 and 16601
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3.0 REQUESTED CHANGES TO LICENSES AND PERMITS

3.1 Requested changes to points of diversion, methods of diversion, places of use, purposes of use, and permitted development periods Requested changes in points of diversion and methods of diversion • Add diversion to underground storage at the Tait Street Diversion Facilities points of diversion in Licenses 1553 and 7200
• Add direct diversion at the Newell Dam point of diversion in License 9847 • Add direct diversion and diversion to underground storage at the Felton Diversion Facility point of diversion, and add the Tait Street Diversion Facilities as points of direct diversion and diversion to underground storage in Permits 16123 and 16601 • Add the four Beltz Injection Wells as points of rediversion to underground storage in Licenses 1553 and 7200 and Permits 16123 and 16601. The City will subsequently recover the stored water at the same wells. The Beltz Injection Wells are located as follows:
1) Well No. 8: California Coordinate System of 1983, Zone 3, North 1,813,775 feet and East 6,132,716 feet, being within the SE¼ of SE¼ of projected Section 16, T11S, R1W, MDB&M
2) Well No. 9: California Coordinate System of 1983, Zone 3, North 1,812,135 feet and East 6,131,318 feet, being within the SW¼ of NE¼ of projected Section 21, T11S, R1W, MDB&M
3) Well No. 10: California Coordinate System of 1983, Zone 3, North 1,813,446 feet and East 6,131,683 feet, being within the SW¼ of SE¼ of projected Section 16, T11S, R1W, MDB&M
4) Well No. 12: California Coordinate System of 1983, Zone 3, North 1,820,121 feet and East 6,132,941 feet, being within the SE¼ of SE¼ of projected Section 9, T11S, R1W, MDB&M
The City requested to add direct diversion as a method of diversion to License 9847 and Permits 16123 and 16601 because during winter months the City has historically used water from Loch Lomond Reservoir at the same time it is filling the reservoir, which constitutes a direct diversion. The maximum direct diversion rates are proposed to be 31 cfs for License 9847, 3,500 gpm for Permit 16123, and a combined limit of 20 cfs for Permit 16601 and 16601. The City stated that the addition of direct diversion to these rights will not cause the existing license and permit diversion limits to be exceeded.

Requested change in place of storage
The City requested to include underground storage in the Santa Cruz Mid-County Groundwater Basin (Basin No. 3-027) in Licenses 1553 and 7200 and Permits 16123 and 16601. The City stated that the underground storage of surface water will protect

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Permits 16123 and 16601
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groundwater quality from seawater intrusion and allow the City to use stored groundwater during dry periods when surface water diversions may be limited due to new stream flow requirements as discussed below in Section 3.2.

Requested changes in place of use
The City requested to expand its place of use under its licenses and permits to provide operational flexibility and to integrate water resources in the regional area. The City requested to include the adjacent service areas of Central Water District, San Lorenzo Valley Water District (San Lorenzo Valley WD), Scotts Valley Water District, Soquel Creek Water District (Soquel Creek WD), the Santa Cruz Mid-County Groundwater Basin and Santa Margarita Groundwater Basin (Basin No. 3-027), as well as the City’s North Coast service area. This expansion of the City’s place of use would in part allow the City to provide those areas surface water supply when excess surface water is available under the City’s licenses and permits.

Requested changes in purpose of use
The City requested to consolidate the purposes of use of Licenses 1553, 7200, 9847 and Permits 16123 and 16601 so that all licenses and permits include municipal, domestic, industrial, recreation, fire protection, and protection of groundwater quality.

Requested extension of time to develop Permits 16123 and 16601 The City has requested a 37-year time extension until December 31, 2043 to complete diversion and use under Permits 16123 and 16601.

3.2 Requested modifications to incorporate the Anadromous Salmonid Habitat Conservation Plan (ASHCP)
In June 2023, the City completed a draft ASHCP for compliance with the Federal and State Endangered Species Acts to address the City’s water supply operations that may adversely affect special status anadromous salmonids such as coho salmon and steelhead. Flow requirements for streams that support the City’s water diversions were developed through the ASHCP process and the City requested that the flow requirements be incorporated into the City’s licenses and permits and replace existing bypass requirements.

Background
As part of development of the ASHCP, starting in 2006 the City engaged with CDFW and NMFS in a technical study to determine appropriate stream flows for coho salmon and steelhead in all streams from which the City diverts water (Agreed Flows). Tables 1 through 4 of Attachment 1 of this Order detail the Agreed Flow requirements for the

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Permits 16123 and 16601
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City’s permits and licenses. The City proposes to apply the ASHCP flow requirements to diversions under the City’s pre-1914 water right claims as well as to incorporate the requirements into the City’s licenses and permits. The City asserts that implementation of these flow requirements across all of the City’s water rights necessitates the other proposed changes to the licenses and permits. Absent the other proposed changes, including groundwater storage and change to the place of use, described in Sections

3.1 and 3.3 of this Order, the City states that complying with the ASHCP Agreed Flows would significantly impact the City’s ability to provide a reliable drinking water supply.

In addition to new flow requirements, the proposed project covered by the ASHCP also includes surface water diversion improvement components aimed at improving fish passage, especially for coho salmon and steelhead. These components consist of modifications of the Felton Diversion, including fish screen replacement and installation of a traveling brush system to maintain optimum efficiency of the fish screens. The components also include the construction of a continuous downstream outmigration bypass route within the existing bypass channel with a downstream opening slide gate.

The requested modifications in methods of diversion and points of diversion would provide the ability to divert water under Permits 16123 and 16601 with or without activation of the Felton Diversion inflatable dam, thereby improving operational flexibility. Water originally authorized to be diverted under Permits 16123 and 16601 at the Felton Diversion could instead be diverted at the Tait Street Diversion, providing fishery benefits by allowing the water to remain in the San Lorenzo River for a longer period.

The Agreed Flows requirements are referenced in the City’s proposed new conditions to be included in its permits and licenses as follows:

Proposed new fish and wildlife conditions to replace current bypass conditions in Permits 16123 and 16601
1) [The City] shall bypass water at both the Felton and Tait Street Diversion Facilities according to the minimum streamflow schedule as agreed to by the City, the National Marine Fisheries Service (NMFS), and the California Department of Fish and Wildlife (CDFW) (in Attachment 1). To improve fish passage at the Felton Diversion Facility, [the City] shall complete improvements to that facility consistent with any habitat conservation plan or incidental take permit issued by NMFS or CDFW for the operation of the facility. [The City] shall complete those improvements in the time provided by that plan or permit. 2) No diversions under this right for rediversion to underground storage shall occur during Hydrologic Condition 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

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Permits 16123 and 16601
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3) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

Proposed new fish and wildlife conditions to be included in Licenses 1553 and 7200 1) [The City] shall provide bypass at Tait Street Diversion Facilities according to the minimum streamflow schedule in Table 2 of the Agreed Flows (in Attachment 1) as agreed to by the City, National Marine Fisheries Service, and the California Department of Fish and Wildlife.
2) No diversions under this right for rediversion to underground storage shall occur during Hydrologic Condition 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.
3) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

Proposed new fish and wildlife conditions to be included in License 9847 to replace current license term referencing 1958 stipulation between the City and CDFW 1) The City shall release water from Loch Lomond Reservoir to Newell Creek according to the minimum streamflow schedule as agreed to by the City, National Marine Fisheries Service, and the California Department of Fish and Wildlife as shown in Table 4 of the Agreed Flows in Attachment 1.
2) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

According to the project description in the City’s environmental impact report (EIR), and consistent with the proposed integrated operation of all of its diversions, the City will incorporate into its pre-1914 rights the “Agreed Flows” bypass requirements for the diversions associated with those rights in conjunction with the State Water Board’s approval of the City’s pending water right petitions.

3.3 Addition of Underground Storage to Licenses 1553 and 7200 and Permits 16123 and 16601
Aquifer Storage and Recovery (ASR) Projects
With the petitions for change, the City requested to include ASR projects in its water supply operations by adding underground storage to Licenses 1553 and 7200 and

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Permits 16123 and 16601
City of Santa Cruz
Permits 16123 and 16601. The ASR process involves utilizing existing and potential new infrastructure to inject surface water, treated to meet drinking water standards, into local groundwater basins during normal or wet periods. These basins then serve in part as underground storage reservoirs, and the stored water can be extracted for later use during dry periods. The operation of all ASR injections and extractions is proposed to align with sustainable management criteria and avoid any undesirable results identified in the adopted Santa Cruz Mid-County Groundwater Basin Groundwater Sustainability Plan (GSP) and in any future revisions to the GSP. Additionally, the ASR facilities are proposed to be permitted, constructed, and operated in accordance with State Water Board Water Quality (WQ) Order 2012-0010, General Waste Discharge Requirements for Aquifer Storage and Recovery Projects that Inject Drinking Water into Groundwater.

This would ensure compliance with relevant regulations and policies, including applicable Basin Plans adopted by the State Water Board and the Central Coast Regional Water Quality Control Board, and State Water Board Resolution No. 68-18 (the Antidegradation Policy).

The City currently uses groundwater wells in the Santa Cruz Mid-County Groundwater Basin to supply municipal water during dry conditions to meet peak season demand.

The California Department of Water Resources (DWR) has prioritized this basin as a high-priority groundwater basin and designated the basin critically overdrafted. Since 2015, the City and Soquel Creek WD have operated groundwater extractions under a cooperative monitoring/adaptive groundwater management agreement. This agreement was developed to ensure the following groundwater management objectives are met:
(1) protect the Santa Cruz Mid-County Groundwater Basin from seawater intrusion; (2) allow for redistribution of groundwater pumping inland; (3) maintain inland and coastal groundwater levels to abate seawater intrusion; and (4) provide both agencies flexibility to respond to changing conditions. In 2020, the City and Soquel Creek WD, along with other members of the Santa Cruz Mid-County GSA, adopted the GSP for that basin.

DWR has approved the GSP, and the City plans to operate its wells consistent with that GSP.

4.0 PROTESTS AND COMMENTS ON THE PETITIONS
Pursuant to Water Code section 1703, the Division issued a public notice of the City’s petitions on February 10, 2021. Two protests were filed in response to the public notice:
1) San Lorenzo Valley WD filed a protest on March 12, 2021; and 2) San Andreas Land Conservancy (SALC) filed a protest on March 11, 2021.

On February 25, 2021, CDFW submitted a letter in support of the City’s petitions for change and extension of time. CDFW indicated that it has been working with the City and NMFS for years to develop an integrated water resource management strategy that would benefit anadromous salmonid species and enhance long-term water supply reliability. CDFW stated that the petitions further a larger project (including the draft

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Permits 16123 and 16601
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ASHCP negotiated with CDFW and NMFS) designed to enhance instream flow conditions for coho salmon and steelhead in the San Lorenzo River, Majors Creek, Laguna Creek, and Liddell Creek watersheds in Santa Cruz County. CDFW indicated that the changes proposed with the petitions would contribute to the recovery of these species and the changes requested are therefore consistent with Action 4 of the California Water Action Plan (California Natural Resources Agency et al. 2014) which encourages the protection and restoration of important ecosystems by enhancing water flows in stream systems statewide.

4.1 Protest filed by San Lorenzo Valley WD
The City and San Lorenzo Valley WD are both solely dependent on local water supplies and both divert water from the San Lorenzo River watershed. In the 1950s and 1960s, the City and San Lorenzo Valley WD entered into a series of agreements that supported the construction of Newell Creek Dam and Loch Lomond Reservoir. In the March 16, 1981 Judgment in San Lorenzo Valley Water District v. City of Santa Cruz, Case No: 62590 (1981 Judgment), the Santa Cruz County Superior Court determined that San Lorenzo Valley WD holds contract rights to use 12.5 percent of safe annual yield of Loch Lomond Reservoir, which is estimated by the City to represent 313.4 acre--feet per year. The City stated its intention that nothing requested by these petitions modify, supersede, or replace any portion of the 1981 Judgment.

San Lorenzo Valley WD filed a protest against the petitions in order to protect its contract rights to its Newell Creek water supply, other water rights, and the public interest in maintaining adequate local water supplies while protecting fisheries. The City responded that San Lorenzo Valley WD water supplies would not be affected by the proposed changes. Following negotiation regarding the protest, the City and San Lorenzo Valley WD signed a protest resolution agreement on January 12, 2022. The agreement included protest dismissal terms agreed upon by both parties that the City has requested be included in License 9847 and Permits 16123 and 16601. The State Water Board considers San Lorenzo Valley WD’s protest resolved with the inclusion of the following terms in the City’s amended water rights as approved by this Order:

Term proposed to be included in Amended License 9847:

Since its issuance, this license has authorized use in areas in “the San Lorenzo Basin.” This license's minimum streamflow requirements, and its limitations on the City's deliveries to other entities under Hydrologic Conditions 4 and 5, do not preclude the City from delivering to San Lorenzo Valley Water District under this license and an existing contract between that District and the City up to 313.4 acre-feet of water per year from reservoir storage at any rate and at any time. The City and the District will collaborate to determine mutually agreeable operational terms for delivering the District's contract supply. The City understands that the District seeks to better integrate the surface-water and groundwater supplies that serve the District's different service areas.

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Permits 16123 and 16601
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Term proposed to be included in Amended Permits 16123 and 16601:

The City of Santa Cruz acknowledges that the minimum Felton bypass flows stated in this permit are not a binding precedent for Term 13 in San Lorenzo Valley Water District's Permit 20123.

4.2 Protest filed by SALC
Substance of protest and the City’s and Division’s responses SALC stated its belief that the City has put no water to use under Permits 16123 and 16601 and the permits should be described as expired and abandoned. SALC also believes that if the City hasn’t completed diversion and use of water under its permits at the end of the development period, a new water right application should be filed. SALC is further concerned that adding direct diversion to License 9847 could allow the diversion of additional water from Newell Creek, and questioned why the City required additional uses to be added to its water rights. Finally, SALC raised concerns regarding the new minimum bypass flows (Agreed Flows) the City developed with CDFW and NMFS and the proposed conditions implementing the Agreed Flows that are to be included in the amended licenses and permits.

On May 16, 2021, the City provided a letter responding to the issues raised by SALC.

Among other things, the City stated that one key reason beneficial use was not maximized under Permits 16123 and 16601 was the success of the City’s conservation programs. The City also stated that adding direct diversion to License 9847 will not increase diversions from Newell Creek and the diversions will remain subject to the currently licensed limits, and that the changes in purposes of use were proposed to help integrate the City’s regional water planning and management consistent with its water rights. The City further stated that it developed the new proposed minimum stream flows through a lengthy technical process with CDFW and NMFS to improve conditions for fish and other protected species and that CDFW subsequently submitted a memorandum to the Division supporting the petitions.

By letter dated September 13, 2022, the Division requested that SALC provide additional information to support its claims that approval of the petitions would cause injury to other water right holders and protected species. The Division indicated that since an EIR for the project had been finalized, SALC should state which issues were not addressed in the final EIR and provide supporting information for those issues.

SALC provided a response on November 14, 2022 and stated that none of its protest issues were addressed in the City’s final EIR sufficiently to be considered resolved.

SALC claimed that the City did not provide information regarding a means of funding or third-party enforcement for the ASHCP and Agreed Flows. SALC also stated that the

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Permits 16123 and 16601
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water is a public trust resource and belongs to the people of California, and if the State Water Board fails to apply the Water Code in an equitable and consistent manner it is an injury to the people of California. SALC also claimed that the City has historically been using water diverted under its municipal water rights for other purposes. Finally, SALC claimed that the City has not proceeded with due diligence in developing water use under Permits 16123 and 16601 and the permits should be canceled.

Cancellation of protest
Based on the Division’s review of information provided by SALC, it appears that SALC’s claim that the City's proposed changes could injure other water users is based on general claims rather than specific evidence of injury or harm to other water right holders. While SALC argues that the City is diverting water for purposes beyond municipal use, it did not provide specific supporting information for this claim, and SALC did not identify any specific water right users that may be injured.

Further, SALC has not provided specific information regarding how the City’s proposed change petitions will be harmful to protected species. SALC expressed general concern that the City's proposed change petitions will not adequately provide for the protection and recovery of protected species such as coho salmon and steelhead. SALC claimed that the City did not identify any funding for the implementation of protection and/or recovery programs for these species in its environmental documents. Additionally, SALC argued that the environmental documents did not provide for any enforcement by third-party organizations such as NGOs to ensure the protection of these species.

However, the Water Code does not require that funding or enforcement by third-party organizations be provided.

The City negotiated with CDFW and NMFS to develop minimum bypass flows as part of the draft ASHCP to protect coho salmon and steelhead, and neither of these resource agencies opposes the City’s petitions for change and extension of time. Further, CDFW sent in a letter supporting the changes requested with the petitions. SALC has failed to provide the requested information to support its protest or to describe why its concerns were not sufficiently addressed in the final EIR.

The State Water Board has determined that SALC has not provided adequate information to substantiate its claim that the changes proposed with the petitions will injure another legal user of water. The State Water Board has also determined that there is no substantial evidence in light of the whole record to support SALC’s allegations of environmental impacts resulting from changes requested with the petitions.

A protest may be cancelled in accordance with Water Code section 1703.6, subdivisions (c) and (d) if the protestant fails to submit information requested by the Board and if the public review for a draft California Environmental Quality (CEQA)

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Permits 16123 and 16601
City of Santa Cruz
document has expired. The City issued a draft EIR for the project covered by the petitions in June 2021 for public circulation and comment, and the City approved the final EIR in December 2021, and SALC did not provide adequate supporting information as requested in the Division’s September 13, 2022 letter. Therefore, SALC’s protest is canceled.

5.0 PETITIONS FOR CHANGE

5.1 Applicable Law
Water Code sections 1700 through 1705 govern changes in the place of use, purpose of use, or point of diversion of an application, permit or license, requiring permission to make such changes from the State Water Board. The petitioner must establish that the proposed changes will not effectively initiate a new right (Cal. Code Regs., tit. 23, § 791, subd. (a).), and the proposed changes must not operate to the injury of any legal user of water. (Wat. Code, § 1702.). The proposed changes must also be in the public interest and not unreasonably harm fish, wildlife, and other instream beneficial uses.

As discussed in State Water Board Order 2009-0061, basic elements of an appropriative water right include priority, source of water, season of diversion, amount of diversion, point of diversion, place of use, and purpose of use. (State Water Board Order 2009-0061, p. 5, citing Wat. Code, § 1260 et seq; Hutchins, The California Law of Water Rights (1956) “Elements of the Appropriative Right,” pp. 130-154 (Hutchins); Central Delta Water Agency v. State Water Resources Control Board (2004) 124 Cal.App.4th 245, 253, 257.) That order notes how some of these elements may be changed, but that “a fundamental principle of water right law, however, is that a right cannot be so changed that it in essence constitutes a new right.” (State Water Board Order WR 2009-0061, citing Cal. Code Regs., tit. 23, § 791, subd. (a).) The given examples of characteristics of a water right that can’t be changed, i.e., for which changes generally require a new water right, are expansion to appropriate a greater amount of water, to increase the season of diversion, or to use a different source of water. (State Water Board Order WR 2009-0061, pp. 5-6, citing Cal. Code Regs., tit. 23, § 699; Johnson Rancho County Water District v. State Water Rights Board (1965) 235 Cal.App.2d 863, 879.)
State Water Board Order WR 2009-0061 also discusses the requirement that a change not injure any legal user of water. “Some of these defining elements may be changed by the appropriator, so long as the change does not injure other water users.” (State Water Board Order WR 2009-0061, p.5, citing Hutchins, supra., p. 175 [“It has long been settled in California that an appropriator may change the point of diversion, place of use, or character of the use of water … provided that the rights of others are not thereby impaired”]; Wat. Code, § 1701; Cal. Code Regs., tit. 23, § 791; City of San Bernardino v.

City of Riverside (1921) 186 Cal. 7, 28-29 [allowing change in the place of use,

26.20 Licenses 1553, 7200, and 9847 Page 15 of 28
Permits 16123 and 16601
City of Santa Cruz
character of use, and point of diversion so long as no others are injured]; Hand v.

Cleese (1927) 202 Cal. 36, 45 [allowing diverter to change the means of diversion of waters from a specific ditch to a different “natural depression” as the change did not cause injury].)

5.2 Analysis

5.2.1 No Initiation of a New Right
While changes in place and purpose of use could under different circumstances constitute initiation of a new right, the City’s unique geographic location, including the lack of other demands on the sources of the City’s water rights, are relevant considerations in evaluating the requested changes.

With the change petitions, the City requested to add domestic, industrial, recreation, fire protection, and water quality protection as purposes of use to its municipal use water rights. The State Water Board regulations define “municipal use” as follows: “Municipal use means the use of water for the municipal water supply of a city, town, or other similar population group, and use incidental thereto for any beneficial purpose.” (Cal.

Code Regs, tit. 23, § 663, italics added). The beneficial uses that the City requested to add to its water rights therefore are implicitly included within municipal use. The City is proposing the addition of the beneficial uses to its permits and licenses largely to align their stated purposes. For example, water quality protection is proposed to be added as purpose of use to protect the City’s water supplies, including the City’s surface water and groundwater sources. The City will recharge water into the Santa Cruz Mid-County Groundwater Basin and, as the Santa Cruz Mid-County Groundwater Basin is overdrafted and potentially subject to seawater intrusion, leaving an increment of recharged water in the basin will contribute to protecting the basin’s fresh water. The addition of “protection of water quality” as a purpose of use therefore, is, among other things, incidental to the City’s municipal use.

The City has proposed to expand its place of use for its licenses and permits to include the service areas of neighboring water agencies and two local groundwater basins.

These modifications will not change the total limits on the volume of water that could be diverted under the City’s water rights. They will, however, allow the City to divert water and potentially store water through ASR to provide more reliability and flexibility of use of existing water sources.

The changes proposed in methods of diversion and points of diversion will not increase the season or quantity of water that is currently authorized to be diverted under the licenses and permits. The City claims that adding direct diversion as a method of diversion to License 9847 and Permits 16123 and 16601 is necessary because during winter months the City uses water from Loch Lomond Reservoir at the same time it is filling the reservoir, which constitutes a direct diversion, but License 9847 and Permits

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Permits 16123 and 16601
City of Santa Cruz
16123 and 16601 only authorize diversion to storage. The City states that the addition of direct diversion to these rights will not cause the existing license and permit limits to be exceeded, will conform the license and permits to existing and historical operations, and will provide operational flexibility to enhance water supply reliability. The proposed changes do not involve diversion from any new water source.

Based on the foregoing information and the City’s unique geographical constraints (e.g., watershed size and location, groundwater basin status, threatened seawater intrusion, etc.), the State Water Board has determined that approval of the requested changes to the City’s licenses and permits are consistent with the City’s existing permits and licenses and will not initiate a new water right.

5.2.2 No Injury to Lawful Users of Water
There are several riparian and junior appropriative right holders diverting water from tributaries that enter the San Lorenzo River below the City’s diversions. However, these diversions are not located on the San Lorenzo River or in the same flow path as the City’s diversions. There is one pre-1914 diverter on the San Lorenzo River downstream of the Felton Diversion. This pre-1914 claim (S015526) is a non-consumptive diversion for recreation, emergency fire protection, and emergency domestic use, and the right holder received a notice of the petitions but did not provide comments. Further, following public notice of the change petitions, only San Lorenzo Valley WD protested the petitions claiming potential injury to their rights. San Lorenzo Valley WD’s protest was resolved upon a protest resolution agreement signed by both the City and San Lorenzo Valley WD. This Order will include protest dismissal terms in the amended rights issued for License 9847 and Permits 16123 and 16601 to prevent potential injury to San Lorenzo Valley WD.

As discussed above in Section 5.2.1 of this Order, the City’s requested changes in points of diversion, methods of diversion, place of use, and purpose of use will not increase diversions from the San Lorenzo River system beyond what is currently authorized by their licenses and permits. The proposed inclusion of Agreed Flow requirements in the City’s licenses and permits will result in more flow in the San Lorenzo River benefiting fishery and riparian habitats.

Therefore, the State Water Board finds that approval of the changes requested with the petitions will not injure any legal user of water.

5.2.3 No Unreasonable Effects on Fish, Wildlife, or other Instream Beneficial Uses
As discussed in detail in Section 3.2 of this Order, the City has developed a draft ASHCP including flow requirements for compliance with the federal and State Endangered Species Acts to address the City’s water supply operations that may

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Permits 16123 and 16601
City of Santa Cruz
adversely affect special status anadromous salmonids such as coho salmon and steelhead. As requested with the petitions for change, the flow requirements developed through the ASHCP process are proposed to be incorporated into the City’s water right permits and licenses and will replace the existing bypass requirements. In addition to new flow requirements, the proposed project covered by the ASHCP also includes surface water diversion improvement components aimed at improving fish passage.

Approval of proposed changes for these water rights will not authorize any act which results in the taking of a threatened or endangered species or any act which is now prohibited, or becomes prohibited in the future, under either the California Endangered Species Act (Fish and G. Code, §§ 2050 to 2097) or the Federal Endangered Species Act (16 U.S.C. §§ 1531 to 1544). The amended water rights will be conditioned that if a “take” will result from any act authorized under the water right, the City will be required to obtain an incidental take permit prior to construction or operation. The City will be responsible for meeting all requirements of the applicable Endangered Species Act for diversions pursuant to its amended licenses and amended permits.

Therefore, the State Water Board finds that the changes requested with the petitions will not have any adverse effects on fish, wildlife, or other instream beneficial uses.

6.0 PETITIONS FOR EXTENSION OF TIME

6.1 Applicable Law
The State Water Board may grant an extension of time within which to commence or complete construction work or apply water to beneficial use upon a showing of good cause. (Wat. Code, § 1398, subd. (a).) The State Water Board’s regulations provide that the Board will grant a petition for extension of time only upon such conditions as the board determines to be in the public interest, and upon a showing to the Board’s satisfaction that: a) due diligence has been exercised; b) failure to comply with previous time requirements has been occasioned by obstacles which could not be reasonably avoided; and c) satisfactory progress will be made if an extension of time is granted.

Lack of finances, occupation with other work, physical disability, and other conditions incident to the person and not to the enterprise will not generally be accepted as good cause for delay. (Cal. Code Regs., tit. 23, § 844.)
A permit is an authorization to develop a water right by diverting water and putting that water to beneficial use. The State Water Board may revoke a water right permit if the permittee fails to diligently appropriate water under the permit by timely constructing the necessary water diversion facilities and applying the water to beneficial use. The requirement that an appropriation of water be completed within a reasonable time with due diligence is a fundamental aspect of California water law. Its purpose is to safeguard the public interest by preventing the "cold storage" of water rights, which

26.23 Licenses 1553, 7200, and 9847 Page 18 of 28
Permits 16123 and 16601
City of Santa Cruz
occurs when an appropriation is initiated but the water remains unused as the appropriator is not actively pursuing the development of that water supply. This situation denies other parties access to the water that could potentially be used for beneficial purposes. In accordance with the due diligence requirement, a water right application must set forth, among other things, the time within which the applicant proposes to begin construction of any necessary facilities, the time required to complete construction, and the time required to complete application of the water to the proposed use. (Wat. Code, § 1260). There shall be cause for revocation of a permit if the work is not commenced, prosecuted with due diligence and completed, or the water applied to beneficial use as contemplated in the permit and in accordance with the Water Code and the rules and regulations of the Board. (Wat. Code, § 1410).

6.2 Analysis

6.2.1 Due Diligence
The City's Permits 16123 and 16601 have not been fully developed, however the City reported that it has diverted and used water under both permits. The City indicated in its Annual Progress Report[s] by Permittee that any lack of use under the permits in the past was due to unavailability, accounting priority, and conservation efforts. The City’s maximum use under the combination of Permits 16123 and 16601 was 1,623 af out of the authorized combined 3,000 af, which occurred in 1989 during the severe drought of 1987-1992. The City also reported that in 1989, due to extensive conservation measures, approximately 3,650 af of water conservation occurred.

According to the City’s Annual Progress Reports, during the 2021-2022 period the City diverted 719.19 af of water under Permit 16123. However, it did not divert any water from the permit in the years 2017-2020. In 2016, 2015, and 2014, the City diverted and used 552, 255, and 117 af of water under Permit 16123, respectively. In 2013, 2012, and 2011, the City diverted and used 66, 190, and 25 af of water under the permit, respectively. The City did not use any water under Permit 16123 in 2010, and claimed use of 109 af of water in 2009. However, the City claimed the diversion in 2009 represented a combined diversion quantity with Permit 16601. According to Progress Reports submitted by the City, the City reported diversion and use of 19 and 109 af of water in 2018 and 2009 under Permit 16601.

The City has also provided resources to develop new streamflow standards protective of fisheries. When the City originally filed its petitions for extension of time in December 2006, the Division issued public notice and CDFW and NMFS protested the petitions based on concerns regarding potential impacts to streamflow. The City subsequently began active engagement with CDFW and NMFS to develop new streamflow requirements that were protective of both fisheries and the City’s water supply commitments to the community. Development of the new streamflow standards (Agreed Flows) involved multiple years of monitoring and analysis and in 2021 CDFW provided

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Permits 16123 and 16601
City of Santa Cruz
the Division a memorandum supporting the City’s pending petitions. CDFW acknowledged in its memorandum that the City invested significant effort and resources into conservation measures and infrastructure improvements to support its water supply needs, dedicating as much water as possible to environmental uses, and that the petitions represent the culmination of years of planning and investment by the City, CDFW, and NMFS in support of defensible environmental flows.

Based on the information above, the State Water Board has determined that the City has exercised due diligence in the diversion and use of water under Permits 16123 and 16601.

6.2.2 Obstacles Not Reasonably Avoided
The City indicated that droughts and bypass flow requirements have hindered its ability to maximize use water from Permits 16123 and 16601. However, the City stated that water conservation is the primary reason that the permits have not been fully used. The City claims that its successful water conservation program has significantly lowered the trajectory of growth in the City’s water demands and that despite a growing population, the City’s total water use is lower than it was as of 2000.

The City provided information showing that its 1977 emergency drought standards required a residential demand as low as 75 gallons per capita per day (gpcd). The City’s 2020 urban water management plan (UWMP) documented that as of 2020 the residential use was 47 gpcd which is only 4 gpcd higher than the City’s absolute low residential use of 43 gpcd during the drought year of 2015. The City pointed out that its 2020 residential use is 37 percent lower than the lowest residential use allowed as an emergency measure during the 1977 drought.

Relative to the City’s overall water use, the City provided the Division information showing that the total water use (measured as total production from the City’s water treatment plant) increased through 2001 with maximums of 13,400 af in 1989 and 13,700 af in 2001. The City noted that although there was a significant population growth between 1989 and 2000, the water use stayed relatively level with slight increases by 2001. The City’s 2020 UWMP documented that although the service area population grew by about 40 percent from 67,500 in 1975 to 96,168 in 2020, implementation of significant water conservation measures resulted in a decline in water use to about 8,000 af by 2020.

Given the City’s successful and extensive conservation efforts reducing its surface water diversions, coupled with periodic droughts and permit diversion bypass requirements, the State Water Board has determined that the City’s failure to comply with previous time requirements has been occasioned by obstacles which could not be reasonably avoided.

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Permits 16123 and 16601
City of Santa Cruz

6.2.3 Satisfactory Progress
With the change petitions, the City proposes to expand its place of use to several service areas outside of the City’s boundaries but within Santa Cruz County. It is unclear whether the permits would be further developed absent this expansion and the addition of groundwater recharge activities. California Department of Finance’s (CDOF) data shows a slight increase over the last two decades in the population of Santa Cruz County, where the City proposed to expand its place of use. Specifically, from 2000 to 2023, Santa Cruz County’s population increased slightly from 255,602 to 266,183.

CDOF projected that the county’s population would maintain this increase trend until 2040. The projected population of Santa Cruz County is 268,734 in 2030 and 269,540 in 2040. Since there is an anticipated increase of population in the proposed place of use, the State Water Board has determined that further development of Permits 16123 and 16601 is feasible.

The City’s compliance with the new Agreed Flows pursuant to the ASHCP will also necessarily shift more demand to water stored under Permits 16123 and 16610 that would have otherwise been met by direct diversions, as those diversions will be limited.

Local demand on the overdrafted groundwater basin is also likely to shift diversions under the permits.

The City analyzed the effects of implementing the Agreed Flows on its long-term water supplies and determined that the annual water demand is approximately 9,816 af per year. The City’s analysis found that during an extended drought such as the 1976- 77 drought, the City would experience a cumulative water supply shortfall of 6,140 af, and the single worst year shortage would be 3,683 af which is equates to a 37.5 percent annual shortage in water supply. Consequently, as the impacts from climate change appear to show a trend of more frequent and lengthier dry periods in the future, the City will have an increased reliance on stored water under Permits 16123 and 16601 to meet its municipal needs.

The City’s water rights do not currently authorize diversion of water to underground storage, however upon approval of the requested time extension and changes, the City will be able to divert water to underground storage. Approval of the requested time extension will also align Permits 16123 and 16601 with obligations pursuant to SGMA for the critically overdrafted Santa Cruz Mid-County Groundwater Basin, 2 with surface
water diverted to underground storage assisting in meeting SGMA groundwater sustainability requirements.
2 SGMA requires local Groundwater Sustainability Agencies (GSAs) to develop plans to achieve sustainable groundwater conditions and end overdraft. High and medium priority basins were required to submit plans by 2022 and reach sustainability by 2042.

SGMA permits multiple GSPs to be prepared for a single basin, as long as the GSAs demonstrate coordination through an agreement.

26.26 Licenses 1553, 7200, and 9847 Page 21 of 28
Permits 16123 and 16601
City of Santa Cruz
Permits 16123 and 16601 have integrated operations such that the permits have the same point of diversion and place of storage, but diversion under the junior Permit 16601 is only triggered when the diversion rate exceeds the 3,500 gpm maximum rate allowed under Permit 16123. The City’s reported diversion rates under Permit 16123 have generally not exceeded the 3,500 gpm diversion limit, so diversions under Permit 16601 have been limited. However, the City believes it is important to maintain Permit 16601 to be able to maximize future diversions above 3,500 gpm to underground storage when possible.

Based on the information above, the State Water Board finds that satisfactory progress will be made if extensions of time are granted to complete application of water to beneficial use for Permits 16123 and 16601.

7.0 PUBLIC INTEREST
The changes and time extensions requested with the petitions are needed to improve the reliability and operational flexibility of the City’s long-term water supply system, including supporting the improved opportunity for conjunctive use of the surface water and groundwater resources. The City’s proposed underground storage components will also be beneficial in the long-term for the over-drafted Santa Cruz Mid-County Groundwater Basin. Given the comprehensive approach to addressing critical needs for the City’s overall water supply portfolio, protection of fish and wildlife, and prevention of seawater intrusion, the State Water Board finds that approval of the pending petitions for extension of time and changes to the City’s water right permits and licenses is in the public interest.

8.0 CEQA COMPLIANCE AND PUBLIC TRUST RESOURCES
On October 15, 2018, the City issued a Notice of Preparation (NOP) pursuant to CEQA to notify interested parties of the preparation of an EIR for proposed modifications of the City’s water rights. The City described the water rights modifications as necessary to increase the operational flexibility of the water system by improving the City's ability to utilize surface water within its existing water right allocations. On November 16, 2018, the Division submitted comments regarding the NOP.

The City issued a Draft EIR on June 11, 2021, and on December 14, 2021, the Santa Cruz City Council certified its Final EIR for the project. The Final EIR addresses significant areas of environmental analysis required by section 15123 of the CEQA Guidelines for the proposed project (SCH No. 2018102039). (Cal. Code regs, tit. 14, § 15123.)

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Permits 16123 and 16601
City of Santa Cruz
The Final EIR evaluates the potential for significant environmental impacts from the Santa Cruz Water Rights Project (Proposed Project). The EIR notes the underlying purpose of the Proposed Project is to improve operational flexibility of the City’s water system while enhancing stream flows for local anadromous fisheries. During the development of the City’s pending ASHCP, the City negotiated with CDFW and NMFS to develop levels of stream flows (Agreed Flows) that would better protect federally listed Central California Coast coho salmon and Central California Coast steelhead in all watersheds from which the City diverts water. Incorporating these Agreed Flows into all City water rights is necessary to benefit local fisheries, specifically for coho and steelhead, but would further constrain the City’s already limited surface water supply.

Consequently, the City stated that it needed to improve operational flexibility of the water supply system that is reliant on its existing water rights to allow better use of limited water resources. The City conducted an analysis of various alternatives and their environmental impacts, ultimately determining that the Proposed Project represents the most environmentally sound option. This conclusion was reached based on the Proposed Project's goal of regional groundwater stabilization including conjunctive use, which offers the greatest benefit to regional groundwater conditions.

The State Water Board has reviewed the environmental documents submitted by the City and agrees with the findings. The State Water Board will submit a Notice of Determination as a responsible agency upon issuance of this Order.

In addition to any obligation the State Water Board may have under CEQA, the State Water Board has an independent obligation to consider the effect of the proposed changes on public trust resources and to protect those resources where feasible. (National Audubon Society v. Superior Court (1983) 33 Cal.3d 419.) Public trust uses include navigation, commerce, fishing, recreation, and the preservation of fish and wildlife habitat. Based on the information above, and as discussed in Sections 3.2 and

5.2.3, there is no evidence that approving the petitions for change for Licenses 1553, 7200, and 9847 and Permits 16123 and 16601, and the petitions for extension of time for Permits 16123 and 16601, will have adverse impacts on public trust resources.

9.0 CONCLUSION
The State Water Board approves the requested changes for Licenses 1553, 7200, 9847 and Permits 16123 and 16601. The Board also approves an extension of time for Permits 16123 and 16601. Additional terms and conditions will be added to the amended licenses and permits as described in this order.

26.28 Licenses 1553, 7200, and 9847 Page 23 of 28
Permits 16123 and 16601
City of Santa Cruz
ORDER
THEREFORE, THE PETITIONS FOR CHANGE FOR LICENSES 1553, 7200, AND 9847 AND PERMITS 16123 AND 16601, AND THE PETITIONS FOR EXTENSION OF TIME FOR PERMITS 16123 AND 16601 OF THE CITY OF SANTA CRUZ ARE APPROVED, AND AMENDED WATER RIGHTS ARE ISSUED AS FOLLOWS:

1. San Andreas Land Conservancy’s protest is cancelled pursuant to Water Code section 1703.6.

2. Diversion to underground storage at the Tait Street Diversion Facilities will be added to Amended Licenses 1553 and 7200.

3. Direct diversion at Newell Creek Dam will be added to Amended License 9847.

4. Amended Permits 16123 and 16601 will be modified as follows: 1) the Tait Street Diversion Facilities will be added as points of direct diversion and diversion to underground storage; and 2) direct diversion and diversion to underground storage will be added at the Felton Diversion Facility.

5. The Beltz Injection Wells will be added to Amended Licenses 1553 and 7200 and Amended Permits 16123 and 16601 as points of rediversion to and withdrawal from underground storage. The Beltz Injection Wells are located as follows:
• Well No. 8: California Coordinate System of 1983, Zone 3, North 1,813,775 feet and East 6,132,716 feet, being within the SE¼ of SE¼ of projected Section 16, T11S, R1W, MDB&M
• Well No. 9: California Coordinate System of 1983, Zone 3, North 1,812,135 feet and East 6,131,318 feet, being within the SW¼ of NE¼ of projected Section 21, T11S, R1W, MDB&M
• Well No. 10: California Coordinate System of 1983, Zone 3, North 1,813,446 feet and East 6,131,683 feet, being within the SW¼ of SE¼ of projected Section 16, T11S, R1W, MDB&M
• Well No. 12: California Coordinate System of 1983, Zone 3, North 1,820,121 feet and East 6,132,941 feet, being within the SE¼ of SE¼ of projected Section 9, T11S, R1W, MDB&M

26.29 Licenses 1553, 7200, and 9847 Page 24 of 28
Permits 16123 and 16601
City of Santa Cruz

6. Diversions under Amended License 1553 shall be limited with the following term:

The water appropriated shall be limited to the quantity which can be beneficially used and shall not exceed a combined maximum rate of 6.2 cubic feet per second by direct diversion and diversion to underground storage to be diverted from January 1 through December 31 of each year.

7. Diversions under Amended License 7200 shall be limited with the following term:

The water appropriated shall be limited to the quantity which can be beneficially used and shall not exceed a combined 6.0 cubic feet per second by direct diversion and diversion to underground storage to be diverted from January 1 through December 31 of each year.

8. Diversions under Amended License 9847 shall be limited with the following term:

The water appropriated shall be limited to the quantity which can be beneficially used and shall not exceed 31 cubic feet per second by direct diversion and 5,600 acre-feet per year by storage to be collected from September 1 each year to July 1 of the succeeding year. The total amount of water to be taken from the source (direct diversion plus collection to storage) for all uses shall not exceed 5,600 acre-feet per year. The total amount of water to be placed to beneficial use (direct diversion plus withdrawal from storage) shall not exceed 3,200 acre-feet per year. The City shall have the right to hold in storage 8,624 acre-feet in Loch Lomond Reservoir.

9. Diversions under Amended Permit 16123 shall be limited with the following term:

The water appropriated shall be limited to the quantity which can be beneficially used and the combined rate of direct diversion, diversion to offstream storage, and diversion to underground storage under Permit 16123 at the Felton and Tait Street diversion facilities shall not exceed 3,500 gallons per minute from September 1 of each year to June 1 of the succeeding year. The combined rate of direct diversion, diversion to offstream storage, and diversion to underground storage under Permits 16123 and 16601 at the Felton and Tait diversion facilities shall not exceed 20 cubic feet per second. The combined annual total diversion shall not exceed 3,000 acre-feet under Permits 16123 and 16601.

10.Diversions under Amended Permit 16601 shall be limited with the following term:

The water appropriated shall be limited to the quantity which can be beneficially used and the combined rate of direct diversion, diversion to offstream storage, and diversion to underground storage under Permits 16123 and 16601 at the Felton and Tait diversion facilities shall not exceed 20 cubic feet per second from October 1 of

26.30 Licenses 1553, 7200, and 9847 Page 25 of 28
Permits 16123 and 16601
City of Santa Cruz
each year to June 1 of the succeeding year. The combined annual total diversion shall not exceed 3,000 acre-feet under Permits 16123 and 16601.

11.The Santa Cruz Mid-County Groundwater Basin (Basin No. 3-027) will be added as a place for underground storage to Amended Licenses 1553 and 7200 and Amended Permits 16123 and 16601.

12.The place of use of Amended Licenses 1553, 7200, and 9847 and Amended Permits 16123 and 16601 shall be described as follows:

At Loch Lomond Reservoir; in the City of Santa Cruz Water Department’s service area and its North Coast service area; the service areas of Central Water District, San Lorenzo Valley Water District, Scotts Valley Water District, and Soquel Creek Water District; the Santa Cruz Mid-County Groundwater Basin (DWR Bulletin 118 Basin No. 3-001) and Santa Margarita Groundwater Basin (DWR Bulletin 118 Basin No. 3-027). The place of use is shown on map filed on January 6, 2021 with the State Water Board.

13.The purposes of use of Amended Licenses 1553, 7200, 9847 and Amended Permits 16123 and 16601 shall include: municipal, domestic, industrial, recreation, fire protection, and water quality protection.

14.Complete application of the water to the proposed beneficial uses for Amended Permits 16123 and 16601 shall be made on or before December 31, 2043.

15.The following new fish and wildlife terms shall be included in Amended Licenses 1553 and 7200, replacing the current bypass terms:
1) The City shall provide bypass at Tait Street Diversion Facilities according to the minimum streamflow schedule in Table 2 of the Agreed Flows (in Attachment 1) as agreed to by the City, National Marine Fisheries Service, and California Department of Fish and Wildlife.
2) No diversions under this right for rediversion to underground storage shall occur during Hydrologic Condition 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.
3) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

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Permits 16123 and 16601
City of Santa Cruz

16.The following new fish and wildlife terms shall be included in Amended License 9847:
1) The City shall release water from Loch Lomond Reservoir to Newell Creek according to the minimum streamflow schedule as agreed to by the City, National Marine Fisheries Service, and California Department of Fish and Wildlife as shown in Table 4 of the Agreed Flows in Attachment 1. 2) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

17.The following new fish and wildlife terms shall be included in Amended Permits 16123 and 16601, replacing the current bypass terms:
1) The City shall bypass water at both the Felton and Tait Street Diversion Facilities according to the minimum streamflow schedule as agreed to by the City, the National Marine Fisheries Service (NMFS), and the California Department of Fish & Wildlife (CDFW) (in Attachment 1). To improve fish passage at the Felton Diversion Facility, the City shall complete improvements to that facility consistent with any habitat conservation plan or incidental take permit issued by NMFS or CDFW for the operation of the facility. The City shall complete those improvements in the time provided by that plan or permit. 2) No diversions under this right for rediversion to underground storage shall occur during Hydrologic Condition 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.
3) No delivery of water diverted under this right for use by a water supplier other than the City of Santa Cruz Water Department shall occur during Hydrologic Conditions 4 and 5, as defined in Table 1: Agreed Flows Hydrologic Condition Types in Attachment 1.

18.The following terms shall be added to Amended Licenses 1553, 7200, and 9847 and Amended Permits 16123 and 16601:
1) The City shall annually report the diversion and use of water from all licenses and permits to the Division’s electronic water right information management system (eWRIMS) or any updated Division reporting system. Reporting shall prioritize diversions under senior water rights (Licenses 1553, 7200, and 9847), followed by Permits 16123 and 16601.

26.32 Licenses 1553, 7200, and 9847 Page 27 of 28
Permits 16123 and 16601
City of Santa Cruz
2) No water shall be diverted or used under this right for commercial and applicable personal medical use cannabis cultivation, unless the water right holder is in compliance with all applicable conditions, including the numeric and narrative instream flow requirements, of the current version of the State Water Board’s Cannabis Cultivation Policy – Principles and Guidelines for Cannabis Cultivation, which is available online at:
https://www.waterboards.ca.gov/water_issues/programs/cannabis/docs/policy/fi nal_cannabis_policy_with_attach_a.pdf

19.The following term shall be added to Amended Licenses 1553 and 7200 and Amended Permits 16123 and 16601:
1) The City shall report the amount of water diverted to underground storage and rediverted from underground storage annually for each permit or license held by the City. The City shall submit documentation of the quantity of water placed in underground storage, the quantity later recovered under the provisions of these water rights, and compliance with the terms and conditions of these rights.

20.The following terms shall be included in Amended License 9847:
1) Since its issuance, this license has authorized use in areas in “the San Lorenzo Basin.” This license's minimum streamflow requirements, and its limitations on the City's deliveries to other entities under Hydrologic Conditions 4 and 5, do not preclude the City from delivering to San Lorenzo Valley Water District under this license and an existing contract between that District and the City up to 313.4 acre-feet of water per year from reservoir storage at any rate and at any time. The City and the District will collaborate to determine mutually agreeable operational terms for delivering the District's contract supply. The City understands that the District seeks to better integrate the surface-water and groundwater supplies that serve the District's different service areas. 2) License Term 9 does not allow the City to violate applicable bypass requirements included in the Agreed Flows in Attachment 1.

26.33 Licenses 1553, 7200, and 9847 Page 28 of 28
Permits 16123 and 16601
City of Santa Cruz

21.The following term shall be included in Amended Permits 16123 and 16601:
1) The City of Santa Cruz acknowledges that the minimum Felton bypass flows stated in this permit are not a binding precedent for Term 13 in San Lorenzo Valley Water District's Permit 20123.

22.Amended Licenses 1553, 7200, 9847 and Amended Permits 16123 and 16601 shall include all the current standard terms and conditions A through Q as applicable.

June 6, 2025 ORIGINAL SIGNED BY:

Dated:__________________
Eric Oppenheimer
Executive Director
Attachment: Attachment 1

26.34 Attachment 1
Table 1: Agreed Flows Hydrologic Condition Types
Month Flow Ranges Used to Determine Monthly Hydrologic Condition Type1(cfs) Using San Lorenzo River End-of-Month Cumulative Daily Flow2 Hydrologic
Condition
5 (driest)
Hydrologic
Condition
4 (dry)
Hydrologic
Condition
3 (normal)
Hydrologic
Condition
2 (wet)
Hydrologic
Condition
1 (wettest)
Oct ≤459 460 – 539 540 – 709 710 – 875 >875
Nov ≤1,186 1,187 – 1,497 1,498 – 1,827 1,828 – 2,485 >2,485 Dec ≤2,397 2,398 – 3,134 3,135 – 5,642 5,643 – 10,196 >10,196 Jan ≤4,322 4,323 – 8,456 8,457 – 16,694 16,695 – 28,019 >28,019 Feb ≤8,442 8,443 – 16,368 16,369 – 29,140 29,141 – 42,995 >42,995 Mar ≤13,004 13,005 – 22,948 22,949 – 35,371 35,372 – 57,968 >57,968 Apr ≤14,203 14,204 – 24,491 24,492 – 39,487 39,488 – 67,884 >67,884 May ≤15,448 15,449 – 25,279 25,280 – 41,659 41,660 – 71,412 >71,412 Jun ≤16,005 16,006 – 26,116 26,117 – 43,123 43,124 – 73,420 >73,420 Jul ≤16,364 16,365 – 26,819 26,820 – 44,073 44,074 – 74,718 >74,718 Aug ≤16,653 16,654 – 27,355 27,356 – 44,799 44,800 – 75,591 >75,591 Sep ≤16,978 16,979 – 27,843 27,844 – 45,398 45,399 – 76,368 >76,368 cfs = cubic feet per second
1 The Hydrologic Condition Types are based on the record of cumulative daily average flow by water year (water years 1937–2015) at the Big Trees gage on the San Lorenzo River. 2 To implement the Agreed Flows, the Hydrologic Condition type is determined on the first day of each month based upon the previous month’s San Lorenzo River end-of-month cumulative flow for the Water Year. Water Year is defined as the 12-month period from October 1 through September 30. a.The end-of-month cumulative daily flow is calculated by adding the San Lorenzo River daily flows, as measured at the Big Trees Gage, from the first day of the Water Year to the last day of the month. b.The flow ranges for the month are then reviewed to determine within which Hydrologic Condition type this end-of-month cumulative daily flow falls.
c.This Hydrologic Condition type is used until the first day of the next month to determine bypass flow conditions under the Agreed Flows across all City of Santa Cruz source waters.

26.35